<PAGE>

   As filed with the Securities and Exchange Commission on January 23, 2001
                                                   Registration Nos. 333-   -01
                                                                      333-
-------------------------------------------------------------------------------
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                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                   FORM S-1

                            REGISTRATION STATEMENT
                                     Under
                          The Securities Act of 1933

                 GREEN TREE FLOORPLAN RECEIVABLES MASTER TRUST
                 (Issuer with respect to Offered Certificates)

                      GREEN TREE FLOORPLAN FUNDING CORP.
                  (Originator of the Trust described herein)
            (Exact name of registrant as specified in its charter)

        Delaware                    6189                    41-1823871
     (State or other          (Primary Standard          (I.R.S. Employer
     jurisdiction of             Industrial             Identification No.)
    incorporation or         Classification Code
      organization)                Number)

                              500 Landmark Towers
            345 St. Peter Street, Saint Paul, Minnesota 55102-1639
                                (651) 293-3400
  (Address, including zip code, and telephone number, including area code, of
                   registrant's principal executive offices)

                             Brian F. Corey, Esq.
                             1100 Landmark Towers
            345 St. Peter Street, Saint Paul, Minnesota 55102-1639
                                (651) 293-3400
(Name, address, including zip code, and telephone number, including area code,
                             of agent for service)

                                  Copies to:
          Charles F. Sawyer                        Renwick D. Martin
        Dorsey & Whitney LLP                       Brown & Wood LLP
       220 South Sixth Street                   One World Trade Center
    Minneapolis, Minnesota 55402               New York, New York 10048
           (612) 343-7986                           (212) 839-5300

   Approximate date of commencement of proposed sale of securities to the
public: On or after the effective date of the registration statement, as
determined by market conditions.

   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 this Form is a post-effective amendment filed pursuant to Rule 462(d)
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
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<TABLE>
<CAPTION>
                                                         Proposed
                                             Proposed     Maximum
                                 Amount      Maximum     Aggregate  Amount of
    Title of Each Class of       to be    Offering Price Offering  Registration
  Securities to Be Registered  Registered  Per Unit(1)   Price(1)      Fee
-------------------------------------------------------------------------------
<S>                            <C>        <C>            <C>       <C>
Class A Certificates..........  $100,000       100%      $100,000     $25.00
-------------------------------------------------------------------------------
Class B Certificates..........  $100,000       100%      $100,000     $25.00
</TABLE>
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(1) Estimated solely for the purposes of calculating the registration fee.

   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 the Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a)
may determine.

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<PAGE>

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+Information contained in this prospectus is subject to completion or          +
+amendment. These securities may not be sold nor may offers to buy be accepted +
+prior to the time this prospectus becomes final. This prospectus shall not    +
+constitute an offer to sell or the solicitation of an offer to buy nor shall  +
+there by 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, dated January 23, 2001

                                                Filed Pursuant to Rule 424(b)(4)
                                                          File Nos. 333-82443-01
                                                                    333-82443

                                                                  [CONSECO LOGO]

PROSPECTUS

                                    $200,000

                 Green Tree Floorplan Receivables Master Trust

 $100,000 Floating Rate Floorplan Receivable Trust Certificates, Series 2001-1,
                                    Class A

 $100,000 Floating Rate Floorplan Receivable Trust Certificates, Series 2001-1,
                                    Class B

                       Green Tree Floorplan Funding Corp.
                                   Transferor

                             Conseco Finance Corp.
                                    Servicer

  Before investing in the certificates, you should read the information under
"Risk Factors" beginning on page 10.

  The certificates represent interests in the trust only and are not interests
in or obligations of any other entity.

<TABLE>
<CAPTION>
                       Underwriting Proceeds to     Scheduled
              Price     Discounts    Transferor  Payment Date(1)      Interest Rate
-----------------------------------------------------------------------------------------
  <S>      <C>         <C>          <C>          <C>             <C>
  Class A     100%            %           %                      Lesser of (a) LIBOR plus
                                                                   % per annum and (b)
                                                                 net receivables rate
-----------------------------------------------------------------------------------------
  Class B     100%            %           %                      Lesser of (a) LIBOR plus
                                                                   % per annum and (b)
                                                                 net receivables rate
-----------------------------------------------------------------------------------------
  Total    $           $            $
</TABLE>
-----
(1)  Under some circumstances, you may receive principal distributions before
     or after the Scheduled Payment Date specified above.

  The certificates will be delivered in book-entry form only on or about
     , 2001.

    Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.

                                 [Underwriters]

                                        , 2001
<PAGE>

Content of Prospectus

    You should rely only on the information contained in this document. We have
not authorized anyone to provide you with different information.

    We include cross-references in this document to captions in this document
where you can find further related discussions. The Table of Contents on page 3
of this document provides the pages on which these captions are located.

    You can find a listing of pages where capitalized terms used in this
document are defined under the caption "Index of Principal Terms" beginning on
page 122 in this prospectus.

    Investors and their representatives who receive an electronic prospectus
can receive a paper prospectus, without charge, by contacting the underwriters.

Limitations on Offers or Solicitations

    We do not intend this document to be an offer or solicitation:

  (A) if used in a jurisdiction in which such offer or solicitation is not
      authorized;

  (B) if the person making such offer or solicitation is not qualified to do
      so; or

  (C) if such offer or solicitation is made to anyone to whom it is unlawful
      to make such offer or solicitation.

Transactions That May Affect the Price of the Certificates

    The underwriters may engage in transactions that stabilize, maintain, or
otherwise affect the price of the certificates. Those transactions may include
stabilizing, the purchase of certificates to cover syndicate short positions
and the imposition of penalty bids. For a description of these activities, see
"Underwriting" herein.

                                       2
<PAGE>

                               TABLE OF CONTENTS
<TABLE>
<S>                                                                          <C>
SUMMARY OF TERMS............................................................   5
 Offered Certificates.......................................................   5
 Issuer.....................................................................   5
 Transferor.................................................................   5
 Servicer...................................................................   5
 Trustee....................................................................   5
 Closing Date...............................................................   5
 Trust Assets...............................................................   5
 Series 2001-1 and Other Series.............................................   6
 Distribution Dates.........................................................   6
 Interest...................................................................   6
 Principal..................................................................   6
 Priority of Application of Collections and Allocation of Losses............   7
 Credit Enhancement.........................................................   7
 Optional Repurchase........................................................   8
 Tax Status.................................................................   8
 ERISA Considerations.......................................................   8
 Ratings....................................................................   8
 Address and Telephone Numbers..............................................   9
 Listing....................................................................   9
RISK FACTORS................................................................  10
THE TRUST...................................................................  21
THE TRANSFEROR..............................................................  21
CONSECO FINANCE CORP. AND ITS COMMERCIAL LENDING DIVISION...................  22
 Recent Developments........................................................  22
 Commercial Lending Division--General.......................................  23
 Floorplan Receivables--General.............................................  24
 Floorplan Agreements With Manufacturers....................................  24
 Floorplan Credit Underwriting Process......................................  24
 Creation of Floorplan Receivables..........................................  25
 Floorplan Payment Terms....................................................  26
 Floorplan Billing Procedures...............................................  26
 Floorplan Dealer Monitoring................................................  26
 Participations in Floorplan Receivables....................................  27
 Participation Arrangements.................................................  27
 Asset-Based Receivables....................................................  28
 Realization on the Receivables.............................................  29
THE RECEIVABLES.............................................................  29
 Eligible Receivables and Eligible Accounts.................................  30
THE ACCOUNTS................................................................  33
 General....................................................................  33
 Description of Conseco Finance's Portfolio.................................  33
 Yield Information..........................................................  35
 Major Customers; Major Manufacturers.......................................  35
 Delinquency Experience.....................................................  36
 Loss Experience............................................................  36
 Aging Experience...........................................................  37
MATURITY CONSIDERATIONS.....................................................  38
USE OF PROCEEDS.............................................................  43
DESCRIPTION OF THE OFFERED CERTIFICATES.....................................  43
 General....................................................................  43
 Book-Entry Registration....................................................  44
 Definitive Certificates....................................................  48
 Replacement of Definitive Certificates.....................................  49
 Interest Payments..........................................................  50
 Principal Payments.........................................................  52
 Postponement of Controlled Accumulation Period.............................  53
</TABLE>
<TABLE>
<S>                                                                         <C>
 Interest Collections; Principal Collections...............................  53
 Subordination of the Class B Certificates.................................  54
 Transfer and Assignment of Receivables and Collateral Security............  55
 Exchanges; Creation of New Series.........................................  56
 Representations and Warranties............................................  59
 Addition of Accounts......................................................  64
 Removal of Accounts.......................................................  66
 Trust Accounts............................................................  67
 Excess Funding Account....................................................  68
 Pre-Funding Account.......................................................  69
 Allocation Percentages....................................................  70
 The Overconcentration Amounts.............................................  74
 Reallocation of Cash Flows................................................  75
 Reallocated Principal Collections.........................................  75
 Application of Collections................................................  79
 Coverage of Certain Interest Shortfalls...................................  89
 Defaulted Receivables.....................................................  89
 Investor Charge-offs......................................................  90
 Companion Series..........................................................  91
 Final Payment of Principal; Termination...................................  91
 Pay Out Events............................................................  93
 Servicing Compensation and Payment of Expenses............................  96
 Certain Matters Regarding the Transferor and the Servicer.................  96
 Servicer Default..........................................................  98
 Reports to Certificateholders.............................................  99
 Reports; Notices.......................................................... 101
 Evidence as to Compliance................................................. 101
 Amendments................................................................ 101
 List of Certificateholders................................................ 102
 The Trustee............................................................... 102
DESCRIPTION OF THE PURCHASE AGREEMENT...................................... 103
 Transfer of Receivables................................................... 103
 Representations and Warranties............................................ 103
 Certain Covenants......................................................... 104
 Termination............................................................... 105
CERTAIN LEGAL ASPECTS OF THE RECEIVABLES................................... 105
 Transfer of Receivables................................................... 105
 Certain Matters Relating to Bankruptcy.................................... 106
 Security Interests in the Related Products................................ 109
FEDERAL INCOME TAX CONSEQUENCES............................................ 109
 State and Local Tax Consequences.......................................... 115
ERISA CONSIDERATIONS....................................................... 116
 Availability of Exemptions for Class A Certificates....................... 117
 Review by Benefit Plan Fiduciaries........................................ 118
UNDERWRITING............................................................... 119
LISTING AND GENERAL INFORMATION............................................ 120
LEGAL MATTERS.............................................................. 121
INDEX OF PRINCIPAL TERMS................................................... 122
ANNEX A: GLOBAL CLEARANCE SETTLEMENT AND TAX DOCUMENTATION PROCEDURES...... A-1
 Initial Settlement........................................................ A-1
 Secondary Market Trading.................................................. A-2
Certain U.S. Federal Income Tax Documentation Requirements................. A-4
ANNEX B: OTHER SERIES...................................................... B-1
</TABLE>

                                       3
<PAGE>

    Note on forward-looking statements: All statements, trend analyses and
other information contained in this prospectus and elsewhere (such as in
filings by Conseco Finance with the Securities and Exchange Commission, press
releases, presentations by Conseco Finance or its management or oral
statements) relative to markets for Conseco Finance's products and trends in
Conseco Finance's operations or financial results, as well as other statements
including words such as "anticipate," "believe," "plan," "estimate," "expect,"
"intend," "should," "could," "goal," "target," "on track," "comfortable with"
and other similar expressions, constitute forward-looking statements under the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements are subject to known and unknown risks, uncertainties and other
factors which may cause actual results to be materially different from those
contemplated by the forward-looking statements. Such factors include, among
other things:

  .   general economic conditions and other factors, including prevailing
      interest rate levels and stock and credit market performance, which
      may affect (among other things) Conseco Finance's ability to make
      loans and access capital resources and the costs associated therewith,
      and the level of defaults and prepayments of loans made by Conseco
      Finance;

  .   Conseco Finance's ability to achieve anticipated synergies and levels
      of operational efficiencies;

  .   customer response to new products, distribution channels and marketing
      initiatives;

  .   performance of its investments;

  .   changes in the federal income tax laws and regulations which may
      affect the relative tax advantages of some of Conseco Finance's
      products;

  .   increasing competition in the finance business;

  .   regulatory changes or actions, including those relative to regulation
      of financial services;

  .   the outcome of Conseco Finance's efforts to sell assets and the
      availability of capital during this process;

  .   actions by rating agencies and the effects of past or future actions
      by these agencies on Conseco Finance's business; and

  .   the risk factors or uncertainties listed from time to time in the
      filings of Conseco Finance or its parent, Conseco, Inc., with the
      Securities and Exchange Commission.


                                       4
<PAGE>

                                SUMMARY OF TERMS

    The following summary is a short, concise description of the main terms of
the certificates. For this reason, the summary does not contain all the
information that is important to you. You will find a detailed description of
the terms of the certificates following this summary.

Offered Certificates

<TABLE>
<CAPTION>
        Aggregate
        Principal
  Class   Amount     Interest Rate
-----------------------------------------
  <C>   <C>        <S>                <C>
    A    $100,000  Lesser of (a)      %
                   LIBOR plus
                   per annum and
                   (b) the net
                   receivables rate
-----------------------------------------
    B    $100,000  Lesser of (a)      %
                   LIBOR plus
                   per annum and
                   (b) the net
                   receivables rate
</TABLE>

    The offered certificates will be book-entry securities clearing through The
Depository Trust Company (in the United States) or Clearstream or Euroclear (in
Europe) in minimum denominations of $1,000 and integral multiples thereof.

Issuer

    Green Tree Floorplan Receivables Master Trust.

Transferor

    Green Tree Floorplan Funding Corp., a wholly owned subsidiary of Conseco
Finance.

Servicer

    Conseco Finance Corp. ("Conseco Finance" or the "Servicer").

Trustee

    Wells Fargo Bank Minnesota, N. A.

Closing Date

          , 2001

Trust Assets

    The Trust assets include receivables and the collections thereon. The
receivables arise from revolving credit agreements between Conseco Finance or
its affiliates and dealers, manufacturers and distributors located throughout
the United States to finance their production and inventory of consumer and
commercial products. The receivables constitute payment obligations arising
from time to time under those revolving credit agreements.

    On the Closing Date, the Trust expects that it will deposit not more than
$      from the net proceeds of the Series 2001-1 certificates into a pre-
funding account for Series 2001-1. Funds in the pre-funding account will be
released to the Transferor as deposits are made into the principal account for
Series 1998-2 and Series 1999-1, which are prior Series issued by the Trust
that are in their early amortization periods. Any funds in the pre-funding
account that have not been invested in receivables by       , 2001 will be
deposited in the excess funding account and be available for use by all series.
Also, approximately $      of the proceeds paid to the Transferor on the
closing date will reflect the amount on deposit in the principal account for
Series 1998-2 and Series 1999-1. Until Series 1998-2 and Series 1999-1 are paid
in full, no interest collections or principal

                                       5
<PAGE>

collections on the receivables that relate to either of those amounts will be
allocated to the Series 2001-1 certificates. We estimate that Series 1998-2 and
Series 1999-1 will be paid in full on       , 2001, but we cannot guarantee
that it will be so paid.

Series 2001-1 and Other Series

    The Trust issues its certificates in series. The class A certificates and
the class B certificates, together with the class C certificates and class D
certificates that are discussed below, constitute Series 2001-1. The Trust has
other series of certificates outstanding. Each series is entitled to a share of
the Trust's collections on its assets and uses those collections to make
distributions on its certificates. The Transferor also owns a share of the
Trust's collections. The amount of each series' share of collections is
determined by various formulas described in this document and may vary over
time.

    For a summary of the terms of the previously issued series, see "Annex B:
Other Series."

Distribution Dates

    Distributions on the certificates will be made on the 13th day of each
month (or, if not a business day, on the next business day), beginning on
13, 2001.

Interest

    The interest rates for the class A certificates and the class B
certificates are specified above. Interest will be distributable on each
distribution date and will be calculated on the basis on the actual number of
days in the interest accrual period divided by 360.

Principal

    Scheduled Principal Payments.

<TABLE>
<CAPTION>
 Class                                                    Scheduled Payment Date
 -----                                                    ----------------------
 <S>                                                      <C>
 A......................................................
 B......................................................
</TABLE>

    The Trust expects to pay the entire principal of such class on the
scheduled payment date. The Trust expects to be able to do this by accumulating
the Series 2001-1 share of principal collections on the receivables during an
accumulation period prior to the scheduled payment date. If the Trust is not
able to repay a class in full on that date, the class will amortize monthly to
the extent of available collections until it is fully repaid. The Trust will
not distribute any principal payments on the class B certificates until it has
distributed the entire principal amount of the class A certificates to the
class A certificateholders.

    For more information on scheduled principal payments, see "Maturity
Considerations," "Description of the Offered Certificates--Principal Payments,"
"--Postponement of Controlled Accumulation Period" and "--Application of
Collections--Payment of Principal."

    Possible Early Repayment of Principal. Principal may be repaid on the
offered certificates earlier than the scheduled payment dates described above
if a pay out event occurs. If a pay out event occurs, principal collections
allocated to Series 2001-1 will be distributed on each distribution date on the
class A certificates until they are repaid in full and then on the class B
certificates until they are repaid in full. Pay out events include (1) a net
loss ratio for the receivables in excess of a

                                       6
<PAGE>

specified level, (2) the Trust's non-receivables assets exceeding a certain
percentage of the Trust's principal receivables for a specified period of time,
(3) the occurrence of certain shortfalls in required payments, (4) other
performance requirements related to the receivables and (5) various other
events.

    For more information on pay out events, see "Maturity Considerations" and
"Description of Offered Certificates--Pay Out Events."

Priority of Application of Collections and Allocation of Losses

    The Series 2001-1 certificates will be entitled to receive a share of the
collections on the Trust's assets. The Trust will apply that share of
collections, in the order of priority described in this prospectus, to pay its
expenses, to make required distributions on the Series 2001-1 certificates and
to cover losses allocated to Series 2001-1. Any collections allocated to Series
2001-1 in excess of those required amounts will be used by other series to the
extent needed or will be paid to the Transferor. In general, the Series 2001-1
share of collections will be applied to make required distributions, first, on
the class A certificates and then on the class B certificates. Prior to the
commencement of the accumulation period or application of the Series 2001-1
principal collections for principal distributions, those principal collections
will be paid to the Transferor or shared with other series that are
accumulating or distributing principal collections.

    Series 2001-1 will also be allocated its share of losses on the
receivables. Those losses will in turn be allocated to the then most
subordinate Series 2001-1 class whose principal balance has not yet been
reduced to zero by prior losses.

    For further information on allocations of collections and losses, see
"Description of the Offered Certificates--Allocation Percentages," "--
Application of Collections" and "--Investor Charge-Offs."

Credit Enhancement

    The credit enhancement for the offered certificates is the subordination of
the junior classes of the Series 2001-1 certificates, as follows:

<TABLE>
<CAPTION>
                                                                    Subordinated
 Class                                                                Classes
 -----                                                              ------------
 <S>                                                                <C>
 A................................................................   B, C and D
 B................................................................   C and D
</TABLE>

    The effect of the subordination arrangement is that (1) collections
allocated to a subordinated class will be used to cover cash shortfalls on a
more senior class and (2) net losses allocated to Series 2001-1 will be borne
by the most subordinate class whose principal balance has not already been
reduced to zero because of prior losses. If the subordination arrangement does
not cover all net losses allocated to Series 2001-1, your interest
distributions may be reduced and you may suffer a loss of principal. The
initial principal balance of the class C certificates will be $      and the
initial principal balance of the class D certificates will be $     . When
Series 1998-2 and Series 1999-1 have been paid in full, the principal amount of
the class D certificates will be reduced to $     .

                                       7
<PAGE>


    For more information on the subordination arrangement, see "Description of
Offered Certificates--Reallocated Principal Collections," "--Defaulted
Receivables" and "--Investor Charge-Offs."

Optional Repurchase

    The class A certificates, the class B certificates and the class C
certificates will be subject to optional repurchase by the Transferor on any
distribution date after the invested amount of the class A certificates, the
class B certificates and the class C certificates is reduced to an amount less
than or equal to $      (20% of the initial outstanding principal amount of the
class A certificates, the class B certificates and the class C certficates), if
certain conditions are met. The repurchase price will be equal to the invested
amount for those classes plus accrued and unpaid interest on the class A
certificates, the class B certificates and the class C certificates through the
day preceding the distribution date on which the repurchase occurs. See
"Description of the Offered Certificates--Final Payment of Principal;
Termination."

Tax Status

    In the opinion of counsel to Conseco Finance and the Transferor, the class
A certificates and the class B certificates will be characterized as debt and
the Trust will not be characterized as an association, publicly traded
partnership or taxable mortgage pool taxable as a corporation for federal
income tax purposes under existing law.

    See "Federal Income Tax Consequences" for additional information concerning
the application of federal income tax laws.

ERISA Considerations

    An employee benefit plan subject to the requirements of the fiduciary
responsibility provisions of the Employee Retirement Income Security Act of
1974, as amended, or the provisions of Section 4975 of the Internal Revenue
Code of 1986, as amended, contemplating the purchase of the class A
certificates should consult its counsel before making a purchase, and the
fiduciary and such legal advisors should consider whether the class A
certificates will satisfy all of the requirements of the "publicly offered
securities" exemption described herein and the possible application of other
ERISA prohibited transaction exemptions described herein. Although we expect
that the "publicly offered securities" exemption or the other ERISA prohibited
transaction exemptions will apply to certain purchases of the class A
certificates by employee benefit plans, we cannot assure you that any of those
exemptions will apply to all purchases of the class A certificates by employee
benefit plans.

    An employee benefit plan is not permitted to purchase class B certificates.

    See "ERISA Considerations."

Ratings

    On the Closing Date the class A certificates will be rated "AAA" by
Standard & Poor's, "Aaa" by Moody's Investors Service, Inc. and "AAA" by Fitch
IBCA, Inc.

    On the Closing Date, the class B certificates will be rated at least "A" by
Standard & Poor's, "A2" by Moody's and "AA-" by Fitch.

                                       8
<PAGE>


    A rating is not a recommendation to buy, sell or hold securities and may be
subject to revision or withdrawal at any time by the assigning rating agency.

    See "Risk Factors--Certificate ratings are not guarantees, and may change."

Address and Telephone Numbers

    The mailing address of the Transferor is 500 Landmark Towers, 345 St. Peter
Street, St. Paul, Minnesota 55102-1639. Its telephone number is (651) 293-3400.

[Listing

    Application will be made to list the Offered Certificates on the Luxembourg
Stock Exchange.]

                                       9
<PAGE>

                                  RISK FACTORS

    You should consider the following risk factors in deciding whether to
purchase the offered certificates.

Limited prior experience   Conseco Finance began originating and servicing
with the receivables may   revolving credit accounts in February 1994 and thus
be different from future   has less underwriting and servicing experience and
experience with them.      limited delinquency, default and loss experience
                           with those accounts compared to some of its other
                           lending operations. Conseco Finance's substantial
                           experience in underwriting and servicing retail
                           installment sales contracts does not necessarily
                           indicate that satisfactory results will be
                           experienced on the receivables. See "Conseco
                           Finance Corp. and Its Commercial Lending Division."

                           Conseco Finance's historical loss experience with
                           respect to its portfolio of revolving credit
                           accounts is presented under "The Accounts--Loss
                           Experience." However, because Conseco Finance's
                           portfolio has grown rapidly in the past six years,
                           and Conseco Finance expects to create receivables
                           from new obligors that will be transferred to the
                           Trust in the future, the actual loss experience
                           with respect to the receivables owned by the Trust
                           may be different than Conseco Finance's historical
                           loss experience. Since a substantial number of the
                           accounts in Conseco Finance's portfolio were only
                           recently originated, the receivables in those
                           accounts may not have yet exhibited a loss
                           experience that is representative of the losses
                           that may be experienced over a longer period of
                           time. There can be no assurance that the loss
                           experience for the receivables in the future will
                           be similar to Conseco Finance's historical
                           experience. In addition, Conseco Finance's
                           historical experience includes the effect of the
                           financial obligations of manufacturers in respect
                           of repossessed products as described under "Conseco
                           Finance Corp. and Its Commercial Lending Division--
                           Floorplan Agreements with Manufacturers." If
                           manufacturers are not able to perform their
                           obligations in the future, the loss experience of
                           the Receivables may be adversely affected.

                                       10
<PAGE>

Future receivables         The Transferor expects, and in some cases will be
purchased by the Trust     obligated, to designate new accounts from which the
may come from new          Trust will acquire receivables. New accounts may
obligors, may be           include accounts with dealers originated by Conseco
underwritten with new      Finance under criteria different from those which
criteria or may be based   were applied before the Closing Date. Those
on new products. The       receivables may also provide financing for products
performance of these new   of types different from those included in the Trust
receivables may            on the Closing Date. Consequently, there can be no
adversely affect the       assurance that receivables from new accounts in the
Trust's ability to make    future will relate to the same types of products or
distributions to you.      will be of the same credit quality as receivables
                           from previously designated accounts or that new
                           product types that may secure the receivables in
                           new accounts will provide security that is as
                           favorable as that provided by manufactured homes or
                           other existing product types. The designation of
                           new accounts will be subject to the satisfaction of
                           certain conditions described under "Description of
                           the Offered Certificates--Addition of Accounts."

Master trust               In addition to Series 2001-1 and the series
considerations: creation   described in Annex B hereto, the Trust, as a master
of new series could        trust, is expected to issue additional series from
adversely affect your      time to time. The terms of any additional series
certificates.              will not be subject to the prior review or consent
                           of holders of the certificates of any previously
                           issued series. The principal terms of a new series
                           may include methods for determining allocations of
                           collections, provisions creating security or credit
                           enhancement, different classes of certificates
                           (including subordinated classes of certificates),
                           provisions subordinating a new series to another
                           series or another series to the new series (if the
                           terms of such other series so permit) and other
                           terms. Pay out events will not necessarily be the
                           same for each series. In addition, the provisions
                           of a new series may give the holders of the
                           certificates of that series consent, approval, or
                           other rights that could result in such holders
                           having the power to cause the Transferor, the
                           Servicer or the Trustee to take or refrain from
                           taking certain actions without regard to the
                           interest of the Series 2001-1. A provider of any
                           credit enhancement for any new Series may have
                           similar rights. However, each rating agency that
                           has rated any outstanding series must deliver
                           written confirmation to the Trustee that the
                           issuance of the new series will not result in such
                           rating agency reducing or withdrawing its rating on
                           any outstanding series. We cannot assure you,
                           however, that the principal terms of any other
                           series might not have an adverse impact on the

                                       11
<PAGE>

                           timing and amount of payments received by you or
                           the value of your certificates even if there is no
                           change in the rating of any outstanding series. See
                           "Description of the Offered Certificates--
                           Exchanges; Creation of New Series."

Series 2001-1 is a         Series 2001-1 is a companion series with respect to
companion series with      Series 1998-2 and Series 1999-1. As principal
Series 1998-2 and          collections are deposited into the principal
Series 1999-1 and may      accounts for Series 1998-2 and Series 1999-1, an
experience a delay in      equal amount will be released from the pre-funding
allocations of principal   account for Series 2001-1 and paid to the
and will experience a      Transferor. However, until Series 1998-2 and
delay in allocations of    Series 1999-1 have been paid in full, Series 2001-1
interest.                  will not receive any allocation of interest
                           collections or principal collections on the
                           receivables with respect to the "Pre-Allocated
                           Invested Amount," which is the sum of (1) the
                           initial amount in the pre-funding account and
                           (2) the amount in the Series 1998-2 and
                           Series 1999-1 principal account on the closing
                           date. Also, if a pay out event occurs with respect
                           to Series 2001-1 before the payment in full of
                           Series 1998-2 and Series 1999-1, Series 2001-1 will
                           receive no allocations of principal collections
                           with respect to the Pre-Allocated Invested Amount
                           until Series 1998-2 and Series 1999-1 are paid in
                           full. In the case of a pay out event, Series 1998-2
                           and Series 1999-1 will receive the funds on deposit
                           in the principal account for Series 1998-2 and
                           Series 1999-1, but Series 2001-1 would not have a
                           corresponding amount of funds in its pre-funding
                           account. We cannot assure you as to when Series
                           1998-2 and Series 1999-1 will be paid in full. See
                           "Description of the Offered Certificates--
                           Allocation Percentages."

The insolvency of          Conseco Finance. Conseco Finance has warranted to
Conseco Finance or the     the Transferor that the sale of the receivables by
Transferor could delay     it to the Transferor is a valid sale. Conseco
or reduce distributions    Finance has taken and will take all actions that
to you or could            are required under Minnesota law to perfect the
accelerate distributions   Transferor's ownership interest in the receivables.
to you.                    However, if Conseco Finance were to become a debtor
                           in a bankruptcy case and a creditor or trustee-in-
                           bankruptcy of Conseco Finance, or Conseco Finance
                           itself as debtor-in-possession, were to take the
                           position that any sale of receivables to the
                           Transferor should be recharacterized as a pledge of
                           such receivables to secure a borrowing of Conseco
                           Finance, then the following things could happen:

                               .   the Trust and you could experience a delay
                                   in payments.

                                       12
<PAGE>

                               .   if a court rules that the transfers were
                                   pledges rather than sales, the Trust and
                                   you could receive reduced payments, in
                                   which case you will incur a loss. In
                                   addition, the Trust may have to sell its
                                   assets, in which case you would be repaid
                                   earlier than you expected and you may still
                                   incur a loss.

                               .   if a court rules that the transfers were
                                   pledges, a tax or government lien on the
                                   property of Conseco Finance arising before
                                   receivables come into existence may have
                                   priority over the Trust's interest in those
                                   receivables and therefore reduce payments
                                   to the Trust and you, in which case you
                                   will incur a loss.

                           It is possible that the risk of recharacterization
                           may be increased by the following factors:

                               .   the Transferor will, initially, retain the
                                   class C certificates, the class D
                                   certificates and its other interests in the
                                   Trust.

                               .   Conseco Finance may guarantee the class D
                                   certificates if they are sold.

                               .   for accounting purposes, Conseco Finance
                                   and the Transferor will treat the
                                   certificates as debt and the transfer of
                                   the receivables allocable to Series 2001-1
                                   from the Transferor to the Trust as a
                                   pledge rather than a sale.

                           See "Certain Legal Aspects of the Receivables--
                           Certain Matters Relating to Bankruptcy." If the
                           transfer of receivables to the Transferor were
                           respected as a sale, the receivables would not be
                           part of Conseco Finance's bankruptcy estate and
                           would not be available to Conseco Finance's
                           creditors.

                           In addition, if a bankruptcy court in a Conseco
                           Finance insolvency were to order that the
                           Transferor be substantively consolidated with
                           Conseco Finance, the Trust and you could experience
                           delays in payments and reductions in payments, and
                           you may incur a loss.

                           Transferor. Although the pooling and servicing
                           agreement provides that the Transferor is selling
                           the receivables to the Trust (for certain non-tax
                           purposes), a court could treat these

                                       13
<PAGE>

                           transactions as a grant of a security interest for
                           the benefit of holders of certificates issued by
                           the Trust. It is possible that the risk of such
                           treatment may be increased by the factors set forth
                           in the second preceding paragraph. The Transferor
                           has represented and warranted in the pooling and
                           servicing agreement that the transfer of the
                           receivables to the Trust is either a valid transfer
                           and assignment of the receivables to the Trust or
                           the grant to the Trust of a security interest in
                           the receivables. The Transferor has taken and will
                           take those actions required to perfect the Trust's
                           interest in the receivables. The Transferor will
                           warrant that if the transfer to the Trust is
                           recharacterized as a grant to the Trust of a
                           security interest in the receivables, the Trustee
                           will have a first priority perfected security
                           interest therein, subject only to liens permitted
                           in the pooling and servicing agreement. If the
                           transfer of the receivables to the Trust is deemed
                           to create a security interest therein, a tax or
                           government lien on property of the Transferor
                           arising before Receivables come into existence may
                           have priority over the Trust's interest in these
                           Receivables. In the event of the insolvency of the
                           Transferor, some administrative expenses may also
                           have priority over the Trust's interest in these
                           Receivables. If the Transferor becomes insolvent,
                           the Trust and you could experience delays in
                           payments and reductions in the amount of those
                           payments, and you could incur a loss. See "Certain
                           Legal Aspects of the Receivables--Transfer of
                           Receivables."

                           Servicer. If a bankruptcy trustee or receiver were
                           appointed for the Servicer, and no Servicer Default
                           other than such bankruptcy or receivership or
                           insolvency of the Servicer exists, the bankruptcy
                           trustee or receiver may have the power to prevent
                           either the Trustee or the certificateholders from
                           effecting a transfer of servicing to a successor
                           Servicer.

                           Pay out event. If a bankruptcy trustee or receiver
                           were appointed for the Transferor or Conseco
                           Finance, a pay out event would occur with respect
                           to all series. New receivables would not be
                           transferred to the Trust and the Trust would sell
                           the receivables, subject to voting provisions
                           specified in the pooling and servicing agreement.
                           You would incur a loss if the net proceeds
                           allocable to your certificates were insufficient to
                           repay you in full. If the only pay out event to
                           occur is either the insolvency of the Transferor or
                           the

                                       14
<PAGE>

                           appointment of a bankruptcy trustee or receiver for
                           the Transferor, the bankruptcy trustee or receiver
                           may have the power to continue to require the
                           Transferor to transfer new receivables to the Trust
                           and to prevent the early disposition of the
                           receivables and the commencement of the
                           amortization of your certificates. In addition, a
                           bankruptcy trustee or receiver for the Transferor
                           may have the power to cause early payment of your
                           certificates. See "Certain Legal Aspects of the
                           Receivables--Certain Matters Relating to
                           Bankruptcy."

Participations in          The receivables may include floorplan receivables
receivables do not         or asset-based receivables acquired by Conseco
provide the Trust with     Finance in the form of participation interests in
direct rights against      those receivables. In purchasing participation
the obligor and may        interests, the Trust may have a contractual
expose the Trust to the    relationship only with the selling institution and
credit of the selling      not the obligor on the receivable. The Trust may
institution.               have no right directly to enforce compliance by the
                           obligor on the receivable with the terms thereof or
                           any rights of set-off against the obligor. The
                           Trust may not have the right to object to certain
                           changes to the terms of the receivables agreed to
                           by the selling institution. The Trust may not
                           directly benefit from any security for the
                           receivable and may be subject to any rights of set-
                           off the obligor has against the selling
                           institution.

                           In addition, in the event of the insolvency of the
                           selling institution, the Trust may be treated as a
                           general creditor of the selling institution and may
                           not have any exclusive or senior claim with respect
                           to the receivables participated by such selling
                           institution or any security therefor.

Your certificate rate      The receivables will bear interest at a variable
may be lower than the      rate above a designated index rate. See "Conseco
interest rate specified    Finance Corp. and Its Commercial Lending Division--
on the cover page.         Floorplan Payment Terms." Your certificates will
                           bear interest at the lesser of (1) a floating rate
                           based on LIBOR plus a margin and (2) the net
                           receivables rate. If there is a decline in such
                           index rate, the amount of interest collections on
                           the receivables may be reduced. It is possible that
                           LIBOR plus the margin used to compute your
                           certificate rate for an interest accrual period
                           will exceed the applicable net receivables rate. In
                           such event, interest will accrue on your
                           certificates during that interest
                           accrual period at a rate equal to the net
                           receivables rate. The

                                       15
<PAGE>

                           Servicer has the right to change the discount
                           factor to offset any such reduced Interest
                           Collections, but is not obligated to do so. The
                           interest rates borne by the receivables will be
                           limited by the applicable state usury laws.

Social, economic and       Conseco Finance's ability to generate new
other factors, including   receivables, and the obligors' ability to make
competition, will affect   payments on the receivables owned by the Trust,
the performance of the     will depend upon the retail sales of the products
Trust.                     securing these receivables. The level of retail
                           sales of these products will be affected by a
                           variety of social and economic factors, including
                           national and regional unemployment levels and
                           levels of economic activity in general, interest
                           rates and consumer perceptions of economic
                           conditions. In addition, Conseco Finance competes
                           with various other financing sources, including
                           independent finance companies, manufacturer-
                           affiliated finance companies and banks that are in
                           the business of providing floorplan financing
                           arrangements. If, for any reason, Conseco Finance
                           were unable to or ceased to generate sufficient new
                           receivables, a pay out event would occur and you
                           would begin receiving principal earlier than you
                           expected. See "The certificates may pay principal
                           earlier than expected" below.

You may have a limited     The underwriters currently intend to assist in the
ability to resell your     resales of the offered certificates but are not
certificates.              obligated to do so. A secondary market may not
                           develop for the offered certificates, or, if one
                           does develop, you still might not be able to resell
                           your certificates. Any secondary market may not
                           continue to exist for the term of your
                           certificates.

Your only source of        You will not have recourse for payment of your
repayment is collections   certificates to any assets of the Transferor
on the receivables; you    (except to the extent it holds subordinated Series
have no recourse to        2001-1 certificates), Conseco Finance or any of its
Conseco Finance, the       affiliates. Consequently, you must rely solely upon
Transferor, any of their   payments of the receivables for the payments on
affiliates or any other    your certificates. Furthermore, your certificates
entity.                    are only entitled to a share of the collections on
                           the receivables as determined in the pooling and
                           servicing agreement. If the receivables do not
                           perform as expected, that share of collections may
                           not be sufficient to repay the certificates in
                           full.

The certificates may pay   The receivables may be paid at any time. There is
principal earlier than     no assurance that Conseco Finance will originate
expected.                  additional receivables or that any particular
                           pattern of originations or repayments will occur. A
                           significant decline in the amount of receivables
                           generated could result in the occurrence of a pay

                                       16
<PAGE>

                           out event and the commencement of early repayment.
                           See "Maturity Considerations" and "Description of
                           the Offered Certificates--Pay Out Events" for a
                           discussion of pay out events. If a pay out event
                           occurs, your principal will be paid sooner than you
                           expected. You may not be able to reinvest that
                           principal in suitable investments with a comparable
                           rate of return.

                           Floorplan receivables are generally payable upon
                           the retail sale of the related product. Asset-based
                           receivables are payable as described under "Conseco
                           Finance Corp. and Its Commercial Lending Division--
                           Asset-Based Receivables." The payment of principal
                           on your certificates is dependent on the receipt of
                           principal collections during the accumulation
                           period in which the Trust will accumulate the
                           Series 2001-1 share of those collections for
                           payment on your scheduled final payment date. No
                           assurance can be given that the Trust will
                           accumulate enough principal collections to repay
                           you in full on that date.

Subordination of class B   The class B certificates will be subordinated in
certificates may cause     right of payment of interest and principal to the
losses on the class B      class A certificates. Payments of principal in
certificates.              respect of the class B certificates will not
                           commence until the class A certificates have been
                           paid in full. Collections allocable to the class B
                           certificates will be used, if needed, to cover
                           distributions due on the class A certificates or
                           losses allocated to the class A certificates. Such
                           reallocation of the class B share of collections
                           will occur only if the other credit enhancements
                           for the class A certificates are not available. If
                           the principal collections allocable to the class B
                           certificates are used to support the class A
                           certificates, then the interest collections
                           allocable to the class B certificates will be
                           reduced. If the reallocated principal collections
                           are not reimbursed, the amount of principal
                           distributable to the class B certificateholders
                           will be reduced, and they will incur a loss. See
                           "Description of the Offered Certificates--
                           Allocation Percentages," "--Reallocated Principal
                           Collections,"""--Investor Charge-Offs" and "--
                           Subordination of the Class B Certificates."

Negative carry will        Funds in the pre-funding account and funds, if any,
reduce interest            in the excess funding account will be invested in
collections.               short-term investments that are expected to earn a
                           rate of return lower than the interest rates borne
                           by the receivables. Accordingly, funds in the pre-
                           funding account and any funds in the excess

                                       17
<PAGE>

                           funding account may be expected to reduce the
                           amount of interest collections available to make
                           distributions on your certificates, until Conseco
                           Finance is able to generate sufficient eligible
                           receivables to permit funds to be released from the
                           pre-funding account or the excess funding account.
                           The Transferor's share of interest collections
                           will, however, be applied toward any such negative
                           carry amounts. See "Description of the Offered
                           Certificates--Coverage of Certain Interest
                           Shortfalls."

The Servicer may change    The Servicer will have the right, on behalf of the
payment terms of the       Transferor, to change the payment terms, including,
receivables. This could    without limitation, the interest rate and repayment
result in the Trust        terms, and various other terms of receivables. A
having less cash for       decrease in the interest rate borne by the
distributions to you.      receivables or an increase in interest-free periods
                           without an increase in the discount factor would
                           decrease the amount of interest collections
                           available to make distributions on your
                           certificates. This decrease could result in the
                           occurrence of a pay out event. Conseco Finance will
                           covenant that generally it will only change the
                           terms relating to the receivables if in its
                           reasonable judgment no pay out event will occur as
                           a result of the change and the interests of the
                           certificateholders of all outstanding series will
                           not be materially adversely affected. Otherwise,
                           there are no restrictions on the ability of the
                           Servicer to change the terms of the receivables.
                           While the Servicer has no current intention of
                           taking actions which would change the payment or
                           other terms of the receivables, other than in
                           accordance with its customary and usual procedures,
                           there can be no assurance that changes in the
                           marketplace or prudent business practice might not
                           result in a determination to do so.

                           Conseco Finance will have the right to generate new
                           receivables with payment terms that are generally
                           longer than the current payment terms on the
                           receivables. Such a lengthening of the payment
                           period could result in a reduction of the monthly
                           payment rate and consequently a reduction in the
                           yield on the receivables that have been discounted,
                           unless the discount factor is increased
                           accordingly.

You will not have          Subject to certain exceptions, the consent of the
control over certain       holders of a specified percentage of the aggregate
actions under the          unpaid principal amount of all outstanding investor
pooling and servicing      certificates of each series will be required to
agreement.                 direct certain actions to be taken under the
                           pooling and servicing agreement or the related

                                       18
<PAGE>

                            supplement. In determining whether the required
                            percentage of certificateholders have given their
                            consent, except as otherwise specified, the class
                            A certificateholders, the class B
                            certificateholders and the class C
                            certificateholders of Series 2001-1 will be
                            treated as a single series. Accordingly, the class
                            A certificateholders, as the largest class, will
                            have the power to determine whether any such
                            action is taken without regard to the position or
                            interests of the class B certificateholders or the
                            class C certificateholders relating to such
                            action. Neither the class B certificateholders nor
                            the class C certificateholders will have similar
                            power. However, under some circumstances the
                            consent of a specified percentage of the aggregate
                            invested amount of all series outstanding or of
                            the invested amount of each class of each series
                            may be required to direct certain actions,
                            including requiring the appointment of a successor
                            Servicer following a servicer default, amending
                            the pooling and servicing agreement in certain
                            circumstances, directing the servicer not to sell
                            the receivables upon the occurrence of an
                            insolvency event of Conseco Finance or the
                            Transferor and directing a repurchase of all
                            outstanding series upon the breach of certain
                            representations and warranties by the Transferor.
                            In such instances, it may be difficult for you to
                            achieve the results that you desire.

Certificate ratings are not On the Closing Date the class A certificates will
guarantees, and may change. have a rating of "AAA" from Standard & Poor's,
                            "Aaa" from Moody's and "AAA" from Fitch. On the
                            Closing Date the class B certificates will have a
                            rating of "A" from Standard & Poor's, "A2" from
                            Moody's and "AA-" from Fitch. However, any such
                            rating will not address the likelihood that the
                            principal of, or interest on, the class A
                            certificates will be paid by the class A scheduled
                            payment date or that the principal of, or interest
                            on, the class B certificates will be paid by the
                            class B scheduled payment date. The ratings will
                            be based primarily on the value of the
                            receivables, the funds in the pre-funding account
                            and the funds, if any, on deposit in the excess
                            funding account (and the manner in which such
                            funds are invested). The ratings are not a
                            recommendation to purchase, hold, or sell your
                            certificates, and the ratings do not comment as to
                            the market price or suitability for a particular
                            investor. There can be no assurance that the
                            ratings will remain in effect for any given period
                            of time or that a rating agency will not lower or

                                       19
<PAGE>

                           withdraw any rating if in its judgment circumstances
                           so warrant. Any reduction in the rating of your
                           certificates will adversely affect their market
                           value.

                           There can be no assurance as to whether any rating
                           agency not requested to rate your certificates will
                           nonetheless issue a rating for your certificates.
                           If it does, there can be no assurance what such
                           rating would be. An unrequested rating assigned to
                           your certificates may be lower than the ratings
                           assigned by the rating agencies pursuant to the
                           Transferor's request.

During the funding         The pre-funded amount represents the proceeds from
period, Series 2001-1      the sale of the Series 2001-1 certificates that
will be entitled only to   will not be invested in receivables on the Closing
some interest and          Date because there are not sufficient receivables
principal collections.     at that time. The amount in the pre-funding account
                           will be released to the Transferor as deposits are
                           made into the principal account for Series 1998-2
                           and Series 1999-1, which are prior Series issued by
                           the Trust that are in their early amortization
                           periods. As principal collections are deposited
                           into the principal account for Series 1998-2 and
                           Series 1999-1, an equal amount will be released
                           from the pre-funding account for Series 2001-1 and
                           paid to the Transferor. However, until Series 1998-
                           2 and Series 1999-1 have been paid in full, Series
                           2001-1 will not receive any allocation of interest
                           collections or principal collections on the
                           receivables with respect to (1) the initial amount
                           in the pre-funding account and (2) the amount in
                           the Series 1998-2 and Series 1999-1 principal
                           account on the closing date. Also, Series 1998-2
                           and Series 1999-1 will receive the funds on deposit
                           in the principal account for Series 1998-2 and
                           Series 1999-1, but Series 2001-1 would not have a
                           corresponding amount of funds in the pre-funding
                           account. Funds in the excess funding account are
                           assets of the entire Trust allocated to all series
                           and to the Transferor's interest and will be
                           applied as described in "Description of the Offered
                           Certificates--Excess Funding Account." Such funds
                           may be released to holders of certificates of other
                           series in connection with a reduction of the
                           principal balance of the certificates of such other
                           series.

                                       20
<PAGE>

                                   THE TRUST

    The Trust has been formed, in accordance with the laws of the State of
Minnesota, pursuant to the pooling and servicing agreement between the
Transferor, Conseco Finance, as Servicer, and the Trustee (the "Pooling and
Servicing Agreement"). The Trust was formed for the transactions described in
this prospectus and similar transactions. The Trust will not engage in any
business activity, other than as described in this prospectus. It will only
acquire and hold the receivables described in this prospectus (the
"Receivables") and related assets, issue the Series 2001-1 certificates (the
"Certificates"), the Exchangeable Transferor Certificate, and certificates
representing other series (each, a "Series") and engage in related activities
(including, with respect to any Series, entering into any credit enhancement
and credit enhancement agreement relating thereto) and make payments thereon.
As a consequence, the Trust is not expected to have any need for additional
capital resources. The Trust has previously issued seven Series of
certificates: Series 1995-1, Series 1996-1, Series 1996-2, Series 1998-1,
Series 1998-A, Series 1998-2 and Series 1999-1. See Annex B hereto. The
Series 1995-1 Certificates, Series 1996-2 Certificates and the Series 1998-A
Certificates have been retired, the Series 1998-1 Certificates will be retired
by April 2001, and the Transferor expects that the Series 1998-2 and Series
1999-1 Certificates will be retired within a few months after the issuance of
the Series 2001-1 Certificates.

                                 THE TRANSFEROR

    Green Tree Floorplan Funding Corp., a wholly owned subsidiary of Conseco
Finance, was incorporated in Delaware in September 1995. The Transferor was
organized for the limited purposes of purchasing receivables from Conseco
Finance pursuant to a receivables purchase agreement (the "Purchase Agreement")
and transferring such receivables to third parties, and any activities
incidental to and necessary or convenient for the accomplishment of these
purposes. The principal executive offices of the Transferor are located at 500
Landmark Towers, 345 St. Peter Street, St. Paul, Minnesota 55102-1639
(telephone (651) 293-3400).

    The Transferor has taken, and will take in connection with the creation of
each Series of Certificates, steps intended to ensure that the voluntary or
involuntary application for relief by Conseco Finance under the United States
Bankruptcy Code or similar applicable state laws ("Insolvency Laws") will not
result in consolidation of the assets and liabilities of the Transferor with
those of Conseco Finance. These steps include the creation of the Transferor as
a separate, limited-purpose subsidiary pursuant to a certificate of
incorporation containing various limitations (including restrictions on the
nature of the Transferor's business and a restriction on the Transferor's
ability to commence a voluntary case or proceeding under any Insolvency Laws
without the unanimous affirmative vote of all of its directors). The
Transferor's certificate of incorporation includes a provision that requires
the Transferor to have two directors who qualify under the certificate of
incorporation as "Independent Directors," meaning a person who is not and has
not been a director or officer of, employed by, or the holder of any beneficial
economic interest in any Affiliate, and who may at no time hold any beneficial
or economic interest in the Transferor. "Affiliate" means any entity other than
the Transferor (i) which owns beneficially, directly or indirectly, 10%

                                       21
<PAGE>

or more of the outstanding shares of Common Stock of the Transferor, or (ii) of
which 10% or more of the outstanding shares of its Common Stock is owned
beneficially, directly or indirectly, by any entity described in clause (i)
above, or (iii) which is controlled by an entity described in clause (i) above,
as the term "control" is defined under the Rules and Regulations of the
Securities and Exchange Commission. No assurance can be given, however, that
such a consolidation will not occur. See "Risk Factors--The insolvency of
Conseco Finance or the Transferor could delay or reduce distributions to you or
could accelerate distributions to you."

                           CONSECO FINANCE CORP. AND
                        ITS COMMERCIAL LENDING DIVISION

    Conseco Finance Corp. is a diversified financial services company with
operations serving customers in the consumer finance, commercial finance and
insurance markets. Through its various divisions, Conseco Finance purchases,
pools, sells and services retail installment sales contracts for manufactured
housing, home improvements and a variety of consumer products, provides sale
and lease financing for a variety of commercial equipment, and provides
inventory financing to dealers, manufacturers and distributors of various
consumer and commercial products. Conseco Finance also offers revolving credit
and originates home equity and mortgage loans. Conseco Finance is currently the
largest servicer of manufactured housing government insured or guaranteed
contracts, and is one of the largest servicers of conventional manufactured
housing contracts, in the United States. Through its principal offices in Saint
Paul, Minnesota and service centers throughout the United States, Conseco
Finance services all 50 states. Its principal executive offices are located at
1100 Landmark Towers, 345 St. Peter Street, St. Paul, Minnesota 55102-1639
(telephone (651) 293-3400). Conseco Finance's Annual Report on Form 10-K for
the year ended December 31, 1999, and, when available, subsequent quarterly or
annual reports are available from Conseco Finance upon written request. The
Certificates do not represent an interest in or obligation of Conseco Finance,
the Transferor or any of their affiliates, and no Certificateholder will have
recourse for payment of its Certificates to any assets of any of Conseco
Finance, the Transferor (other than the Exchangeable Transferor Certificate (as
defined herein) and any class of investor certificates retained by the
Transferor (a "Transferor Retained Class"), to the extent described herein) or
any of their affiliates.

Recent Developments

    In recent months, rating agencies lowered their ratings of the debt
obligations of Conseco Finance and placed some ratings of Conseco Finance's
debt obligations on review as the rating agencies analyze the impact of
developing events. The uncertainty surrounding the ultimate outcome of Conseco,
Inc.'s efforts to sell Conseco Finance, which Conseco, Inc. announced in March
2000, made it more difficult for Conseco Finance to complete new public
securitization transactions.

    On July 27, 2000, Conseco, Inc. announced a restructuring program for
Conseco Finance that includes selling or running off five of Conseco Finance's
business units. Conseco Finance's floorplan funding division is not one of
these five units.

                                       22
<PAGE>

    On August 8, 2000, Moody's reduced the rating of the long-term senior
unsecured debt obligations of Conseco Finance to B1 from Ba3. We cannot assure
you that further downgrades will not occur.

    Conseco Finance has been served with various lawsuits in the United States
District Court for the District of Minnesota. These lawsuits were generally
filed as purported class actions on behalf of persons or entities who purchased
common stock or options to purchase common stock of Conseco Finance during
alleged class periods that generally run from February 1995 to January 1998.
One of these lawsuits did not include class action claims. In addition to
Conseco Finance, some of Conseco Finance's current and former officers and
directors are named as defendants in one or more of the lawsuits. The lawsuits
have been consolidated into two complaints, one relating to an alleged class of
purchasers of Conseco Finance's common stock and the other relating to an
alleged class of traders in options for Conseco Finance's common stock. In
addition to these two complaints, a separate non-class action lawsuit
containing similar allegations was also filed. Plaintiffs in the lawsuits
assert claims under Sections 10(b) and 20(a) of the Securities Exchange Act of
1934. In each case, plaintiffs allege that Conseco Finance and the other
defendants violated federal securities laws by making false and misleading
statements about Conseco Finance's current state and Conseco Finance's future
prospects, particularly about prepayment assumptions and performance of some of
our loan portfolios, which allegedly rendered Conseco Finance's financial
statements false and misleading. Conseco Finance filed motions to dismiss these
lawsuits. On August 24, 1999, Conseco Finance's motions to dismiss were granted
with prejudice. The plaintiffs subsequently appealed the decision to the U.S.
Court of Appeals for the 8th Circuit, and the appeal is currently pending.
Conseco Finance believes that the lawsuits are without merit and intends to
defend the lawsuits vigorously. However, the ultimate outcome of these lawsuits
cannot be predicted with certainty.

Commercial Lending Division--General

    The Receivables sold and to be sold to the Transferor were and will be
selected from extensions of credit made by Conseco Finance's Commercial Lending
Division ("CLD") under revolving credit agreements with dealers, manufacturers
and distributors of various consumer and commercial products. The lending party
to such an agreement may be a subsidiary of Conseco Finance. "Floorplan
Receivables" represent the financing of product inventory for retail dealers of
a variety of consumer products. "Asset-Based Receivables" generally represent
the financing of production and inventory by manufacturers and distributors,
such financing being secured by finished goods inventory, accounts receivable
arising from the sale of such inventory, certain work-in-process, raw materials
and component parts, as well as other assets of the borrower, which may include
commercial real estate in some cases. The dealers, manufacturers and
distributors obligated under the Receivables are collectively referred to as
"Dealers." The products securing the Floorplan Receivables currently include
manufactured housing, recreational vehicles, marine products, and lawn and
garden equipment. Conseco Finance expects to provide financing to additional
Dealers in the future and expects that the financing needs of Dealers will
change over time, whether as a result of seasonality or other changes in the
Dealers' business. Accordingly,

                                       23
<PAGE>

though the types of credit arrangements are expected to remain the same, the
products securing those arrangements are expected to expand and change over
time, and the relative proportions of the various types of product collateral
will change over time. In addition, Conseco Finance may from time to time sell
participation interests in Floorplan Receivables arising in certain accounts
prior to designating such account as an Additional Account and transferring to
the Transferor that portion of the Receivables arising in such accounts and
owned by Conseco Finance.

Floorplan Receivables--General

    The Floorplan Receivables are secured by the products being financed and
the Dealer's other inventory, together with personal guaranties in some
instances. The amount of the advance is generally equal to 100% of the
wholesale invoice price of the product. The Floorplan Receivables are generally
full recourse obligations of the related Dealer.

Floorplan Agreements with Manufacturers

    Conseco Finance will provide financing for products for a particular
Dealer, in most instances, only if Conseco Finance has also entered into an
inventory repurchase agreement (the "Floorplan Agreement") with the
manufacturer, distributor or other vendor of that product. We refer to any
manufacturer, distributor or other vendor as the "manufacturer." Pursuant to
the Floorplan Agreement, the manufacturer will agree, among other matters, to
purchase from Conseco Finance those products sold by a manufacturer to a Dealer
and financed by Conseco Finance if Conseco Finance acquires possession of such
products pursuant to repossession, voluntary surrender, or other circumstances.
The terms of these repurchase obligations may vary, both by industry and by
manufacturer. In some instances, the manufacturer will be obligated to
repurchase the product for a price equal to the unpaid principal balance owed
by the Dealer for the product in question whenever Conseco Finance acquires
possession of the product. On occasion, different terms may be negotiated.
These terms may provide for a smaller purchase price, or a purchase price which
declines over time, or time periods beyond which no obligation to purchase by
the Manufacturer shall apply. Some Floorplan Agreements may also eliminate the
repurchase obligation or reduce the purchase price payable by the manufacturer,
depending upon the condition of the inventory acquired by Conseco Finance.

Floorplan Credit Underwriting Process

    A Dealer requesting the establishment of a credit line with Conseco Finance
is required to submit an application and financial information, including
audited or unaudited financial statements and, in some cases, tax returns. CLD
attempts to talk to, or receive reference letters from, several of the
applicant's current creditors and may also obtain a credit agency report on the
applicant's credit history. In addition to such current financial information
and historical credit information, CLD will consider the following factors: the
reason for the request for the extension of credit; the need for the credit
line; the products to be financed and the financial status of the manufacturer
of such products, if any, that would enter into a related Floorplan Agreement;
and the experience of the Dealer's management. The

                                       24
<PAGE>

determination of whether to extend credit and the amount to be extended is
based upon a weighing of the above factors.

    Extensions of credit lines in excess of $5,000,000 must be approved at the
corporate level of Conseco Finance. Extensions of credit up to $5,000,000 may
be approved by division level credit officers and up to $1,000,000 by a
business center vice president. CLD reviews individual Dealer credit limits (i)
prior to any increase in such credit limit, (ii) generally every 12 to 18
months and (iii) upon becoming aware that the Dealer is experiencing financial
difficulties or is in default on its obligations under its agreement with
Conseco Finance.

Creation of Floorplan Receivables

    Conseco Finance's floorplan business is typically documented by an
agreement between Conseco Finance and the Dealer which provides for both the
extension of credit and a grant of a security interest. Such agreements are
generally for an unspecified period of time and create discretionary lines of
credit, which Conseco Finance may terminate at any time in its sole discretion,
subject, however, to prevailing standards of commercial reasonableness and good
faith. Absent default by the Dealer, the outstanding Floorplan Receivables owed
by a Dealer generally cannot be accelerated, even if the line of credit is
terminated. After the effective date of termination, Conseco Finance is under
no obligation to continue to provide additional financing, but the then-current
outstanding balance will be repayable in accordance with the payment terms of
the Dealer's program with Conseco Finance, as described below.

    Advances made for the purchase of inventory are most commonly arranged in
the following manner. The Dealer will contact the manufacturer and place a
purchase order for a shipment of inventory. If the manufacturer has been
advised that Conseco Finance is the Dealer's inventory financing source, the
manufacturer will contact Conseco Finance to obtain an approval number with
respect to that purchase order. Upon such request, Conseco Finance will
determine whether (i) the manufacturer is in compliance with its Floorplan
Agreement, (ii) the Dealer is in compliance with its program with Conseco
Finance and (iii) the purchase order is within the Dealer's credit limit. If
all of such requirements are met, Conseco Finance will issue an approval number
to the manufacturer. The manufacturer will then ship the inventory and submit
its invoice for the purchase order directly to Conseco Finance for payment.
Interest or finance charges normally begin to accrue on the Dealer's accounts
as of the invoice date. The proceeds of the loan being made by Conseco Finance
to the Dealer are paid directly to the manufacturer in satisfaction of the
invoice price and will normally be funded at that time. In some cases, however,
Conseco Finance will negotiate a delay in funding the advance for a period
which in most cases does not exceed 10 days after the date of the invoice.
Conseco Finance and the manufacturer may also agree that Conseco Finance may
discount the invoice price of the inventory ordered by the Dealer. Under this
arrangement, the manufacturer will deem itself paid in full upon receipt of
such discounted amount. Typically, in exchange for the increased yield created
by the discount, Conseco Finance will agree to provide the manufacturer's
Dealers with reduced interest, or perhaps no interest, for some period of time.
Thus, the Dealer's financing program may provide for

                                       25
<PAGE>

so-called "interest free" or "free flooring" periods during which no interest
or finance charges will accrue on their accounts. The price paid by the Trust
for such a Receivable will be the full amount payable by the Dealer.

Floorplan Payment Terms

    The Dealer is obligated to pay interest or finance charges monthly, but
principal repayment with respect to any particular item of inventory financed
by Conseco Finance is due and payable only upon the sale of that item by the
Dealer, subject in some cases to an ultimate maturity date. In addition,
Conseco Finance requires Dealers to begin repaying principal in installments if
the unit has not been sold within a specified period of time. These payments
are referred to as "curtailments." Even if a unit is subject to curtailment
payments, the outstanding balance with respect to such unit will remain fully
payable upon the sale of the unit.

      Floorplan receivables generally accrue interest (subject to any "interest
free" or "free flooring" periods as described above) at a floating rate based
on a generally published prime rate or other index. Conseco Finance may charge
the Dealer a documentation, handling and inspection fee for each unit financed
("DHI Fees"). These fees will be included in the Interest Collections owned by
the Trust. Interest and DHI Fees are due and payable on a monthly basis.

Floorplan Billing Procedures

    At the beginning of each month, Conseco Finance sends to each Dealer a
billing statement for the interest, DHI Fees, curtailments, if any, and any
other non-principal charges accrued or arising in the prior month. Payment is
due in the same month.

Floorplan Dealer Monitoring

    Inventory inspections are performed to physically verify the collateral
used to secure a Dealer's loan, check the condition of the inventory, account
for any missing inventory and collect any funds due. The inventory inspection
is one of the key tools utilized by CLD for monitoring inventory financed by
Conseco Finance, and is performed generally on a monthly basis with respect to
each Dealer account (and each location within a Dealer account to the extent
that a dealer conducts its business in more than one location). If an
inspection reveals that the Dealer has sold any inventory without immediate
repayment to Conseco Finance, the inventory is considered "sold and unpaid"
("SAU") and Conseco Finance demands immediate repayment from the Dealer or
initiates other appropriate steps to resolve the SAU. Inspection dates within
each month may vary, as all inspections are unscheduled and are performed
whenever CLD deems it appropriate. CLD also requires regular rotation of the
individuals conducting a Dealer's inspections.

    In addition, Area Managers, within their respective portfolio of Dealers,
monitor each Dealer as to the Dealer's performance and adherence to Conseco
Finance's requirements. This includes a regular review of annual and interim
financial statements for trends, payments for sold inventory between
inspections, monitoring of Conseco Finance's ongoing perfected security
interests in the inventory, existence of proper insurance coverage with

                                       26
<PAGE>

respect to the inventory at all times, timely payment of interest, DHI Fees and
curtailments, proper recording of invoices, the maintenance of the Manufacturer
Statements of Origin which are on file with respect to each item of inventory
financed, and the requirement that all inventory stays within the repurchase
period in effect with respect to each manufacturer.

Participations in Floorplan Receivables

    Conseco Finance may also acquire participation interests in floorplan
receivables established by other lenders. Such participation interests, rather
than the receivables themselves, would be transferred to the Transferor and, in
turn, to the Trust. These receivables would have terms similar to those of
Floorplan Receivables originated by Conseco Finance, and would be serviced by
the lead lender in a manner similar to Conseco Finance's servicing standards.

Participation Arrangements

    From time to time Conseco Finance will enable other financing sources to
participate in some of its credit facilities ("Participations"). Pursuant to a
typical Participation, the documentation for the underlying line of credit will
remain in the name of Conseco Finance, as lender. In a separate contractual
arrangement with Conseco Finance, the participant will agree to provide a
portion of the funding for a facility in exchange for an agreed-upon interest
rate. Occasionally, fees and other charges may also be shared with the
participant. In some cases, Conseco Finance will advise a borrower that the
size of its credit facility is expressly conditioned upon the availability of
participants in the facility. In those situations, if no participants can be
found, or if such participants cease to participate, the size of the credit
facility may be reduced. In other circumstances, there will be no such
condition, and Conseco Finance may be obligated to maintain a credit facility
notwithstanding its expectation that a portion of it would be participated. The
Receivables to be sold by Conseco Finance to the Transferor, and in turn by the
Transferor to the Trust, may include the non-participated portion of
receivables from accounts which have been participated. In addition, subject to
substantially the same limitations that apply to the removal of Accounts, the
Transferor may cause the Trust to transfer an interest in certain Receivables
to the Transferor, which may thereafter transfer such interest to another
person in the form of a Participation. Conseco Finance may also sell to the
Transferor (who will then transfer to the Trust) floorplan receivables and
asset-based receivables subject to a participation interest granted to another
lender, or Conseco Finance may sell to the Transferor (who will then transfer
to the Trust) interests in a partnership or other limited-purpose entity whose
sole assets will be receivables that are subject to the participation interests
of other lenders. In addition, Conseco Finance may, from time to time, enter
into syndicated credit facilities, pursuant to which multiple lenders,
including Conseco Finance, will jointly establish a credit facility
administered by a lender agent. Under these facilities, Conseco Finance and its
co-lenders will agree, pursuant to the terms of the loan agreement with the
borrower, to provide a portion of the overall credit facility up to their
respective maximum commitment amounts. In return, Conseco Finance and its co-
lenders generally share in the interest and principal payments and other fees
and charges on a pro-rata basis.

                                       27
<PAGE>

Asset-Based Receivables


    Asset-Based Receivables that may be sold to the Transferor arise from
asset-based revolving credit facilities provided to certain manufacturers,
retailers and distributors. These facilities typically involve a revolving line
of credit, for a contractually committed period of time, pursuant to which the
borrower may draw the lesser of the maximum amount of such line of credit or a
specifically negotiated loan availability amount, subject to the availability
of adequate collateral. Interest is typically payable monthly, while principal
payments and draws are generally settled weekly or, if earlier, when and to the
extent principal outstandings exceed eligible collateral at negotiated advance
rates (i.e., the maximum percentage of the borrowing base, or portion thereof,
that the borrowed amount can represent). As a result, monthly payment rates for
Asset-Based Receivables will vary depending on the terms of the facility. The
loan availability amount is generally determined by multiplying an agreed upon
advance rate against the value of certain types of assets. In these facilities,
Conseco Finance will most typically lend against finished inventory and
eligible accounts receivable arising from the sale of such inventory which are
free and clear of other liens and otherwise in compliance with specified
standards. Conseco Finance's asset-based revolving credit facilities are
secured by the assets which constitute the borrowing base against which the
loan availability amount is calculated and, occasionally, by other personal
property, mortgages or other assets of the borrower. Asset-Based Receivables
are generally not supported by any Floorplan Agreement with a manufacturer, and
for that reason generally have significantly lower advance rates than a
borrowing agreement supported by a Floorplan Agreement with a Manufacturer.

    Conseco Finance's underwriting of Asset-Based Receivables gives
consideration to a variety of factors, including, among others, the financial
condition of the borrowing entity, its credit history and relationship with
current and previous lenders and its historical performance and trends. Upon
satisfaction of certain credit criteria, terms and conditions, an account is
approved for a revolving line of credit, the size of which is based on a
variety of factors including the needs of the borrower.

    Upon approval of the credit, Conseco Finance performs an evaluation of the
borrowing base and establishes advance rates based on the type of collateral.
For purposes of evaluating items such as finished goods inventory, work-in-
process, raw materials and component parts, Conseco Finance may obtain an
independent appraisal for use in establishing advance rates. With respect to
accounts receivable, Conseco Finance establishes eligibility criteria,
typically excluding items past due in excess of 60 days or aged over 120 days
from invoice date, and concentration limits with respect to the individual
items within the receivables base. Next, Conseco Finance determines an advance
rate on eligible receivables based on a review of historical and projected
data, giving consideration to factors such as credit loss experience, dilution,
contingent sales and aged items. The intended result of the above analyses is
to set eligibility criteria and advance rates such that, under a collateral
liquidation scenario, Conseco Finance would fully recover any principal dollars
advanced on the revolving line of credit.

    The credit facilities giving rise to the Asset-Based Receivables may also
provide for control of all cash receipts of the borrower through a bank lockbox
facility. The adequacy of

                                       28
<PAGE>

the borrowing base is monitored weekly and audited quarterly. Collateral
inspections may occur on a more frequent basis. In addition, the financial
condition of the borrower is monitored in connection with financial covenants
set forth in the loan agreements, and is subject to audit by Conseco Finance at
any time. In cases in which Conseco Finance is a co-lender with other lenders
one of which is a lead lender, the lead lender may perform such monitoring.

Realization on the Receivables

    Upon any default by a Dealer of its obligations to Conseco Finance under
the related financing agreement and expiration of any and all applicable notice
and cure periods that may have been agreed to between Conseco Finance and that
Dealer, Conseco Finance may declare that Dealer's obligations immediately due
and payable and enforce all of its legal rights and remedies, including
commencement of proceedings to realize upon any collateral, subject to
prevailing standards of commercial reasonableness and good faith. Upon learning
of such a default relating to Floorplan Receivables, Conseco Finance makes
contact with the Dealer to determine whether it can develop a workout
arrangement with the Dealer to cure all defaults. If disputes with the Dealer
exist, these disputes may be submitted to arbitration. If Conseco Finance
determines that this arrangement to cure a default cannot be successfully
implemented, it accelerates the Dealer's payment obligations. Conseco Finance
then attempts to obtain possession of the collateral. If a manufacturer is
obligated to repurchase the collateral under a Floorplan Agreement as described
above under "Floorplan Agreements with Manufacturers," Conseco Finance turns
the collateral over to the related manufacturer. Conseco Finance repossesses,
stores and then attempts to sell all other salable collateral in a commercially
reasonable manner. See "The Accounts--Loss Experience."

    Upon default by the borrower under an Asset-Based Receivable revolving
credit arrangement, which, among other conditions, may arise as a result of the
borrower's failure to comply with certain specified debt covenants or failure
to maintain an adequate borrowing base to support outstanding balances, Conseco
Finance will continue its ongoing assessment of the borrower's financial
condition and determine its best course of action for purposes of obtaining
repayment, including the possibility of immediate liquidation of all
collateral.

                                THE RECEIVABLES

    The receivables conveyed to the Trust (the "Receivables") represent the
amounts owed from time to time under the revolving financing arrangements (the
"Accounts"). The Accounts were selected from Conseco Finance's portfolio of
accounts on the basis of criteria set forth in the Pooling and Servicing
Agreement as applied on December 1, 1995 (the "Cut-off Date") and, with respect
to Accounts designated after the Cut-off Date ("Additional Accounts"), as of
the related date of their designation (collectively the "Trust Portfolio").
Most of the Accounts were originated by subsidiaries of Conseco Finance.
Subject to certain limitations in the Pooling and Servicing Agreement, the
Transferor has the right, and in some circumstances will be obligated, to
designate from time to time Additional Accounts and to transfer to the Trust
all Receivables arising from such Additional Accounts,

                                       29
<PAGE>

whether such Receivables are then existing or thereafter created. Conseco
Finance expects to transfer Receivables in Additional Accounts to the
Transferor, which will transfer such Receivables to the Trust, as Conseco
Finance's commercial finance business continues to grow. Any Additional
Accounts must be Eligible Accounts as of the date the Transferor designates
such accounts as Additional Accounts. Furthermore, subject to certain
limitations in the Pooling and Servicing Agreement, the Transferor has the
right to designate certain Accounts as Removed Accounts and to require the
Trustee to reconvey all Receivables in such Removed Accounts to the Transferor,
whether such Receivables are then existing or thereafter created. The Accounts
from which the Receivables arise will be the Accounts designated by the
Transferor on the Cut-off Date plus any Additional Accounts minus any Removed
Accounts. Pursuant to the Pooling and Servicing Agreement, the Transferor will
represent and warrant to the Trust that, as of the date Receivables are
conveyed to the Trust, such Receivables meet certain eligibility requirements.
See "Description of the Offered Certificates--Representations and Warranties."

Eligible Receivables and Eligible Accounts

    The Receivables must arise under an Eligible Account. An "Eligible Account"
is defined to mean, as of the Cut-off Date (or, with respect to Additional
Accounts, as of their date of designation for inclusion in the Trust), an
arrangement to provide a revolving extension of credit by Conseco Finance or
one of its subsidiaries to a Dealer (i) in order to finance the purchase by a
Dealer of consumer and commercial product inventory or (ii) as a line of credit
secured by unencumbered assets of such Dealer, which extension of credit, as of
the date of determination thereof,

  (a) is in existence and maintained with Conseco Finance or such
      subsidiary,

  (b) is payable in United States dollars,

  (c) is with a Dealer whose most recent billing address is in the United
      States or its territories or possessions,

  (d) has been originated by Conseco Finance or such subsidiary in the
      ordinary course of its business or acquired by Conseco Finance through
      the acquisition of an Eligible Account from another lender upon
      satisfying Conseco Finance's customary underwriting standards,

  (e) in respect of which no amounts have been charged off by Conseco
      Finance or such subsidiary as uncollectible in its customary and usual
      manner as of the Cut-off Date (or, with respect to Additional
      Accounts, as of their date of designation for inclusion in the Trust),
      and

  (f) is with a Dealer that is not involved in insolvency proceedings.

The definition of Eligible Account may be changed by amendment to the Pooling
and Servicing Agreement without the consent of the Certificateholders if (i)
the Transferor delivers to the Trustee a certificate of an authorized officer
to the effect that, in the reasonable belief of the Transferor, such amendment
will not as of the date of such amendment adversely affect in any material
respect the interest of the Certificateholders, and

                                       30
<PAGE>

(ii) such amendment will not result in a withdrawal or reduction of the rating
of any outstanding Series issued by the Trust.

    An "Eligible Receivable" is defined as a Receivable

  (a) that was originated by Conseco Finance or one of its subsidiaries in
      the ordinary course of business or acquired by Conseco Finance through
      the acquisition of an Eligible Account from another lender upon
      satisfying Conseco Finance's customary underwriting standards,

  (b) that has arisen under an Eligible Account,

  (c) that was created in compliance with all requirements of law applicable
      thereto and pursuant to a floorplan or asset-based financing agreement
      that complies with all requirements of law applicable thereto,

  (d) with respect to which all consents, licenses or authorizations of, or
      registrations with, any governmental authority required to be obtained
      or given by Conseco Finance or such subsidiary or the Transferor in
      connection with the creation of such Receivable, or the transfer
      thereof to the Trust or the execution, delivery, creation and
      performance by Conseco Finance or such subsidiary of the related
      floorplan or asset-based financing agreement have been duly obtained
      or given and are in full force and effect as of the date of the
      creation of such Receivable,

  (e) as to which, at the time of its creation, the Transferor had good and
      marketable title free and clear of all liens and security interests
      (other than certain liens permitted pursuant to the Pooling and
      Servicing Agreement), and at all times following the transfer of such
      Receivables to the Trust, the Trust will have good and marketable
      title free and clear of all liens and security interests (other than
      certain liens permitted pursuant to the Pooling and Servicing
      Agreement) or the grant of a first priority security interest therein,

  (f) that is the legal, valid, binding and assignable payment obligation of
      the related Dealer, legally enforceable against such Dealer in
      accordance with its terms (with certain bankruptcy related
      exceptions),

  (g) that constitutes "chattel paper," an "account" or a "general
      intangible" under Article 9 of the UCC as then in effect in the State
      of Minnesota,

  (h) if such Receivable has the benefit of a Floorplan Agreement with a
      manufacturer, such Floorplan Agreement provides, subject to the
      specific terms thereof and any limitations therein (which may vary
      among Floorplan Agreements), that the manufacturer is obligated to
      repurchase the products securing the Receivables upon the Servicer's
      repossession thereof upon the related Dealer's default,

  (i) which has been the subject of a valid transfer and assignment from the
      Transferor to the Trust of all the Transferor's interest therein and
      in the related Collateral Security (including any proceeds thereof),


                                       31
<PAGE>

  (j) which at the time of transfer to the Trust is not subject to any right
      of rescission, setoff, or any other defense (including defenses
      arising out of violations of usury laws) of the Dealer,

  (k) as to which, at the time of transfer of such Receivable to the Trust,
      Conseco Finance (or such subsidiary) and the Transferor have satisfied
      all their respective obligations with respect to such Receivable
      required to be satisfied at such time,

  (l) as to which, at the time of transfer of such Receivable to the Trust,
      neither Conseco Finance (or such subsidiary) nor the Transferor has
      taken or failed to take any action which would impair the rights of
      the Trust or the certificateholders therein, and

  (m) which represents the obligation of a Dealer to repay an advance made
      to or on behalf of such Dealer to finance products or the accounts
      receivable arising from the sale of such products.

In addition, participation interests described above under "Conseco Finance
Corp. and Its Commercial Lending Division--Participations in Floorplan
Receivables" and Receivables described above under "Conseco Finance Corp. and
Its Commercial Lending Division--Participation Arrangements" will be
Receivables.

    The products financed by the receivables in Conseco Finance's portfolio as
of      , 2000 are shown below under "The Accounts--Description of Conseco
Finance's Portfolio." Currently, substantially all of the Floorplan Receivables
are owed by manufactured housing, recreational vehicle, marine product
(primarily boats, outboard motors and boat trailers), lawn and garden
equipment, aircraft, motorcycle and truck dealers. These Receivables enable
dealers to finance their inventory pending resale to consumers. Conseco Finance
expects that it will establish Accounts for other Dealers in the future, whose
related Receivables will finance other types of products. The Asset-Based
Receivables generally arise under revolving credit facilities for
manufacturers, retailers and distributors of various products. Conseco Finance
expects that the composition of the Receivables will change over time.

    In order to reduce the Trust's exposure to any single Dealer or any single
industry, certain diversification thresholds ("Overconcentration Amounts") will
be tested at the end of each Monthly Period. Initially, the Overconcentration
Amounts will be as follows:

  .   no more than   % of the Receivables may be Asset-Based Receivables

  .   no more than  % (or, with respect to certain designated Dealers,  %)
      of the Receivables may have arisen under an Account with a single
      Dealer

  .   no more than   % (or, with respect to certain designated
      manufacturers, up to   %) of the Receivables may be Floorplan
      Receivables financing products from a single manufacturer

  .   no more than  % of the Receivables may be Floorplan Receivables
      financing marine products


                                       32
<PAGE>

  .   no more than   % of the Receivables may be Floorplan Receivables
      financing recreational vehicles

  .   no more than   % of the Receivables may be Floorplan Receivables
      financing lawn and garden equipment

  .   no more than   % of the Receivables may be Floorplan Receivables
      financing products other than manufactured housing, marine products,
      recreational vehicles, or lawn and garden equipment.

    Conseco Finance expects that the Receivables will from time to time exceed
one or more of these thresholds. To the extent that any such threshold is
exceeded at the end of a month, the Class D Invested Amount will be increased
by an equivalent amount. These threshold percentages may, however, be increased
or decreased in the future without the consent of any Certificateholder, to a
level acceptable to each rating agency referred to under "Summary of Terms"
(each, a "Rating Agency") without any reduction or withdrawal of its rating of
the Class A Certificates or Class B Certificates. See "Description of the
Offered Certificates--The Overconcentration Amounts."

                                  THE ACCOUNTS

General

    The Receivables have arisen or will arise in the Accounts. The Accounts
were selected from all the accounts that were Eligible Accounts (the "Eligible
Portfolio") at the Cut-off Date or, in the case of Additional Accounts, as of
the date of their designation. Eligible Accounts, including Additional
Accounts, are described under "The Receivables--Eligible Receivables and
Eligible Accounts" and "Description of the Offered Certificates--
Representations and Warranties" and "--Addition of Accounts."

Description of Conseco Finance's Portfolio

    The following tables set forth the composition of the receivables in
Conseco Finance's servicing portfolio of revolving credit agreements, as of
    , 2000, by business line and other criteria. Because Conseco Finance
expects to designate Additional Accounts from time to time, the business lines
and the actual composition of the Receivables in the Trust Portfolio by
business line are expected to change over time. In addition, due to the
variability and uncertainty with respect to the rates at which Receivables in
the Trust Portfolio are created, paid or otherwise reduced, the characteristics
set forth below may vary significantly as of any other date of determination.
Percentages may not add to 100% due to rounding.

    In general, Conseco Finance considers any number of revolving financing
arrangements established with a group of affiliated Dealers to be a single
account, because the affiliated Dealers represent a consolidated credit risk.
However, Conseco Finance also measures its exposure to Dealers in various
industries. For this purpose Conseco Finance would, for example, consider
revolving financing arrangements with a group of affiliated dealers

                                       33
<PAGE>

engaged in sales of manufactured housing and recreational vehicles to be
separate accounts, one relating to a group of manufactured housing dealers and
one relating to a group of recreational vehicle dealers. Accordingly, the total
number of Accounts in the tables below may vary.

 Composition of Receivables in Conseco Finance's Portfolio by Business Line as
                                of       , 2000

<TABLE>
<CAPTION>
                                                                 Percentage of
                                                  Receivables     Receivables
Business Line                                       Balance         Balance
-------------                                  ----------------- -------------
<S>                                            <C>               <C>
Manufactured Housing Floorplan Receivables.... $                          %
Recreational Vehicle Floorplan Receivables....
Marine Floorplan Receivables..................
Motorcycle Floorplan Receivables..............
Aircraft Floorplan Receivables................
Truck Floorplan Receivables...................
Trailer Floorplan Receivables.................
Real Estate...................................
Lawn and Garden Equipment.....................
Asset-Based Receivables.......................
                                               -----------------    ------
  Total....................................... $                    100.00%(1)
                                               =================    ======
</TABLE>
--------
(1) The sum of the individual Receivables balance percentages may not total
    100.00% due to rounding.

Composition of Receivables in Conseco Finance's Portfolio by Account Balance as
                                of       , 2000

<TABLE>
<CAPTION>
                                           Percentage of           Percentage
                            Receivables     Receivables  Number of  of Number
Account Balance Range         Balance         Balance    Accounts  of Accounts
---------------------    ----------------- ------------- --------- -----------
<S>                      <C>               <C>           <C>       <C>
$0 to $100,000.......... $                          %                      %
$100,000.01 to
 $500,000...............
$500,000.01 to
 $1,000,000.............
$1,000,000.01 to
 $5,000,000.............
$5,000,000.01 to
 $10,000,000............
Over $10,000,000........
                         -----------------    ------       -----     ------
  Total................. $                    100.00%                100.00%
                         =================    ======       =====     ======
</TABLE>

                                       34
<PAGE>

  Geographic Distribution of Receivables in Conseco Finance's Portfolio as of
                                       , 2000

<TABLE>
<CAPTION>
                                             Percentage of           Percentage
                              Receivables     Receivables  Number of  of Number
Dealer Location(1)              Balance         Balance    Accounts  of Accounts
------------------         ----------------- ------------- --------- -----------
<S>                        <C>               <C>           <C>       <C>
     ..................... $                          %                      %
     .....................
     .....................
     .....................
     .....................
     .....................
     .....................
     .....................
     .....................
     .....................
     .....................
Other States (2)..........
                           -----------------    ------       -----     ------
  Total................... $                    100.00%                100.00%
                           =================    ======       =====     ======
</TABLE>
--------
(1) For purposes of this table, the Dealer's location is based on the Dealer's
    headquarters address rather than the actual location of the Dealer's place
    of business. For purposes of this table, the accounts of affiliated Dealers
    have not been aggregated. This table excludes Dealers with Receivables of
    less than $5.00.
(2) The percentage of the Receivables balance represented by Receivables in
    each state not specifically listed is less than 3% of the Receivables
    balance.

Yield Information

    The Receivables bear interest in their accrual periods at rates generally
equal to an index rate selected in the related financing agreement, which as of
the date hereof is generally a prime rate, plus a margin. Some Receivables do
not bear interest for a specified period after their origination. During the
[   ] months ended       , 2000, the receivables in Conseco Finance's portfolio
had a yield of   % per annum. The Trust's yield on its Receivables will be
affected by the interest rates borne by Receivables, the Discount Factor, if
any, and the rate at which the Receivables balances are paid.

Major Customers; Major Manufacturers

    At       , 2000, no one Floorplan Dealer accounted for more than    % of
the aggregate balance of the Receivables in Conseco Finance's portfolio. At
      , 2000, except as discussed below, no one manufacturer was obligated
under Floorplan Agreements relating to receivables in Conseco Finance's
portfolio aggregating more than    % of the aggregate receivables balance. [At
     , 2000, Fleetwood Enterprises, Inc. and Champion Enterprises, Inc. were
obligated under their Floorplan Agreements with Conseco Finance with respect to
receivables aggregating    % and    %, respectively, of Conseco Finance's
portfolio, and aggregating    % and    %, respectively, of the Receivables
owned by the Trust.] No prediction can be made as to what percentage of the
Receivables in the future may be obligations of a single Dealer or be related
to a single manufacturer under its Floorplan Agreement. Such percentages are

                                       35
<PAGE>

subject to the effect of Overconcentration Amounts. See "Description of the
Offered Certificates--The Overconcentration Amounts."

Delinquency Experience

    The following table sets forth the delinquency experience as of the dates
indicated for Conseco Finance's Floorplan portfolio. Because Conseco Finance's
portfolio has grown rapidly in the past year, and Conseco Finance expects to
create a substantial number of Additional Accounts that will be transferred to
the Trust in the future, the actual delinquency experience with respect to the
Receivables may be different. There can be no assurance that the delinquency
experience for the Receivables in the future will be similar to the experience
shown below.

   Delinquency Experience for the Floorplan Portfolio(1) Receivables Balance
                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                         December 31, December 31, December 31, December 31, December 31,  December
                             1995         1996         1997         1998         1999      31, 2000
                         ------------ ------------ ------------ ------------ ------------ -----------
<S>                      <C>          <C>          <C>          <C>          <C>          <C>
Aggregate Principal
 Balance................   $539,615    $1,022,534   $1,496,433   $1,989,985   $           $
SAU/NSF (2).............      1,558         1,319        1,447        3,413
SAU/NSF as a Percentage
 of Aggregate Principal
 Balance................       0.29%         0.13%        0.10%        0.17%           %            %
</TABLE>
--------
(1) Excludes Asset-Based Receivables.
(2) A "SAU/NSF" Receivable is one that is deemed delinquent when (i) there is
    an unpaid receivable balance as to which the related product has been sold
    and such receivable balance has not been paid by the related Dealer or (ii)
    a payoff check from the related Dealer has been returned because of
    insufficient funds.

Loss Experience

    The following table sets forth Conseco Finance's average principal
receivables balance and loss experience for each of the periods shown with
respect to its portfolio. Because Conseco Finance's portfolio has grown rapidly
in the past three years, and Conseco Finance expects to create a substantial
number of Additional Accounts that will be designated for the Trust in the
future, actual loss experience with respect to the Receivables may be
different. Since a substantial number of receivables from which the Receivables
will be taken were only recently originated, it may be expected that such
receivables have not yet exhibited a loss experience that is representative of
the losses that may be experienced over a longer period of time. There can be
no assurance that the loss experience for the Receivables in the future will be
similar to the historical experience set forth below with respect to the
portfolio. The historical experience set forth below includes the effect of the
financial obligations of manufacturers in respect of repossessed products as
described above under "Conseco Finance Corp. and Its Commercial Lending
Division--Floorplan Agreements with Manufacturers." If Manufacturers are not
able to perform such obligations in the future, the loss experience in respect
of the portfolio and the Receivables may be adversely affected.

                                       36
<PAGE>

               Loss Experience for the Conseco Finance Portfolio
                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                            Twelve       Twelve       Twelve       Twelve       Twelve       Twelve
                         Months Ended Months Ended Months Ended Months Ended Months Ended Months Ended
                         December 31, December 31, December 31, December 31, December 31, December 31,
                             1995         1996         1997         1998         1999         2000
                         ------------ ------------ ------------ ------------ ------------ ------------
<S>                      <C>          <C>          <C>          <C>          <C>          <C>
Average Principal
 Receivables Balance
 (1)....................   $380,226    $1,048,260   $1,657,940   $2,319,637   $            $
Gross Losses............         24           612        1,667        1,045
Recoveries..............                     (104)        (239)        (221)
Net Losses (Recoveries)
 (2)....................         24           508        1,428          824
Net Losses (Recoveries)
 as a percentage of
 Average Principal
 Receivables Balance....      0.006%        0.049%       0.086%       0.036%           %            %
</TABLE>
--------
(1) Average Principal Receivables Balance is the average daily principal
    balances for the twelve months ended December 31, 1995, 1996, 1997, 1998,
    1999 and 2000, respectively.
(2) Net losses (recoveries) in any period are gross losses less recoveries for
    that period. Recoveries include recoveries from collateral security in
    addition to recoveries from the products.

Aging Experience

    The following table provides the age distribution of inventory for all
dealers in the Floorplan portfolio, as a percentage of total principal
outstanding at the date indicated. Because the Eligible Accounts will only be a
portion of the entire portfolio, actual age distribution with respect to the
Eligible Accounts may be different.

                Age Distribution for the Floorplan Portfolio(1)
                               as of       , 2000

<TABLE>
<CAPTION>
                                                                   Percentage of
                                                     Receivables    Receivables
                                                       Balance        Balance
                                                    -------------- -------------
<S>                                                 <C>            <C>
Days
 0-90.............................................. $                       %
 91-180............................................
 181-365...........................................
 366-730...........................................
 Over 731..........................................
                                                    --------------    ------
  Total............................................ $                 100.00%
                                                    ==============    ======
</TABLE>
--------
(1) Excludes Asset-Based Receivables.

                                       37
<PAGE>

                            MATURITY CONSIDERATIONS

    Unless a Pay Out Event has occurred, principal of the Class A Certificates
is expected to be paid on the Distribution Date (as defined herein) in
(the "Class A Scheduled Payment Date"), and principal of the Class B
Certificates is expected to be paid on the Distribution Date in       (the
"Class B Scheduled Payment Date"). If the Class A Invested Amount is not
reduced to zero on the Class A Scheduled Payment Date, principal will be paid
to the Class A Certificateholders on each Distribution Date thereafter until
the earlier of the date on which the Class A Invested Amount has been paid in
full and       (the "Series 2001-1 Termination Date"). After the Class A
Invested Amount has been paid in full, principal will be paid to the Class B
Certificateholders on each Distribution Date until the earlier of the date on
which the Class B Invested Amount has been paid in full or the Series 2001-1
Termination Date.

    Controlled Accumulation Period. The determination of the "Controlled
Accumulation Period" is described under "Description of the Offered
Certificates--Postponement of Controlled Accumulation Period." It will start no
earlier than       and no later than      . On each business day during the
Controlled Accumulation Period, Principal Collections (as defined herein)
allocable to the Class A, Class B and Class C Certificates, Shared Principal
Collections (as defined herein), if any, from other Series available to Series
2001-1 and certain other available amounts will be deposited into the Principal
Account (as defined herein) until that account contains an amount (the
"Controlled Deposit Amount") equal to the sum of (i) the Controlled
Accumulation Amount for the related Monthly Period and (ii) the Accumulation
Shortfall, if any, for that Monthly Period. A "Monthly Period" is a calendar
month. The "Controlled Accumulation Amount" is the amount that, if accumulated
for each month in the Controlled Accumulation Period, will equal the initial
Class A Invested Amount. The "Accumulation Shortfall" for a Monthly Period is
the amount by which the Controlled Deposit Amount for the prior Monthly Period
exceeds the amount actually deposited into the Principal Account during that
prior Monthly Period.

    At the end of the Controlled Accumulation Period, we expect that there will
be enough funds in the Principal Account to distribute the entire Class A
Invested Amount to the Class A Certificateholders on the Class A Scheduled
Payment Date and the entire Class B Invested Amount to the Class B
Certificateholders on the Class B Scheduled Payment Date. Although we
anticipate that the Trust will be able to make these accumulations and
distributions within that time frame, we cannot assure you that the Trust will
accumulate enough principal to pay these amounts on these dates.

    Early Amortization Period. If a Pay Out Event occurs, the "Early
Amortization Period" will commence and any amounts on deposit in the Principal
Account will be paid to the Class A Certificateholders on the Distribution Date
in the month following the commencement of the Early Amortization Period. In
addition, payments of principal equal to the Principal Collections allocable to
the Class A, Class B and Class C Certificateholders' Interest plus Shared
Principal Collections, if any, from other Series allocable to the Class A,
Class B and Class C Certificates, plus certain other amounts comprising
Class A, Class B

                                       38
<PAGE>

and Class C Principal, will distributed on each Distribution Date in the
following order of priority:

  (1)   to the Class A Certificateholders until the Class A Invested Amount
        is reduced to zero;

  (2)  to the Class B Certificateholders until the Class B Invested Amount
       is reduced to zero;

  (3) to the Class C Certificateholders until the Class C Invested Amount is
      reduced to zero; and

  (4)  to the Class D Certificateholders until the Class D Invested Amount
       is reduced to zero.

    If a Pay Out Event occurs with respect to the Series 2001-1 Certificates
prior to the payment in full of the Series 1998-2 and Series 1999-1
Certificates, Series 2001-1 Certificateholders will receive no allocations of
principal (other than funds then on deposit in the Pre-Funding Account) until
the Series 1998-2 and Series 1999-1 Certificates are paid in full or funds in
respect thereof have been deposited in the Principal Account. In addition,
funds in the Pre-Funding Account will be released to the Transferor as funds
are deposited in the Principal Account for Series 1998-2 and Series 1999-1. If
a Pay Out Event occurs with respect to Series 2001-1 before the payment in full
of Series 1998-2 and Series 1999-1, Series 1998-2 and Series 1999-1 will
receive the funds on deposit in the Principal Account for Series 1998-2 and
Series 1999-1, but Series 2001-1 would not have a corresponding amount of funds
in the Pre-Funding Account.

    A "Pay Out Event" occurs, either automatically or after specified notice,
upon

  (1)   failure by the Transferor to convey Receivables in Additional
        Accounts to the Trust within five Business Days after the day on
        which it is required to convey such Receivables pursuant to the
        Pooling and Servicing Agreement;

  (2)  failure on the part of the Transferor, the Servicer or Conseco
       Finance, as applicable,

     (a) to make any payment or deposit required by the Pooling and
         Servicing Agreement or the Purchase Agreement, on or before the
         date such payment or deposit is required to be made therein, which
         failure is not cured within five business days after written
         notice from the Trustee of such failure; or

     (b) to deliver a Distribution Date statement as required under the
         Pooling and Servicing Agreement within ten business days after
         written notice from the Trustee of such failure; or

     (c) to comply with its covenant not to create any lien on a Receivable
         which failure has a material adverse effect on the holders of the
         Certificates and which continues unremedied for a period of 60
         days after written notice to it; provided, however, that any Pay
         Out Event shall not be deemed to have

                                       39
<PAGE>

         occurred if the Transferor shall have repurchased the related
         Receivables or, if applicable, all the Receivables during such
         period in accordance with the provisions of the Pooling and
         Servicing Agreement; or

     (d) to observe or perform in any material respect any other covenants
         or agreements set forth in the Pooling and Servicing Agreement or
         the Purchase Agreement, which failure has a materially adverse
         effect on the Certificateholders and which continues unremedied
         for a period of 45 days after written notice of such failure;

  (3)  any representation or warranty made by Conseco Finance in the
       Purchase Agreement or by the Transferor in the Pooling and Servicing
       Agreement or any information required to be given by the Transferor
       to the Trustee to identify the Accounts proves to have been incorrect
       in any material respect when made and continues to be incorrect in
       any material respect for a period of 60 days after written notice and
       as a result the interests of the Certificateholders are materially
       and adversely affected (excluding, however, any representation or
       warranty made by the Transferor that the Pooling and Servicing
       Agreement constitutes, or the transfer of the Receivables to the
       Trust is, a valid sale, transfer and assignment to the Trust of all
       right, title and interest of the Transferor in the Receivables and
       the Collateral Security (as defined herein) if the Pooling and
       Servicing Agreement constitutes the grant of a security interest in
       the Receivables and Collateral Security); provided, however, that any
       Pay Out Event shall not be deemed to occur thereunder if the
       Transferor has repurchased the related Receivables or all such
       Receivables, if applicable, during such period in accordance with the
       provisions of the Pooling and Servicing Agreement;

  (4)   the occurrence of certain events of bankruptcy, insolvency or
        receivership relating to Conseco Finance or the Transferor;

  (5)    the Trust or the Transferor becomes an investment company within
         the meaning of the Investment Company Act of 1940, as amended;

  (6)   any Servicer Default (as defined herein) occurs;

  (7)  on any Determination Date, the average of the Monthly Payment Rates
       for the three preceding Monthly Periods, where the Monthly Payment
       Rate for a Monthly Period is the percentage obtained by dividing the
       aggregate of the Receivables balances (without deducting therefrom
       any discount portion) collected during such Monthly Period by the
       average daily aggregate Receivables balance (without deducting
       therefrom any discount portion) for such Monthly Period, is less than
         %;

  (8) the failure to pay the outstanding principal amount of the Class A or
      Class B Certificates by the Class A Scheduled Payment Date or the
      Class B Scheduled Payment Date, as applicable;

  (9)   the ratio (expressed as a percentage) of (i) the average for each
        month of the net losses on the Receivables (exclusive of the
        Ineligible Receivables (as defined herein)) owned by the Trust
        (i.e., gross losses less recoveries on any such

                                      40
<PAGE>

      Receivables (including, without limitation, recoveries from collateral
      security in addition to recoveries from the products, recoveries from
      manufacturers and insurance proceeds)) during any three consecutive
      calendar months to (ii) the average of the month-end aggregate
      balances of such Receivables (without deducting therefrom the discount
      portion) for such three-month period, exceeds  % on an annualized
      basis;

  (10)  the sum of all Cash Equivalents and amounts on deposit in the Excess
        Funding Account represents more than 50% of the sum of the aggregate
        amount of Principal Receivables (without deducting therefrom any
        discount portion) on each of six or more consecutive Determination
        Dates, after giving effect to all payments made or to be made on the
        Distribution Date next succeeding each such respective Determination
        Date; or

  (11) if Principal Collections allocable to the Class D Certificateholder's
       Interest have been reallocated in any Monthly Period to cover any
       Required Amounts and have not been reimbursed as of the Determination
       Date in such Monthly Period.

    A "Determination Date" is the second Business Day preceding a Distribution
Date.

    The amount of new Receivables generated in any month and payment rates on
the Receivables may vary because of seasonal variations in product sales and
inventory levels, retail incentive programs provided by product manufacturers
and various economic factors affecting product sales generally. The following
table sets forth the monthly payment rates ("MPR") for the receivables
originated by Conseco Finance from Dealers for each month since January 1995
and the average monthly payment rates for such receivables for all months
during the periods shown, in each case calculated by dividing the total
collections during a given month by total opening monthly balances of such
receivables during the periods shown and expressing such amounts as a
percentage. The payment rates shown in the table reflect payments on Floorplan
Receivables only. As of       , 2000, approximately     % of the receivables
in Conseco Finance's portfolio were Asset-Based Receivables.

                                      41
<PAGE>

                    Monthly Payment Rates for the Portfolio

<TABLE>
<CAPTION>
                                                           Payment Rate
                                                   ----------------------------------
Month                                              1995  1996  1997  1998  1999  2000
-----                                              ----  ----  ----  ----  ----  ----
<S>                                                <C>   <C>   <C>   <C>   <C>   <C>
January...........................................  22%   20%   17%   16%   15%     %
February..........................................  19    19    17    18    16
March.............................................  24    23    22    21    21
April.............................................  25    27    23    24    20
May...............................................  28    26    24    22    20
June..............................................  29    25    25    26    22
July..............................................  29    27    28    26    21
August............................................  33    28    25    25    22
September.........................................  28    26    26    25
October...........................................  30    26    26    25
November..........................................  28    23    22    22
December..........................................  24    21    22    21
                                                   ---   ---   ---   ---   ---   ---
Average...........................................  26%   24%   23%   23%   20%     %
                                                   ===   ===   ===   ===   ===   ===
</TABLE>

    The amount of collections on Receivables may vary from month to month due
to seasonal fluctuations in sales of the products securing the Receivables and
other factors. There can be no assurance that Principal Collections with
respect to the Trust, and thus the rate at which funds are deposited in the
Principal Account during the Controlled Accumulation Period, will be similar to
the historical experience set forth above. If a Pay Out Event occurs, the
average life and maturity of the Class A Certificates and the Class B
Certificates (the "Offered Certificates") could be significantly reduced.
Certificateholders will bear the risk of being able to reinvest principal
received on the Certificates at a yield at least equal to their yield on the
Certificates. If an investor acquires a Certificate at a discount, the
repayment of principal on the Certificate later than on the related Scheduled
Payment Date will likely result in a lower than anticipated yield. In addition,
if an investor acquires a Certificate at a premium, repayment of principal
earlier than the related Scheduled Payment Date will result in a yield to that
investor that is lower than anticipated by that investor.

                                       42
<PAGE>

                                USE OF PROCEEDS

    The net proceeds from the sale of the Offered Certificates, expected to be
$       , will be paid by the Underwriters directly to the Transferor. The
Transferor will apply such net proceeds to reduce the principal amount of the
Series 1998-2 and Series 1999-1 Certificates, to pay the purchase price of
Receivables and to fund the Pre-Funding Account (as defined herein) to the
extent of the Pre-Funded Amount (as defined herein).

                    DESCRIPTION OF THE OFFERED CERTIFICATES

    The Offered Certificates will be issued pursuant to the Pooling and
Servicing Agreement and the Series 2001-1 Supplement. Pursuant to the Pooling
and Servicing Agreement, the Transferor and the Trustee have executed
Supplements for the Series 1995-1 Certificates (which have been paid), the
Series 1996-1 Certificates, the Series 1996-2 Certificates (which have been
retired), the Series 1998-1 Certificates (which will be retired by April 2001),
the Series 1998-A Certificates (which have been retired), the Series 1998-2
Certificates and the Series 1999-1 Certificates, as summarized in Annex B, and
may execute additional Supplements in order to issue additional Series.

General

    The Offered Certificates will represent undivided interests in certain
assets of the Trust, including the right to the investor allocation percentage
of all payments on the Receivables in the Trust. Each Class A Certificate and
Class B Certificate represents the right to receive payments of interest at the
Class A Certificate Rate (as defined herein) or the Class B Certificate Rate
(as defined herein), as the case may be, funded from Series Available Interest
Collections (as defined herein) and the right to receive payments of principal
on or after the Class A Scheduled Payment Date or the Class B Scheduled Payment
Date, as applicable, in each case funded from Principal Collections allocated
to the Class A, Class B and Class C Certificateholders' Interests.

    The Transferor will own the Exchangeable Transferor Certificate and the
Class D Certificates and may either own or privately sell the Class C
Certificates. The "Exchangeable Transferor Certificate" will represent an
undivided interest in the Trust, including the right to a percentage (the
"Transferor Percentage") of all payments on the Receivables in the Trust equal
to 100% minus the sum of the applicable investor allocation percentages (which
shall not exceed 100%) for all Series of certificates then outstanding. See "--
Certain Matters Regarding the Transferor and the Servicer."

    The "Invested Amount" is the sum of the Class A Invested Amount, the Class
B Invested Amount, the Class C Invested Amount and the Class D Invested Amount
(each as defined herein). The "Certificateholders' Interest" is the interest in
the Trust's assets allocated to the holders of the Certificates (the
"Certificateholders"). The "Transferor Interest" is the Transferor's rights in
the assets of the Trust not allocated to the Series 2001-1 Certificateholders'
interest or the interest of the holders of certificates of any other

                                       43
<PAGE>

Series pursuant to the Pooling and Servicing Agreement and the applicable
Series supplements thereto. During the Revolving Period (as defined herein),
the amount of the Invested Amount will remain constant except under certain
limited circumstances. See "--Defaulted Receivables" and "--The
Overconcentration Amounts." The amount of Principal Receivables in the Trust,
however, will vary each day as new Receivables arise in the Accounts and other
Receivables are paid. The amount of the Transferor Interest (or the amount in
the Excess Funding Account (as defined herein), if necessary) will fluctuate
each day, therefore, to reflect the changes in the amount of the Principal
Receivables in the Trust, except to the extent another Series absorbs such
change. During the Controlled Accumulation Period or an Early Amortization
Period, dealer payments of Principal Receivables will be collected and
distributed to the Certificateholders. As a result, except to the extent
another Series (which may be a Companion Series (as defined herein)) absorbs
such change, the Transferor Interest will generally increase as principal
payments are made to certificateholders of a Series, reducing the invested
amount of such Series. The Transferor Interest will also change to reflect the
variations in the amount of the Principal Receivables in the Trust. The
Transferor Interest may be reduced as the result of an Exchange. See""--
Exchanges."


    Each Class of Offered Certificates initially will be represented by
certificates registered in the name of the nominee of The Depository Trust
Company ("DTC" and, together with any successor depository selected by the
Transferor, the "Depository"), except as set forth below. Beneficial interests
in each Class of Offered Certificates will be available for purchase in minimum
denominations of $1,000 and integral multiples of $1,000 in excess thereof in
book-entry form only. The Transferor has been informed by DTC that DTC's
nominee will be Cede & Co. Accordingly, Cede & Co. is expected to be the holder
of record of the Offered Certificates. Unless and until Definitive Certificates
are issued under the limited circumstances described herein, no beneficial
owner of a Certificate (a "Certificate Owner") acquiring an interest in any
Class of Offered Certificates will be entitled to receive a certificate
representing such Certificate Owner's interest in such Certificates. Until such
time, all references herein to actions by Certificateholders of any Class of
Offered Certificates will refer to actions taken by the Depository upon
instructions from its participating organizations ("DTC Participants" or
"Participants") and all references herein to distributions, notices, reports,
and statements to Certificateholders of any Class of Offered Certificates will
refer to distributions, notices, reports, and statements to the Depository or
its nominee, as the registered holder of the Offered Certificates of such
Class, for distribution to Certificate Owners of such Class in accordance with
the Depository's procedures. See""--Book-Entry Registration" and "--Definitive
Certificates."

Book-Entry Registration

    With respect to each Class of Offered Certificates in book-entry form,
Certificateholders may hold their Certificates through DTC (in the United
States) or Clearstream or Euroclear (in Europe), if they are participants of
such systems, or indirectly through organizations that are participants in such
systems.


                                       44
<PAGE>

    Cede & Co. as nominee for DTC, will hold the global certificates.
Clearstream and Euroclear will hold omnibus positions on behalf of the
Clearstream Participants and the Euroclear Participants, respectively, through
customers' securities accounts in Clearstream's and Euroclear's names on the
books of their respective depositaries (collectively, the "Depositaries") which
in turn will hold such positions in customers' securities accounts in the
Depositaries' names on the books of DTC.

    DTC is a limited-purpose trust company organized under the New York Banking
Law, 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 New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Exchange Act. DTC
holds securities for its Participants and facilitates the clearance and
settlement among Participants of securities transactions, such as transfers and
pledges, in deposited securities through electronic book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement of
securities certificates. Participants include securities brokers and dealers,
banks, trust companies, clearing corporations, and certain other organizations.
Indirect access to the DTC system is also available to others such as
securities brokers and dealers, banks, and trust companies that clear through
or maintain a custodial relationship with a Participant, either directly or
indirectly ("Indirect Participants"). The rules applicable to DTC and its
Participants are on file with the Commission.

    Transfers between DTC Participants will occur in accordance with DTC rules.
Transfers between Clearstream Participants and Euroclear Participants will
occur in the ordinary way in accordance with their applicable rules and
operating procedures.

    Cross-market transfers between persons holding directly or indirectly
through DTC in the United States, on the one hand, and directly or indirectly
through Clearstream Participants or Euroclear Participants on the other, will
be effected in DTC in accordance with DTC rules on behalf of the relevant
European international clearing system by its Depositary; however, such cross-
market transactions will require delivery of instructions to the relevant
European international clearing system by the counterparty in such system in
accordance with its rules and procedures and within its established deadlines
(European time). The relevant European international clearing system will, if
the transaction meets its settlement requirements, deliver instructions to its
Depositary to take action to effect final settlement on its behalf by
delivering or receiving securities in DTC, and making or receiving payment in
accordance with normal procedures for same-day funds settlement applicable to
DTC. Clearstream Participants and Euroclear Participants may not deliver
instructions directly to the Depositaries.

    Because of time-zone differences, credits of securities in Clearstream or
Euroclear as a result of a transaction with a DTC Participant will be made
during the subsequent securities settlement processing, dated the business day
following the DTC settlement date, and such credits or any transactions in such
securities settled during such processing will be reported to the relevant
Clearstream Participant or Euroclear Participant on such business day. Cash
received in Clearstream or Euroclear as a result of sales of securities by or
through a

                                       45
<PAGE>

Clearstream Participant or a Euroclear Participant to a DTC Participant will be
received with value on the DTC settlement date but will be available in the
relevant Clearstream or Euroclear cash account only as of the business day
following settlement in DTC.

    Purchases of Offered Certificates under the DTC system must be made by or
through Participants, which will receive a credit for the Offered Certificates
on DTC's records. The ownership interest of each actual Certificate Owner is in
turn to be recorded on the Participants' and Indirect Participants' 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 Offered Certificates are to be accomplished by entries made on
the books of Participants acting on behalf of Certificate Owners. Certificate
Owners will not receive certificates representing their ownership interest in
Offered Certificates, except in the event that use of the book-entry system for
the Offered Certificates is discontinued.

    To facilitate subsequent transfers, all Offered Certificates deposited by
Participants with DTC are registered in the name of DTC's partnership nominee,
Cede & Co. The deposit of Offered Certificates with DTC and their registration
in the name of Cede & Co. effects no change in beneficial ownership. DTC has no
knowledge of the actual Certificate Owners; DTC's records reflect only the
identity of the Participants to whose accounts such Offered Certificates are
credited, which may or may not be the Certificate Owners. The 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.

    Neither DTC nor Cede & Co. will consent or vote with respect to the Offered
Certificates. Under its usual procedures, DTC mails an omnibus proxy to the
issuer as soon as possible after the record date, which assigns Cede & Co.'s
consenting or voting rights to those Participants to whose accounts the Offered
Certificates are credited on the record date (identified in a listing attached
thereto).

    Principal and interest payments on the Offered Certificates will be made to
DTC. DTC's practice is to credit Participants' accounts on the Distribution
Date in accordance with their respective holdings shown on DTC's records unless
DTC has reason to believe that it will not receive payment on the Distribution
Date. Payments by 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 Participant and not of DTC, the
Trustee or the Transferor, subject to any statutory or regulatory requirements
as may be in effect from time to time. Payment of principal and interest to DTC
is the responsibility of the Trustee, disbursement of such payments to
Participants shall be the responsibility of

                                       46
<PAGE>

DTC, and disbursement of such payments to the Certificate Owners shall be the
responsibility of Participants and Indirect Participants.

    DTC may discontinue providing its services as securities depository with
respect to the Offered Certificates at any time by giving reasonable notice to
the Transferor or the Trustee. Under such circumstances, in the event that a
successor securities depository is not obtained, Definitive Certificates are
required to be printed and delivered. The Transferor may decide to discontinue
use of the system of book-entry transfers through DTC (or a successor
securities depository). In that event, Definitive Certificates will be printed
and delivered.

    Clearstream is incorporated under the laws of Luxembourg as a limited
liability company. Clearstream holds securities for its participating
organizations, which are called Clearstream Participants, and facilitates the
clearance and settlement of securities transactions between Clearstream
Participants through electronic book-entry changes in accounts of Clearstream
Participants, thereby eliminating the need for physical movement of
certificates. Transactions may be settled in Clearstream in any of 28
currencies, including United States dollars. Clearstream provides to its
Clearstream Participants, among other things, services for safekeeping,
administration, clearance and settlement of internationally traded securities
and securities lending and borrowing. Clearstream interfaces with domestic
markets in several countries. As a professional depository, Clearstream is
subject to regulation by the Luxembourg Monetary Institute. Clearstream
Participants are recognized financial institutions around the world, including
underwriters, securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations and may include the underwriter.
Indirect access to Clearstream is also available to others, such as banks,
brokers, dealers and trust companies that clear through or maintain a custodial
relationship with a Clearstream Participant, either directly or indirectly.

    The Euroclear System (the "Euroclear System") was created in 1968 to hold
securities for participants of the Euroclear System ("Euroclear Participants")
and to clear and settle transactions between Euroclear Participants through
simultaneous electronic book-entry delivery against payment, thereby
eliminating the need for physical movement of certificates and any risk from
lack of simultaneous transfers of securities and cash. Transactions may now be
settled in any of 32 currencies, including United States dollars. The Euroclear
System includes various other services, including securities lending and
borrowing and interfaces with domestic markets in several countries generally
similar to the arrangements for cross-market transfers with DTC described
above. The Euroclear System is operated by Morgan Guaranty Trust Company of New
York, Brussels, Belgium office (the "Euroclear Operator" or "Euroclear"), under
contract with Euroclear Clearance System, S.C., a Belgian cooperative
corporation (the "Cooperative"). All operations are conducted by the Euroclear
Operator, and all Euroclear securities clearance accounts and Euroclear cash
accounts are accounts with the Euroclear Operator, not the Cooperative. The
Cooperative establishes policy for the Euroclear system on behalf of Euroclear
Participants. Euroclear Participants include banks (including central banks),
securities brokers and dealers and other professional financial intermediaries
and may include the underwriters of any Series of Certificates. Indirect access
to the Euroclear System is also available to other firms that clear

                                       47
<PAGE>

through or maintain a custodial relationship with a Euroclear Participant,
either directly or indirectly.

    The Euroclear Operator is the Belgian branch of a New York banking
corporation which is a member bank of the Federal Reserve System. As such, it
is regulated and examined by the Board of Governors of the Federal Reserve
System and the New York State Banking Department, as well as the Belgian
Banking Commission.

    Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Terms and Conditions Governing Use of Euroclear and the
related Operating Procedures of the Euroclear System and applicable Belgian law
(collectively, the "Terms and Conditions"). The Terms and Conditions govern
transfers of securities and cash within the Euroclear System, withdrawal of
securities and cash from the Euroclear System, and receipts of payments with
respect to securities in the Euroclear System. All securities in the Euroclear
System are held on a fungible basis without attribution of specific
certificates to specific securities clearance accounts. The Euroclear Operator
acts under the Terms and Conditions only on behalf of Euroclear Participants
and has no record of or relationship with persons holding through Euroclear
Participants.

    Distributions with respect to Offered Certificates held through Clearstream
or Euroclear will be credited to the cash accounts of Clearstream Participants
or Euroclear Participants in accordance with the relevant system's rules and
procedures, to the extent received by its Depositary. Such distributions will
be subject to tax reporting in accordance with relevant United States tax laws
and regulations. Clearstream or the Euroclear Operator, as the case may be,
will take any other action permitted to be taken by a Certificateholder under
the related Pooling and Servicing Agreement on behalf of a Clearstream
Participant or a Euroclear Participant only in accordance with its relevant
rules and procedures and subject to its Depositary's ability to effect such
actions on its behalf through DTC.

    Although DTC, Clearstream and Euroclear have agreed to the foregoing
procedures in order to facilitate transfers of Offered Certificates among
participants of DTC, Clearstream and Euroclear, they are under no obligation to
perform or continue to perform such procedures and such procedures may be
discontinued at any time.

Definitive Certificates

    Each Class of Offered Certificates will be issued in such registered,
certificated form to the Certificate Owners of such Class or their nominees
("Definitive Certificates"), rather than to the Depository or its nominee, only
if (i) the Transferor advises the Trustee in writing that the Depository is no
longer willing or able to discharge properly its responsibilities as Depository
with respect to the Offered Certificates of such Class, and the Trustee or the
Transferor is unable to locate a qualified successor, (ii) the Transferor, at
its option, advises the Trustee in writing that it elects to terminate the
book-entry system through the Depository, or (iii) after the occurrence of a
Servicer Default, Certificate Owners representing not less than 50% of the
Invested Amount of such Class advise the Trustee and the Depository through
Participants in writing that the continuation of a book-entry system through
the Depository is no longer in the best interest of the Certificate Owners of
such Class.


                                       48
<PAGE>

    Upon the occurrence of any of the events described in the immediately
preceding paragraph, the Depository is required to notify all Participants of
the availability through the Depository of Definitive Certificates. Upon
surrender by the Depository of the definitive certificate representing the
Offered Certificates of the affected Class and instructions for registration,
the Trustee will issue the Offered Certificates of such Class as Definitive
Certificates, and thereafter the Trustee will recognize the holders of such
Definitive Certificates as Certificateholders under the Pooling and Servicing
Agreement.

    Distribution of principal and interest on the Offered Certificates will be
made by the Trustee directly to Certificateholders in accordance with the
procedures set forth herein and in the Pooling and Servicing Agreement.
Interest payments and any principal payments on each Distribution Date will be
made to Certificateholders in whose names the Definitive Certificates were
registered at the close of business on the related Record Date. Distributions
will be made by check mailed to the address of such Certificateholder as it
appears on the register maintained by the Trustee. The final payment on any
Offered Certificate, however, will be made only upon presentation and surrender
of such Certificate at the office or agency specified in the notice of final
distribution to Certificateholders. The Trustee will provide such notice to
registered Certificateholders mailed not later than the fifth day of the month
of such final distributions.

    Definitive Certificates will be transferable and exchangeable at the
offices of the transfer agent and registrar, which initially will be the
Trustee (in such capacity, the "Transfer Agent and Registrar"). No service
charge will be imposed for any registration of transfer or exchange, but the
Transfer Agent and Registrar may require payment of a sum sufficient to cover
any tax or other governmental charge imposed in connection therewith. The
Transfer Agent and Registrar will not be required to register the transfer or
exchange of Definitive Certificates for the period from the Record Date
preceding the due date for any payment to the Distribution Date with respect to
such Definitive Certificates.

    If Definitive Certificates are issued, such Definitive Certificates will be
transferable and exchangeable at the offices of the transfer agent and such co-
transfer agents. In the event of the transfer of less than all the Invested
Amount represented by a Definitive Certificate, the transfer agent or such co-
transfer agent, as applicable, will issue a new Definitive Certificate to the
transferor thereof representing the Invested Amount not so transferred. The
Trustee may take appropriate steps to contact the remaining Certificateholders
regarding the surrender of their Certificates, and the cost thereof will be
paid out of the fund held by the Trustee for benefit of such
Certificateholders. The Trustee and the Paying Agent will pay to the Transferor
upon request any monies held by them for the payment of principal or interest
which remains unclaimed for two years. After payment to the Transferor,
Investor Certificateholders entitled to the money must look to the Transferor
for payment as general creditors unless an applicable abandoned property law
designates another Person.

Replacement of Definitive Certificates

    In the event that Definitive Certificates are issued, a Class A or a Class
B Certificate that is mutilated, destroyed, lost or stolen may be exchanged or
replaced at the offices of the

                                       49
<PAGE>

co-transfer agent and co-registrar in Luxembourg upon presentation of the
Certificate or satisfactory evidence of its destruction, loss or theft to the
co-transfer agent and co-registrar. An indemnity satisfactory to the co-
transfer agent and co-registrar and the Trustee may be required at the expense
of the Class A or the Class B Certificateholder before a replacement Class A or
Class B Certificate will be issued. The Class A or the Class B
Certificateholder will be required to pay any tax or other governmental charge
imposed in connection with such exchange or replacement and any other expenses
(including the fees and expenses of the Trustee and the co-transfer agent and
co-registrar).

Interest Payments

    Interest on the respective outstanding balance of each Class of Offered
Certificates will accrue at the applicable certificate rate and will be payable
on the 13th day of each month, or if such day is not a business day, on the
next succeeding business day (each a "Distribution Date"), beginning on       ,
2001. A "Business Day" is any day other than a Saturday or Sunday or another
day on which banking institutions in New York, New York, London, England or
Luxembourg are authorized or obligated by law or executive order to be closed.
Interest will accrue from and including the preceding Distribution Date (or, in
the case of the first Distribution Date, from and including the Closing Date)
to but excluding such Distribution Date (each, an "Interest Accrual Period")
and will be calculated on the basis of the actual number of days in the related
Interest Accrual Period divided by 360 days.

    Interest on the outstanding principal balance of the Class A Certificates
will accrue for each Interest Accrual Period at the "Class A Certificate Rate,"
which shall equal the lesser of (i) LIBOR (calculated as described below)
determined as of the second LIBOR business day prior to such Interest Accrual
Period (or, in the case of the first Distribution Date, determined as of
      , 2001 for the period from      , 2001 up to but excluding       , 2001)
plus   % per annum or (ii) the Net Receivables Rate (described below). Interest
on the outstanding principal balance of the Class B Certificates will accrue
for each Interest Accrual Period at the "Class B Certificate Rate," which shall
equal the lesser of (i) LIBOR determined as of the second LIBOR business day
prior to such Interest Accrual Period (or, in the case of the first
Distribution Date, determined as of       , 2001 for the period from       ,
2001 up to but excluding       , 2001) plus   % per annum or (ii) the Net
Receivables Rate.

    The "Class C Certificate Rate" will be the lesser of (i) LIBOR plus   % per
annum and (ii) the Net Receivables Rate. The "Class D Certificate Rate" will be
the lesser of (i) LIBOR plus   % per annum and (ii) the Net Receivables Rate.

    On the second London Banking Day prior to the Interest Reset date (as
defined herein) for such Interest Accrual Period (a "LIBOR Determination
Date"), until the Series 2001-1 Termination Date, the Trustee will determine
the rate for deposits in United States dollars for the applicable Index
Maturity, commencing on such Interest Reset Date, which appears on Telerate
Page 3750 as of 11:00 a.m., London time, on the LIBOR Determination Date. If
such rate does not appear on Telerate Page 3750, the rate for the LIBOR
Determination

                                       50
<PAGE>

Date will be determined on the basis of the rates at which deposits in United
States dollars are offered by the Reference Banks (as defined herein) at
approximately 11:00 a.m., London time, on that day to prime banks in the London
interbank market for the applicable Index Maturity. The Trustee will request
the principal London office in each of the Reference Banks to provide a
quotation of its rate. If at least two such quotations are provided, the rate
for such LIBOR Determination Date will be the arithmetic mean of the quotations
(rounded upward to the nearest 0.015625%). If fewer than two quotations are
provided as requested, the rate for such LIBOR Determination Date will be the
arithmetic mean (rounded upward to the nearest 0.015625%) of the rates quoted
by major banks in New York City, selected by the Servicer, at approximately
11:00 a.m., New York City time, on that date for loans in United States dollars
to leading European banks for the applicable Index Maturity; provided, however,
that if the Trustee is unable to determine a rate in accordance with one of the
procedures described above, LIBOR shall be LIBOR as determined on the most
recent LIBOR Determination Date. For purposes of calculating LIBOR, "London
Banking Day" means any business day on which dealings in deposits in United
States dollars are transacted in the London interbank market, "Telerate Page
3750" means the display page currently so designated on the Dow Jones Telerate
Service (or such other page as may replace that page on that service for the
purpose of displaying comparable rates or prices), and "Reference Banks" means
three major banks in the London interbank market selected by the Servicer.

    The "Net Receivables Rate" for a Distribution Date is (1) the weighted
average of the interest rates borne by the Receivables during the second
preceding Monthly Period (because interest payments on the Receivables at such
rates will be due and payable in the Monthly Period preceding such Distribution
Date), plus (2) the product of (x) the Monthly Payment Rate for the Monthly
Period preceding such Distribution Date, (y) the Discount Factor (as defined
herein), if any, for such Distribution Date and (z) twelve, less 1% per annum
if Conseco Finance or an affiliate is the Servicer, or 2% per annum if Conseco
Finance or an affiliate is not the Servicer, unless the Monthly Servicing Fee
has been waived for such Monthly Period. The "Monthly Payment Rate" for a
Monthly Period is the percentage equivalent of a fraction, the numerator of
which is the aggregate of the Receivables balance (without deducting therefrom
the discount portion, if any) collected during such Monthly Period and the
denominator of which is the average daily aggregate Receivables balance
(without deducting therefrom the discount portion, if any) for such Monthly
Period.

    The Class A Certificate Rate and the Class B Certificate Rate applicable to
the then current and immediately preceding Interest Accrual Period may be
obtained by telephoning the Trustee at its Corporate Trust Office at (612) 667-
4959. If the Offered Certificates are listed on the Luxembourg Stock Exchange,
the Trustee will cause the Class A Certificate Rate and the Class B Certificate
Rate applicable to an Interest Accrual Period to be provided to the Luxembourg
Stock Exchange as soon as possible after its determination but in no event
later than the first day of such Interest Accrual Period. If the Offered
Certificates are listed on the Luxembourg Stock Exchange, the Trustee will
publish or cause to be published in the Luxemburger Wort, as soon as possible
after determination, the Certificate Rates for the Interest Accrual Period
commencing on such Distribution Date, as well as the length of such Interest
Accrual Period and the aggregate amount of interest payable on the Class A

                                       51
<PAGE>

Certificates and the Class B Certificates on the following Distribution Date,
and will provide notice thereof to the Luxembourg Stock Exchange.

Principal Payments

    The "Revolving Period" begins on the Closing Date and ends on the day
before the earlier of (1) the commencement of the Controlled Accumulation
Period or (2) the occurrence of a Pay Out Event. During the Revolving Period,
no principal payments will be made to the Certificateholders. During the
Controlled Accumulation Period, principal will be deposited in the Principal
Account on each business day and such amounts will be distributed to the Class
A Certificateholders on the Class A Scheduled Payment Date, then to the Class B
Certificateholders on the Class B Scheduled Payment Date, then to the Class C
Certificateholders until the Class C Invested Amount (as defined herein) is
paid in full, and finally to the Class D Certificateholders until the Class D
Invested Amount (as defined herein) is paid in full. The amount of principal
deposited in the Principal Account during each Monthly Period during the
Controlled Accumulation Period will not exceed the Controlled Deposit Amount.
See "--Pay Out Events" for a discussion of events which would cause the
commencement of the Early Amortization Period prior to the first day of the
Controlled Accumulation Period. See "--Application of Collections" for a
discussion of the method by which Principal Collections are allocated during
the Controlled Accumulation Period.

    Principal Collections for any Monthly Period during the Controlled
Accumulation Period allocated to the Class A, Class B and Class C
Certificateholders' Interests will first be used to cover, with respect to such
Monthly Period, required deposits into the Principal Account for the benefit of
the Class A Certificateholders. On and after the date on which an amount equal
to the Class A Invested Amount has been deposited in the Principal Account,
Principal Collections for any Monthly Period allocated to the Class A, Class B
and Class C Certificateholders' Interests will first be used to cover required
deposits into the Principal Account for the benefit of the Class B
Certificateholders. On and after the date on which an amount equal to the Class
B Invested Amount has been deposited in the Principal Account, Principal
Collections for any Monthly Period allocated to the Class A, Class B and Class
C Certificateholders' Interests will first be used to cover required deposits
into the Principal Account for the benefit of the Class C Certificateholders.
The Servicer will determine the amount of Principal Collections for any
business day allocated to the Class A, Class B and Class C Certificateholders'
Interests that remain after covering required deposits or payments of principal
to the Certificateholders and any similar amount remaining with respect to
certificates of any other Series (other than amounts allocated to Transferor
Retained Classes) (collectively, "Shared Principal Collections"). The Servicer
will allocate the Shared Principal Collections to cover any scheduled or
permitted principal distributions to certificateholders and deposits to
principal funding accounts, if any, for any Series that have not been covered
out of the Principal Collections allocable to such Series and certain other
amounts ("Principal Shortfalls"). Shared Principal Collections will not be used
to cover investor charge-offs for any Series. If Principal Shortfalls exceed
Shared Principal Collections on any business day, Shared Principal Collections
will be allocated pro rata

                                       52
<PAGE>

among the applicable Series based on the relative amounts of their Principal
Shortfalls. To the extent that Shared Principal Collections exceed Principal
Shortfalls, the balance will, subject to certain limitations, be paid to the
holder of the Exchangeable Transferor Certificate.

Postponement of Controlled Accumulation Period

    The Controlled Accumulation Period is currently expected to commence at the
close of business on     . However, the date on which the Controlled
Accumulation Period actually commences may be delayed if the Accumulation
Period Length is less than the number of months remaining between the Period
Length Determination Date and the Class A Scheduled Payment Date. On      , the
Servicer will determine the "Accumulation Period Length." The "Accumulation
Period Length" will be one, two, three or four months and will be calculated as
the product, rounded upwards to the nearest integer, of (a) four and (b) a
fraction, the numerator of which is the Invested Amount as of       (after
giving effect to all changes therein on such date) and the denominator of which
is the sum of such Invested Amount and the invested amounts as of       (after
giving effect to all changes therein on such date) of all other outstanding
Series whose respective revolving periods are not scheduled to end before the
last day of the       Monthly Period. Depending on whether the Accumulation
Period Length is one month, two months, three months or four months, the
"Accumulation Period Commencement Date" will be the first day of the
Monthly Period, the       Monthly Period, the       Monthly Period or the
Monthly Period, respectively. Notwithstanding the foregoing, the Accumulation
Period Commencement Date will be       if, prior to such date, any other
outstanding Series has entered into an early amortization period. The effect of
the foregoing calculation is to reduce the Accumulation Period Length based on
the invested amounts of other Series that are scheduled to be in their
revolving periods and thus scheduled to create Shared Principal Collections
during the Controlled Accumulation Period.

Interest Collections; Principal Collections

    The Servicer will allocate the aggregate amount of Collections available in
the Collection Account (or shall instruct the Trustee to so allocate from
amounts on deposit in the Collection Account if all Collections are being
deposited therein as described below under "--Application of Collections--
Allocations") on each business day to Interest Collections and Principal
Collections. "Collections" are payments in respect of the Receivables,
including proceeds from any Collateral Security. "Interest Collections" are
calculated as the sum of (A) all collections of interest and other fees on the
Receivables, (B) all Imputed Yield Collections (if a Discount Factor is then in
effect), (C) investment earnings on amounts on deposit in the Trust Accounts
(as defined herein) on such business day and (D) Recoveries on such business
day. The Transferor may designate as interest collections ("Imputed Yield
Collections") a percentage (the "Discount Factor") of the amount of Receivables
arising after that designation that would otherwise be Principal Receivables.
The Discount Factor, if any, may vary from time to time (subject to the
limitations set forth in the Series 2001-1 Supplement), and initially will be
zero. "Principal

                                       53
<PAGE>

Collections" are Collections other than Interest Collections. "Trust Accounts"
include the Interest Funding Account, the Principal Account, the Distribution
Account, the Collection Account, the Excess Funding Account and the Pre-Funding
Account (each as defined under "--Trust Accounts"). "Recoveries" are amounts
received by the Servicer in respect of Receivables that were previously
charged-off as uncollectible in accordance with its customary servicing
procedures.

Subordination of the Class B Certificates

    The Class B Certificates will be subordinated to the extent necessary to
fund certain payments with respect to the Class A Certificates. To the extent
the Class B Invested Amount is reduced, the percentage of Interest Collections
allocated to the Class B Certificateholders will be reduced. Moreover, to the
extent the amount of such reduction in the Class B Invested Amount is not
reimbursed, the amount of principal distributable to the Class B
Certificateholders will be reduced.

    The Class C Certificates will be subordinated to the extent necessary to
fund certain payments with respect to the Class A Certificates and the Class B
Certificates. To the extent the Class C Invested Amount is reduced, the
percentage of Interest Collections allocated to the Class C Certificateholders
will be reduced. Moreover, to the extent the amount of such reduction in the
Class C Invested Amount is not reimbursed, the amount of principal
distributable to the Class C Certificateholders will be reduced.

    If, on any Determination Date, the aggregate Investor Default Amount (as
defined herein), if any, for each business day in the preceding Monthly Period
exceeds the sum of

  (a) the aggregate amount of Series Available Interest Collections applied
      to the payment thereof as described in clauses (iv) and (v) of "--
      Application of Collections--Payment of Fees, Interest, and Other
      Items,"

  (b) the amount of Excess Interest Collections allocated thereto as
      described in "--Reallocation of Cash Flows," and

  (c) the amount of Reallocated Principal Collections allocated with respect
      thereto as described in "--Reallocated Principal Collections,"

then the Class D Invested Amount will be reduced by the amount by which the
aggregate Investor Default Amount exceeds the amount applied with respect
thereto during the preceding Monthly Period. Such reductions of the Class D
Invested Amount will thereafter be reimbursed and the Class D Invested Amount
increased on each business day by the amount, if any, of Series Available
Interest Collections and Excess Interest Collections allocated and available
for that purpose. The Class D Invested Amount will initially be $      , will
be reduced to $       on the Distribution Date on which Series 1998-2 and
Series 1999-1 are paid in full and may be adjusted under the circumstances
described under "--The Overconcentration Amounts" below.

    If any reduction of the Class D Invested Amount would cause the Class D
Invested Amount to be a negative number, the Class D Invested Amount will be
reduced to zero and

                                       54
<PAGE>

the Class C Invested Amount will be reduced by the amount by which the Class D
Invested Amount would have been reduced below zero, but not more than the
remaining aggregate Investor Default Amount for the preceding Monthly Period.
Such reductions of the Class C Invested Amount will thereafter be reimbursed
and the Class C Invested Amount increased during the Monthly Period by the
amount, if any, of such Series Available Interest Collections and Excess
Interest Collections for such business day allocated and available for that
purpose.

    If any reduction of the Class C Invested Amount would cause the Class C
Invested Amount to be a negative number, the Class C Invested Amount will be
reduced to zero and the Class B Invested Amount will be reduced by the amount
by which the Class C Invested Amount would have been reduced below zero, but
not more than the remaining aggregate Investor Default Amount for such Monthly
Period. Such reductions of the Class B Invested Amount will thereafter be
reimbursed and the Class B Invested Amount increased on each business day by
the amount, if any, of Series Available Interest Collections and Excess
Interest Collections for such business day allocated and available for that
purpose.

    If the Class B Invested Amount is reduced to zero, the Class A Invested
Amount will be reduced by the amount by which the Class B Invested Amount would
have been reduced below zero, but not more than the remaining aggregate
Investor Default Amount for such Monthly Period. Such reductions of the Class A
Invested Amount will thereafter be reimbursed and the Class A Invested Amount
increased on each business day by the amount, if any, of Series Available
Interest Collections and Excess Interest Collections allocated and available
for that purpose.

    See "--Reallocation of Cash Flows," "--Reallocated Principal Collections"
and "--Investor Charge-Offs."

Transfer and Assignment of Receivables and Collateral Security

    Pursuant to the Purchase Agreement, Conseco Finance has contributed and
sold to the Transferor all of its interest in the outstanding Receivables and
the related Collateral Security, all the Receivables and the related Collateral
Security arising in the Accounts from time to time thereafter, and the proceeds
of all of the foregoing. Pursuant to the Pooling and Servicing Agreement, the
Transferor has transferred and assigned to the Trust all of its interest in the
outstanding Receivables and the related Collateral Security and all the
Receivables and the related Collateral Security arising in the Accounts from
time to time thereafter. The "Collateral Security" is the security interest in
the assets securing a Receivable.

    Conseco Finance, for itself and as Servicer, will identify in its computer
files that the Receivables have been assigned to the Trust. Conseco Finance, as
Servicer, will retain and will not deliver to the Trustee any other records or
agreements relating to the Receivables. The records and agreements relating to
the Receivables will not be segregated from those relating to other accounts
and receivables of Conseco Finance and the physical documentation relating to
the Receivables will not be stamped or marked to reflect the

                                       55
<PAGE>

transfer of the Receivables to the Trust. The Trustee will have reasonable
access to such records and agreements as required by applicable law or to
enforce the rights of the Certificateholders. Conseco Finance has filed one or
more UCC-1 financing statements in accordance with the Uniform Commercial Code
to perfect the Transferor's interest in the Receivables and the proceeds
thereof, as applicable. The Transferor has filed one or more UCC-1 financing
statements in accordance with applicable state law to perfect the Trust's
interest in the Receivables and the proceeds thereof. The UCC-1 financing
statements that perfect Conseco Finance's (or the relevant subsidiary's)
security interest in the Collateral Security will not be amended to reflect
such transfers. See "Risk Factors" and "Certain Legal Aspects of the
Receivables."

Exchanges; Creation of New Series

    The Pooling and Servicing Agreement provides for the Trustee to issue two
types of certificates: (1) one or more Series of certificates, each of which
may have one or more classes, and (2) the Exchangeable Transferor Certificate.
The Exchangeable Transferor Certificate will evidence the Transferor Interest,
will initially be held by the Transferor, and will be transferable only as
provided in the Pooling and Servicing Agreement. The Pooling and Servicing
Agreement also provides that, pursuant to any one or more supplements (each, a
"Supplement") to the Pooling and Servicing Agreement, the holder of the
Exchangeable Transferor Certificate may tender such certificate, or the
Exchangeable Transferor Certificate and the certificates evidencing any Series
of certificates, to the Trustee in exchange for one or more new Series and a
reissued Exchangeable Transferor Certificate (an "Exchange"). Under the Pooling
and Servicing Agreement, the holder of the Exchangeable Transferor Certificate
may define for any newly issued Series certain terms including:

  (1)    its name or designation;

  (2)   its initial invested amount (or method for calculating such amount);

  (3)   its certificate rate (or the method of allocating interest payments
        or other cash flows to such Series);

  (4)   the closing date;

  (5)    the rating agency or agencies, if any, rating the Series;

  (6)   the interest payment date or dates and the date or dates from which
        interest shall accrue;

  (7)   the name of the clearing agency, if any;

  (8)   the method for allocating collections to certificateholders of such
        Series with respect to Principal Collections, Interest Collections,
        and Defaulted Receivables (as defined herein) and the method by
        which the principal amount of such Series will amortize or accrue;

  (9)   the names of any accounts to be used by such Series and the terms
        governing the operation of any such accounts;

                                       56
<PAGE>

  (10)    the percentage used to calculate monthly servicing fees;

  (11)    the Minimum Transferor Interest (as defined herein);

  (12)   the credit enhancement provider, if applicable, and the terms of
         any credit enhancement with respect to such Series;

  (13)  the base rate applicable to such Series;

  (14)   the terms on which the certificates of such Series may be
         repurchased or remarketed to other investors;

  (15)    the termination date of such Series;

  (16)   any deposit into any account provided for such Series;

  (17)  the number of classes of such Series and, if more than one class,
        the rights and priorities of each such class;

  (18)  the fees, if any, to be included in funds available to
        certificateholders in such Series;

  (19)   the subordination, if any, of such new Series with respect to any
         other Series;

  (20)    the rights, if any, of the holder of the Exchangeable Transferor
          Certificate that have been transferred to the holders of such
          Series;

  (21)   the pool factor (consisting of a seven-digit decimal expressing the
         ratio of the invested amount to the initial invested amount);

  (22)  whether such Series will be part of a group or subject to being
        paired with any other prefunded Series;

  (23)  whether such Series will be prefunded; and

  (24)  any other relevant terms, including whether or not such Series will
        be pledged as collateral for an issuance of any other securities,
        including commercial paper

(all such terms, the "Principal Terms" of such Series).

    None of the Transferor, the Servicer, the Trustee, or the Trust is required
or intends to obtain the consent of any Certificateholder to issue any
additional Series or in connection with the determination of the Principal
Terms thereof. However, as a condition of an Exchange, the holder of the
Exchangeable Transferor Certificate will deliver to the Trustee written
confirmation that the Exchange will not result in any Rating Agency reducing or
withdrawing its rating of any outstanding Series, including the Offered
Certificates. The Transferor may offer any Series to the public or other
investors in transactions either registered under the Securities Act of 1933,
as amended (the "Securities Act") or exempt from registration thereunder,
directly, through one or more underwriters or placement agents, in fixed-price
offerings, in negotiated transactions, or otherwise. Any such Series may be
issued in fully registered or book-entry form in minimum denominations
determined by the Transferor. The Transferor currently intends to offer, from
time to time, additional Series.


                                       57
<PAGE>

    The Pooling and Servicing Agreement provides that the holder of the
Exchangeable Transferor Certificate may perform Exchanges and define the
Principal Terms of each Series, including the period during which amortization
of the principal amount thereof is intended to occur, which period may have a
different length and begin on a different date than such period for any other
Series. Accordingly, one or more Series may be in their amortization periods
while other Series are not. Moreover, any Series may have the benefit of a
credit enhancement that is available only to that Series. Under the Pooling and
Servicing Agreement, the Trustee will hold any such form of credit enhancement
only on behalf of the Series with respect to which it relates. Likewise, with
respect to each such form of credit enhancement, the holder of the Exchangeable
Transferor Certificate may deliver a different form of credit enhancement
agreement. The Pooling and Servicing Agreement also provides that the holder of
the Exchangeable Transferor Certificate may specify different coupon rates and
monthly servicing fees with respect to each Series or a particular class within
such Series. Collections allocated to Interest Receivables not used to pay
interest on the certificates, the monthly servicing fee, the investor default
amount, or investor charge-offs with respect to any Series will be allocated as
provided in such credit enhancement agreement, if applicable. The holder of the
Exchangeable Transferor Certificate also has the option under the Pooling and
Servicing Agreement to vary between Series the terms upon which a Series or a
particular class within such Series may be repurchased by the Transferor or
remarketed to other investors. Additionally, certain Series may be subordinated
to other Series, and classes within a Series may have different priorities. The
Series 2001-1 Supplement does not permit the subordination of the Certificates
to any other Series that may be issued by the Trust (except to the limited
extent described herein with respect to Shared Principal Collections and Excess
Interest Collections). There is no limit to the number of Exchanges that may be
performed under the Pooling and Servicing Agreement.

    An Exchange may occur only upon the satisfaction of certain conditions
provided in the Pooling and Servicing Agreement. The holder of the Exchangeable
Transferor Certificate may perform an Exchange by notifying the Trustee at
least five business days in advance of the date upon which the Exchange is to
occur. The notice will state the designation of any Series to be issued on the
date of the Exchange and the following:

  (1)   its initial principal amount (or method for calculating such
        amount),

  (2)  its certificate rate (or the method of allocating interest payments
       or other cash flows to such Series), and

  (3) the provider of the credit enhancement, if any, which is expected to
      provide credit support with respect to it.

    The Pooling and Servicing Agreement provides that on the date of the
Exchange, the Trustee will authenticate any such Series only upon delivery to
the Trustee of the following:

  (1)   a Supplement to the Pooling and Servicing Agreement specifying the
        Principal Terms of such Series,

                                       58
<PAGE>

  (2)  an opinion of counsel to the effect that the certificates of such
       Series will be characterized as indebtedness or as partnership
       interests under existing law for federal and applicable state income
       tax purposes and that the issuance of such Series will not materially
       adversely affect the federal income tax characterization of any
       outstanding Series, including Series 2001-1, or result in the trust
       being subject to tax at the entity level for federal or applicable
       state tax purposes,

  (3) if required by such Supplement, the form of credit enhancement and an
      appropriate credit enhancement agreement with respect thereto executed
      by the Transferor and the issuer of the credit enhancement,

  (4)  written confirmation from each Rating Agency that the Exchange will
       not result in such Rating Agency's reducing or withdrawing its rating
       on any then-outstanding Series rated by it, including Series 2001-1,

  (5)   the existing Exchangeable Transferor Certificate and, if applicable,
        the certificates representing the Series to be exchanged, and

  (6)  an officer's certificate of the Transferor stating that, after giving
       effect to such Exchange, (a) the Transferor Interest would be at
       least equal to the Minimum Transferor Interest, and (b) taking into
       account the certificates of the newly issued Series, more than 20%
       (by Invested Amount and by value) of the outstanding certificates
       issued by the Trust with respect to which no opinion of counsel was
       issued that the applicable class would be treated as debt for federal
       income tax purposes (including the Exchangeable Transferor
       Certificate and each Transferor Retained Class) shall, by their
       terms, be prohibited from being transferred.

    Under the Pooling and Servicing Agreement, the Transferor may also exchange
the Exchangeable Transferor Certificate for a newly issued Exchangeable
Transferor Certificate and a second certificate (a "Supplemental Certificate")
the terms of which will be defined in a Supplement upon the satisfaction of
certain conditions provided in the Pooling and Servicing Agreement.

Representations and Warranties

    The Transferor has made and will make representations and warranties to the
Trust relating to the Accounts, the Receivables and the Collateral Security to
the effect, among other things, that

  (1) as of the Cut-off Date, the Closing Date and the date of issuance of
      any other Series (a "Series Issuance Date") (or, in the case of an
      Additional Account, as of the date of its designation for inclusion in
      the Trust and the date the related Receivables are transferred to the
      Trust (an "Addition Date")), each Account or Additional Account was or
      is an Eligible Account or, if it was or is an Ineligible Account on
      such date, such Account is being removed from the Trust in accordance
      with the requirements of the Pooling and Servicing Agreement,

                                       59
<PAGE>

  (2) as of the Cut-off Date (or as of the specified cut-off date, in the
      case of any Additional Accounts) or as of the date any Receivable is
      generated (a "Receivables Transfer Date"), each Receivable is an
      Eligible Receivable,

  (3) each Receivable and all Collateral Security conveyed to the Trust on
      the Closing Date and on each Receivables Transfer Date or, in the case
      of Additional Accounts, on the Addition Date, and all of the
      Transferor's right, title and interest in the Purchase Agreement, have
      been conveyed to the Trust free and clear of any liens, and

  (4) all appropriate consents and governmental authorizations required to
      be obtained by the Transferor in connection with the conveyance of
      each such Receivable have been duly obtained.

    If the Transferor breaches any representation and warranty described in
this paragraph, such breach remains uncured for 30 days (or such longer period
as may be agreed to by the Trustee) after the earlier to occur of the discovery
of such breach by the Transferor or the Servicer or receipt of written notice
of such breach by the Transferor or the Servicer, and such breach has a
materially adverse effect on the Certificateholders' Interest or the interests
of the holders of other outstanding Series in any Receivable or Account, the
Certificateholders' Interest and such other certificateholders' interests in
such Receivable or, in the case of a breach relating to an Account, all
Receivables in the related Account ("Ineligible Receivables") will be
reassigned to the Transferor on the terms and conditions set forth below and
such Account shall no longer be included as an Account.

    Each Ineligible Receivable will be reassigned to the Transferor on or
before the end of the Monthly Period in which such reassignment obligation
arises by the Transferor directing the Servicer to deduct the balance of such
Receivable (discounted by the Discount Factor, if any, for the Monthly Period
preceding such Determination Date) from the Pool Balance (as defined under "--
Allocation Percentages"). If such deduction would cause the Transferor Interest
to be less than the Minimum Transferor Interest on the preceding Determination
Date (after giving effect to the allocations, distributions, withdrawals and
deposits to be made on such Distribution Date), on the date on which such
reassignment is to occur the Transferor will be obligated to make a deposit
into the Collection Account in immediately available funds in an amount equal
to the amount by which the Transferor Interest would be less than the Minimum
Transferor Interest (the amount of any such deposit being referred to herein as
a "Transfer Deposit Amount"). If the Transfer Deposit Amount is not so
deposited, the principal balance of the related Receivables will be deducted
from the Pool Balance only to the extent the Transferor Interest is not reduced
below the Minimum Transferor Interest and any principal balance not so deducted
will not be reassigned and will remain part of the Trust. The reassignment of
any such Receivable to the Transferor and the payment of any related Transfer
Deposit Amount will be the sole remedy respecting any breach of the
representations and warranties described in the preceding paragraph with
respect to such Receivable available to Certificateholders or the Trustee on
behalf of Certificateholders.

                                       60
<PAGE>

    The Transferor will make representations and warranties to the Trust in the
Pooling and Servicing Agreement to the effect, among other things, that as of
the closing date of each Series

  (1) the Transferor is duly organized, validly existing, and in good
      standing under the laws of the State of Delaware and has the corporate
      power and authority to execute, deliver and perform its obligations
      under the Pooling and Servicing Agreement, the related Supplement, and
      the Purchase Agreement,

  (2) the Transferor is duly qualified to do business and in good standing
      (or is exempt from such requirement) in any state required in order to
      conduct its business and has obtained all necessary licenses and
      approvals required under federal, Minnesota and Delaware law,

  (3) the execution and delivery of the Pooling and Servicing Agreement, the
      related Supplement, and the Purchase Agreement, and the consummation
      of the transactions provided for therein, have been duly authorized by
      the Transferor by all necessary corporate action on its part,

  (4) the Pooling and Servicing Agreement constitutes a legal, valid and
      binding obligation of the Transferor, and

  (5) the transfer of Receivables and the Collateral Security by it to the
      Trust under the Pooling and Servicing Agreement constitutes either a
      valid transfer and assignment to the Trust of all right, title and
      interest of the Transferor in and to the Receivables and the
      Collateral Security (other than Receivables in Accounts designated as
      Additional Accounts after such closing date), whether then existing or
      thereafter created and the proceeds thereof (including amounts in any
      of the accounts established for the benefit of Certificateholders) or
      the grant of a first priority perfected security interest in such
      Receivables (except for certain liens permitted pursuant to the
      Pooling and Servicing Agreement) and the proceeds thereof (including
      amounts in any of the accounts established for the benefit of
      Certificateholders), which is effective as to each such Receivable
      upon the creation thereof.

    In the event of a breach of any of the representations and warranties
described in this paragraph, either the Trustee or the Holders of Certificates
evidencing undivided interests in the Trust aggregating more than 50% of the
aggregate investor interest of the related Series outstanding may direct the
Transferor to accept reassignment of an amount of Principal Receivables equal
to the invested amount to be reassigned (as described below) within 60 days of
such notice, or within such longer period specified in such notice. The
Transferor will thereupon be obligated to accept reassignment of such
Receivables on a Distribution Date occurring within such applicable period.
Such reassignment will not be required to be made, however, if at any time
during such applicable period, or such longer period, the representations and
warranties shall then be true and correct in all material respects. The amount
to be deposited by the Transferor for distribution to certificateholders in
connection with such reassignment will be equal to the invested amount for all
Series of certificates

                                       61
<PAGE>

required to be reassigned on the last day of the Monthly Period preceding the
Distribution Date on which the reassignment is scheduled to be made, less the
amount, if any, previously allocated for payment of principal to such
certificateholders on such Distribution Date, plus an amount equal to all
interest accrued but unpaid on such certificates at the applicable certificate
rate through the last day of the related Interest Accrual Period, less the
amount transferred to the Distribution Account from the Interest Funding
Account (each as defined under "--Trust Accounts") in respect of interest on
such certificates for the month ending on such last day of the Monthly Period.
The payment of the reassignment deposit amount and the transfer of all other
amounts deposited for the preceding month in the Distribution Account will be
considered a payment in full of the investor interest for all Series of
certificates required to be repurchased and will be distributed upon
presentation and surrender of the certificates for each such Series. If the
Trustee or certificateholders give a notice as provided above, the obligation
of the Transferor to make any such deposit will constitute the sole remedy
available to the Trustee and the certificateholders with respect to any breach
of the Transferor's representations and warranties.

    An "Eligible Account" is defined to mean, as of the Cut-off Date (or, with
respect to Additional Accounts, as of their date of designation for inclusion
in the Trust), an arrangement to provide a revolving extension of credit by
Conseco Finance or one of its subsidiaries to a Dealer (i) in order to finance
the purchase by a Dealer of consumer and commercial product inventory or (ii)
as a line of credit secured by unencumbered assets of such Dealer, as of the
date of determination thereof,

  (a) that is in existence and maintained with Conseco Finance or such
      subsidiary,

  (b) that is payable in United States dollars,

  (c) that is with a Dealer whose most recent billing address is in the
      United States or its territories or possessions,

  (d) that has been originated by Conseco Finance or such subsidiary in the
      ordinary course of business or acquired by Conseco Finance through the
      acquisition of an Eligible Account from another lender upon satisfying
      Conseco Finance's customary underwriting standards,

  (e) in respect of which no amounts have been charged off by Conseco
      Finance or such subsidiary as uncollectible in its customary and usual
      manner as of the Cut-off Date (or, with respect to Additional
      Accounts, as of their date of designation for inclusion in the Trust),
      and

  (f) that is with a Dealer that is not involved in insolvency proceedings.

The definition of Eligible Account may be changed by amendment to the Pooling
and Servicing Agreement without the consent of the Certificateholders if (i)
the Transferor delivers to the Trustee a certificate of an authorized officer
to the effect that, in the reasonable belief of the Transferor, such amendment
will not as of the date of such amendment adversely affect in any material
respect the interest of the Certificateholders, and (ii) such amendment will
not result in a withdrawal or reduction of the rating of any outstanding Series
under the Trust.

                                       62
<PAGE>

    An "Eligible Receivable" is defined to mean each Receivable

  (a) that was originated or acquired by Conseco Finance or one of its
      subsidiaries in the ordinary course of business or acquired by Conseco
      Finance through the acquisition of an Eligible Account from another
      lender upon satisfying Conseco Finance's customary underwriting
      standards,

  (b) that has arisen under an Eligible Account,

  (c) that was created in compliance with all requirements of law applicable
      thereto and pursuant to a floorplan or asset-based financing agreement
      that complies with all requirements of law applicable thereto,

  (d) with respect to which all consents, licenses or authorizations of, or
      registrations with, any governmental authority required to be obtained
      or given by Conseco Finance or such subsidiary or the Transferor in
      connection with the creation of such Receivable or the transfer
      thereof to the Trust or the execution, delivery, creation and
      performance by Conseco Finance or such subsidiary of the related
      floorplan or asset-based financing agreement have been duly obtained
      or given and are in full force and effect as of the date of the
      creation of such Receivable,

  (e) as to which, at the time of its creation, the Transferor had good and
      marketable title free and clear of all liens and security interests
      (other than certain liens permitted pursuant to the Pooling and
      Servicing Agreement), and at all times following the transfer of such
      Receivables to the Trust, the Trust will have good and marketable
      title free and clear of all liens and security interests (other than
      certain liens permitted pursuant to the Pooling and Servicing
      Agreement) or the grant of a first priority security interest therein,

  (f) that is the legal, valid, binding and assignable payment obligation of
      the related Dealer, legally enforceable against such Dealer, in
      accordance with its terms (with certain bankruptcy related
      exceptions),

  (g) that constitutes "chattel paper," an "account" or a "general
      intangible" under Article 9 of the Uniform Commercial Code as then in
      effect in the State of Minnesota,

  (h) if such Receivable has the benefit of a Floorplan Agreement with a
      manufacturer, such Floorplan Agreement provides, subject to the
      specific terms thereof and any limitations therein (which may vary
      among Floorplan Agreements), that the manufacturer is obligated to
      repurchase the products securing the Receivables upon the Servicer's
      repossession thereof upon the related Dealer's default,

  (i) that has been the subject of a valid transfer and assignment from the
      Transferor to the Trust of all the Transferor's interest therein and
      in the related Collateral Security (including any proceeds thereof),

  (j) that at the time of transfer to the Trust is not subject to any right
      of rescission, setoff, or any other defense (including defenses
      arising out of violations of usury laws) of the Dealer,

                                       63
<PAGE>

  (k) as to which, at the time of transfer of such Receivable to the Trust,
      Conseco Finance (or such subsidiary) and the Transferor have satisfied
      all their respective obligations with respect to such Receivable
      required to be satisfied at such time,

  (l) as to which, at the time of transfer of such Receivable to the Trust,
      neither Conseco Finance or such subsidiary nor the Transferor has
      taken or failed to take any action which would impair the rights of
      the Trust or the certificateholders therein, and

  (m) that represents the obligation of a Dealer to repay an advance made to
      or on behalf of such Dealer to finance products or the accounts
      receivable arising from the sale of such products.

    In addition, participation interests described above under "Conseco Finance
Corp. and Its Commercial Lending Division--Participations in Floorplan
Receivables" and Receivables described above under "Conseco Finance Corp. and
Its Commercial Lending Division--Participation Arrangements" will be
Receivables.

    The Trustee will not make any initial or periodic general examination of
the Receivables or any records relating to the Receivables for the purpose of
establishing the presence or absence of defects, compliance with the
Transferor's representations and warranties or for any other purpose. The
Servicer, however, will deliver to the Trustee on or before March 31 of each
year, an opinion of counsel with respect to the validity of the security
interest of the Trust in and to the Receivables and certain other components of
the Trust Portfolio.

Addition of Accounts

    Subject to the conditions described below, the Transferor will have the
right to designate, from time to time, Additional Accounts to be included as
Accounts with respect to the Trust. In addition, the Transferor will be
required to designate Additional Accounts if (i) the Transferor Interest on the
last day of any Monthly Period is less than the Minimum Transferor Interest or
(ii) the Pool Balance is less than the Minimum Aggregate Principal Receivables
(less any amounts in the Excess Funding Account or amounts deposited in the
Principal Account with respect to any Series from the Excess Funding Account).
The Transferor will convey to the Trust its interest in all Receivables in such
Additional Accounts, whether such Receivables are then existing or thereafter
created. The "Minimum Transferor Interest" is the sum of the product, for each
Series, of (a) its Minimum Transferor Percentage and (ii) its invested amount.
The "Minimum Transferor Percentage" for Series 2001-1 is   %.

    Each Additional Account must be an Eligible Account at the time of its
designation. However, Additional Accounts may not be of the same credit quality
as the initial Accounts and may have been originated by Conseco Finance using
credit criteria different from those which were applied by Conseco Finance to
the initial Accounts.


                                       64
<PAGE>

    A conveyance by the Transferor to the Trust of Receivables in Additional
Accounts is subject to the following conditions, among others:

  (1)   each such Additional Account must be an Eligible Account;

  (2)  the Transferor shall represent and warrant that the addition of such
       Additional Accounts shall not, in the reasonable belief of the
       Transferor, cause a Pay Out Event to occur;

  (3) the Transferor shall not select such Additional Accounts in a manner
      that it believes is adverse to the interests of the certificateholders
      or any credit enhancement provider;

  (4)  the Transferor shall deliver a Tax Opinion, other than in the case of
       a required addition, and certain other opinions of counsel with
       respect to the addition of such Additional Accounts to the Trustee,
       each Rating Agency and any credit enhancement provider, and

  (5)   if the Automatic Addition Condition (as described below) is not
        satisfied, the applicable Rating Agencies shall have provided
        written confirmation that such addition will not result in a
        reduction or withdrawal of the rating of the Certificates or any
        other rated outstanding Series or class of certificates.

    If the Automatic Addition Condition is satisfied and the Account being
added will contain Receivables secured by a security interest in a type of
product not previously financed by Conseco Finance, then such addition is
subject to each Rating Agency confirming that the addition of such Account
would not result in the reduction or the withdrawal of the rating of the
Certificates.

    The "Automatic Addition Condition" means, with respect to the addition of
Accounts, that

  (1)   during the calendar quarter in which such addition occurs, the
        number of new Accounts for Dealers that are financing products of
        the type already being financed by Conseco Finance does not exceed
        5% of the number of all Accounts at the end of the preceding
        calendar quarter,

  (2)  during the twelve months ending at the beginning of such calendar
       quarter, the number of such new Accounts does not exceed 20% of the
       number of all Accounts at the beginning of such twelve month period,

  (3) the average for the three months preceding the month of such addition
      of the aggregate balance of Receivables that have been delinquent for
      more than 30 days does not exceed 1.25% of the Pool Balance at the end
      of the month preceding the month of such addition, and

  (4)  the annualized average for such three month period of the net losses
       incurred in respect of the Receivables does not exceed 1.75% of the
       Pool Balance at the end of the month preceding the month of such
       addition.


                                       65
<PAGE>

    In addition to the periodic reports otherwise required to be filed by the
Servicer with the Commission pursuant to the Exchange Act, the Servicer intends
to file, on behalf of the Trust, a Report on Form 8-K with respect to any
addition to the Trust of Receivables in Additional Accounts that would have a
material effect on the composition of the assets of the Trust.

Removal of Accounts

    The Transferor shall have the right at any time to require the removal from
the Trust of Eligible Accounts, including all amounts then held by the Trust or
thereafter received by the Trust in respect of the Eligible Accounts to be
removed. To remove any Eligible Account and such amounts, the Transferor (or
the Servicer on its behalf) shall, among other things,

  (1)   on or before the fifth business day prior to the Determination Date
        on which such removal will occur (the "Removal Date"), furnish to
        the Trustee, any credit enhancement provider and each Rating Agency
        a written notice (the "Removal Notice") specifying the Removal Date;

  (2)  on or before the fifth business day after the Removal Date, the
       Transferor shall have furnished to the Trustee a computer file,
       microfiche list or other list of the Accounts (the "Removed
       Accounts") that were removed on the Removal Date, specifying for each
       Removed Account as of the date of the Removal Notice its number, the
       aggregate amount outstanding in such Removed Account and the
       aggregate amount of Principal Receivables therein;

  (3) represent and warrant that the removal of any such Eligible Account on
      the Removal Date will not, in the reasonable belief of the Transferor,
      cause a Pay Out Event to occur or cause the Transferor Interest to be
      less than the Minimum Transferor Interest amount as of such date;

  (4)  represent and warrant that no selection procedures believed by the
       Transferor to be adverse to the interest of the certificateholders
       were utilized in selecting the Removed Accounts;

  (5)   obtain a statement from each Rating Agency that such removal will
        not result in a reduction or withdrawal of the rating of the Class A
        or Class B Certificates or any other outstanding Series or class of
        certificates; and

  (6)  on or before the related Removal Date, deliver to the Trustee and any
       credit enhancement provider an Officer's certificate confirming the
       items set forth in clauses (3), (4) and (5) above and a Tax Opinion
       with respect to such removal.

    All Receivables existing in the Removed Accounts will be reassigned to the
Transferor as of the Removal Date. On any date on which an Account becomes an
Ineligible Account (which date will be deemed the Removal Date for such
Account), the Transferor will commence the removal of such Account from the
Trust. However, all Receivables existing in any such Account (other than an
Account that was an Ineligible Account at the time it was originally designated
as an Account) as of the Removal Date will continue to be a Trust asset.

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<PAGE>

    Accounts that are terminated by their Dealers after they have paid the
related Receivables in full will be deemed to be removed from the Trust without
having to follow the procedures described above.

Trust Accounts

    The Trustee will establish and maintain with a Qualified Institution in the
name of the Trust, for the benefit of the Certificateholders, two separate
accounts, each in a segregated trust account (which need not be a deposit
account), consisting of an "Interest Funding Account" and a "Principal
Account." The Trustee will also establish a "Distribution Account" for the
benefit of the certificateholders of each Series which will be a non-interest
bearing segregated demand deposit account established with a Qualified
Institution. The Servicer will establish and maintain, in the name of the
Trust, for the benefit of certificateholders of all Series, a "Collection
Account," which will be a segregated account established by and maintained by
the Servicer with a Qualified Institution. A "Qualified Institution" is a
depository institution or trust company, which may include the Trustee,
organized under the laws of the United States or any one of the states thereof,
which at all times has a certificate of deposit rating of P-1 by Moody's
Investor Services, Inc. ("Moody's), of A-1+ by Standard & Poor's, a division of
McGraw-Hill, Inc. ("Standard & Poor's"), and of F-1+ by Fitch IBCA, Inc.
("Fitch") if rated by Fitch or long-term unsecured debt obligation (other than
such obligation the rating of which is based on collateral or on the credit of
a person other than such institution or trust company) rating of Aaa by
Moody's, of AAA by Standard & Poor's and of AAA by Fitch if rated by Fitch and
deposit insurance provided by the Federal Deposit Insurance Corporation, or a
depository institution, which may include the Trustee, which is acceptable to
the Rating Agencies; provided, however, that no such rating shall be required
of an institution which shall have corporate trust powers and which maintains
the Collection Account, any principal account, any interest funding account or
any other account maintained for the benefit of Certificateholders as a fully
segregated trust account with the trust department of such institution which is
rated at least Baa3 by Moody's. Funds in the Principal Account and the Interest
Funding Account will be invested, at the direction of the Transferor, in "Cash
Equivalents" consisting of:

  (1)   obligations fully guaranteed by the United States of America,

  (2)  time deposits, promissory notes, or certificates of deposit of
       depository institutions or trust companies, the certificates of
       deposit of which are rated P-1 by Moody's, A-1+ by Standard & Poor's
       and F-1+ by Fitch if rated by Fitch,

  (3)  commercial paper having, at the time of the Trust's investment, a
       rating of P-1 by Moody's, of A-1+ by Standard & Poor's and F-1+ by
       Fitch if rated by Fitch,

  (4)  bankers' acceptances issued by any depository institution or trust
       company described in clause (ii) above,

  (5)   money market funds which have the highest rating from, or have
        otherwise been approved in writing by, each of Moody's, Standard &
        Poor's and Fitch (each, a "Rating Agency"),

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<PAGE>

  (6)   certain open end diversified investment companies,

  (7)  Eurodollar time deposits that have been rated P-1 by Moody's, A-1+ by
       Standard & Poor's and F-1+ by Fitch if rated by Fitch, and

  (8)  any other investment that each Rating Agency confirms in writing will
       not adversely affect its then current rating of any outstanding
       Certificates.

Any earnings (net of losses and investment expenses) on funds in the Interest
Funding Account and the Principal Account will be deposited in the Collection
Account as part of Series Available Interest Collections. The Servicer has the
revocable power to withdraw funds from the Collection Account, and to instruct
the Trustee to make withdrawals and payments from the Interest Funding Account
and the Principal Account, for the purpose of carrying out the Servicer' duties
under the Pooling and Servicing Agreement. The agent making payments to the
Certificateholders (the "Paying Agent") has the revocable power to withdraw
funds from the Distribution Account for the purpose of making distributions to
Certificateholders. The Paying Agent initially will be the Trustee.

Excess Funding Account

    The Trustee will establish and maintain in the name of the Trust, for the
benefit of the certificateholders of all Series, an "Excess Funding Account"
which will be a segregated account established by and maintained by the
Servicer with a Qualified Institution. At any time during which the Transferor
Interest (plus any funds deposited in the Principal Account with respect to any
Series from the Excess Funding Account) does not exceed the Minimum Transferor
Interest, funds (to the extent available therefor as described herein)
otherwise payable to the Transferor will be deposited in the Excess Funding
Account on any business day until the Transferor Interest is at least equal to
the Minimum Transferor Interest. Funds on deposit in the Excess Funding Account
will be withdrawn and paid to the Transferor to the extent that on any day the
Transferor Interest exceeds the Minimum Transferor Interest as a result of the
addition of new Receivables to the Trust. Such deposits in and withdrawals from
the Excess Funding Account may be made on a daily basis. No funds will be
deposited in the Excess Funding Account, however, if any Series is in an
amortization or accumulation period (including any early amortization period),
unless the principal account for such Series has been fully funded for such
Monthly Period.

    Any funds on deposit in the Excess Funding Account at the beginning of the
Controlled Accumulation Period or Early Amortization Period will be deposited
in the Principal Account as part of Class A Principal, Class B Principal, or
Class C Principal, as applicable, for any Distribution Date. In the event that
more than one Series begins its amortization or accumulation period at the same
time, amounts on deposit in the Excess Funding Account (other than any amounts
in the Class D Subaccount) will be paid out to each such Series pro rata based
on the aggregate invested amount of each such Series. A Pay Out Event will
occur if the sum of all Cash Equivalents and other amounts on deposit in the
Excess Funding Account as a percentage of the sum of the aggregate amount of
Principal Receivables (without deducting therefrom any discount portion) plus
the amount on deposit in the Excess

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<PAGE>

Funding Account shall equal or exceed 50% on the last day of six consecutive
Monthly Periods.

      Funds on deposit in the Excess Funding Account will be invested by the
Trustee at the direction of the Transferor in Cash Equivalents. On each
Distribution Date, all net investment income earned on amounts in the Excess
Funding Account since the preceding Distribution Date will be withdrawn from
the Excess Funding Account and treated as Interest Collections. Amounts, if
any, in the Excess Funding Account may be expected to earn interest at a rate
that is less than the Base Rate (as defined under "-- Coverage of Certain
Interest Shortfalls"). The difference between the amount of interest actually
earned on investments in the Excess Funding Account on any day and the amount
of interest that would have been earned on such investments at the Base Rate is
the "Negative Carry Amount" for such day. See "--Coverage of Certain Interest
Shortfalls" below.

Pre-Funding Account

    The Servicer will establish and maintain in the name of the Trustee, on
behalf of the Trust, the "Pre-Funding Account." The Pre-Funding Account will be
established and maintained with the trust department of the Trustee. Funds on
deposit in the Pre-Funding Account (the "Pre-Funded Amount") will be withdrawn
and paid to the Transferor during the period from      , 2001 to      , 2001
(the "Funding Period") as a result of (a) funds being deposited in the
principal account for Series 1998-2 and Series 1999-1, or (b) an increase in
the amount of Receivables in the Trust, in accordance with the Series 2001-1
Supplement. If a Pay Out Event were to occur during the Funding Period, the
amounts remaining on deposit in the Pre-Funding Account would be payable as
principal first to the Class A Certificateholders until the Class A Invested
Amount is paid in full, then to the Class B Certificateholders until the Class
B Invested Amount is paid in full, then to the Class C Certificateholders until
the Class C Invested Amount is paid in full, and then to the Class D
Certificateholders until the Class D Invested Amount is paid in full. Should
the Pre-Funded Amount be greater than zero at the end of the      , 2001
Monthly Period, such amount will be deposited in the Excess Funding Account.

    All amounts on deposit in the Pre-Funding Account will be invested by the
Trustee at the direction of the Servicer in Cash Equivalents. On each
Distribution Date with respect to the Funding Period, all investment income
earned on amounts in the Pre-Funding Account since the preceding Distribution
Date will be withdrawn from the Pre-Funding Account and deposited into the
Collection Account for application as Series Available Interest Collections for
distribution to the Certificateholders.

    Amounts on deposit in the Pre-Funding Account may be expected to earn
interest at a rate that is less than the Base Rate. In addition, no Interest
Collections will be allocated to the Pre-Allocated Invested Amount until Series
1998-2 and Series 1999-1 are paid in full. See "--Coverage of Certain Interest
Shortfalls" for a discussion of sources intended to cover such interest
shortfalls.


                                       69
<PAGE>

Allocation Percentages

    Pursuant to the Pooling and Servicing Agreement, during each Monthly
Period, the Servicer will allocate all Interest Collections and Principal
Collections and the amount of all Defaulted Receivables among the Class A
Certificateholders' Interest, the Class B Certificateholders' Interest, the
Class C Certificateholders' Interest, the Class D Certificateholders' Interest,
the Transferor Interest, and the holders of all other Series issued and
outstanding from time to time pursuant to the Pooling and Servicing Agreement
and applicable Supplements.

    Interest Collections and the amount of Defaulted Receivables will be
allocated at all times, and Principal Collections will be allocated during the
Revolving Period, to the Class A Certificateholders' Interest, the Class B
Certificateholders' Interest, the Class C Certificateholders' Interest and the
Class D Certificateholders' Interest, based on the percentage equivalent of a
fraction, the numerator of which is the Class A Invested Amount, the Class B
Invested Amount, the Class C Invested Amount, or the Class D Invested Amount,
respectively, at the end of the preceding business day and the denominator of
which is the greater of (a) the Pool Balance (plus amounts, if any, on deposit
in the Excess Funding Account) as of the end of the preceding business day and
(b) the sum of the numerator for all classes of all Series then outstanding
used to calculate the applicable allocation percentage (the "Class A Floating
Allocation Percentage," the "Class B Floating Allocation Percentage," the
"Class C Floating Allocation Percentage," and the "Class D Floating Allocation
Percentage," respectively; the sum of all such percentages, the "Floating
Allocation Percentage").

    During the Revolving Period, all Principal Collections allocable to the
Certificates will be allocated and paid to the Transferor (except for
collections applied as Reallocated Principal Collections and Shared Principal
Collections paid to the holders of certificates of other Series, if any, and
except for any funds deposited in the Excess Funding Account). On any business
day during the Controlled Accumulation Period or the Early Amortization Period,
Principal Collections will be allocated to the Certificateholders' Interest
based on the percentage equivalent of a fraction, the numerator of which is the
Class A Invested Amount, the Class B Invested Amount, the Class C Invested
Amount or the Class D Invested Amount, respectively, at the end of the last day
of the Revolving Period and the denominator of which is the greater of (a) the
Pool Balance (plus amounts, if any, on deposit in the Excess Funding Account)
at the end of the preceding business day and (b) the sum of the numerators used
to calculate the allocation percentages with respect to Principal Collections
for all Series (the "Class A Fixed/Floating Allocation Percentage," the "Class
B Fixed/Floating Allocation Percentage," the "Class C Fixed/Floating Allocation
Percentage," and the "Class D Fixed/Floating Allocation Percentage,"
respectively; the sum of all such percentages the "Fixed/Floating Allocation
Percentage").

    On any business day when Principal Collections are being allocated for
payment to the Class A, Class B or Class C Certificates, Principal Collections
will be allocated to the Class A, Class B or Class C Certificateholders'
Interest based on the percentage equivalent of a fraction, the numerator of
which is the sum of the Class A Invested Amount, the

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<PAGE>

Class B Invested Amount and the Class C Invested Amount at the end of the last
day of the Revolving Period and the denominator of which is the greater of
(a) the sum of the Pool Balance and the amount on deposit in the Excess Funding
Account at the end of the preceding business day and (b) the sum of the
numerators used to calculate the allocation percentages with respect to
Principal Collections for all Series (the "ABC Fixed/Floating Allocation
Percentage"). Because the allocation percentages are based on the Invested
Amount, the 2001-1 Certificates will not be allocated any Interest Collections
in respect of the Pre-Funded Amount until Series 1998-2 and Series 1999-1 are
paid in full. Also, if a Pay Out Event occurs with respect to the Series 2001-1
Certificates prior to the payment in full of the Series 1998-2 and Series 1999-
1 Certificates, Series 2001-1 Certificateholders will receive no allocations of
principal with respect to the Pre-Funded Amount until the Series 1998-2 and
1999-1 Certificates are paid in full. No assurance can be given as to when the
Series 1998-2 and Series 1999-1 Certificates will be paid in full. See "Risk
Factors--Series 2001-1 is a companion series with Series 1998-2 and Series
1999-1 and may experience delay in allocations of principal and will experience
a delay in allocations of interest."

    "Pool Balance" means, as of the time of determination thereof, the product
of (i) the total amount of Principal Receivables at such time multiplied by
(ii) one minus the Discount Factor, if any.

    "Class A Invested Amount" means an amount equal to

  (a) the initial principal balance of the Class A Certificates, minus (i)
      the Class A Percentage of the Pre-Allocated Invested Amount, plus (ii)
      the Class A Percentage of (x) any withdrawals from the Pre-Funding
      Account in connection with the addition of Receivables to the Trust
      and (y) after Series 1998-2 and Series 1999-1 are paid in full, the
      Pre-Allocated Invested Amount less the amount in clause (x) and the
      amount, if any, in clause (iii), plus (iii) the Class A Percentage of
      any withdrawals from the Pre-Funding Account at the end of the Funding
      Period, for deposit into the Excess Funding Account,

      minus (b) the aggregate amount of principal payments (except principal
      payments made from the Pre-Funding Account) made to Class A
      Certificateholders prior to such date,

      minus (c) the aggregate amount of Class A Investor Charge-Offs for all
      prior Determination Dates, equal to the amount by which the Class A
      Invested Amount has been reduced to fund the Investor Default Amount
      on all prior Distribution Dates as described under "--Investor Charge-
      Offs," and

      plus (d) the aggregate amount of Series Available Interest
      Collections, Excess Interest Collections and Reallocated Principal
      Collections (defined under""--Reallocated Principal Collections")
      applied on all prior Distribution Dates for the purpose of reimbursing
      amounts deducted pursuant to the foregoing clause (c).

    "Class B Invested Amount" for any date means an amount equal to

  (a) the initial principal balance of the Class B Certificates, minus (i)
      the Class B Percentage of the Pre-Allocated Invested Amount, plus (ii)
      the Class B Percentage

                                       71
<PAGE>

      of (x) any withdrawals from the Pre-Funding Account in connection with
      the addition of Receivables to the Trust and (y) after Series 1998-2
      and Series 1999-1 are paid in full, the Pre-Allocated Invested Amount
      less the amount in clause (x) and the amount, if any, in clause (iii),
      plus (iii) the Class B Percentage of any withdrawals from the Pre-
      Funding Account at the end of the Funding Period, for deposit into the
      Excess Funding Account,

      minus (b) the aggregate amount of principal payments (except principal
      payments made from the Pre-Funding Account) made to Class B
      Certificateholders prior to such date,

      minus (c) the aggregate amount of Class B Investor Charge-Offs for all
      prior Determination Dates, equal to the amount by which the Class B
      Invested Amount has been reduced to fund the Investor Default Amount
      on all prior Distribution Dates as described under "--Investor Charge-
      Offs,"

      minus (d) the aggregate amount of Reallocated Class B Principal
      Collections (defined under "--Reallocated Principal Collections") for
      which neither the Class D Invested Amount nor the Class C Invested
      Amount has been reduced for all prior Distribution Dates, and

      plus (e) the aggregate amount of Series Available Interest
      Collections, Excess Interest Collections and Reallocated Class C
      Principal Collections and Reallocated Class D Principal Collections
      applied on all prior Distribution Dates for the purpose of reimbursing
      amounts deducted pursuant to the foregoing clauses (c) and (d).

    "Class C Invested Amount" for any date means an amount equal to

  (a) the initial principal balance of the Class C Certificates, minus (i)
      the Class C Percentage of the Pre-Allocated Invested Amount, plus (ii)
      the Class C Percentage of (x) any withdrawals from the Pre-Funding
      Account in connection with the addition of Receivables to the Trust
      and (y) after Series 1998-2 and Series 1999-1 are paid in full, the
      Pre-Allocated Invested Amount less the amount in clause (x) and the
      amount, if any, in clause (iii), plus (iii) the Class C Percentage of
      any withdrawals from the Pre-Funding Account at the end of the Funding
      Period, for deposit into the Excess Funding Account,

      minus (b) the aggregate amount of principal payments (except principal
      payments made from the Pre-Funding Account) made to Class C
      Certificateholders prior to such date,

      minus (c) the aggregate amount of Class C Investor Charge-Offs for all
      prior Determination Dates, equal to the amount by which the Class C
      Invested Amount has been reduced to fund the Investor Default Amount
      on all prior Distribution Dates as described under "--Investor Charge-
      Offs,"

      minus (d) the aggregate amount of Reallocated Class B Principal
      Collections and Reallocated Class C Principal Collections (defined
      under "--Reallocated Principal

                                       72
<PAGE>

      Collections") for which the Class D Invested Amount has not been
      reduced for all prior Distribution Dates, and

      plus (e) the aggregate amount of Series Available Interest
      Collections, Excess Interest Collections, Reallocated Class D
      Principal Collections and certain other amounts as may be available
      applied on all prior Distribution Dates for the purpose of reimbursing
      amounts deducted pursuant to the foregoing clauses (c) and (d).

    "Class D Invested Amount" means an amount equal to

  (a) the initial principal balance of the Class D Certificates,

      plus (b) the Class D Incremental Invested Amount (described below
      under "--The Overconcentration Amounts") for the related Monthly
      Period,

      minus (c) $       when the Series 1998-2 and Series 1999-1
      Certificates are paid in full,

      plus (d) any Additional Class D Invested Amount,

      minus (e) the aggregate amount of principal payments made to Class D
      Certificateholders prior to such date,

      minus (f) the aggregate amount of Class D Investor Charge-Offs for all
      prior Determination Dates, equal to the amount by which the Class D
      Invested Amount has been reduced to fund the Investor Default Amount
      on all prior Distribution Dates as described under "--Investor Charge-
      Offs,"

      minus (g) the aggregate amount of Reallocated Class D Principal
      Collections (defined under "--Reallocated Principal Collections") for
      all prior Distribution Dates,

      plus (h) the aggregate amount of Series Available Interest Collections
      and Excess Interest Collections applied on all prior Distribution
      Dates for the purpose of reimbursing amounts deducted pursuant to the
      foregoing clauses (f) and (g).

    "Invested Amount" means the sum of the Class A Invested Amount, the Class B
Invested Amount, the Class C Invested Amount and the Class D Invested Amount.

    "Class A Percentage," "Class B Percentage" and "Class C Percentage" means,
respectively, the percentage derived from dividing the initial principal amount
of the related Class by the sum of the initial principal amounts of all of
those Classes.

    "Transferor's Percentage" means (a) when used with respect to Principal
Collections during the Revolving Period and Interest Collections and the amount
of Defaulted Receivables at all times, 100% minus the sum of the Floating
Allocation Percentage and the floating allocation percentages for all other
Series and (b) when used with respect to Principal Collections during the
Controlled Accumulation Period or Early Amortization Period, 100% minus the sum
of the Fixed/Floating Allocation Percentage and the allocation percentages used
with respect to Principal Collections for all other Series.

                                       73
<PAGE>

    As a result of the Floating Allocation Percentage, Interest Collections and
the portion of Defaulted Receivables allocated to the Certificateholders will
change each business day based on the relationship of the Class A Invested
Amount, the Class B Invested Amount, the Class C Invested Amount, and Class D
Invested Amount to the Pool Balance and amounts on deposit in the Excess
Funding Account on the preceding business day.

The Overconcentration Amounts

    The Class D Invested Amount will be adjusted to reflect, on each
Distribution Date, the aggregate principal amount of Receivables in the Trust
on such Distribution Date which are Asset-Based Receivable Overconcentrations,
Dealer Overconcentrations, Manufacturer Overconcentrations and Product Line
Overconcentrations (the "Overconcentration Amount") allocable to the
Certificateholders' Interest. The Overconcentration Amount is intended to
provide additional protection to Class A, Class B and Class C
Certificateholders against the risk of a decrease in credit diversification of
the Receivables caused by such Overconcentrations. There can be no assurance,
however, that the adjustment to the Class D Invested Amount will provide
sufficient protection against losses on the Receivables. Moreover, if Conseco
Finance is unable to continue to generate new Receivables that satisfy these
diversification requirements, the resulting increase in the Class D Invested
Amount due to the Overconcentration Amount, resulting in a corresponding
decrease in the Transferor Interest, could cause a Pay Out Event to occur.

    "Asset-Based Receivable Overconcentration" on any Distribution Date means
the excess of (a) the aggregate of all amounts of Principal Receivables in
Accounts for Asset-Based Receivables on the last day of the Monthly Period
immediately preceding such Distribution Date over (b)   % of the Principal
Receivables on the last day of such immediately preceding Monthly Period.

    "Dealer Overconcentration" on any Distribution Date means, with respect to
any Account with a Dealer, the excess of (a) the aggregate amount of Principal
Receivables in such Account on the last day of the Monthly Period immediately
preceding such Distribution Date over (b)   % of the Principal Receivables on
the last day of such immediately preceding Monthly Period. Certain designated
Dealers may be subject to a higher percentage limit with Rating Agency
approval, but in no case higher than  %.

    "Manufacturer Overconcentration" on any Distribution Date means the excess
of (a) the aggregate of all amounts of Principal Receivables in Accounts
created pursuant to Floorplan Agreements with a single manufacturer on the last
day of the Monthly Period immediately preceding such Distribution Date over (b)
  % of the Principal Receivables on the last day of such immediately preceding
Monthly Period. Certain designated manufacturers may be subject to a higher
percentage limit with Rating Agency approval, but in no case higher than   %.

    "Product Line Overconcentration" on any Distribution Date means the excess
of (a) the aggregate of all amounts of Principal Receivables in the Accounts
that represent

                                       74
<PAGE>

financing for a single product line (other than Asset-Based Receivables and
Receivables that represent financing for manufactured housing) on the last day
of the Monthly Period immediately preceding such Distribution Date over (b)   %
for marine products,   % for recreational vehicles,   % for lawn and garden
equipment, and   % for any other products in total, of the Principal
Receivables on the last day of such immediately preceding Monthly Period. If
Receivables are transferred to the Trust in the future and such Receivables are
secured by products in a product line that is new to the Trust, the Rating
Agencies may create a separate category of product line overconcentration with
its own overconcentration limits, and such new product line overconcentration
will become part of the Overconcentration Amount.

    The Class D Invested Amount will be adjusted to reflect changes in the
Class D Incremental Invested Amount, as described under "--Allocation
Percentages" above. The "Class D Incremental Invested Amount" for any Monthly
Period will equal the product of (a) a fraction, the numerator of which is the
Invested Amount (exclusive of the Class D Incremental Invested Amount) on the
last day of the immediately preceding Monthly Period, and the denominator of
which is the Pool Balance on such last day, times (b) the Overconcentration
Amount for the Distribution Date in such Monthly Period.

    Notwithstanding the above, in the case of each such Overconcentration, the
percentage in clause (b) for such Overconcentration may be increased or
decreased by the Transferor, without the consent of any Certificateholder, to a
level acceptable to each Rating Agency without any reduction or withdrawal of
its rating of the Class A or Class B Certificates. Any such increase in such a
percentage may involve an adjustment, upward or downward, of the Class D
Invested Amount (if upward, an "Additional Class D Invested Amount").

Reallocation of Cash Flows

    On the first business day following the end of each Monthly Period, the
Servicer will determine the Required Amount, if any. Commencing on such first
business day, the Servicer will apply all or a portion of the Excess Interest
Collections of other Series with respect to such business day allocable to the
Series 2001-1 Certificates in an amount equal to the remaining Required Amount.
Excess Interest Collections from other Series allocable to the Series 2001-1
Certificates for any business day will be equal to the product of (x) Excess
Interest Collections available from all other Series for such business day and
(y) a fraction, the numerator of which is the Required Amount for such business
day and the denominator of which is the aggregate amount of shortfalls in
required amounts or other amounts to be paid from available Interest
Collections for all Series for such business day.

Reallocated Principal Collections

    On the first business day following the end of each Monthly Period, the
Servicer will apply or cause the Trustee to apply an amount, not to exceed the
Class D Invested Amount, equal to the product of (a)(i) during the Revolving
Period, the Class D Floating Allocation Percentage or (ii) during the
Controlled Accumulation Period or Early Amortization Period,

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the Class D Fixed/Floating Allocation Percentage and (b) the amount of
Principal Collections with respect to such business day to the following
amounts in the following priority (such collections applied in accordance with
clause (a) below are called "Reallocated Class D Principal Collections"):

  (a) an amount equal to the sum of (i) the remaining Class A Required
      Amount, if any, with respect to the prior Monthly Period, (ii) the
      remaining Class B Required Amount, if any, with respect to the prior
      Monthly Period and (iii) the remaining Class C Required Amount, if
      any, with respect to the prior Monthly Period will be applied first to
      the components of the Class A Required Amount, then to the components
      of the Class B Required Amount and then to the components of the Class
      C Required Amount in the same priority in which Available Series
      Interest Collections are applied to such components as described in
      "--Application of Collections--Payment of Fees, Interest and Other
      Items"; and

  (b) any such collections not applied in the foregoing manner (and
      therefore not constituting Reallocated Class D Principal Collections)
      (i) on business days with respect to the Revolving Period and the
      Controlled Accumulation Period or Early Amortization Period prior to
      the payment in full of the Class C Invested Amount will be paid to the
      Transferor in order to maintain the Class D Invested Amount, (ii) on
      business days during the Controlled Accumulation Period following
      payment in full of the Class C Invested Amount will be included in the
      funds available to make principal payments to the Class D
      Certificateholders until the Class D Invested Amount is paid in full
      and (iii) on business days during an Early Amortization Period will be
      deposited in a subaccount (the "Class D Subaccount") of the Excess
      Funding Account to be held until the Class C Invested Amount is paid
      in full and to be available to be applied as Reallocated Class D
      Principal Collections.

    On each business day, the Servicer will apply or cause the Trustee to apply
an amount, not to exceed the Class C Invested Amount, equal to the product of
(a)(i) during the Revolving Period, the Class C Floating Allocation Percentage
or (ii) during the Controlled Accumulation Period or Early Amortization Period,
the Class C Fixed/Floating Allocation Percentage and (b) the amount of
Principal Collections with respect to such business day to the following
amounts in the following priority (such collections applied in accordance with
clause (a) below are called "Reallocated Class C Principal Collections"):

  (a) an amount equal to the sum of (i) the remaining Class A Required
      Amount, if any, with respect to the prior Monthly Period over the
      amount of Reallocated Class D Principal Collections applied with
      respect thereto for such Monthly Period and (ii) the remaining Class B
      Required Amount, if any, with respect to the prior Monthly Period over
      the amount of Reallocated Class D Principal Collections applied with
      respect thereto for such Monthly Period, will be applied first to the
      remaining components of the Class A Required Amount and then to the
      remaining components of the Class B Required Amount in the same
      priority in which Series

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      Available Interest Collections are applied to such components as
      described in "--Application of Collections--Payment of Fees, Interest
      and Other Items"; and

  (b) any such collections not applied in the foregoing manner (and
      therefore not constituting Reallocated Class C Principal Collections)
      will, on business days with respect to the Revolving Period, be
      applied as Shared Principal Collections and on business days with
      respect to the Controlled Accumulation Period or Early Amortization
      Period will be included in the funds available to make principal
      payments to the Class A Certificateholders until the Class A Invested
      Amount is paid in full and then to the Class B Certificateholders
      until the Class B Invested Amount is paid in full and then to the
      Class C Certificateholders until the Class C Invested Amount is paid
      in full.

    On each business day, the Servicer will apply or cause the Trustee to apply
an amount, not to exceed the Class B Invested Amount, equal to the product of
(a)(i) during the Revolving Period, the Class B Floating Allocation Percentage
or (ii) during the Controlled Accumulation Period or Early Amortization Period,
the Class B Fixed/Floating Allocation Percentage and (b) the amount of
Principal Collections with respect to such business day to the following
amounts in the following priority (such collections applied in accordance with
clause (a) below are called "Reallocated Class B Principal Collections" and the
sum of Reallocated Class D Principal Collections, Reallocated Class C Principal
Collections and Reallocated Class B Principal Collections is called
"Reallocated Principal Collections"):

  (a) an amount equal to the excess, if any, of the remaining Class A
      Required Amount, if any, with respect to the prior Monthly Period over
      the sum of the amount of Reallocated Class D Principal Collections and
      Reallocated Class C Principal Collections applied with respect thereto
      for the prior Monthly Period will be applied to the remaining
      components of the Class A Required Amount in the same priority in
      which Series Available Interest Collections are applied to such
      components as described in "--Application of Collections--Payment of
      Fees, Interest and Other Items"; and

  (b) any such collections not applied in the foregoing manner (and
      therefore not constituting Reallocated Class B Principal Collections)
      will, on business days with respect to the Revolving Period, be
      applied as Shared Principal Collections and on business days with
      respect to the Controlled Accumulation Period or Early Amortization
      Period will be included in the funds available to make principal
      payments to the Class A Certificateholders until the Class A Invested
      Amount is paid in full and then to the Class B Certificateholders
      until the Class B Invested Amount is paid in full.

    On each Determination Date, the Class D Invested Amount will be reduced by
the amount of unreimbursed Reallocated Principal Collections for the related
Monthly Period. In the event that such reduction would cause the Class D
Invested Amount to be a negative number, the Class D Invested Amount will be
reduced to zero and the Class C Invested Amount will be reduced by the amount
by which the Class D Invested Amount would have

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<PAGE>

been reduced below zero. In the event that the amount of Reallocated Principal
Collections for such Distribution Date would cause the Class C Invested Amount
to be a negative number, the Class C Invested Amount will be reduced to zero
and the Class B Invested Amount will be reduced by the amount by which the
Class C Invested Amount would have been reduced below zero. In the event that
the amount of Reallocated Principal Collections for such Distribution Date
would cause the Class B Invested Amount to be a negative number on any
Distribution Date, the amount of Reallocated Class B Principal Collections on
such Distribution Date will be an amount not to exceed the amount which would
cause the Class B Invested Amount to be reduced to zero.

    "Class A Required Amount" is the amount determined by the Servicer on each
Business Day in a Monthly Period equal to the excess, if any, of (x) the sum of
(1) Class A Monthly Interest for the prior Monthly Period, (2) any Class A
Monthly Interest due but not paid on any previous Distribution Date plus any
Class A Additional Interest previously due but not paid to the Class A
Certificateholders on a prior Distribution Date, (3) if Conseco Finance or an
Affiliate of Conseco Finance is no longer the Servicer, the Class A Floating
Allocation Percentage of the Monthly Servicing Fee for the prior Monthly Period
and (4) the Class A Floating Allocation Percentage of the Default Amount, to
the extent not previously paid, for any Business Day in the prior Monthly
Period over (y) the Series Available Interest Collections plus any Excess
Interest Collections from other Series allocated with respect to the amounts
described in clauses (x)(1) through (4).

    "Class B Required Amount" is the amount determined by the Servicer on each
Business Day in a Monthly Period equal to the excess, if any, of (x) the sum of
(1) Class B Monthly Interest for the prior Monthly Period, (2) any Class B
Monthly Interest due but not paid on any previous Distribution Date plus any
Class B Additional Interest previously due but not paid to the Class B
Certificateholders on a prior Distribution Date, (3) if Conseco Finance or an
Affiliate of Conseco Finance is no longer the Servicer, the Class B Floating
Allocation Percentage of the Monthly Servicing Fee for the prior Monthly Period
and (4) the Class B Floating Allocation Percentage of the Default Amount, to
the extent not previously paid, for any Business Day in the prior Monthly
Period over (y) the Series Available Interest Collections plus any Excess
Interest Collections from other Series allocated with respect to the amounts
described in clauses (x)(1) through (4).

    "Class C Required Amount" is the amount determined by the Servicer on each
Business Day in a Monthly Period equal to the excess, if any, of (x) the sum of
(1) if the Class A Certificates and Class B Certificates have been reduced to
zero, interest accrued on the Class C Certificates for the prior Monthly
Period, (2) if the Class A Certificates and Class B Certificates have been
reduced to zero, any interest due on the Class C Certificates but not paid on
any previous Distribution Date plus any interest at the Class C Certificate
Rate (to the extent lawful) on interest on the Class C Certificates previously
due but not paid to the Class C Certificateholders on a prior Distribution
Date, (3) if Conseco Finance or an Affiliate of Conseco Finance is no longer
the Servicer, the Class C Floating Allocation Percentage of the Monthly
Servicing Fee for the prior Monthly Period and (4) the Class C

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<PAGE>

Floating Allocation Percentage of the Default Amount, to the extent not
previously paid, for any Business Day in the prior Monthly Period over (y) the
Series Available Interest Collections plus any Excess Interest Collections from
other Series allocated with respect to the amounts described in clauses (x)(1)
through (4).

Application of Collections

    Allocations. Payments on the Receivables will be made to the Servicer, and
it will deposit all such payments (other than collections allocable to the
Exchangeable Transferor Certificate, subject to certain exceptions specified
herein) in the Collection Account no later than the second business day
following the date of processing. On the day on which any deposit to the
Collection Account is available, the Servicer will make the deposits and
payments to the accounts and parties as indicated below. However, as long as
Conseco Finance or any affiliate of Conseco Finance remains the Servicer, then
the Servicer may make such deposits and payments on a net basis on the business
day immediately prior to the Distribution Date (the "Transfer Date") of such
deposits and if (a)(i) the Servicer provides to the Trustee a letter of credit
or other form of credit enhancement rated in the highest rating category by
each Rating Agency covering the risk of collection of the Servicer and (ii) the
Transferor shall not have received a notice from any Rating Agency that making
payments monthly rather than daily would result in the lowering of such Rating
Agency's then-existing rating of any Series of certificates then outstanding or
(b) the Servicer has and maintains a short-term credit rating of P-1 by
Moody's, A-1 by Standard & Poor's and F-1 by Fitch. During the Revolving
Period, upon the retail sale of a product securing a Receivable where Conseco
Finance is providing the customer financing for such retail sale, Conseco
Finance will not, except under certain limited circumstances, be obligated to
deposit cash in the Collection Account in respect of the principal amount of
such Receivable but may instead replace such Receivable with other Receivables.

    If clause (a) or clause (b) set forth in the immediately preceding
paragraph is satisfied, payments on the Receivables collected by the Servicer
will not be segregated from the assets of the Servicer. Until such payments on
the Receivables collected by the Servicer are deposited into the Collection
Account, such funds may be used by the Servicer for its own benefit, and the
proceeds of any short-term investment of such funds will accrue to the
Servicer. During such times as the Servicer holds funds representing payments
on the Receivables collected by the Servicer and is permitted to use such funds
for its own benefit, the Certificateholders are subject to risk of loss,
including risk resulting from the bankruptcy or insolvency of the Servicer. The
Servicer will pay no fee to the Trust or any Certificateholder for any use by
the Servicer of funds representing collections on the Receivables.

    Notwithstanding the foregoing, whether the Servicer is required to make
daily or monthly deposits to the Collection Account, the Servicer is only
required to deposit Collections from the Collection Account into any Trust
Account or any account for any other Series up to the required amount to be
deposited therein and is permitted to withdraw from the Collection Account any
funds not required to be so deposited.


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<PAGE>

    The Servicer will withdraw the following amounts from the Collection
Account for application on each business day as indicated:

  (1)   an amount equal to the Transferor Percentage plus, prior to the
        Class D Principal Payment Commencement Date, the Class D Floating
        Allocation Percentage or the Class D Fixed/Floating Allocation
        Percentage, as applicable, of the aggregate amount of Principal
        Collections (less the amount thereof which may be applied as
        Reallocated Class D Principal Collections) and any amounts to be
        paid in respect of the Class D Investor Default Amount will be paid
        to the Transferor to maintain the Class D Invested Amount;

  (2)  an amount equal to the Transferor Percentage of the aggregate amount
       of Interest Collections will be paid to the holder of the
       Exchangeable Transferor Certificate to the extent such funds are not
       applied to cover Negative Carry Amounts or Principal Funding
       Investment Shortfalls, or allocated to any Series as set forth in the
       applicable Supplement;

  (3)  an amount equal to the sum of (a) the Floating Allocation Percentage
       of the aggregate amount of Interest Collections and (b) Excess
       Interest Collections of other Series allocable to Series 2001-1, will
       be allocated and paid as described below in "--Payment of Fees,
       Interest, and Other Items;"

  (4)  during the Revolving Period, an amount equal to the sum of the Class
       A Floating Allocation Percentage, the Class B Floating Allocation
       Percentage and the Class C Floating Allocation Percentage of
       Principal Collections (less the amount thereof which may be applied
       as Reallocated Class B Principal Collections and Reallocated Class C
       Principal Collections) will be applied as Shared Principal
       Collections;

  (5)   during the Controlled Accumulation Period or Early Amortization
        Period and prior to the date on which an amount equal to the Class A
        Invested Amount has been deposited in the Principal Amount, an
        amount equal to the ABC Fixed/Floating Allocation Percentage of
        Principal Collections (less the amount thereof which may be applied
        as Reallocated Class B Principal Collections or Reallocated Class C
        Principal Collections), any amount on deposit in the Excess Funding
        Account (exclusive of any amount in the Class D Subaccount), any
        amounts to be paid in respect of the ABC Investor Default Amount,
        Class A Investor Charge-Offs, Class B Investor Charge-Offs and Class
        C Investor Charge-Offs and any amount of Shared Principal
        Collections allocated to the Certificates on such business day up to
        (a) during the Controlled Accumulation Period, the Controlled
        Deposit Amount or (b) during the Early Amortization Period, the
        Class A Invested Amount, will be deposited in the Principal Account;

  (6)  during the Controlled Accumulation Period or Early Amortization
       Period and on or after the date on which an amount equal to the Class
       A Invested Amount has been deposited in the Principal Account, an
       amount equal to the ABC Fixed/Floating Allocation Percentage of such
       Principal Collections (less the amount thereof which may be applied
       as Reallocated Class B Principal

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<PAGE>

       Collections or Reallocated Class C Principal Collections), any
       remaining amount on deposit in the Excess Funding Account (exclusive
       of any amount in the Class D Subaccount), any amounts to be paid in
       respect of the ABC Investor Default Amount, Class B Investor Charge-
       Offs and Class C Investor Charge-Offs and any amount of Shared
       Principal Collections allocated to the Certificates on such business
       day, up to (a) during the Controlled Accumulation Period, the
       Controlled Deposit Amount or (b) during the Early Amortization Period,
       the Class B Invested Amount, will be deposited in the Principal
       Account;

  (7)  during the Controlled Accumulation Period or Early Amortization Period
       and on or after the date on which an amount equal to the Class B
       Invested Amount has been deposited in the Principal Account, an amount
       equal to the ABC Fixed/Floating Allocation Percentage of such
       Principal Collections (less the amount thereof which may be applied as
       Reallocated Class C Principal Collections), any remaining amount on
       deposit in the Excess Funding Account (exclusive of any amount in the
       Class D Subaccount), any amounts to be paid in respect of the ABC
       Investor Default Amount, and Class C Investor Charge-Offs and any
       amount of Shared Principal Collections allocated to the Certificates
       on such business day, up to the Class C Invested Amount, will be
       deposited into the Principal Account;

  (8)  Shared Principal Collections will be allocated to each outstanding
       Series pro rata based on any Principal Shortfalls with respect to any
       Series which is in its amortization period. The Servicer will pay any
       remaining Shared Principal Collections on such business day to the
       holder of the Exchangeable Transferor Certificate; and

  (9)   Excess Interest Collections (as defined herein) will be allocated as
        set forth below in paragraph (xiv) to "--Payment of Fees, Interest,
        and Other Items."

   Any Shared Principal Collections and other amounts described above as being
payable to the Transferor will not be paid to the Transferor if the Transferor
Interest on any date, after giving effect to the inclusion in the Trust of all
Receivables on or prior to such date and the application of all prior payments
to the Transferor, does not exceed the Minimum Transferor Interest. Any such
amounts otherwise payable to the Transferor will be deposited into and held in
the Excess Funding Account, and on the commencement of the accumulation period
or amortization period with respect to any Series, such amounts will be
deposited in the principal account of such Series to the extent specified in
the related Supplement until the applicable principal account of such Series
has been funded in full or the holders of certificates of such Series have
been paid in full. See "--Excess Funding Account."

   Payment of Fees, Interest and Other Items. On each business day during a
Monthly Period, the Servicer will determine the Floating Allocation Percentage
of Interest Collections (the "Series Available Interest Collections") and will
distribute from the Collection Account

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<PAGE>

the following amounts in the following priority (in each case, subject to the
limit of the Series Available Interest Collections less all amounts distributed
pursuant to a higher priority):

  (i) an amount equal to the excess of

     (A) the sum of (1) the Class A Monthly Interest, (2) the amount of any
         Class A Monthly Interest previously due but not deposited in the
         Interest Funding Account in prior Monthly Periods, and (3) any
         additional interest (to the extent permitted by applicable law) at
         the Class A Certificate Rate with respect to interest amounts that
         were due but not paid in a prior Monthly Period over

     (B) the amount which has already been deposited in the Interest
         Funding Account with respect to clause (i)(A) in the current
         Monthly Period,

  will be deposited in the Interest Funding Account for distribution on the
  next succeeding Distribution Date to the Class A Certificateholders;

  (ii) an amount equal to the excess of

     (A) the sum of (1) the Class B Monthly Interest, (2) the amount of any
         Class B Monthly Interest previously due but not deposited in the
         Interest Funding Account in prior Monthly Periods, and (3) any
         additional interest (to the extent permitted by applicable law) at
         the Class B Certificate Rate with respect to Class B Monthly
         Interest amounts that were due but not paid in a prior Monthly
         Period over

     (B) the amount which has already been deposited in the Interest
         Funding Account with respect to clause (ii)(A) in the current
         Monthly Period,

  will be deposited in the Interest Funding Account for distribution on the
  next succeeding Distribution Date to the Class B Certificateholders;

  (iii) if Conseco Finance or an affiliate of Conseco Finance is not the
        Servicer, an amount equal to the portion of the Monthly Servicing
        Fee for the current month that has not been previously paid to the
        Servicer plus any prior Monthly Servicing Fee that was due but not
        previously paid to the Servicer, will be distributed to the
        Servicer;

  (iv)  an amount equal to the sum of (1) the aggregate ABC Investor Default
        Amount for such business day and (2) the unpaid ABC Investor Default
        Amount for any prior business day during the then-current Monthly
        Period, will

     (A) during the Revolving Period, be treated as Shared Principal
         Collections,

     (B) during the Controlled Accumulation Period or Early Amortization
         Period on and prior to the date on which an amount equal to the
         Class A Invested Amount has been deposited in the Principal
         Account, be deposited in the Principal Account for payment to the
         Class A Certificateholders,

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<PAGE>

     (C) on and after the date on which an amount equal to the Class A
         Invested Amount has been deposited in the Principal Account, be
         deposited in the Principal Account for payment to the Class B
         Certificateholders, and

     (D) on and after the date on which an amount equal to the Class B
         Invested Amount has been deposited in the Principal Account, be
         deposited in the Principal Account for payment to the Class C
         Certificateholders;

  (v)  an amount equal to the sum of (1) the aggregate Class D Investor
       Default Amount for such business day and (2) the unpaid Class D
       Investor Default Amount for any prior business day during the then-
       current Monthly Period, will

     (A) during the Revolving Period and the Controlled Accumulation Period
         prior to the date on which an amount equal to the Class C Invested
         Amount has been deposited in the Principal Account, be paid to the
         Transferor in order to maintain the Class D Invested Amount,

     (B) during the Controlled Accumulation Period or Early Amortization
         Period following the date on which an amount equal to the Class C
         Invested Amount has been deposited in the Principal Account, be
         deposited in the Principal Account for payment to the Class D
         Certificateholders, and

     (C) during the Early Amortization Period prior to the date on which an
         amount equal to the Class C Invested Amount has been deposited in
         the Principal Account, be deposited in the Class D Subaccount of
         the Excess Funding Account, to be held until the Class C Invested
         Amount has been paid in full, and to be available to be applied as
         Reallocated Class D Principal Collections;

  (vi) an amount equal to unreimbursed Class A Investor Charge-Offs, if any,
       will be applied to reimburse Class A Investor Charge-Offs and

     (A) during the Revolving Period, the amount of such reimbursement will
         be treated as Shared Principal Collections,

     (B) during the Controlled Accumulation Period or Early Amortization
         Period but on and prior to the date on which an amount equal to
         the Class A Invested Amount has been deposited in the Principal
         Account, the amount of such reimbursement will be deposited in the
         Principal Account for payment to the Class A Certificateholders,

     (C) on and after the date on which an amount equal to the Class A
         Invested Amount has been deposited in the Principal Account, the
         amount of such reimbursement will be deposited in the Principal
         Account for payment to the Class B Certificateholders and

     (D) on and after the date on which an amount equal to the Class B
         Invested Amount has been deposited in the Principal Account, the
         amount of such reimbursement will be deposited in the Principal
         Account for payment to the Class C Certificateholders;

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<PAGE>

  (vii)  an amount equal to the sum of (1) the amount of interest which has
         accrued with respect to the outstanding aggregate principal amount
         of the Class B Certificates at the Class B Certificate Rate but has
         not been deposited in the Interest Funding Account with respect to
         the Class B Certificateholders either on such business day or on a
         prior business day, and (2) any additional interest (to the extent
         permitted by applicable law) at the Class B Certificate Rate with
         respect to such interest amounts that were due but not paid to
         Class B Certificateholders in any previous Monthly Period, will be
         deposited in the Interest Funding Account for distribution on the
         next succeeding Distribution Date to the Class B
         Certificateholders;

  (viii) an amount equal to the sum of (a) unreimbursed Class B Investor
         Charge-Offs, if any, and (b) any unreimbursed reduction in the
         Class B Invested Amount on account of Reallocated Principal
         Collections as described under "--Reallocated Principal
         Collections" will be applied to reimburse such Class B Investor
         Charge-Offs and such reduction and

     (A) during the Revolving Period, the amount of such reimbursement will
         be treated as Shared Principal Collections,

     (B) during the Controlled Accumulation Period or Early Amortization
         Period but prior to the date on which an amount equal to the Class
         A Invested Amount has been deposited in the Principal Account, the
         amount of such reimbursement will be deposited in the Principal
         Account for payment to the Class A Certificateholders,

     (C) on and after the date on which an amount equal to the Class A
         Invested Amount has been deposited in the Principal Account but
         prior to the date on which an amount equal to the Class B Invested
         Amount has been deposited in the Principal Account, the amount of
         such reimbursement will be deposited in the Principal Account for
         payment to the Class B Certificateholders and

     (D) on and after the date on which an amount equal to the Class B
         Invested Amount has been deposited in the Principal Account, the
         amount of such reimbursement will be deposited in the Principal
         Account for payment to the Class C Certificateholders;

  (ix)   an amount equal to the sum of (a) unreimbursed Class C Investor
         Charge-Offs, if any, and (b) any unreimbursed reduction in the
         Class C Invested Amount on account of Reallocated Principal
         Collections as described under "--Reallocated Principal
         Collections" will be applied to reimburse such Class C Investor
         Charge-Offs and such reduction and

     (A) during the Revolving Period, the amount of such reimbursement will
         be treated as Shared Principal Collections,

     (B) during the Controlled Accumulation Period or Early Amortization
         Period but prior to the date on which an amount equal to the Class
         A Invested Amount has been deposited in the Principal Account, the
         amount of such

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<PAGE>

         reimbursement be deposited in the Principal Account for payment to
         the Class A Certificateholders,

     (C) on and after the date on which an amount equal to the Class A
         Invested Amount has been deposited in the Principal Account but
         prior to the date on which an amount equal to the Class B Invested
         Amount has been deposited in the Principal Account, the amount of
         such reimbursement be deposited in the Principal Account for
         payment to the Class B Certificateholders and

     (D) on and after the date on which an amount equal to the Class B
         Invested Amount has been deposited in the Principal Account, the
         amount of such reimbursement be deposited in the Principal Account
         for payment to the Class C Certificateholders;

  (x)    an amount equal to the sum of (a) unreimbursed Class D Investor
         Charge-Offs, if any, and (b) any unreimbursed reduction in the
         Class D Invested Amount on account of Reallocated Principal
         Collections as described under "--Reallocated Principal
         Collections" will

     (A) during the Revolving Period and during the Controlled Accumulation
         Period prior to the date on which an amount equal to the Class C
         Invested Amount has been deposited in the Principal Account, be
         paid to the Transferor,

     (B) during the Early Amortization Period, be deposited in the Class D
         Subaccount of the Excess Funding Account, to be held until the
         date on which an amount equal to the Class C Invested Amount has
         been deposited in the Principal Account and to be available to be
         applied as Reallocated Class D Principal Collections, and

     (C) during the Controlled Accumulation Period on or after date on
         which an amount equal to the Class C Invested Amount has been
         deposited in the Principal Account, be deposited in the Principal
         Account for payment to the Class D Certificateholders;

  (xi)   an amount equal to the sum of (1) the amount of interest which has
         accrued with respect to the outstanding aggregate principal amount
         of the Class C Certificates at the Class C Certificate Rate but has
         not been deposited in the Interest Funding Account with respect to
         the Class C Certificateholders either on such business days or on a
         prior business day, and (2) any additional interest (to the extend
         permitted by applicable law) at the interest rate on the Class C
         Certificates with respect to such interest amounts that are due but
         not paid to Class C Certificateholders in any previous Monthly
         Period, will be deposited in the Interest Funding Account for
         distribution on the next succeeding Distribution Date to the Class
         C Certificateholders;

  (xii)  an amount equal to the sum of (1) the amount of interest which has
         accrued with respect to the outstanding aggregate principal amount
         of the Class D Certificates at the Class D Certificate Rate but has
         not been deposited in the Interest Funding

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<PAGE>

         Account with respect to the Class D Certificateholders either on
         such business days or on a prior business day, and (2) any
         additional interest (to the extend permitted by applicable law) at
         the interest rate on the Class D Certificate with respect to such
         interest amounts that are due but not paid to Class D
         Certificateholders in any previous Monthly Period, will be
         deposited in the Interest Funding Account for distribution on the
         next succeeding Distribution Date to the Class D
         Certificateholders;

  (xiii) if Conseco Finance or an affiliate of Conseco Finance is the
         Servicer, an amount equal to the portion of the Monthly Servicing
         Fee for the current month that has not been previously paid to the
         Servicer plus any prior Monthly Servicing Fee that was due but not
         previously paid to the Servicer will be distributed to the
         Servicer; and

  (xiv)  any Series Available Interest Collections remaining after making
         the above described distributions will be treated as "Excess
         Interest Collections" which will be available to cover shortfalls,
         if any, in amounts payable from Interest Collections to
         certificateholders of other Series and then to pay any unpaid
         commercially reasonable costs and expenses of a successor Servicer,
         if any. Excess Interest Collections which are not so used will be
         paid to the Transferor.

    "Class A Monthly Interest" with respect to any Distribution Date will equal
the product of (1) the Class A Certificate Rate for the related Interest
Accrual Period, (2) the actual number of days in such Interest Accrual Period
divided by 360 and (3) the outstanding principal balance of the Class A
Certificates at the close of business on the first day of such Interest Accrual
Period.

    "Class B Monthly Interest" with respect to any Distribution Date will equal
the product of (1) the Class B Certificate Rate for the related Interest
Accrual Period, (2) the actual number of days in such Interest Accrual Period
divided by 360 and (3) with respect to the Funding Period, the outstanding
principal balance of the Class B Certificates at the close of business on the
first day of such Interest Accrual Period and after the Funding Period, the
Class B Invested Amount at the close of business on the first day of such
Interest Accrual Period.

    "Required Amount" means on the first business day following a Monthly
Period the amount, if any, by which the full amount to be paid pursuant to
clauses (i)-(xiii) above in "--Payments of Fees, Interest, and Other Items" for
such prior Monthly Period exceeds the portion of the Series Available Interest
Collections applied to the payment of the amounts described in such clauses for
such prior Monthly Period.

    Payment of Principal. On each business day during the Revolving Period, the
Trustee, acting in accordance with instructions from the Servicer, will treat
the amount described in clause (4) of "--Allocations" as Shared Principal
Collections which will be applied as described in clause (8) of "--
Allocations." On the Transfer Date preceding the Class A Scheduled Payment
Date, the Trustee, acting in accordance with instructions from the Servicer,
will withdraw the amount on deposit in the Principal Account and deposit such

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<PAGE>

amount in the Distribution Account for distribution to the Class A
Certificateholders on the Class A Scheduled Payment Date. If the amount so
distributed on the Class A Scheduled Payment Date is less than the Class A
Invested Amount, the Class A Certificateholders will be entitled on each
subsequent Distribution Date to receive principal payments to the extent of
Class A Principal until the Class A Invested Amount is paid in full. The Class
B Certificateholders will be entitled to receive payment of the Class B
Invested Amount on the Class B Scheduled Payment Date, but only after the Class
A Invested Amount has been paid in full. The Class C Certificateholders will be
entitled to receive principal payments to the extent of Class C Principal until
the Class C Invested Amount is paid in full only after the Class A Invested
Amount and the Class B Invested Amount have been paid in full. The Class D
Certificateholders will be entitled to receive principal payments only after
the Class A Invested Amount, the Class B Invested Amount, and the Class C
Invested Amount have been paid in full.

    "Class A Principal" with respect to any Distribution Date during the
Controlled Accumulation Period or Early Amortization Period will equal the sum
of,

  (1)    an amount equal to the ABC Fixed/Floating Allocation Percentage of
         all Principal Collections (less the amount of Reallocated Class B
         Principal Collections and Reallocated Class C Principal
         Collections) received during the Monthly Period immediately
         preceding such Distribution Date,

  (2)   any amount on deposit in the Excess Funding Account (other than any
        amount in the Class D Subaccount) or the Pre-Funding Account
        allocated to the Class A Certificates with respect to the preceding
        Monthly Period,

  (3)  the aggregate ABC Investor Default Amount paid from Series Available
       Interest Collections, Excess Interest Collections or Reallocated
       Principal Collections with respect to the preceding Monthly Period
       and any reimbursements from Series Available Interest Collections,
       Excess Interest Collections or Reallocated Principal Collections of
       unreimbursed Class A Investor Charge-Offs, Class B Investor Charge-
       Offs and Class C Investor Charge-Offs, and

  (4)   Shared Principal Collections allocated to the Class A Certificates.

However, with respect to any Distribution Date during the Controlled
Accumulation Period, Class A Principal will not exceed the lesser of (1) the
Controlled Deposit Amount and (2) the Class A Invested Amount. On the Series
2001-1 Termination Date, Class A Principal will be an amount equal to the Class
A Invested Amount.

    "Class B Principal" with respect to any Distribution Date on or after the
Class A Scheduled Payment Date will equal the sum of

  (1) an amount equal to the ABC Fixed/Floating Allocation Percentage of all
      Principal Collections (less the amount of Reallocated Class B
      Principal Collections and Reallocated Class C Principal Collections)
      received during the Monthly Period immediately preceding such
      Distribution Date (or, in the case of the first Distribution Date
      following the date on which an amount equal to the Class A Invested
      Amount is deposited in the Principal Account to be applied to the

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<PAGE>

      payment of Class A Principal, the ABC Fixed/Floating Allocation
      Percentage of Principal Collections from the date on which such
      deposit is made),

  (2)   any amount on deposit in the Excess Funding Account (other than any
        amount in the Class D Subaccount) or the Pre-Funding Account
        allocated to the Class B Certificates with respect to the preceding
        Monthly Period,

  (3)  the aggregate ABC Investor Default Amount paid from Series Available
       Interest Collections, Excess Interest Collections or Reallocated
       Principal Collections with respect to the preceding Monthly Period
       and any reimbursements from Series Available Interest Collections,
       Excess Interest Collections or Reallocated Principal Collections of
       unreimbursed Class B Investor Charge-Offs and Class C Investor
       Charge-Offs, and

  (4)   Shared Principal Collections allocated to the Class B Certificates.

However, with respect to any Distribution Date during the Controlled
Accumulation Period, Class B Principal will not exceed the lesser of (1) the
Controlled Deposit Amount and (2) the Class B Invested Amount. On the Series
2001-1 Termination Date, Class B Principal will be an amount equal to the
Class B Invested Amount.

    "Class C Principal" with respect to any Distribution Date on or after the
date on which an amount equal to the Class B Invested Amount has been
deposited in the Principal Account will equal the sum of

  (1)    an amount equal to the ABC Fixed/Floating Allocation Percentage of
         all Principal Collections (less the amount of Reallocated Class C
         Principal Collections) received during the Monthly Period
         immediately preceding such Distribution Date (or, in the case of
         the first Distribution Date following the date on which an amount
         equal to the Class B Invested Amount is deposited in the Principal
         Account to be applied to the payment of Class B Principal, the ABC
         Fixed/Floating Allocation Percentage of Principal Collections from
         the date on which such deposit is made),

  (2)   any amount on deposit in the Excess Funding Account (other than any
        amount in the Class D Subaccount) or the Pre-Funding Account
        allocated to the Class C Certificates with respect to the preceding
        Monthly Period,

  (3)  the aggregate ABC Investor Default Amount paid from Series Available
       Interest Collections, Excess Interest Collections or Reallocated
       Principal Collections with respect to the preceding Monthly Period
       and any reimbursements from Series Available Interest Collections,
       Excess Interest Collections or Reallocated Principal Collections of
       unreimbursed Class C Investor Charge-Offs, and

  (4)   Shared Principal Collections allocated to the Class C Certificates.

On the Series 2001-1 Termination Date, Class C Principal will be an amount
equal to the Class C Invested Amount.

    On the Transfer Date preceding the date on which an amount equal to the
Class C Invested Amount has been deposited in the Principal Account, and on
each Transfer Date

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<PAGE>

thereafter until the Trust is terminated or until the Class D Invested Amount
is paid in full, the Trustee, acting in accordance with instructions from the
Servicer, will withdraw amounts deposited into the Principal Account in respect
of Principal Collections processed during the related Monthly Period and, to
the extent of the Class D Invested Amount, deposit such amounts in the
Distribution Account for distribution to the Class D Certificateholders on the
next succeeding Distribution Date (the "Class D Principal"). The Class D
Certificateholders will be entitled to receive principal payments to the extent
of Class D Principal until the Class D Invested Amount is paid in full.

Coverage of Certain Interest Shortfalls

    To the extent of any shortfall in the amount of Series Available Interest
Collections due to the accumulation of principal in the Excess Funding Account
or the Principal Account and because no Interest Collections or Principal
Collections will be allocated to the Pre-Allocated Invested Amount until Series
1998-2 and 1999-1 are paid in full, the Transferor Interest Collections will be
made available to cover the related Negative Carry Amount and such Principal
Funding Investment Shortfall.

    The "Negative Carry Amount" is the difference between the amount of
interest actually earned on investments in the Excess Funding Account and the
Pre-Funding Account on any day and the amount of interest that would have been
earned on such investments and, until Series 1998-2 and Series 1999-1 are paid
in full, the Pre-Allocated Invested Amount at the Base Rate on such day. The
"Principal Funding Investment Shortfall" for any day is the difference between
the amount of interest actually earned on investments in the Principal Account
on that day and the amount of interest that would have been earned on such
investments at the Base Rate for such day. The "Base Rate" is the sum of (1)
the weighted average of the Class A Certificate Rate, the Class B Certificate
Rate, the Class C Certificate Rate and the Class D Certificate Rate plus (2) 2%
per annum.

    Interest Collections allocable to any Series in excess of the amounts
necessary to make required payments with respect to such Series ("Excess
Interest Collections") will be applied to cover any shortfalls with respect to
amounts payable from Interest Collections allocable to any other Series, pro
rata based upon the amounts of the shortfalls, if any, with respect to such
other Series. Any Excess Interest Collections remaining after covering
shortfalls with respect to all outstanding Series during a Monthly Period will
be paid to the successor Servicer, if any, to cover certain costs and expenses
and then to the holder of the Exchangeable Transferor Certificate.

Defaulted Receivables

    Receivables will be charged off as uncollectible in accordance with the
Servicer's customary and usual policies (a "Defaulted Receivable"). See "The
Accounts--Loss Experience." On each business day, the Servicer will allocate to
the Certificateholders a portion of all Defaulted Receivables in an amount (the
"Investor Default Amount") equal to the product of (a) the Floating Allocation
Percentage applicable on such business day and

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<PAGE>

(b) the aggregate principal amount of Defaulted Receivables identified since
the prior reporting date. On each business day, the Servicer will allocate to
the Class A, Class B and Class C Certificateholders a portion of all Defaulted
Receivables in an amount (the "ABC Investor Default Amount") equal to the
product of (a) the sum of the Class A Floating Allocation Percentage, the Class
B Floating Allocation Percentage and the Class C Floating Allocation Percentage
applicable on such business day and (b) the aggregate principal amount of
Defaulted Receivables identified since the prior reporting date. On each
business day, the Servicer will allocate to the Class D Certificateholders a
portion of all Defaulted Receivables in an amount (the "Class D Investor
Default Amount") equal to the product of (a) the Class D Floating Allocation
Percentage and (b) the aggregate principal amount of Defaulted Receivables
identified since the prior reporting date.

Investor Charge-Offs

    If on the second business day preceding each Distribution Date (the
"Determination Date"), the aggregate Investor Default Amount, if any, for all
business days in the preceding Monthly Period exceeded the aggregate amount of
the Series Available Interest Collections, Excess Interest Collections and
Reallocated Principal Collections allocated with respect thereto during such
Monthly Period, then the Class D Invested Amount will be reduced by the
aggregate amount of such excess, but not more than the remaining aggregate
Investor Default Amount for such Monthly Period (a "Class D Investor Charge-
Off"). The Class D Invested Amount thereafter will be increased (but not in
excess of the aggregate of such reductions in the Class D Invested Amount
previously made that have not been previously reimbursed as described in this
sentence) on any business day by the amounts allocated and available for that
purpose as described under clause (10) of "--Application of Collections--
Payment of Fees, Interest, and Other Items."

    In the event that any such reduction of the Class D Invested Amount would
cause the Class D Invested Amount to be a negative number, the Class D Invested
Amount will be maintained at or reduced to zero, and the Class C Invested
Amount will be reduced by the aggregate amount of such excess, but not more
than the remaining aggregate Investor Default Amount for such Monthly Period (a
"Class C Investor Charge-Off"), which will have the effect of slowing or
reducing the return of principal to the Class C Certificateholders. The Class C
Invested Amount will thereafter be increased (but not in excess of the unpaid
principal balance of the Class C Certificates) on any Monthly Period by the
amounts allocated and available for that purpose as described under clause (9)
of""--Application of Collections--Payment of Fees, Interest, and Other Items."

    In the event that any such reduction of the Class C Invested Amount would
cause the Class C Invested Amount to be a negative number, the Class C Invested
Amount will be reduced to zero, and the Class B Invested Amount will be reduced
by the aggregate amount of such excess, but not more than the remaining
aggregate Investor Default Amount for such Monthly Period (a "Class B Investor
Charge-Off"), which will have the effect of slowing or reducing the return of
principal to the Class B Certificateholders. The Class B Invested Amount will
thereafter be increased (but not in excess of the unpaid principal balance of
the

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<PAGE>

Class B Certificates) on any Monthly Period by the amounts allocated and
available for that purpose as described under clause (8) of "--Application of
Collections--Payment of Fees, Interest, and Other Items."

    In the event that any such reduction of the Class B Invested Amount would
cause the Class B Invested Amount to be a negative number, the Class B Invested
Amount will be reduced to zero, and the Class A Invested Amount will be reduced
by the amount by which the Class B Invested Amount would have been reduced
below zero, but not more than the remaining aggregate Investor Default Amount
for such Monthly Period (a "Class A Investor Charge-Off"). The Class A Invested
Amount will thereafter be increased (but not in excess of the unpaid principal
balance of the Class A Certificates) on any Monthly Period by the amounts
allocated and available for that purpose as described under clause (6) of""--
Application of Collections--Payment of Fees, Interest, and Other Items."

Companion Series

    The Series 2001-1 Certificates may be entirely or partially paired with one
or more other Series (each a "Companion Series"). Each Companion Series either
will be prefunded with an initial deposit to a pre-funding account in an amount
up to the initial principal balance of such Companion Series, funded primarily
from the proceeds of the sale of a Companion Series, or will have a variable
principal amount. Any pre-funding account will be held for the benefit of such
Companion Series and not for the benefit of Series 2001-1 Certificateholders.
As principal is deposited in the Principal Account with respect to the Series
2001-1 Certificates or paid to the Series 2001-1 Certificateholders, either (1)
in the case of a pre-funded Companion Series, an equal amount of funds on
deposit in any pre-funding account for such pre-funded Companion Series will be
released (which funds will be distributed to the Transferor) or (2) in the case
of a Companion Series having a variable principal amount, an interest in such
variable Companion Series in an equal or lesser amount may be sold by the Trust
(and the proceeds thereof will be distributed to the Transferor) and, in either
case, the invested amount in the Trust of the Companion Series will increase by
up to the corresponding amount. Upon payment in full of the Series 2001-1
Certificates, assuming that there have been no unreimbursed charge-offs with
respect to any related Companion Series, the aggregate invested amount of such
related Companion Series will have been increased by an amount up to an
aggregate amount equal to the Series 2001-1 Investor Interest paid to the
Series 2001-1 Certificateholders since the issuance of such Companion Series.
The issuance of a Companion Series will be subject to the conditions described
under "Description of the Certificates--Exchanges." We cannot assure you that
the terms of any Companion Series would have no impact on the timing or amount
of payments received by a Series 2001-1 Certificateholder.

Final Payment of Principal; Termination

    The Class A Certificates, the Class B Certificates, and the Class C
Certificates will each be subject to optional repurchase by the Transferor on
any Distribution Date when the sum of the Class A Invested Amount, the Class B
Invested Amount and the Class C Invested

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<PAGE>

Amount is reduced to an amount less than or equal to $       (20% of the
initial outstanding principal amount of the Class A Certificates, the Class B
Certificates and the Class C Certificates), if certain conditions set forth in
the Pooling and Servicing Agreement are satisfied. The repurchase price will be
equal to the sum of (i) the unpaid Class A Invested Amount plus accrued and
unpaid interest on the Class A Certificates, (ii) the unpaid Class B Invested
Amount plus accrued and unpaid interest on the Class B Certificates, (iii) the
unpaid Class C Invested Amount plus accrued and unpaid interest on the Class C
Certificates and (iv) the unpaid Class D Invested Amount. In each case interest
will accrue through the day preceding the Distribution Date on which the
repurchase occurs.

    The Certificates will be retired on the day following the Distribution Date
on which the final payment of principal is scheduled to be made to the
Certificateholders, whether as a result of optional reassignment to the
Transferor or otherwise. Subject to prior termination as provided above, the
Pooling and Servicing Agreement provides that the final distribution of
principal and interest on the Certificates will be made on the earlier of (i)
the Distribution Date on which the Invested Amount is paid in full and (ii) the
      Distribution Date (the "Series 2001-1 Termination Date"), except to the
extent provided below. In the event that the Invested Amount is greater than
zero, exclusive of any Class held by the Transferor, on the Series 2001-1
Termination Date, the Trustee will sell or cause to be sold interests in the
Receivables or certain Receivables, as specified in the Pooling and Servicing
Agreement and the Series 2001-1 Supplement, in an amount up to 110% of the
Invested Amount at the close of business on such date (but not more than the
total amount of Receivables allocable to the Certificates in accordance with
the Pooling and Servicing Agreement). If the sale contemplated by the preceding
sentence has not occurred by the Series 2001-1 Termination Date, the affected
Certificateholders shall remain entitled to receive proceeds of such sale when
it occurs. The net proceeds of such sale and any collections on the
Receivables, up to an amount equal to the Invested Amount plus accrued interest
due on the Certificates, will be paid on the Series 2001-1 Termination Date in
the following order of priority:

  .   to the Class A Certificateholders until the Class A Invested Amount is
      paid in full,

  .   to the Class B Certificateholders until the Class B Invested Amount is
      paid in full,

  .   to the Class C Certificateholders until the Class C Invested Amount is
      paid in full, and

  .   to the Class D Certificateholders until the Class D Invested Amount is
      paid in full.

    Unless the Servicer and the holder of the Exchangeable Transferor
Certificate instruct the Trustee otherwise, the Trust will terminate on the
earlier of (a) the day after the Distribution Date following the date on which
funds shall have been deposited in the Distribution Account for the payment to
certificateholders outstanding sufficient to pay in full the aggregate investor
interest of all Series outstanding plus interest thereon at the applicable
certificate rates to the next Distribution Date and (b) a date which shall not
be later than        , or (c) if the Receivables are sold, disposed of or
liquidated following the occurrence of an Insolvency Event, immediately
following such sale,

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<PAGE>

disposition or liquidation (such date, the "Trust Termination Date"). Upon the
termination of the Trust and the surrender of the Exchangeable Transferor
Certificate, the Trustee will convey to the holder of the Exchangeable
Transferor Certificate all right, title, and interest of the Trust in and to
the Receivables and other funds of the Trust (other than funds on deposit in
the Distribution Account and other similar bank accounts of the Trust with
respect to any Series).

Pay Out Events

    As described above, the Revolving Period is expected to continue through
the end of the Monthly Period immediately preceding the Controlled Accumulation
Period, unless a Pay Out Event occurs prior to such date. A "Pay Out Event"
refers to any of the following events:

  (1)    failure by the Transferor to convey Receivables in Additional
         Accounts to the Trust within five business days after the day on
         which it is required to convey such Receivables pursuant to the
         Pooling and Servicing Agreement;

  (2)   failure on the part of the Transferor, the Servicer or Conseco
        Finance, as applicable, (a) to make any payment or deposit required
        by the Pooling and Servicing Agreement or the Purchase Agreement, on
        or before the date such payment or deposit is required to be made
        therein, which failure is not cured within five business days after
        written notice from the Trustee of such failure; or (b) to deliver a
        Distribution Date statement as required under the Pooling and
        Servicing Agreement within ten business days after written notice
        from the Trustee of such failure; or (c) to comply with its covenant
        not to create any lien on a Receivable which failure has a material
        adverse effect on the holders of the Certificates and which
        continues unremedied for a period of 60 days after written notice to
        it; provided, however, that any Pay Out Event shall not be deemed to
        have occurred if the Transferor shall have repurchased the related
        Receivables or, if applicable, all the Receivables during such
        period in accordance with the provisions of the Pooling and
        Servicing Agreement; or (d) to observe or perform in any material
        respect any other covenants or agreements set forth in the Pooling
        and Servicing Agreement or the Purchase Agreement, which failure has
        a materially adverse effect on the Certificateholders and which
        continues unremedied for a period of 45 days after written notice of
        such failure;

  (3)  any representation or warranty made by Conseco Finance in the
       Purchase Agreement or by the Transferor in the Pooling and Servicing
       Agreement or any information required to be given by the Transferor
       to the Trustee to identify the Accounts proves to have been incorrect
       in any material respect when made and continues to be incorrect in
       any material respect for a period of 60 days after written notice and
       as a result the interests of the Certificateholders are materially
       and adversely affected (excluding, however, any representation or
       warranty made by the Transferor that the Pooling and Servicing
       Agreement constitutes, or the transfer of the Receivables to the
       Trust is, a valid sale, transfer and assignment to

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<PAGE>

      the Trust of all right, title and interest of the Transferor in the
      Receivables and the Collateral Security if the Pooling and Servicing
      Agreement constitutes the grant of a security interest in the
      Receivables and Collateral Security); provided, however, that any Pay
      Out Event shall not be deemed to occur thereunder if the Transferor
      has repurchased the related Receivables or all such Receivables, if
      applicable, during such period in accordance with the provisions of
      the Pooling and Servicing Agreement;

  (4)   the occurrence of certain events of bankruptcy, insolvency or
        receivership relating to Conseco Finance or the Transferor;

  (5)    the Trust or the Transferor becomes an investment company within
         the meaning of the Investment Company Act of 1940, as amended;

  (6)   any Servicer Default occurs;

  (7)  on any Determination Date, the average of the Monthly Payment Rates
       for the three preceding Monthly Periods, where the Monthly Payment
       Rate for a Monthly Period is the percentage obtained by dividing the
       aggregate of the Receivables balance (without deducting therefrom any
       discount portion) collected during such Monthly Period by the average
       daily aggregate Receivables balance (without deducting therefrom any
       discount portion) for such Monthly Period, is less than   %;

  (8) the failure to pay the outstanding principal amount of the Class A
      Certificates or Class B Certificates by the Class A Scheduled Payment
      Date or the Class B Scheduled Payment Date, as applicable;

  (9)   the ratio (expressed as a percentage) of (a) the average for each
        month of the net losses on the Receivables (exclusive of the
        Ineligible Receivables) owned by the Trust (i.e., gross losses less
        recoveries on any such Receivables (including, without limitation,
        recoveries from collateral security in addition to recoveries from
        the products, recoveries from manufacturers and insurance proceeds))
        during any three consecutive calendar months to (b) the average of
        the month-end aggregate balances of such Receivables (without
        deducting therefrom the discount portion) for such three-month
        period, exceeds  % on an annualized basis;

  (10)    the sum of all Cash Equivalents and other amounts on deposit in
          the Excess Funding Account represents more than 50% of the
          aggregate amount of Principal Receivables (without deducting
          therefrom any discount portion) on each of six or more consecutive
          Determination Dates, after giving effect to all payments made or
          to be made on the Distribution Date next succeeding each such
          respective Determination Date; or

  (11)   if Principal Collections allocable to the Class D
         Certificateholder's Interest have been reallocated in any Monthly
         Period to cover any Required Amounts and have not been reimbursed
         as of the Determination Date in such Monthly Period.

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<PAGE>

    In the case of any event described in clause (2), (3) or (6) above, a Pay
Out Event will be deemed to have occurred with respect to the Certificates only
if, after any applicable grace period, the Certificateholders evidencing
undivided interests aggregating more than 50% of the Invested Amount, by
written notice to the Transferor and the Servicer, declare that a Pay Out Event
has occurred with respect to the Certificates as of the date of such notice. In
the case of any event described in clause (4) or (5) above, a Pay Out Event
with respect to all Series then outstanding, and in the case of any event
described in clause (1), (7), (8), (9), (10) or (11) above, a Pay Out Event
with respect only to the Certificates, will be deemed to have occurred without
any notice or other action on the part of the Trustee or the Certificateholders
or all certificateholders, as appropriate, immediately upon the occurrence of
such event. On the date on which a Pay Out Event is deemed to have occurred,
the Early Amortization Period will commence. In such event, distributions of
principal to the Certificateholders will begin on the first Distribution Date
following the month in which such Pay Out Event occurred. If, because of the
occurrence of a Pay Out Event, the Early Amortization Period begins,
Certificateholders will begin receiving distributions of principal earlier than
they otherwise would have, which may shorten the average life of the
Certificates.

    In addition to the consequences of a Pay Out Event discussed above, if,
pursuant to certain provisions of federal law, the Transferor voluntarily
enters liquidation or a trustee in bankruptcy is appointed for the Transferor
(an "Insolvency Event"), the Transferor will immediately cease to transfer
Receivables to the Trust and promptly give notice to the Trustee of such event.
Within 15 days, the Trustee will publish a notice of the liquidation or the
appointment stating that the Trustee intends to sell, dispose of, or otherwise
liquidate the Receivables in a commercially reasonable manner. With respect to
each Series outstanding at such time (or, if any such Series has more than one
class, of each class of such Series excluding any class or portion thereof held
by the Transferor), unless otherwise instructed within a specified period by
certificateholders representing undivided interests aggregating more than 50%
of the invested amount of such Series (or class excluding any class or portion
thereof held by the Transferor) and the holders (other than the Transferor) of
any Supplemental Certificates or any other interest in the Exchangeable
Transferor Certificate, the Trustee will sell, dispose of, or otherwise
liquidate the portion of the Receivables allocable to the Series that did not
vote to continue the Trust in accordance with the Pooling and Servicing
Agreement in a commercially reasonable manner and on commercially reasonable
terms. The proceeds from the sale, disposition, or liquidation of the
Receivables will be treated as collections of the Receivables allocable to such
Certificateholders and will be distributed to the applicable Certificateholders
as provided above in "--Application of Collections."

    If the only Pay Out Event to occur is either the bankruptcy or insolvency
of the Transferor or the appointment of a bankruptcy trustee or receiver for
the Transferor, the bankruptcy trustee or receiver may have the power to
prevent the early sale, liquidation, or disposition of the Receivables and the
commencement of the Early Amortization Period. In addition, a bankruptcy
trustee or receiver may have the power to cause the early sale of the
Receivables and the early retirement of the Certificates.

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<PAGE>

Servicing Compensation and Payment of Expenses

    The Servicer's compensation for its servicing activities and reimbursement
for its expenses will take the form of the payment to it of a servicing fee in
an amount for any Monthly Period equal to the sum of (1) with respect to each
Series, one-twelfth of the product of (x) the applicable servicing fee rate
with respect to such Series and (y) the Invested Amount of such Series on the
first day of such Monthly Period and (2) one-twelfth of the product of the
weighted average servicing fee rate for all Series and the average Transferor
Interest for such Monthly Period. The servicing fee will be allocated between
the Transferor Interest, the Certificateholders' Interest, and the investor
interest for all other Series. The portion of the servicing fee allocable to
the Certificateholders' Interest during each Monthly Period (the "Monthly
Servicing Fee") will be equal to one-twelfth of the product of (x) 2.00% per
annum and (y) the Invested Amount on the first day of the related Monthly
Period or, in the case of the first Distribution Date, the initial principal
amount of the Certificates. The Monthly Servicing Fee will be funded from
Interest Collections allocated to the Certificateholders' Interest, and will be
paid each month from the amount so allocated and on deposit in the Collection
Account. See "--Application of Collections--Payment of Fees, Interest, and
Other Items" above. The remainder of the servicing fee will be allocable to the
Transferor Interest and the investor interests of other Series. Neither the
Trust nor the Certificateholders will have any obligation to pay such portion
of the servicing fee.

    The Servicer will be permitted to waive its right to receive the Monthly
Servicing Fee on any Distribution Date, so long as it believes that sufficient
Interest Collections will be available on a future Distribution Date to pay
such waived Monthly Servicing Fee, in which case the Monthly Servicing Fee for
such Distribution Date shall be deemed to be zero.

    The Servicer will pay from its servicing compensation certain expenses
incurred in connection with servicing the Receivables, including, without
limitation, payment of the fees and disbursements of the Trustee and
independent certified public accountants and other fees which are not expressly
stated in the Pooling and Servicing Agreement to be payable by the Trust or the
Certificateholders other than federal, state, and local income and franchise
taxes, if any, of the Trust.

Certain Matters Regarding the Transferor and the Servicer

    The Servicer may not resign from its obligations and duties under the
Pooling and Servicing Agreement, except upon determination that performance of
its duties is no longer permissible under applicable law. No such resignation
will become effective until the Trustee or a successor to the Servicer has
assumed the Servicer's responsibilities and obligations under the Pooling and
Servicing Agreement. The Servicer may delegate some or all of its servicing
duties; provided, however, such delegation will not relieve the Servicer of its
obligation to perform such duties in accordance with the Pooling and Servicing
Agreement. In addition, any affiliate of Conseco Finance may be substituted in
all respects for Conseco Finance as Servicer, provided that Conseco Finance
will remain jointly and severally liable with such affiliate.

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    The Pooling and Servicing Agreement provides that the Servicer will
indemnify the Trust and the Trustee from and against any reasonable loss,
liability, expense, damage, or injury suffered or sustained by reason of any
acts or omissions or alleged acts or omissions of the Servicer with respect to
the activities of the Trust or the Trustee; provided, however, that the
Servicer will not indemnify (a) the Trustee for liabilities imposed by reason
of fraud, negligence, or willful misconduct by the Trustee in the performance
of its duties under the Pooling and Servicing Agreement, (b) the Trust, the
Certificateholders, or the Certificate Owners for liabilities arising from
actions taken by the Trustee at the request of Certificateholders, (c) the
Trust, the Certificateholders, or the Certificate Owners for any losses,
claims, damages, or liabilities incurred by any of them in their capacities as
investors, including without limitation, losses incurred as a result of
Defaulted Receivables, or (d) the Trust, the Certificateholders, or the
Certificate Owners for any liabilities, costs, or expenses of the Trust, the
Certificateholders, or the Certificate Owners arising under any tax law,
including without limitation, any federal, state, or local income or franchise
tax or any other tax imposed on or measured by income (or any interest or
penalties with respect thereto or arising from a failure to comply therewith)
required to be paid by the Trust, the Certificateholders, or the Certificate
Owners in connection with the Pooling and Servicing Agreement to any taxing
authority.

    In addition, the Pooling and Servicing Agreement provides that, subject to
certain exceptions, the Transferor will indemnify the Trust and the Trustee
from and against any reasonable loss, liability, expense, damage, or injury
(other than to the extent that any of the foregoing relate to any tax law or
any failure to comply therewith) suffered or sustained by reason of any acts or
omissions or alleged acts or omissions arising out of or based upon the
arrangement created by the Pooling and Servicing Agreement as though the
Pooling and Servicing Agreement created a partnership under the Minnesota
Uniform Partnership Act in which the Transferor is a general partner.

    The Pooling and Servicing Agreement provides that, except for the foregoing
indemnities, neither the Transferor nor the Servicer nor any of their
respective directors, officers, employees, or agents will be under any
liability to the Trust, the Trustee, the Certificateholders, or any other
person for any action taken, or for refraining from taking any action pursuant
to the Pooling and Servicing Agreement. Neither the Transferor nor the Servicer
nor any of their respective directors, officers, employees, or agents will be
protected against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith, or gross negligence of the Transferor, the
Servicer, or any such person in the performance of its duties thereunder or by
reason of reckless disregard of obligations and duties thereunder. In addition,
the Pooling and Servicing Agreement provides that the Servicer is not under any
obligation to appear in, prosecute, or defend any legal action that is not
incidental to its servicing responsibilities under the Pooling and Servicing
Agreement and which in its opinion may expose it to any expense or liability.

    Under the Pooling and Servicing Agreement, the Transferor will be liable
directly to an injured party for the entire amount of any losses, claims,
damages or liabilities (other than those incurred by a Certificateholder in the
capacity of an investor in the Certificates) arising

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<PAGE>

out of or based on the arrangement created by the Pooling and Servicing
Agreement or the actions of the Servicer taken pursuant to the Pooling and
Servicing Agreement as though the Pooling and Servicing Agreement created a
partnership under the Minnesota Uniform Partnership Act in which the Transferor
is a general partner. The Transferor will also pay, indemnify and hold harmless
each Certificateholder for any such losses, claims, damages or liabilities
(other than those incurred by a Certificateholder in the capacity of an
investor in the Certificates) except to the extent that they lapse from any
action by any Certificateholder. In the event of a Service Transfer, the
successor Servicer will indemnify the Transferor for any losses, claims,
damages and liabilities of the Transferor as described in this paragraph
arising from the actions or omissions of such successor.

Servicer Default

    In the event of any Servicer Default (as defined below), either the Trustee
or certificateholders representing undivided interests aggregating more than
50% of the aggregate investor interests for all outstanding Series, by written
notice to the Servicer (and to the Trustee if given by the certificateholders),
may terminate all of the rights and obligations of the Servicer as servicer
under the Pooling and Servicing Agreement and in and to the Receivables and the
proceeds thereof and the Trustee may appoint a new Servicer (a "Service
Transfer"). The rights and interest of the Transferor under the Pooling and
Servicing Agreement and in the Transferor Interest will not be affected by such
termination. Upon such termination, the Trustee will as promptly as possible
appoint a successor Servicer. If no such Servicer has been appointed and has
accepted such appointment by the time the Servicer ceases to act as Servicer,
all authority, power, and obligations of the Servicer under the Pooling and
Servicing Agreement will pass to and be vested in the Trustee. If the Trustee
is unable to obtain any bids from eligible servicers and the Servicer delivers
an Officer's Certificate to the effect that it cannot in good faith cure the
applicable Servicer Default, and if the Trustee is legally unable to act as a
successor Servicer, then the Trustee will give the Transferor the right to
accept reassignment of all of the Receivables on terms equivalent to the best
purchase offer as determined by the Trustee.

    A "Servicer Default" refers to any of the following events:

  (1)  failure by the Servicer to make any payment, transfer, or deposit, or
       to give instructions to the Trustee to make certain payments,
       transfers, or deposits within five business days after the date the
       Servicer is required to do so under the Pooling and Servicing
       Agreement or any Supplement; provided, however, that any such failure
       caused by a nonwillful act of the Servicer shall not constitute a
       Servicer Default if the Servicer promptly remedies such failure
       within five business days after receiving notice of such failure or
       otherwise becoming aware of such failure;

  (2) failure on the part of the Servicer duly to observe or perform in any
      respect any other covenants or agreements of the Servicer which has a
      material adverse effect on the certificateholders of any Series then
      outstanding and which continues unremedied for a period of 60 days
      after written notice of such failure, requiring the same to be
      remedied, shall have been given to the Servicer by the Trustee, or

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<PAGE>

      to the Servicer and the Trustee by holders of Certificates evidencing
      undivided interests aggregating not less than 50% of the Invested
      Amount of any Series materially adversely affected thereby and
      continues to have a material adverse effect on the certificateholders
      of any Series then outstanding for such period; or the delegation by
      the Servicer of its duties under the Pooling and Servicing Agreement,
      except as specifically permitted thereunder;

  (3) any representation, warranty, or certification made by the Servicer in
      the Pooling and Servicing Agreement, or in any certificate delivered
      pursuant to the Pooling and Servicing Agreement, proves to have been
      incorrect when made which has a material adverse effect on the
      certificateholders of any Series then outstanding, and which continues
      to be incorrect in any material respect for a period of 60 days after
      written notice of such failure, requiring the same to be remedied,
      shall have been given to the Servicer by the Trustee, or to the
      Servicer and Trustee by the holders of Certificates evidencing
      undivided interests aggregating not less than 50% of the Invested
      Amount of any Series materially adversely affected thereby and
      continues to have a material adverse effect on such certificateholders
      for such period; or

  (4)  the occurrence of certain events of bankruptcy, insolvency, or
       receivership of the Servicer.

    Notwithstanding the foregoing, a delay in or failure of performance
referred to in clause (1) above for a period of five business days, or referred
to under clause (2) or (3) for a period of 60 business days, will not
constitute a Servicer Default if such delay or failure could not be prevented
by the exercise of reasonable diligence by the Servicer and such delay or
failure was caused by an act of God or other similar occurrence. Upon the
occurrence of any such event, the Servicer will not be relieved from using its
best efforts to perform its obligations in a timely manner in accordance with
the terms of the Pooling and Servicing Agreement, and the Servicer will provide
the Trustee, any provider of credit enhancement, the Transferor, and the
holders of certificates of all Series outstanding prompt notice of such failure
or delay by it, together with a description of the cause of such failure or
delay and its efforts to perform its obligations.

    In the event of a Servicer Default due to the bankruptcy of the Servicer,
if no Servicer Default other than such bankruptcy or the insolvency of the
Servicer exists, the bankruptcy trustee or the Servicer itself as debtor-in-
possession may have the power to prevent either the Trustee or the majority of
the Certificateholders from effecting a Service Transfer.

Reports to Certificateholders

    On each Distribution Date, the Paying Agent will forward to each
Certificateholder of record (which is expected to be Cede & Co., as nominee for
DTC, unless Definitive Certificates are issued) a statement prepared by the
Servicer setting forth, among other things, with respect to such Series:

  (a) the total amount distributed,


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  (b) the amount of the distribution allocable to principal on the Class A
      Certificates, the Class B Certificates, the Class C Certificates and
      the Class D Certificates,

  (c) the amount of such distribution allocable to interest on the Class A
      Certificates and the Class B Certificates,

  (d) the amount of Principal Collections processed during the related
      Monthly Period and allocated in respect of the Class A Certificates,
      the Class B Certificates, the Class C Certificates and the Class D
      Certificates, respectively,

  (e) the amount of Interest Collections processed during the preceding
      Monthly Period and allocated in respect of the Class A Certificates,
      the Class B Certificates, the Class C Certificates and the Class D
      Certificates, respectively,

  (f) the aggregate amount of Principal Receivables, the Invested Amount,
      the Class A Invested Amount, the Class B Invested Amount, the Class C
      Invested Amount, the Class D Invested Amount, the Floating Allocation
      Percentage, and during the Controlled Accumulation Period or Early
      Amortization Period, the ABC Fixed/Floating Allocation Percentage with
      respect to the Principal Receivables in the Trust as of the close of
      business on the Record Date,

  (g) the aggregate outstanding balance of Receivables which are current,
      30-59, 60-89 and 90 or more days delinquent as of the end of the day
      on the Record Date,

  (h) the Aggregate Investor Default Amount for the related Monthly Period,

  (i) the aggregate amount of Class A Investor Charge-Offs, Class B Investor
      Charge-Offs, Class C Investor Charge-Offs and Class D Investor Charge-
      Offs for the preceding Monthly Period,

  (j) the amount of the Monthly Servicing Fee for the preceding Monthly
      Period, and

  (k) the aggregate amount of funds in the Excess Funding Account as of the
      last day of the Monthly Period immediately preceding the Distribution
      Date.

Unless and until Definitive Certificates are issued, such reports with respect
to the Series 2001-1 Certificates will be sent to Cede & Co., as registered
holder of the Certificates and the nominee of DTC. Certificate Owners may
receive copies of such reports upon written request, together with a
certification that they are Certificate Owners and payment of reproduction and
postage expenses associated with the distribution of such reports, from the
Trustee. See "Reports to Certificateholders."

    The Paying Agent will furnish to each person who at any time during the
preceding calendar year was a Certificateholder of record (which is expected to
be Cede & Co., as nominee for DTC, unless Definitive Certificates are issued) a
statement prepared by the Servicer containing the information required to be
contained in the regular monthly report to Certificateholders, as set forth in
clauses (a), (b), and (c) above aggregated for such calendar year or the
applicable portion thereof during which such person was a Certificateholder,
together with, on or before March 31 of each year, such customary information
(consistent with the treatment of the Certificates as debt) as the Servicer or
Trustee deems necessary or

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desirable for tax reporting purposes. Moreover, as long as the
Certificateholder of record is Cede & Co., as nominee for DTC, Certificate
Owners will receive tax and other information from Participants and Indirect
Participant rather than from the Trustee.

Reports; Notices

    If the Offered Certificates are listed on the Luxembourg Stock Exchange,
the Trustee will publish or will cause to be published following each
Distribution Date in the Luxemburger Wort a notice to the effect that
Servicer's reports described above will be available for review at the main
office of the Listing Agent of the Trust in Luxembourg, Luxembourg.

    Following the listing of the Offered Certificates on the Luxembourg Stock
Exchange, notices to Certificateholders will be given by publication in the
Luxemburger Wort. In the event that Definitive Certificates are issued, notices
to Certificateholders will also be given by mail to the addresses of such
holders as they appear in the certificate register.

Evidence as to Compliance

    The Pooling and Servicing Agreement provides that on or before March 31 of
each calendar year, the Servicer will cause a firm of independent public
accountants which is a member of the American Institute of Certified Public
Accountants to furnish a report to the effect that such accounting firm has
examined selected documents and records relating to the servicing of the
Accounts in accordance with certain procedures agreed upon with the Servicer,
and that, on the basis of such agreed upon procedures, such firm states that
such servicing was conducted in compliance with the Pooling and Servicing
Agreement during the period covered by such report except for such significant
exceptions or errors in records that, in the opinion of such firm, generally
accepted auditing standards requires it to report.

Amendments

    The Pooling and Servicing Agreement and any Supplement may be amended by
the Transferor, the Servicer, and the Trustee, without the consent of
Certificateholders, for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of the Pooling and Servicing
Agreement and Supplements or of modifying in any manner the rights of the
Certificateholders; provided that (1) the Transferor delivers an opinion of
counsel acceptable to the trustee to the effect that the amendment will not
adversely affect in any material respect the interest of the
Certificateholders, and (2) the amendment will not result in a withdrawal or
reduction of the rating of any outstanding series.

    The Pooling and Servicing Agreement and the Supplement may be amended by
the Transferor, the Servicer, and the Trustee with the consent of the holders
of certificates evidencing undivided interests aggregating not less than 66
2/3% of the investor interests of each and every Series adversely affected (and
with respect to Series 2001-1, the holders of not less than 66 2/3% of the
Invested Amount of each Class of Certificates adversely

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affected), for the purpose of adding any provisions to, changing in any manner
or eliminating any of the provisions of the Pooling and Servicing Agreement, or
any Supplement or of modifying in any manner the rights of certificateholders
of any then outstanding Series. No such amendment, however, may (a) reduce in
any manner the amount of, or delay the timing of, distributions required to be
made on any such Series, (b) change the definition of or the manner of
calculating the interest of any certificateholder of such Series, or (c) reduce
the aforesaid percentage of investor interests the holders of which are
required to consent to any such amendment, in each case without the consent of
all certificateholders of all Series adversely affected. Promptly following the
execution of any amendment to the Pooling and Servicing Agreement, the Trustee
will furnish written notice of the substance of such amendment to each
Certificateholder. Any Supplement and any amendments regarding the addition or
removal of Receivables from the Trust will not be considered an amendment
requiring certificateholder consent under the provisions of the Pooling and
Servicing Agreement and any Supplement.

List of Certificateholders

    Upon written request of Certificateholders representing undivided interests
in the Trust aggregating not less than 10% of the Invested Amount, the Trustee,
after having been adequately indemnified by such Certificateholders for its
costs and expenses and having given the Servicer notice that such request has
been made, will afford such Certificateholders access during business hours to
the current list of Certificateholders of the Trust for purposes of
communicating with other Certificateholders with respect to their rights under
the Pooling and Servicing Agreement. See "--Book-Entry Registration" and "--
Definitive Certificates."

The Trustee

    The Transferor, the Servicer, and their respective affiliates may from time
to time enter into normal banking, lending and trustee relationships with the
Trustee and its affiliates. The Trustee, the Transferor, the Servicer, and any
of their respective affiliates may hold Certificates in their own names. In
addition, for purposes of meeting the legal requirements of certain local
jurisdictions, the Trustee will have the power to appoint a co-trustee or
separate trustees of all or any part of the Trust. In the event of such
appointment, all rights, powers, duties, and obligations conferred or imposed
upon the Trustee by the Pooling and Servicing 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 shall 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.

    The Trustee may resign at any time, in which event the Transferor will be
obligated to appoint a successor Trustee. The Transferor may also remove the
Trustee if the Trustee ceases to be eligible to continue as such under the
Pooling and Servicing Agreement or if the Trustee becomes insolvent. In such
circumstances, the Transferor will be obligated to appoint a successor Trustee.
Any resignation or removal of the Trustee and appointment of a

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successor Trustee does not become effective until acceptance of the appointment
by the successor Trustee.

    If the Trustee fails to perform any of its obligations under the Pooling
and Servicing Agreement, and a certificateholder delivers written notice of
such failure to the Trustee, and the Trustee shall not have corrected such
failure for 60 days thereafter, then the holders of investor certificates
representing more than 50% of the aggregate invested amount of all Series
(including related commitments) shall have the right to remove the Trustee and
(with the consent of the Transferor, which shall not be unreasonably withheld)
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.

                     DESCRIPTION OF THE PURCHASE AGREEMENT

    The following summary describes certain terms of the Receivables Purchase
Agreement (the "Purchase Agreement") and is qualified in its entirety by
reference to the Purchase Agreement.

Transfer of Receivables

    Pursuant to the Purchase Agreement, Conseco Finance has sold and
transferred to the Transferor all of its right, title and interest in and to
all of the outstanding Receivables and the Collateral Security as of the Cut-
off Date and will sell and transfer all of the Receivables thereafter created.
As described herein, pursuant to the Pooling and Servicing Agreement, the
Transferor has transferred to the Trust all of its right, title and interest in
and to the Purchase Agreement.

    In connection with each such sale or transfer of Receivables to the
Transferor, Conseco Finance will indicate in its computer files that such
Receivables have been sold or transferred to the Transferor, and that such
Receivables have been transferred by the Transferor to the Trust. In addition,
Conseco Finance will provide to the Transferor a computer file or microfiche or
written list containing a true and complete list of all such Receivables,
identifying the balances of the Receivables as of the Cut-off Date. The records
and agreements relating to such Accounts and Receivables will not be segregated
by Conseco Finance from other documents and agreements relating to other
accounts and receivables and will not be stamped or marked to reflect the sale
or transfer of such Receivables to the Transferor, but the computer records of
Conseco Finance will be marked to evidence such sale or transfer. Conseco
Finance will file UCC financing statements with respect to the Receivables
meeting the requirements of Minnesota state law. See "Risk Factors--Transfer of
the Receivables; Insolvency Risk Considerations" and "Certain Legal Aspects of
the Receivables--Transfer of Receivables."

Representations and Warranties

    Pursuant to the Purchase Agreement, Conseco Finance made certain
representations and warranties to the Transferor that, among other things, (a)
it has been duly incorporated and is

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in good standing and that it has the authority to consummate the transactions
contemplated by the Purchase Agreement and (b) as of the Cut-off Date (or, in
the case of an Additional Account, as of the specified cut-off Date and the
Addition Date), each Account or Additional Account was an Eligible Account.

    Pursuant to the Purchase Agreement, Conseco Finance will make certain
representations and warranties to the Transferor relating to the Receivables
that, among other things, (a) as of the Cut-off Date and each Closing Date,
each of the Accounts was an Eligible Account or, if it was or is an Ineligible
Account on such date, such Account is being removed from the Trust in
accordance with the requirements of the Pooling and Servicing Agreement, and
(b) as of the date any new Receivable is created, such Receivable is an
Eligible Receivable. In the event of a breach of any representation and
warranty set forth in this paragraph which results in an Ineligible Receivable
and the requirement that the Transferor accept retransfer of such Ineligible
Receivable pursuant to the Pooling and Servicing Agreement, then Conseco
Finance will be obligated to repurchase such Ineligible Receivable from the
Transferor on the date of such retransfer. The purchase price for such
Ineligible Receivable will be the face amount thereof plus any accrued and
unpaid interest thereon, of which at least the amount of any cash deposit
required to be made by the Transferor under the Pooling and Servicing Agreement
in respect of the retransfer of such Ineligible Receivable must be paid in
cash.

    Pursuant to the Purchase Agreement, Conseco Finance also made
representations and warranties to the Transferor that, among other things, as
of each Closing Date, (a) the Purchase Agreement constitutes a legal, valid and
binding obligation of Conseco Finance and (b) the Purchase Agreement
constitutes a valid sale or transfer to the Transferor of all right, title and
interest of Conseco Finance in and to the Receivables, whether then existing or
thereafter created in the Accounts, the Collateral Security, all related
security interests and other related rights and the proceeds thereof, which is
effective as to each Receivable upon the creation thereof. If the breach of any
of the representations and warranties described in this paragraph results in
the obligation of the Transferor under the Pooling and Servicing Agreement to
accept retransfer of the Receivables, Conseco Finance will be obligated to
repurchase the Receivables retransferred to Conseco Finance for an amount of
cash equal to the amount of cash the Transferor is required to deposit under
the Pooling and Servicing Agreement in connection with such retransfer.

    Conseco Finance has agreed to indemnify the Transferor and to hold the
Transferor harmless from and against any and all losses, damages and expenses
(including reasonable attorneys' fees) suffered or incurred by the Transferor
if the foregoing representations and warranties are materially false.

Certain Covenants

    Pursuant to the Purchase Agreement, Conseco Finance covenants that it will
perform its obligations under the agreements relating to the Receivables and
the Accounts in conformity with its then-current policies and procedures
relating to the Receivables and Accounts.


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    Conseco Finance further covenants that, except for the sale and conveyance
under the Purchase Agreement and the interests created under the Pooling and
Servicing Agreement and the Series Supplement, Conseco Finance will not sell,
pledge, assign or transfer any interest in the Receivables to any other person.
Conseco Finance also covenants to defend and indemnify the Transferor for any
loss, liability or expense incurred by the Transferor in connection with a
breach by Conseco Finance of any of its representations, warranties or
covenants contained in the Purchase Agreement.

    In addition, Conseco Finance expressly acknowledges and consents to the
Transferor's assignment of its rights relating to the Receivables under the
Purchase Agreement to the Trustee.

Termination

    The Purchase Agreement will terminate immediately after the Trust
terminates. In addition, if Conseco Finance becomes party to any bankruptcy or
similar proceeding (other than as a claimant) and, if such proceeding is not
voluntary and is not dismissed within 60 days of its institution, Conseco
Finance will immediately cease to sell or transfer Receivables to the
Transferor and will promptly give notice of such event to the Transferor and to
the Trustee.

                    CERTAIN LEGAL ASPECTS OF THE RECEIVABLES

Transfer of Receivables

    On the Series 1995-1 Closing Date, Conseco Finance sold and assigned the
Receivables arising in the Initial Accounts to the Transferor pursuant to the
Purchase Agreement, and the Transferor immediately sold and assigned such
Receivables to the Trust pursuant to the Pooling and Servicing Agreement.
Conseco Finance has since designated Additional Accounts from time to time and
sold and assigned the Receivables arising in such Additional Accounts to the
Transferor, and the Transferor immediately sold and assigned such Receivables
to the Trust. The Transferor represented and warranted in the Pooling and
Servicing Agreement that each such sale to the Trust constituted a valid
transfer and assignment to the Trust of all right, title and interest of the
Transferor in and to the Receivables, except for the interest of any investor
certificate of any Series then held by it, or the grant to the Trust of a
security interest in the Receivables. The Transferor has also represented and
warranted in the Pooling and Servicing Agreement that, in the event the
transfer of the Receivables by the Transferor to the Trust is deemed to create
a security interest under the UCC, there will exist a valid, subsisting, and
enforceable first priority perfected security interest in such Receivables
created thereafter in favor of the Trust on and after their creation, subject
to certain tax liens. For a discussion of the Trust's rights arising from these
representations and warranties not being satisfied, see "Description of the
Offered Certificates--Representations and Warranties."

    Each of Conseco Finance and the Transferor has represented that the
Receivables are "general intangibles," "chattel paper" or "accounts" for
purposes of the UCC as in effect

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in Minnesota. If the Receivables are deemed to be general intangibles and the
transfer thereof by either Conseco Finance to the Transferor or by the
Transferor to the Trust is deemed to be a sale, Minnesota common law applies
and neither possession nor a financing statement is required. If the
Receivables are deemed to be general intangibles and the transfer thereof by
either Conseco Finance to the Transferor or by the Transferor to the Trust is
deemed to create a security interest, the UCC as in effect in Minnesota applies
and the transferee must file an appropriate financing statement or statements
in order to perfect its interest therein. If the Receivables are deemed to be
chattel paper and the transfer thereof by either Conseco Finance to the
Transferor or by the Transferor to the Trust is deemed either to be a sale or
to create a security interest, the UCC as in effect in Minnesota applies and
the transferee must either take possession of the chattel paper or file an
appropriate financing statement or statements in order to perfect its interest
therein. If the Receivables are treated as accounts and the transfer thereof by
either by Conseco Finance to the Transferor or the Transferor to the Trust is
deemed either to be a sale or create a security interest, the transferee must
file an appropriate financing statement or statements in order to perfect its
interest therein under the UCC as in effect in Minnesota. Financing statements
covering the Receivables will be filed under the UCC as in effect in Minnesota
by both the Transferor and the Trust to perfect their respective interests in
the Receivables and continuation statements will be filed as required to
continue the perfection of such interests. The Receivables will not be stamped
to indicate the interest of the Transferor or the Trustee.

      There are certain limited circumstances under the UCC and other
applicable law in which prior or subsequent transferees of Receivables could
have an interest in such Receivables with priority over the Trust's interest. A
purchaser of the Receivables that are chattel paper who gives new value and
takes possession of the instruments that evidence the Receivables (i.e., the
chattel paper) in the ordinary course of such purchaser's business may, under
certain circumstances, have priority over the interest of the Trust in such
Receivable. Under the Purchase Agreement, Conseco Finance warrants to the
Transferor, and under the Pooling and Servicing Agreement and the Series 2001-1
Supplement the Transferor warrants to the Trust, that the Receivables have been
transferred free and clear of the lien of any third party. Each of Conseco
Finance and the Transferor will also covenant that it will not sell, pledge,
assign, transfer or grant any lien on any Receivable or, except as described
under "Description of the Offered Certificates--Exchanges," the Exchangeable
Transferor's Certificate (or any interest therein) other than to the Trust. A
tax or other government lien on property of Conseco Finance or the Transferor
arising prior to the time a Receivable comes into existence may also have
priority over the interest of the Trust in such Receivable. In addition, while
Conseco Finance is the Servicer, cash collections on the Receivables may, under
certain circumstances, be commingled with the funds of Conseco Finance prior to
each Distribution Date and, in the event of bankruptcy of Conseco Finance, the
Trust may not have a perfected interest in such collections.

Certain Matters Relating to Bankruptcy

    Conseco Finance warrants to the Transferor in the Purchase Agreement that
the sale of the Receivables by it to the Transferor is a valid sale of the
Receivables to the Transferor. In

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addition, pursuant to the Purchase Agreement, Conseco Finance and the
Transferor have agreed to treat the transactions described herein as a sale of
such Receivables to the Transferor, and Conseco Finance will take all actions
that are required under Minnesota law to perfect the Transferor's ownership
interest in the Receivables. Notwithstanding the foregoing, if Conseco Finance
were to become a debtor in a bankruptcy case and a creditor or trustee-in-
bankruptcy of Conseco Finance or Conseco Finance itself as debtor-in-possession
were to take the position that the sale of Receivables from Conseco Finance to
the Transferor should be recharacterized as a pledge of such Receivables to
secure a borrowing from Conseco Finance, then delays in payments of collections
of Receivables to the Transferor could occur or (should the court Rule in favor
of any such trustee, debtor-in-possession or creditor) reductions in the amount
of such payments could result.

    It is possible that the risk of recharacterization may be increased by the
following factors:

  .   the Transferor will initially retain the Class C Certificates, the
      Class D Certificates and its other interests in the Trust.

  .   Conseco Finance may guarantee the Class D Certificates if they are
      sold.

  .   for accounting purposes, Conseco Finance and the Transferor will treat
      the Certificates as debt and the transfer of the Receivables allocable
      to Series 2001-1 from Transferor to the Trust as a pledge rather than
      a sale.

If the transfer of Receivables to the Transferor were respected as a sale, the
Receivables would not be part of Conseco Finance's bankruptcy estate and would
not be available to Conseco Finance's creditors.

    In addition, if Conseco Finance were to become a debtor in a bankruptcy
case and a creditor or trustee-in-bankruptcy of such debtor or Conseco Finance
itself were to request a court to order that Conseco Finance should be
substantively consolidated with the Transferor, delays in payments on the
Certificates could result. Should the bankruptcy court Rule in favor of any
such creditor, trustee-in-bankruptcy or Conseco Finance, reductions in such
payments could result.

    The Transferor warrants to the Trust that the transfer of the Receivables
to the Trust is a sale of the Receivables to the Trust or the grant of a
security interest in the Receivables to the Trust. The Transferor is required
to take all actions that are required under Minnesota law to perfect the
Trust's ownership interest or security interest in the Receivables and the
Transferor warrants to the Trust that the Trust will at all times have a first
priority perfected ownership interest or security interest therein and, with
certain exceptions, the proceeds thereof. Nevertheless, a tax or government
lien on property of Conseco Finance or the Transferor arising prior to the time
a Receivable is conveyed to the Trust may have priority over the interest of
the Trust in such Receivable. The Transferor's certificate of incorporation
provides that, under certain circumstances, the Transferor is required to have
two independent directors (as defined therein) in which event it shall not file
a voluntary application for relief under Title 11 of the United States Code
(the "Bankruptcy Code") without the affirmative vote of its two independent
directors. Pursuant to the Pooling and

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Servicing Agreement, the Trustee, all certificateholders and any credit
enhancement provider with respect to any other series have covenanted that they
will not at any time institute against the Transferor any bankruptcy,
reorganization or other proceedings under any federal or state bankruptcy or
similar law. Notwithstanding such steps, if the Transferor were to become a
debtor in a bankruptcy case, and a bankruptcy trustee for the Transferor or the
Transferor as debtor in possession or a creditor of the Transferor were to take
the position that the transfer of the Receivables from the Transferor to the
Trust should be recharacterized as a pledge of such Receivables, then delays in
payments on the Certificates or (should the court Rule in favor of any such
trustee, debtor in possession or creditor) reductions in the amount of such
payments could result. The risk of such a recharacterization may be increased
by the factors set forth in the second preceding paragraph.

    The Transferor does not intend to file, and Conseco Finance has agreed that
it will not cause the Transferor to file, a voluntary application for relief
under the Bankruptcy Code or any similar applicable state law with respect to
the Transferor so long as the Transferor is solvent and does not foresee
becoming insolvent.

    If Conseco Finance or the Transferor were to become a debtor in a
bankruptcy case causing a Pay Out Event to occur, then, pursuant to the
Purchase Agreement, new Receivables would no longer be transferred to the
Transferor and, pursuant to the Pooling and Servicing Agreement, only
collections on Receivables theretofore sold to the Transferor and transferred
to the related Trust would be available to be applied to pay interest accruing
on the Certificates and to pay the principal amount of the Certificates. Under
such circumstances, the Servicer is obligated to allocate all Principal
Collections to the oldest principal balance first. If such allocation method
were to be altered by the bankruptcy court, the rate of payment on the
Certificates might be adversely affected. In addition, distributions of
principal on each Certificate would not be subject to the applicable Controlled
Accumulation Amount. If the only Pay Out Event to occur is either the
insolvency of the Transferor or the appointment of a bankruptcy trustee or
receiver for the Transferor, the receiver or bankruptcy trustee for the
Transferor may have the power to continue to require the Transferor to transfer
new Principal Receivables to the Trust and to prevent the early sale,
liquidation, or disposition of the Receivables and the commencement of the
Early Amortization Period. See "Description of the Offered Certificates--Pay
Out Events."

    The occurrence of certain events of bankruptcy, insolvency or receivership
with respect to the Servicer will result in a Servicer Default, which Servicer
Default, in turn, will result in a Pay Out Event. If no other Servicer Default
other than the commencement of such bankruptcy or similar event exists, a
trustee-in-bankruptcy of the Servicer may have the power to prevent either the
Trustee or the Certificateholders from appointing a successor Servicer.

    Payments made in respect of repurchases of Receivables by Conseco Finance
or the Transferor pursuant to the Pooling and Servicing Agreement and the
Series 2001-1 Supplement may be recoverable by Conseco Finance or the
Transferor, as debtor in possession, or by a creditor or a trustee-in-
bankruptcy of Conseco Finance or the Transferor as a preferential transfer from
Conseco Finance or the Transferor if such payments are made

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within one year prior to the filing of a bankruptcy case in respect of Conseco
Finance or the Transferor.

    In Octagon Gas Systems, Inc. v. Rimmer, 995 F.2d 948 (10th Cir. 1993), the
United States Court of Appeals for the 10th Circuit suggested that even where a
transfer of accounts from a seller to a buyer constitutes a "true sale," the
accounts would nevertheless constitute property of the seller's bankruptcy
estate in a bankruptcy of the seller. If Conseco Finance or the Transferor were
to become subject to a bankruptcy proceeding and a court were to follow the
Octagon court's reasoning, Certificateholders might experience delays in
payment or possibly losses in their investment in the Certificates. Counsel has
advised the seller that the reasoning of the Octagon case appears to be
inconsistent with established precedent and the UCC. In addition, because
Conseco Finance, the Transferor, the Trust and the transaction governed by the
Pooling and Servicing Agreement do not have any particular link to the 10th
Circuit, it is unlikely that Conseco Finance or the Transferor would be subject
to a receivership proceeding in the 10th Circuit. Accordingly, the Octagon case
should not be binding precedent on a court in a receivership proceeding.

Security Interests in the Related Products

    The Transferor represents and warrants in the Pooling and Servicing
Agreement that each Receivable is at the time of creation secured by a first
priority security interest in the related product or accounts receivable.
Generally, under applicable state laws, a security interest in goods or
accounts receivable which secure wholesale financing obligations may be
perfected by the filing of UCC financing statements. Conseco Finance endeavors
to take all actions necessary under applicable state laws to perfect Conseco
Finance's (or a subsidiary's) security interest in such goods and accounts
receivable. However, at the time a product is sold or an account receivable is
paid, Conseco Finance's (or a subsidiary's) security interest therein will
terminate. Therefore, if a Dealer fails to remit to Conseco Finance amounts
owed with respect to a product that has been sold or an account receivable that
has been paid, the related Receivables will no longer be secured by such goods
or accounts receivable.

                        FEDERAL INCOME TAX CONSEQUENCES

    Set forth below is a discussion of the material federal income tax
consequences to Certificate Owners. This discussion is based upon present
provisions of the Internal Revenue Code of 1986, as amended (the "Code"), the
regulations promulgated thereunder, and judicial or ruling authority, all of
which are subject to change (which may be retroactive). Dorsey & Whitney LLP,
counsel to Conseco Finance and the Transferor ("Counsel"), is delivering its
opinion regarding certain federal income tax matters discussed below. The
opinion of Counsel specifically addresses only those issues specifically
identified below as being covered by such opinion; however, the opinion of
Counsel also states that the additional discussion set forth below accurately
sets forth Counsel's advice with respect to material tax issues. No ruling on
any of the issues discussed below will be sought from the Internal Revenue
Service (the "IRS"). This discussion does not deal with all aspects of

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federal income taxation that may be relevant to Offered Certificate Owners in
light of their personal investment circumstances, nor to certain types of
owners subject to special treatment under the federal income tax laws (e.g.,
banks, life insurance companies and tax-exempt organizations). Prospective
investors are encouraged to consult their own tax advisors with regard to the
federal income tax consequences of owning and disposing of the Certificates, as
well as the tax consequences arising under the laws of any applicable state,
foreign country or other jurisdiction.

    Treatment of the Certificates as Indebtedness of the Transferor. The
Transferor and the holders of Certificates will express in the Pooling and
Servicing Agreement the intent that, for federal, state and local income and
franchise tax purposes, the Offered Certificates will be indebtedness secured
by the Receivables and any other Trust assets allocable to the Offered
Certificates. The Transferor, by entering into the Pooling and Servicing
Agreement, and each Offered Certificate Owner, by the acceptance of an interest
in an Offered Certificate, will agree to treat the Offered Certificates as
indebtedness for federal, state and local income and franchise tax purposes.

    The determination of whether the economic substance of a property transfer
is a sale or a loan secured by the transferred property has been made by the
IRS and the courts on the basis of numerous factors designed to determine
whether the transferor has relinquished (and the transferee has obtained)
substantial incidents of ownership in the property. Among those factors, the
primary factors examined are whether the transferee has the opportunity to gain
if the property increases in value and bears the risk of loss if the property
decreases in value. Based upon an analysis of such factors, Counsel's opinion
provides that for federal income tax purposes the Offered Certificates will be
characterized as indebtedness secured by the Receivables and any other Trust
assets, and the Trust will not be characterized as an "association," "publicly
traded partnership" or "taxable mortgage pool" taxable as a corporation.

    Interest Income to Certificate Owners. Assuming the Offered Certificates
are debt obligations for federal income tax purposes, interest on the Offered
Certificates will be taxable as ordinary interest income when received by
Certificate Owners utilizing the cash-basis method of accounting and when
accrued by Certificate Owners utilizing the accrual method of accounting. Under
the applicable regulations, the Offered Certificates would be considered issued
with original issue discount ("OID") if the "stated redemption price at
maturity" of an Offered Certificate (generally equal to its principal amount as
of the date of issuance plus all interest other than "qualified stated
interest" payable prior to or at maturity) exceeds the original issue price (in
this case, the initial offering price at which a substantial amount of the
Offered Certificates are sold to the public). Any OID would be considered de
minimis under the regulation if it does not exceed 0.25% of the stated
redemption price at maturity of an Offered Certificate multiplied by the number
of full years until its maturity date. It is anticipated that the Offered
Certificates will not be considered issued with more than de minimis OID. Under
the OID regulations, an owner of an Offered Certificate issued with a de
minimis amount of OID must include such OID in income, on a pro rata basis, as
principal payments are made on the Offered Certificate.

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    While it is not anticipated that the Offered Certificates will be issued
with more than de minimis OID, it is possible that they will be so issued or
will be deemed to be issued with OID. This deemed OID could arise, for example,
if interest payments on the Offered Certificates are not deemed to be
"qualified stated interest" because the Offered Certificates do not provide for
default remedies ordinarily available to holders of debt instruments or because
no penalties are imposed as a result of any failure to make interest payments
on the Offered Certificates. In addition, under the OID regulations, certain
variable interest rates, including rates based upon the weighted average
interest rate of the Receivables, may not be treated as qualified stated
interest. Based upon existing authority, however, the Transferor and the
Trustee will treat interest payments on the Offered Certificates as qualified
stated interest under the OID regulations. If the Offered Certificates are
issued or are deemed to be issued with OID, all or a portion of the taxable
income to be recognized with respect to the Offered Certificates would be
includible in the income of Certificate Owners as OID. Any amount treated as
OID would not, however, be includible again when the amount is actually
received. If the yield on a class of Offered Certificates were not materially
different from its coupon, this treatment would have no significant effect on
Certificate Owners using the accrual method of accounting. However, cash method
Certificate Owners may be required to report income with respect to the Offered
Certificates in advance of the receipt of cash attributable to such income.

    A Certificate Owner must include OID in income as interest over the term of
the Offered Certificate under a constant yield method. In general, OID must be
included in income in advance of the receipt of cash representing that income.
Each Certificate Owner should consult its own tax advisor regarding the impact
of the OID rules if the Offered Certificates are issued with OID.

    A Certificate Owner who purchases an Offered Certificate at a discount may
be subject to the "market discount" rules of the Code. These rules provide, in
part, for the treatment of gain attributable to accrued market discount as
ordinary income upon the receipt of partial principal payments or on the sale
or other disposition of the Offered Certificate, and for the deferral of
interest deductions with respect to debt incurred to acquire or carry the
market discount Offered Certificate. A Certificate Owner who purchases an
Offered Certificate at a premium may elect to amortize and deduct this premium
over the remaining term of the Offered Certificate in accordance with rules set
forth in Section 171 of the Code.

    As an alternative to the above treatments, accrual method Certificate
Owners may elect to include in gross income all interest with respect to an
Offered Certificate, including stated interest, acquisition discount, OID, de
minimis OID, market discount, de minimis market discount, and unstated
interest, as adjusted by any amortizable bond premium or acquisition premium,
using the constant yield method.

    Disposition of Offered Certificates. Generally, gain or loss will be
recognized on a sale or other taxable disposition of Offered Certificates in an
amount equal to the difference between the amount realized and the seller's tax
basis in the Offered Certificates. A Certificate Owner's tax basis in an
Offered Certificate will generally equal the cost thereof increased by any OID,
market discount and gain previously included by such Certificate

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Owner in income with respect to the Offered Certificate and decreased by any
bond premium previously amortized and any principal payments previously
received by such Certificate Owner with respect to the Offered Certificate. Any
such gain or loss will be capital gain or loss if the Offered Certificate was
held as a capital asset, except for gain representing accrued interest and
accrued market discount not previously included in income. Any such capital
gain would be taxed at long-term rates if the Offered Certificate is held for
more than one year and at short-term rates if held for not more than one year.

    Information Reporting and Backup Withholding. The Trustee will be required
to report annually to the IRS, and to each Offered Certificateholder of record,
the amount of interest paid on the Offered Certificates (and the amount of
interest withheld for federal income taxes, if any) for each calendar year,
except as to exempt holders (generally, holders that are corporations, tax-
exempt organizations, qualified pension and profit-sharing trusts, individual
retirement accounts, or nonresident aliens who provide certification of their
status as nonresidents). As long as the only "Certificateholder" of record is
Cede & Co., as nominee for DTC, Certificate Owners and the IRS will receive tax
and other information only from Participants and Indirect Participants rather
than from the Trustee. Each nonexempt Certificate Owner will be required to
provide, under penalties of perjury, a certificate on IRS Form W-9 containing
the Certificate Owner's name, address, federal taxpayer identification number
and a statement that such Certificate Owner is not subject to backup
withholding. Should a nonexempt Certificate Owner fail to provide the required
certification, the Trustee (or the Participants or Indirect Participants) will
be required to withhold (or cause to be withheld) 31% of the interest (and
principal) otherwise payable to the Certificate Owner, and remit the withheld
amounts to the IRS as a credit against the Certificate Owner's federal income
tax liability.

    Possible Classification of the Trust as a Partnership or Association. As
described above, it is the opinion of Counsel that for federal income tax
purposes the Offered Certificates will be characterized as debt and the Trust
will not be characterized as an association, publicly traded partnership or
taxable mortgage pool taxable as a corporation. However, this opinion is not
binding on the IRS and no assurance can be given that this characterization
will be sustained.

    If the IRS were to contend successfully that any class of Certificates is
not debt for federal income tax purposes, the Trust might be classified for
federal income tax purposes as a partnership, an association taxable as a
corporation, or a publicly traded partnership taxable as a corporation. In the
opinion of Counsel, if the Class C Certificates were sold to investors and the
IRS were to contend successfully that the Class C Certificates were not debt
for federal income tax purposes (assuming that neither the Class A or Class B
Certificates, nor certificates of any other outstanding series, were also
recharacterized) the arrangement among the Transferor and the Class C
Certificateholders would be classified as a partnership for federal income tax
purposes and would not be treated as a publicly traded partnership because of
an exception for (1) an entity whose income is interest income that is not
derived in the conduct of a financial business or (2) partnership interests
that are privately placed. In such case, the partnership would not be subject
to federal income tax. If the Class A or

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<PAGE>

Class B Certificates are treated as equity interests in a partnership, the
partnership would in all likelihood be treated as a publicly traded
partnership. A publicly traded partnership is, in general, taxable as a
corporation. If the partnership were nevertheless not taxable as a corporation
because of an exception for an entity whose income is interest income that is
not derived in the conduct of a financial business, it would not be subject to
federal income tax. Rather, each item of income, gain, loss, deduction and
credit generated through the ownership of the Receivables by the partnership
would be passed through to the partners in the partnership (including the
Certificate Owners) according to their respective interests therein.

    The income reportable by the Certificate Owners as partners in such a
partnership could differ from the income reportable by them as holders of debt.
However, except as provided below, it is not expected that such differences
would be material. If the Certificate Owners were treated as partners, a cash-
basis Certificate Owner might be required to report income when it accrues to
the partnership rather than when it is received by the Certificate Owner.
Moreover, if the Offered Certificates are interests in a partnership, an
individual Certificate Owner's share of expenses of the partnership would be
miscellaneous itemized deductions that might not be deductible in whole or in
part, causing the Certificate Owner to be taxable on a greater amount of income
than the stated interest on the Offered Certificates. Finally, if any class of
Certificates is treated as equity in a partnership in which other Certificates
are debt, all or part of a tax-exempt Certificate Owner's share of income from
Certificates treated as equity would be treated as unrelated debt-financed
income taxable to the Certificate Owner.

    Alternatively, if the Trust were treated as either an association taxable
as a corporation, a publicly traded partnership or taxable mortgage pool
taxable as a corporation, the resulting entity would be subject to federal
income taxes at corporate tax rates on its taxable income generated by
ownership of the Receivables. Distributions by the entity (other than interest
distributions on classes of Certificates properly characterized as debt) would
probably not be deductible in computing the entity's taxable income. Such an
entity-level tax could result in reduced distributions to Certificate Owners,
and the Certificate Owners could be liable for a share of such a tax. Moreover,
all or part of the distributions on Certificates treated as equity would
probably be treated as dividend income to the recipients, although such
dividends might, under certain circumstances, be eligible for the dividends
received deduction under the Code.

    Since the Transferor will treat the Offered Certificates as indebtedness
for federal income tax purposes, the Trustee (and Participants and Indirect
Participants) will not comply with the tax reporting requirements that would
apply under these alternative characterizations of the Offered Certificates.

    Foreign Investors. If, in accordance with the opinion of Counsel, the
Offered Certificates are classified as debt for federal income tax purposes,
the following information describes the federal income tax treatment of
investors that are not U.S. persons (each a "Foreign Person"). The term
"Foreign Person" means any person other than (1) a citizen or resident of the
United States, (2) a corporation, partnership or other entity organized in or

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under the laws of the United States or any state, including the District of
Columbia (unless in the case of a partnership, the Treasury Regulations provide
otherwise) subdivision thereof, (3) an estate the income of which is includible
in gross income for U.S. federal income tax purposes, regardless of its source
or (4) a trust if (A) a court within the United States is able to exercise
primary supervision over the administration of the trust and one or more United
States persons have authority to control all substantial decisions of the trust
or (B) the trust was in existence on August 20, 1996, was treated as a United
States person at that time and has in effect an election to continue to be so
treated.

  (a) Interest paid or accrued to a Foreign Person would be exempt from U.S.
      withholding taxes (including backup withholding taxes); provided that
      the Foreign Person complies with applicable identification
      requirements (and does not actually or constructively own 10% or more
      of the voting stock of Conseco Finance, is not a controlled foreign
      corporation with respect to Conseco Finance and is not a bank
      receiving interest described in Section 881(c)(3)(A) of the Code).
      Applicable identification requirements will be satisfied if there is
      delivered to a securities clearing organization (or bank or other
      financial institution that holds the Offered Certificates on behalf of
      the customer in the ordinary course of its trade or business) (i) IRS
      Form W-8 or substitute form signed under penalties of perjury by the
      beneficial owner of the Offered Certificates stating that the owner is
      not a U.S. person and providing the owner's name and address, (ii) IRS
      Form 1001 or substitute form signed by the beneficial owner of the
      Offered Certificates or the owner's agent claiming exemption from
      withholding under an applicable tax treaty, or (iii) IRS Form 4224 or
      substitute form signed by the beneficial owner of the Offered
      Certificates or the owner's agent claiming exemption from withholding
      of tax on income connected with the conduct of a trade or business in
      the United States; provided that in any such case (x) the applicable
      form is delivered pursuant to applicable procedures and is properly
      transmitted to the United States entity otherwise required to withhold
      tax and (y) none of the entities receiving the form has actual
      knowledge that the owner is a U.S. person or that any certification on
      the form is false.

  (b) An owner of an Offered Certificate who is a Foreign Person will not be
      subject to United States federal income tax on gain realized on the
      sale, exchange or redemption of the Offered Certificate, provided that
      (i) the gain is not effectively connected to a trade or business
      carried on by the owner in the United States, (ii) in the case of an
      owner who is an individual, the owner is not present in the United
      States for 183 days or more during the taxable year in which the sale,
      exchange or redemption occurs, (iii) in the case of gain representing
      accrued interest, the conditions described in clause (a) are
      satisfied, and (iv) the Offered Certificate was held as a capital
      asset.

  (c) If the interest, gain or income on an Offered Certificate held by a
      Foreign Person is effectively connected with the conduct of a trade or
      business in the United States by the Foreign Person, the holder
      (although exempt from the withholding tax previously discussed if an
      appropriate statement is furnished) generally will be

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<PAGE>

      subject to United States federal income tax on the interest, gain or
      income at regular federal income tax rates. In addition, if the
      Foreign Person is a foreign corporation, it may be subject to a branch
      profits tax equal to 30 percent of its "effectively connected earnings
      and profits" within the meaning of the Code for the taxable year, as
      adjusted for certain items, unless it qualifies for a lower rate under
      an applicable tax treaty.

  (d) An Offered Certificate owned by an individual who at the time of death
      is a nonresident alien will not be subject to United States federal
      estate tax as a result of the owner's death if, immediately before his
      death, (i) the decedent did not actually or constructively own 10% or
      more of the voting stock of Conseco Finance and (ii) the ownership of
      the Offered Certificate was not effectively connected with the conduct
      by the decedent of a trade or business in the United States.

    Final regulations dealing with withholding tax on income paid to foreign
persons, backup withholding tax, and related matters (the "New Withholding
Regulations") were issued by the Treasury Department on October 6, 1997. The
New Withholding Regulations will generally be effective for payments made after
December 31, 2000, subject to certain transition rules. In certain
circumstances, the New Withholding Regulations may impose stricter
certification requirements than the regulations presently in effect.
Prospective holders of Offered Certificates are urged to consult their own tax
advisors with respect to the New Withholding Regulations.

    If the IRS were to contend successfully that the Offered Certificates are
equity interests in a partnership (not taxable as a corporation), a Certificate
Owner that is a Foreign Person might be required to file a U.S. income tax
return and pay tax on its share of partnership income at regular U.S. rates,
including, in the case of a corporation, the branch profits tax (and would be
subject to withholding tax on its share of partnership income). If the Offered
Certificates are recharacterized as equity interests in an association taxable
as a corporation or a publicly traded partnership taxable as a corporation, an
owner who is a Foreign Person would generally be taxed (and be subject to
withholding) on the gross amount of the distributions on the Offered
Certificates, to the extent they are treated as dividends, at the rate of 30%
(unless the rate is reduced by applicable treaty).

State and Local Tax Consequences

    The activities to be undertaken by the Servicer in servicing and collecting
the Receivables will take place in Minnesota. The State of Minnesota imposes an
income tax on individuals, trusts and estates and a franchise tax measured by
net income on corporations. This discussion of Minnesota taxation is based upon
current statutory provisions and the regulations promulgated thereunder, and
applicable judicial or ruling authority, all of which are subject to change
(which may be retroactive). No ruling on any of the issues discussed below will
be sought from the Minnesota Department of Revenue.


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    If the Offered Certificates are treated as debt for federal income tax
purposes, in the opinion of Counsel this treatment will also apply for
Minnesota tax purposes, and the Trust will not be characterized as an
association, publicly traded partnership or taxable mortgage pool taxable as a
corporation for Minnesota tax purposes. Certificate Owners not otherwise
subject to Minnesota income or franchise taxation would not become subject to
such a tax solely because of their ownership of the Offered Certificates.
Certificate Owners already subject to income or franchise taxation in Minnesota
could, however, be required to pay such a tax on all or a portion of the income
generated from ownership of the Offered Certificates.

    If the Trust is treated as a partnership (not taxable as a corporation) for
federal income tax purposes, in the opinion of Counsel the Trust would also be
treated as such a partnership for Minnesota income tax purposes. The
partnership therefore would not be subject to Minnesota taxation. Certificate
Owners that are not otherwise subject to Minnesota income or franchise taxation
would not become subject to such a tax solely because of their interests in the
constructive partnership. Certificate Owners already subject to income or
franchise taxation in Minnesota could, however, be required to pay such a tax
on all or a portion of the income from the constructive partnership.

    If the Offered Certificates are treated as ownership interests in an
association or publicly traded partnership taxable as a corporation, in the
opinion of Counsel this treatment would also apply for Minnesota income and
franchise tax purposes. Pursuant to this treatment, the Trust would be subject
to the Minnesota franchise tax measured by net income (which could result in
reduced distributions to Certificate Owners). Certificate Owners that are not
otherwise subject to Minnesota income or franchise taxation would not become
subject to such a tax solely because of their interests in the constructive
corporation. Certificate Owners already subject to income or franchise taxation
in Minnesota could, however, be required to pay such a tax on all or a portion
of the income from the constructive corporation.

    Because state tax laws vary, it is not possible to describe the tax
consequences to the Certificate Owners in all of the states. Certificate Owners
are therefore urged to consult their own tax advisors with respect to the state
tax treatment of the Offered Certificates and income derived therefrom.

                              ERISA CONSIDERATIONS

    Section 406 of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), and Section 4975 of the Internal Revenue Code prohibit a
pension, profit-sharing or other employee benefit plan from engaging in various
transactions involving "plan assets" with persons that are "parties in
interest" under ERISA or "disqualified persons" under the Code with respect to
the plan. A violation of these "prohibited transaction" rules may generate
excise tax and other liabilities under ERISA and the Code for such person. For
example, a prohibited transaction would arise, unless an exemption were
available, if the Class A Certificates were viewed as debt of the Seller and
the Seller

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<PAGE>

were a disqualified person or party in interest with respect to a plan that
acquired Class A Certificates.

    Moreover, additional prohibited transactions could arise if the assets of
the Trust were deemed to constitute assets of any plan that owned Class A
Certificates. The Department of Labor has issued a final regulation, known as
the plan assets regulation, 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. These plans and accounts are collectively
referred to in this prospectus as "benefit plans". Under the plan assets
regulation the assets and properties of certain corporations, partnerships and
certain other entities in which a benefit plan acquires an "equity interest"
could be deemed to be assets of the benefit plan in some circumstances.
Accordingly, if benefit plans purchase Class A Certificates, the trust could be
deemed to hold plan assets of those benefit plans unless one of the exceptions
under the plan assets regulation is applicable to the trust.

    Class B Certificates will not be eligible for purchase by benefit plans.

Availability of Exemptions for Class A Certificates

    The plan assets regulation contains an exception, known as the "publicly-
offered securities exemption," that provides that if a benefit plan acquires a
"publicly-offered security," the issuer of the security is not deemed to hold
plan assets. A publicly-offered security is a security that is (i) freely
transferable, (ii) part of a class of securities that is owned by 100 or more
investors independent of the issuer and of one another and (iii) either is (A)
part of a class of securities registered under Section 12(b) or 12(g) of the
Exchange Act or (B) sold to the benefit plan as part of an offering of
securities to the public pursuant to an effective registration statement under
the Securities Act and the class of securities of which such security is a part
is registered under the Exchange Act within 120 days, or any later time that
may be allowed by the Securities and Exchange Commission, after the end of the
fiscal year of the issuer during which the offering of the securities to the
public occurred.

    It is anticipated that the Class A Certificates will meet the criteria of
the publicly-offered securities exemption as set forth above. The underwriters
expect, although they cannot give any assurance, that the Class A Certificates
will be held by at least 100 persons independent of the trust and of each other
at the conclusion of the offering; there are no restrictions imposed on the
transfer of the Class A Certificates; and the Class A Certificates will be sold
as part of an offering pursuant to an effective registration statement under
the Securities Act, and then will be timely registered under the Exchange Act.
The underwriters will notify the Trustee as to whether or not the Class A
Certificates will be held by 100 independent persons at the conclusion of the
offering. The transferor will not, however, determine whether the 100-investor
requirement of the publicly-offered securities exemption is satisfied with
respect to the Class A Certificates.

    If the Class A Certificates fail to meet the criteria of the publicly-
offered securities exemption and the trust's assets are deemed to include
assets of benefit plans that are holders of those Certificates, transactions
involving the trust and "parties in interest" or "disqualified

                                      117
<PAGE>

persons" with respect to such benefit plans might be prohibited under Section
406 of ERISA and Section 4975 of the Internal Revenue Code unless another ERISA
prohibited transaction exemption is applicable. Thus, for example, if a
participant in any benefit plan is an obligor or guarantor of any receivable,
under Department of Labor interpretations the purchase of the Class A
Certificates by that benefit plan could constitute a prohibited transaction.
There are five class exemptions issued by the Department of Labor that may
apply in such event: (1) Department of Labor Prohibited Transaction Exemption
84-14 (Class Exemption for Plan Asset Transactions Determined by Independent
Qualified Professional Asset Managers), (2) Department of Labor Prohibited
Transaction Exemption 91-38 (Class Exemption for Certain Transactions Involving
Bank Collective Investment Funds), (3) Department of Labor Prohibited
Transaction Exemption 90-1 (Class Exemption for Transactions Involving
Insurance Company Pooled Separate Accounts), (4) Department of Labor Prohibited
Transaction Exemption 95-60 (Class Exemption for Transactions Involving
Insurance Company General Accounts), and (5) Department of Labor Prohibited
Transaction Exemption 96-23 (Class Exemption for Plan Asset Transactions
Determined by In-House Asset Managers). We cannot assure you that these
exemptions, even if all of the conditions specified therein are satisfied, will
apply to all transactions involving the trust's assets.

Review by Benefit Plan Fiduciaries

    Due to the complexity of these rules and the penalties imposed upon persons
involved in prohibited transactions, it is especially important that any
benefit plan fiduciary who proposes to cause a benefit plan to purchase Class A
Certificates should consult with its own counsel with respect to the potential
consequences under ERISA and the Internal Revenue Code of the benefit plan's
acquisition and ownership of Class A Certificates. Assets of a benefit plan
should not be invested in the Class A Certificates unless it is clear that the
assets of the trust will not be plan assets or unless it is clear that a
prohibited transaction class exemption will apply and exempt all potential
prohibited transactions.

    In addition, prospective benefit plan investors should consult with their
legal advisors concerning the impact of ERISA and the Internal Revenue Code,
the applicability of the publicly-offered securities exemption, and the
potential consequences in their specific circumstances, prior to making an
investment in the Class A Certificates. Moreover, each benefit plan fiduciary
should determine whether under the general fiduciary standards of investment
prudence and diversification, an investment in the Class A Certificates is
appropriate for the benefit plan, taking into account the overall investment
policy of the benefit plan and the composition of the benefit plan's investment
portfolio.

                                      118
<PAGE>

                                  UNDERWRITING

    Subject to the terms and conditions set forth in an Underwriting Agreement
dated        , 2001 (the "Underwriting Agreement"), among the Transferor,
Conseco Finance and the underwriters named below (the "Underwriters"), the
Transferor has agreed to sell to each of the Underwriters, and each of the
Underwriters has severally agreed to purchase from the Transferor, the
principal amount of the Offered Certificates set forth opposite its name below.

<TABLE>
<CAPTION>
                                                        Amount of    Amount of
                                                         Class A      Class B
     Underwriters                                      Certificates Certificates
     ------------                                      ------------ ------------
     <S>                                               <C>          <C>
     [Underwriters]................................... $            $
                                                       ------------ -----------
         Total........................................ $            $
                                                       ============ ===========
</TABLE>

    In the Underwriting Agreement, the Underwriters have agreed, subject to the
terms and conditions set forth therein, to purchase all of the Offered
Certificates offered hereby if any Offered Certificates are purchased.

    The Transferor has been advised by the Underwriters that the Underwriters
intend to offer the Class A Certificates to the public at the public offering
price set forth on the cover page of the Prospectus, and to certain dealers at
such price less a concession not in excess of    % of the principal amount of
the Class A Certificates. The Transferor has been advised by the Underwriters
that the Underwriters propose initially to offer the Class B Certificates to
the public at the public offering price set forth on the cover page of this
Prospectus, and to certain dealers at such price less a concession not in
excess of    % of the principal amount of the Class B Certificates. The
Underwriters may allow, and such dealers may reallow, a discount with respect
to the Class A Certificates and the Class B Certificates not in excess of    %
and    %, respectively, of such principal amount to certain other dealers.
After the initial public offering, such public offering prices, concessions and
discounts may be changed.

    The Underwriting Agreement provides that the Transferor and Conseco Finance
will 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.

    The Underwriters have represented and agreed that (i) they have not offered
or sold and, prior to the expiration of the period of six months from the
Closing Date, will not offer or sell any Class A or Class B Certificates to
persons in the United Kingdom, except to persons whose ordinary activities
involve them in acquiring, holding, managing or disposing of investments (as
principal or agent) for the purposes of their businesses or otherwise in
circumstances which have not resulted and will not result in an offer to the
public in the United Kingdom within the meaning of the Public Offers of
Securities Regulation 1995; (ii) they have complied and will comply with all
applicable provisions of the Financial

                                      119
<PAGE>

Services Act 1986 with respect to anything done by them in relation to the
Class A or Class B Certificates in, from or otherwise involving the United
Kingdom; and (iii) they have only issued or passed on and will only issue or
pass on in the United Kingdom any document received by them in connection with
the issue of the Class A or Class B Certificates to a person who is of a kind
described in Article 11(3) of the Financial Services Act 1986 (Investment
Advertisements) (Exemptions) Order 1995, or is a person to whom such document
may otherwise lawfully be issued or passed on.

    The Underwriters and their affiliates may from time to time provide banking
and other financial services to the Transferor and the Trust, including
investment vehicles for funds held by the Trust.

    In connection with the offering, the Underwriters may engage in
transactions that stabilize, maintain or otherwise affect the price of the
Offered Certificates. Specifically, the Underwriters may overallot the
offering, creating a syndicate short position. The Underwriters may bid for and
purchase Offered Certificates in the open market to cover syndicate short
positions. In addition, the Underwriters may bid for and purchase Offered
Certificates in the open market to stabilize the price of the Offered
Certificates. These activities may stabilize or maintain the market price of
the Offered Certificates above independent market levels. The Underwriters are
not required to engage in these activities, and may end these activities at any
time.

                        LISTING AND GENERAL INFORMATION

    The Transferor has taken all reasonable care to ensure that the information
in this Prospectus in relation to the Transferor, the Trust, the Offered
Certificates and the Servicer is true and accurate in all material respects and
that in relation to the Transferor, the Trust, the Offered Certificates and the
Servicer there are no material facts the omission of which would make
misleading any statement herein, whether fact or opinion. The Transferor
accepts responsibility for the information contained in this Prospectus.

    Application will be made to list the Offered Certificates on the Luxembourg
Stock Exchange. In connection with the listing application, the Certificate of
Incorporation and Bylaws of the Transferor, as well as legal notice relating to
the issuance of the Offered Certificates will be deposited prior to listing
with the Chief Registrar of the District Court of Luxembourg, where copies
thereof may be obtained upon request. Once the Certificates have been so
listed, trading of the Offered Certificates may be effected on the Luxembourg
Stock Exchange. The Class A Certificates and the Class B Certificates have been
accepted for clearance through the facilities of DTC, Cedel and Euroclear.

    The transactions contemplated in this Prospectus were authorized by
resolutions adopted by the Transferor on September 13, 1995, and       , 2001.

    There have been no material adverse changes in the composition of the Trust
Portfolio since       , 2000.


                                      120
<PAGE>

    Copies of the Purchase Agreement, the Pooling and Servicing Agreement, the
Series 2001-1 Supplement, a form of Floorplan Agreement, the annual report of
independent public accountants described in "Description of the Offered
Certificates--Evidence as to Compliance" in the Prospectus, the reports to
Certificateholders referred to under "Description of the Offered Certificates--
Reports to Certificateholders" in the Prospectus will be available at the
office of the Listing Agent of the Trust in Luxembourg, whose address is 80,
place de la Gare 1616, Luxembourg. Financial information regarding the
Transferor will be included in the consolidated financial statements of Conseco
Finance Corp. in its Annual Report on Form 10-K for the fiscal year ended
December 31, 1999, which will be available at the office of the Listing Agent
in Luxembourg, along with future quarterly and annual reports of Conseco
Finance Corp. In the event that the Listing Agent is changed or replaced, in
any manner, the Trustee will publish or will cause to be published in the
Luxemburger Wort a notice to the effect that a change in the Listing Agent has
occurred and other relevant information.

    If the Offered Certificates are listed on the Luxembourg Stock Exchange,
the Trustee will publish or will cause to be published following each
Distribution Date in the Luxemburger Wort a notice to the effect that copies of
the statements described under "Description of the Offered Certificates--
Reports to Certificateholders" will be available for collection at the main
office of the Listing Agent of the Trust in Luxembourg.

    If the Offered Certificates are listed on the Luxembourg Stock Exchange,
all notices to Certificateholders will be given by publication in the
Luxemburger Wort. In the event that Definitive Certificates are issued, notices
to Certificateholders will also be given by mail to the address of such holders
as they appear in the Certificate Register.

    The Offered Certificates, the Pooling and Servicing Agreement, the 2001-1
Series Supplement and the Receivables Purchase Agreement are governed by the
laws of the State of Minnesota. The Trust was organized under the laws of the
State of Minnesota.

    The Certificates, the Pooling and Servicing Agreement and the Series 2001-1
Supplement are governed by the laws of the State of Minnesota.

                                 LEGAL MATTERS

    The legality of the Offered Certificates will be passed upon for the
Transferor and Conseco Finance by Dorsey & Whitney LLP, Minneapolis, Minnesota.
The material federal income tax consequences of the Certificates will be passed
upon for the Transferor by Dorsey & Whitney LLP. Certain legal matters relating
to the Offered Certificates will be passed upon for the Underwriters by
          .

                                      121
<PAGE>

                            INDEX OF PRINCIPAL TERMS

    This is a list of defined terms used in this document and the pages on
which the definitions are found.

<TABLE>
<S>                                                                       <C>
ABC Fixed/Floating Allocation Percentage.................................     70
ABC Investor Default Amount..............................................     89
Accounts.................................................................     29
Accumulation Period Commencement Date....................................     53
Accumulation Period Length...............................................     53
Accumulation Shortfall...................................................     37
Addition Date............................................................     59
Additional Accounts......................................................     29
Additional Class D Invested Amount.......................................     75
Affiliate................................................................     21
Asset-Based Receivable Overconcentration.................................     74
Asset-Based Receivables..................................................     23
Automatic Addition Condition.............................................     64
Bankruptcy Code..........................................................    107
Base Rate................................................................     89
Business Day.............................................................     49
Capitalized Interest Account.............................................     69
Cash Equivalents.........................................................     67
Clearstream Participants.................................................     46
Certificate Owner........................................................     43
Certificates.............................................................     21
Certificateholders.......................................................     42
Certificateholders' Interest.............................................     42
Class A Certificate Rate.................................................     49
Class A Fixed/Floating Allocation Percentage.............................     70
Class A Floating Allocation Percentage...................................     69
Class A Invested Amount..................................................     70
Class A Investor Charge-Off..............................................     90
Class A Monthly Interest.................................................     86
Class A Percentage.......................................................     73
Class A Principal........................................................     86
Class A Required Amount..................................................     77
Class A Scheduled Payment Date...........................................     37
Class B Certificate Rate.................................................     50
Class B Fixed/Floating Allocation Percentage.............................     70
Class B Floating Allocation Percentage...................................     69
Class B Invested Amount..................................................     71
Class B Investor Charge-Off..............................................     90
Class B Monthly Interest.................................................     86
Class B Percentage.......................................................     73
Class B Principal........................................................     87
Class B Required Amount..................................................     78
Class B Scheduled Payment Date...........................................     37
</TABLE>
<TABLE>
<S>                                                                       <C>
Class C Certificate Rate.................................................     50
Class C Fixed/Floating Allocation Percentage.............................     70
Class C Floating Allocation Percentage...................................     69
Class C Invested Amount..................................................     71
Class C Investor Charge-Off..............................................     90
Class C Percentage.......................................................     73
Class C Principal........................................................     88
Class C Required Amount..................................................     78
Class D Certificate Rate.................................................     50
Class D Fixed/Floating Allocation Percentage.............................     70
Class D Floating Allocation Percentage...................................     69
Class D Incremental Invested Amount......................................     74
Class D Invested Amount..................................................     72
Class D Investor Charge-Off..............................................     90
Class D Investor Default Amount..........................................     89
Class D Principal........................................................     88
Class D Subaccount.......................................................     76
CLD......................................................................     23
Code.....................................................................    109
Collateral Security......................................................     55
Collections..............................................................     53
Collection Account.......................................................     66
Companion Series.........................................................     90
Controlled Accumulation Amount...........................................     37
Controlled Accumulation Period...........................................     37
Controlled Deposit Amount................................................     37
Cooperative..............................................................     47
Counsel..................................................................    109
Cut-off Date.............................................................     29
Dealer Overconcentration.................................................     74
Dealers..................................................................     23
Defaulted Receivable.....................................................     89
Definitive Certificates..................................................     48
Depositaries.............................................................     43
Depository...............................................................     43
Determination Date....................................................... 40, 89
DHI Fees.................................................................     25
Discount Factor..........................................................     53
Distribution Account.....................................................     66
Distribution Date........................................................     49
DTC......................................................................     43
DTC Participants.........................................................     43
Early Amortization Period................................................     37
Eligible Account......................................................... 29, 61
Eligible Portfolio.......................................................     32
Eligible Receivable...................................................... 30, 62
</TABLE>

                                      122
<PAGE>

<TABLE>
<S>                                                                       <C>
ERISA....................................................................    116
Euroclear................................................................     47
Euroclear Operator.......................................................     47
Euroclear Participants...................................................     46
Euroclear System.........................................................     46
Excess Funding Account...................................................     67
Excess Interest Collections.............................................. 85, 89
Exchange.................................................................     55
Exchangeable Transferor Certificate......................................     42
Fitch....................................................................     66
Fixed/Floating Allocation Percentage.....................................     70
Floating Allocation Percentage...........................................     69
Floorplan Agreement......................................................     23
Floorplan Receivables....................................................     23
Foreign Person...........................................................    113
Funding Period...........................................................     68
Conseco Finance..........................................................      5
Imputed Yield Collections................................................     53
Independent Directors....................................................     21
Indirect Participants....................................................     44
Ineligible Receivables...................................................     59
Insolvency Event.........................................................     95
Insolvency Laws..........................................................     21
Interest Accrual Period..................................................     49
Interest Collections.....................................................     53
Interest Funding Account.................................................     66
Interest Free............................................................     25
Invested Amount.......................................................... 42, 73
Investor Default Amount..................................................     89
IRS......................................................................    109
LIBOR Determination Date.................................................     50
London Banking Day.......................................................     50
Manufacturer Overconcentration...........................................     74
Minimum Transferor Interest..............................................     64
Minimum Transferor Percentage............................................     64
Monthly Payment Rate.....................................................     51
Monthly Period...........................................................     37
Monthly Servicing Fee....................................................     95
Moody's..................................................................     66
MPR......................................................................     40
Negative Carry Amount....................................................     89
Net Receivables Rate.....................................................     50
New Withholding Regulations..............................................    115
Offered Certificates.....................................................     41
OID......................................................................    110
Overconcentration Amount.................................................     73
Overconcentration Amounts................................................     31
Participants.............................................................     43
Participations...........................................................     26
Pay Out Event............................................................ 38, 92
Paying Agent.............................................................     67
Pool Balance.............................................................     70
Pooling and Servicing Agreement..........................................     21
</TABLE>
<TABLE>
<S>                                                                      <C>
Pre-Allocated Invested Amount...........................................      12
Pre-Funded Amount.......................................................      68
Pre-Funding Account.....................................................      68
Principal Account.......................................................      66
Principal Collections...................................................      53
Principal Funding Investment Shortfall..................................      89
Principal Shortfalls....................................................      52
Principal Terms.........................................................      57
Product Line Overconcentration..........................................      74
Purchase Agreement...................................................... 21, 103
Qualified Institution...................................................      66
Rating Agency...........................................................  32, 67
Reallocated Class B Principal Collections...............................      76
Reallocated Class C Principal Collections...............................      76
Reallocated Class D Principal Collections...............................      75
Reallocated Principal Collections.......................................      77
Receivables.............................................................  21, 29
Receivables Transfer Date...............................................      59
Recoveries..............................................................      53
Reference Banks.........................................................      50
Removal Date............................................................      65
Removal Notice..........................................................      65
Removed Accounts........................................................      65
Required Amount.........................................................      86
Revolving Period........................................................      51
SAU.....................................................................      26
Securities Act..........................................................      57
Series..................................................................      21
Series 1999-1 Termination Date..........................................  37, 91
Series Available Interest Collections...................................      81
Series Issuance Date....................................................      59
Service Transfer........................................................      98
Servicer................................................................       5
Servicer Default........................................................      98
Shared Principal Collections............................................      52
Standard & Poors........................................................      66
Supplement..............................................................      55
Supplemental Certificate................................................      59
Telerate Page 3750......................................................      50
Terms and Conditions....................................................      47
Transfer Agent and Registrar............................................      48
Transfer Date...........................................................      78
Transfer Deposit Amount.................................................      60
Transferor Interest.....................................................      42
Transferor Percentage...................................................  42, 73
Transferor Retained Class...............................................      22
Transferor's Percentage.................................................      73
Trust Accounts..........................................................      53
Trust Portfolio.........................................................      29
Trust Termination Date..................................................      92
Underwriters............................................................     119
Underwriting Agreement..................................................     119
</TABLE>

                                      123
<PAGE>

                                                                         ANNEX A

                        GLOBAL CLEARANCE SETTLEMENT AND
                          TAX DOCUMENTATION PROCEDURES

   Except in certain limited circumstances, the globally offered Floating Rate
Floorplan Receivable Trust Certificates, Series 2001-1 (the "Global
Securities") will be available only in book-entry form. Investors in the Global
Securities may hold such Global Securities through any of The Depository Trust
Company ("DTC"), Clearstream or Euroclear. The Global Securities will be
tradeable as home market instruments in both the European and U.S. domestic
markets. Initial settlement and all secondary trades will settle in same-day
funds.

   Secondary market trading between investors holding Global Securities through
Clearstream and Euroclear will be conducted in the ordinary way in accordance
with their normal rules and operating procedures and in accordance with
conventional eurobond practice (i.e., seven calendar day settlement).

   Secondary market trading between investors holding Global Securities through
DTC will be conducted according to the rules and procedures applicable to U.S.
corporate debt obligations.

   Secondary cross-market trading between Clearstream or Euroclear and DTC
Participants holding Certificates will be effected on a delivery-against-
payment basis through the respective Depositaries of Clearstream and Euroclear
(in such capacity) and as DTC Participants.

   Non-U.S. holders (as described below) of Global Securities will be subject
to U.S. withholding taxes unless such holders meet certain requirements and
deliver appropriate U.S. tax documents to the securities clearing organizations
or their participants.

Initial Settlement

   All Global Securities will be held in book-entry form by DTC in the name of
Cede & Co. as nominee of DTC. Investors' interests in the Global Securities
will be represented through financial institutions acting on their behalf as
direct and indirect Participants in DTC. As a result, Clearstream and Euroclear
will hold positions on behalf of their participants through their respective
Depositaries, which in turn will hold such positions in accounts as DTC
Participants.

   Investors electing to hold their Global Securities through DTC will follow
the settlement practices applicable to conventional credit card certificate
issues. Investor securities custody accounts will be credited with their
holdings against payment in same-day funds on the settlement date.

   Investors electing to hold their Global Securities through Clearstream or
Euroclear accounts will follow the settlement procedures applicable to
conventional eurobonds, except

                                      A-1
<PAGE>

that there will be no temporary global security and no "lock-up" or restricted
period. Global Securities will be credited to the securities custody accounts
on the settlement date against payment in the same-day funds.

Secondary Market Trading

    Since the purchaser determines the place of delivery, it is important to
establish at the time of the trade where both the purchaser's and Transferor's
accounts are located to ensure that settlement can be made on the desired value
date.

    Trading between DTC Participants. Secondary market trading between DTC
Participants will be settled using the procedures applicable to conventional
credit card certificate issues in same-day funds.

    Trading between Clearstream and/or Euroclear Participants. Secondary market
trading between Clearstream Participants or Euroclear Participants will be
settled using the procedures applicable to conventional eurobonds in same-day
funds.

      Trading between DTC Transferor and Clearstream or Euroclear purchaser.
When Global Securities are to be transferred from the account of a DTC
Participant to the accounts of a Clearstream Participant or a Euroclear
Participant, the purchaser will send instructions to Clearstream or Euroclear
through a Clearstream Participant or Euroclear Participant at least one
business day prior to settlement. Clearstream or Euroclear will instruct the
respective Depositary, as the case may be, to receive the Global Securities
against payment. Payment will include interest accrued on the Global Securities
from and including the last coupon payment date to and excluding the settlement
date, on the basis of actual days elapsed and a 360 day year. Payment will then
be made by the respective Depositary to the DTC Participant's account against
delivery of the Global Securities. After settlement has been completed, the
Global Securities will be credited to the respective clearing system and by the
clearing system, in accordance with its usual procedures, to the Clearstream
Participant's or Euroclear Participant's account. The Global Securities credit
will appear the next day (European time) and the cash debit will be bad-valued
to, and the interest on the Global Securities will accrue from, the value date
(which would be the preceding day when settlement occurred in New York). If
settlement is not completed on the intended value date (i.e., the trade fails),
the Clearstream or Euroclear cash debit will be valued instead as of the actual
settlement date.

    Clearstream Participants and Euroclear Participants will need to make
available to the respective clearing systems the funds necessary to process
same-day funds settlement. The most direct means of doing so is to pre-position
funds for settlement, either from cash on hand or existing lines of credit, as
they would for any settlement occurring within Clearstream or Euroclear. Under
this approach, they may take on credit exposure to Clearstream or Euroclear
until the Global Securities are credited to their accounts one day later.

    As an alternative, if Clearstream or Euroclear has extended a line of
credit to them, Clearstream Participants or Euroclear Participants can elect
not to preposition funds and

                                      A-2
<PAGE>

allow that credit line to be drawn upon the finance settlement. Under this
procedure, Clearstream Participants or Euroclear Participants purchasing Global
Securities would incur overdraft charges for one day, assuming they cleared the
overdraft when the Global Securities were credited to their accounts. However,
interest on the Global Securities would accrue form the value date. Therefore,
in many cases the investment income on the Global Securities earned during that
one-day period may substantially reduce or offset the amount of such overdraft
charges, although this result will depend on each Clearstream Participant's or
Euroclear Participant's particular cost of funds.

    Since the settlement is taking place during New York business hours, DTC
Participants can employ their usual procedures for sending Global Securities to
the respective Depositary for the benefit of Clearstream Participants or
Euroclear Participants. The sale proceeds will be available to the DTC
Transferor on the settlement date. Thus, to the DTC Participants a cross-market
transaction will settle no differently than a trade between two DTC
Participants.

    Trading between Clearstream or Euroclear Transferor and DTC purchaser. Due
to time zone differences in their favor, Clearstream Participants and Euroclear
Participants may employ their customary procedures for transactions in which
Global Securities are to be transferred by the respective clearing system,
through the respective Depositary, to a DTC Participant. The Transferor will
send instructions to Clearstream or Euroclear through a Clearstream Participant
or Euroclear Participant at least one business day prior to settlement. In
these cases, Clearstream or Euroclear will instruct the respective Depositary,
as appropriate, to deliver the bonds to the DTC Participant's account against
payment. Payment will include interest accrued on the Global Securities from
and including the last coupon payment date to and excluding the settlement date
on the basis of actual days elapsed and a 360 day year. The payment will then
be reflected in the account of the Clearstream Participant or Euroclear
Participant the following day, and receipt of the cash proceeds in the
Clearstream Participant's or Euroclear Participant's account would be back-
valued to the value date (which would be the preceding day, when settlement
occurred in New York). Should the Clearstream Participant or Euroclear
Participant have a line of credit with its respective clearing system and elect
to be in debt in anticipation of receipt of the sale proceeds in its account,
the back-valuation will extinguish any overdraft charges incurred over that
one-day period. If settlement is not completed on the intended value date
(i.e., the trade fails), receipt of the cash proceeds in the Clearstream
Participant's or Euroclear Participant's account would instead be valued as of
the actual settlement date.

    Finally, day traders that use Clearstream or Euroclear and that purchase
Global Securities from DTC Participants for delivery to Clearstream
Participants or Euroclear Participants should note that these trades would
automatically fail on the sale side unless affirmative action were taken. At
least three techniques should be readily available to eliminate this potential
problem:

  (a)  borrowing through Clearstream or Euroclear for one day (until the
       purchase side of the day trade is reflected in their Clearstream or
       Euroclear accounts) in accordance with the clearing system's
       customary procedures;

                                      A-3
<PAGE>

  (b) borrowing the Global Securities in the U.S. from a DTC Participant no
      later than one day prior to settlement, which would give the Global
      Securities sufficient time to be reflected in their Clearstream or
      Euroclear account in order to settle the sale side of the trade; or

  (c) staggering the value dates for the buy and sell sides of the trade so
      that the value date for the purchase form the DTC Participant is at
      least one day prior to the value date for the sale to the Clearstream
      Participant or Euroclear Participant.

Certain U.S. Federal Income Tax Documentation Requirements

    A beneficial owner of Global Securities holding securities through
Clearstream or Euroclear (or through DTC if the holder has an address outside
the U.S.) will be subject to the 30% U.S. withholding tax that generally
applies to payments of interest (including original issue discount) on
registered debt issued by U.S. Persons, unless (i) each clearing system, bank
or other financial institution that holds customers' securities in the ordinary
course of its trade or business in the chain of intermediaries between such
beneficial owner and the U.S. entity required to withhold tax complies with
applicable certification requirements and (ii) such beneficial owner takes one
of the following steps to obtain an exemption or reduced tax rate:

    Exemption for non-U.S. Persons (Form W-8). Beneficial owners of
Certificates that are non-U.S. Persons can obtain a complete exemption from the
withholding tax by filing a signed Form W-8 (Certificate of Foreign Status) and
a certificate under penalties of perjury (the "Tax Certificate") that such
beneficial owner is (i) not a controlled foreign corporation (within the
meaning of Section 957(a) of the Code) that is related (within the meaning of
Section 864(d)(4) of the Code) to the Trust or the Transferor and (ii) not a 10
percent shareholder (within the meaning of Section 871(h)(3)(B) of the Code) of
the Trust or the Transferor. If the information shown on Form W-8 or the Tax
Certificate changes, a new Form W-8 or Tax Certificate, as the case may be,
must be filed within 30 days of such change.

    Exemption for non-U.S. Persons with effectively connected income (Form
4224). A non-U.S. Person, including a non-U.S. corporation or bank with a U.S.
branch, for which the interest income is effectively connected with its conduct
of a trade or business in the United States, can obtain an exemption from the
withholding tax by filing Form 4224 (Exemption from Withholding of Tax on
Income Effectively Connected with the Conduct of a Trade or Business in the
United States).

    Exemption or reduced rate for non-U.S. persons resident in treaty countries
(Form 1001). Non-U.S. Persons that are Certificate Owners residing in a country
that has a tax treaty with the United States can obtain an exemption or reduced
tax rate (depending on the treaty terms) by filing Form 1001 (Ownership,
Exemption or Reduced Rate Certificate). If the treaty provides only for a
reduced rate, withholding tax will be imposed at that rate unless the filer
alternatively files Form W-8. Form 1001 may be filed by the Certificate Owner
or his agent.


                                      A-4
<PAGE>

    Exemption for U.S. Persons (Form W-9). U.S. Persons can obtain a complete
exemption from the withholding tax by filing Form W-9 (Payer's Request for
Taxpayer Identification Number and Certification).

    U.S. Federal Income Tax Reporting Procedure. The Certificate Owner of a
Global Security or, in the case of a Form 1001 or a Form 4224 filer, his agent,
files by submitting the appropriate form to the person through whom it holds
(the clearing agency, in the case of persons holding directly on the books of
the clearing agency). Form W-8 and Form 1001 are effective for three calendar
years and Form 4224 is effective for one calendar year.

    The term "U.S. Person" means (1) a citizen or resident of the United
States, (2) a corporation or partnership organized in or under the laws of the
United States or any political subdivision thereof, (3) an estate the income of
which is includible in gross income for United States tax purposes, regardless
of its source or (4) a trust if (A) a court within the United States is able to
exercise primary supervision over the administration of the trust and (B) one
or more United States trustees have authority to control all substantial
decisions of the trust. This summary does not deal with all aspects of U.S.
Federal income tax withholding that may be relevant to foreign holders of the
Global Securities. Investors are advised to consult their own tax advisors for
specific tax advice concerning their holding and disposing of the Global
Securities.


                                      A-5
<PAGE>

                                                                         ANNEX B

                                  OTHER SERIES

    The table below sets forth the principal characteristics of Series 1996-1,
Series 1996-2, Series 1998-1, Series 1998-A, Series 1998-2 and Series 1999-1,
the only Series heretofore issued by the Trust. Series 1995-1 was paid off in
October 1998, Series 1998-A was retired in October 1998 and Series 1998-1 will
be retired by April 2001. Each of Series 1996-1, Series 1998-A and Series
1999-1 is a series of variable funding certificates, meaning that the aggregate
outstanding principal amount of the Series 1996-1 Certificates, the Series
1998-A Certificates and the Series 1999-1 Certificates may be increased or
decreased from time to time subject to a maximum amount. It is expected that
the aggregate outstanding principal amount of the Series 1996-1 Certificates
will be zero on the Series 1999-1 Closing Date. For more specific information
with respect to any Series, any prospective investor should contact the
Servicer at (651) 293-3400. The Servicer will provide, without charge, to any
prospective purchaser of the Certificates, a copy of the disclosure documents
for any previous publicly issued Series.

Series 1996-1

<TABLE>
<S>                                           <C>
Scheduled Series Termination Date............ September 27, 2001
Series Issuance Date......................... June 12, 1996
Annual Servicing Fee Percentage.............. 2.0%

Class A Certificates

Invested Amount.............................. Variable (subject to a maximum of
                                              $271,610,000)
Certificate Rate............................. Variable
Enhancement.................................. Subordination of Class B
                                              Certificates, Class C Certificates
                                              and Class D Certificates

Class B Certificates

Invested Amount.............................. Variable (subject to a maximum of
                                              $14,130,000)
Certificate Rate............................. Variable
Enhancement.................................. Subordination of Class C
                                              Certificates and Class D
                                              Certificates

Class C Certificates

Invested Amount.............................. Variable
Certificate Rate............................. None
Enhancement.................................. Subordination of Class D
                                              Certificates

Class D Certificates

Initial Invested Amount...................... Variable (subject to a maximum of
                                              $35,817,679.77)
Certificate Rate............................. None
</TABLE>

                                      B-1
<PAGE>

Series 1996-2

<TABLE>
<S>                                        <C>
Scheduled Series Termination Date......... December 13, 2001
Series Issuance Date...................... December 18, 1996
Annual Servicing Fee Percentage........... 2.0%

Class A Certificates

Invested Amount........................... $478,800,000
Certificate Rate.......................... LIBOR + 0.08%
Commencement of Controlled Accumulation
 Period................................... August 1999
Enhancement............................... Subordination of Class B
                                           Certificates, Class C Certificates
                                           and Class D Certificates

Class B Certificates

Invested Amount........................... $21,500,000
Certificate Rate.......................... LIBOR + 0.30%
Enhancement............................... Subordination of Class C
                                           Certificates and Class D
                                           Certificates

Class C Certificates

Invested Amount........................... $8,100,000
Certificate Rate.......................... None
Enhancement............................... Subordination of Class D
                                           Certificates

Class D Certificates

Initial Invested Amount................... $29,600,000 (exclusive of the Class
                                           D Incremental Invested Amount)
Certificate Rate.......................... None

Series 1998-1

Scheduled Series Termination Date......... March 13, 2003
Series Issuance Date...................... April 15, 1998
Annual Servicing Fee Percentage........... 2.00%

Class A Certificates

Invested Amount........................... $400,400,000
Certificate Rate.......................... LIBOR + .05%
Commencement of Controlled Accumulation
 Period................................... October 2000
Enhancement............................... Subordination of Class B
                                           Certificates, Class C Certificates
                                           and Class D Certificates

Class B Certificates

Invested Amount........................... $20,475,000
Certificate Rate.......................... LIBOR + .27%
Enhancement............................... Subordination of Class C
                                           Certificates and Class D
                                           Certificates
</TABLE>

                                      B-2
<PAGE>

Class C Certificates

<TABLE>
<S>                                          <C>
Invested Amount............................. $19,337,000
Certificate Rate............................ LIBOR + .70%
Enhancement................................. Subordination of Class D
                                             Certificates

Class D Certificates

Initial Invested Amount..................... $14,788,000 (exclusive of the Class
                                             D Incremental Invested Amount)
Certificate Rate............................ LIBOR + .70%

Series 1998-A

Scheduled Series Termination Date........... March 13, 2001
Series Issuance Date........................ August 3, 1998
Annual Servicing Fee Percentage............. 2.00%

Class A Certificates

Invested Amount............................. Variable (subject to a maximum of
                                             $404,800,000)
Certificate Rate............................ Variable
Commencement of Amortization Period......... December 1998
Enhancement................................. Subordination of Class B
                                             Certificates, Class C Certificates
                                             and Class D Certificates

Class B Certificates

Invested Amount............................. Variable (subject to a maximum of
                                             $20,700,000)
Certificate Rate............................ Variable
Enhancement................................. Subordination of Class C
                                             Certificates and
                                             Class D Certificates

Class C Certificates

Invested Amount............................. Variable (subject to a maximum of
                                             $25,300,000)
Certificate Rate............................ Variable
Enhancement................................. Subordination of Class D
                                             Certificates

Class D Certificates

Initial Invested Amount..................... Variable (subject to a maximum of
                                             $9,200,000)
Certificate Rate............................ Variable
</TABLE>

                                      B-3
<PAGE>

Series 1998-2

<TABLE>
<S>                                        <C>
Scheduled Series Termination Date......... April 13, 2004
Series Issuance Date...................... September 14, 1998
Annual Servicing Fee Percentage........... 2.00%

Class A Certificates

Invested Amount........................... $440,000,000
Certificate Rate.......................... LIBOR + .055%
Commencement of Controlled Accumulation
 Period................................... November 2001
Enhancement............................... Subordination of Class B
                                           Certificates, Class C Certificates
                                           and Class D Certificates

Class B Certificates

Invested Amount........................... $22,500,000
Certificate Rate.......................... LIBOR + .225%
Enhancement............................... Subordination of Class C
                                           Certificates and Class D
                                           Certificates

Class C Certificates

Invested Amount........................... $21,250,000
Certificate Rate.......................... LIBOR + .70%
Enhancement............................... Subordination of Class D
                                           Certificates

Class D Certificates

Initial Invested Amount................... $24,921,000 (exclusive of the Class
                                           D Incremental Invested Amount)
Certificate Rate.......................... LIBOR + .70%

Series 1999-1

Scheduled Series Termination Date......... November 13, 2004
Series Issuance Date...................... October 4, 1999
Annual Servicing Fee Percentage........... 2.00%

Class A Certificates

Invested Amount........................... $605,500,000
Certificate Rate.......................... LIBOR + .35%
Commencement of Controlled Accumulation
 Period................................... July 2002
Enhancement............................... Subordination of Class B
                                           Certificates, Class C Certificates
                                           and Class D Certificates

Class B Certificates

Invested Amount........................... $31,500,000
Certificate Rate.......................... LIBOR + 0.65%
Enhancement............................... Subordination of Class C
                                           Certificates and Class D
                                           Certificates
</TABLE>

                                      B-4
<PAGE>

Class C Certificates

<TABLE>
<S>                                          <C>
Invested Amount............................. $40,250,000
Certificate Rate............................ LIBOR + 0.95%
Enhancement................................. Subordination of Class D
                                             Certificates

Class D Certificates

Initial Invested Amount..................... $28,000,000 (exclusive of the Class
                                             D Incremental Invested Amount)
Certificate Rate............................ LIBOR + 0.95%
</TABLE>



                                      B-5
<PAGE>


                                   $200,000

                       [LOGO OF GREEN TREE APPEARS HERE]

                 Green Tree Floorplan Receivables Master Trust

$100,000 Floating Rate Floorplan Receivable Trust Certificates, Series 2001-1,
                                    Class A
$100,000 Floating Rate Floorplan Receivable Trust Certificates, Series 2001-1,
                                    Class B

                      Green Tree Floorplan Funding Corp.
                                  Transferor

                             Conseco Finance Corp.
                                   Servicer

                  ------------------------------------------
                                  PROSPECTUS
                  ------------------------------------------

                                [Underwriters]


Until the expiration of 90 days after the date of this prospectus, all dealers
selling the Class A Certificates or Class B Certificates, whether or not
participating in this distribution, will deliver a prospectus. This delivery
requirement 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.

                                       , 2001

<PAGE>

                                    PART II.

                     INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution

<TABLE>
      <S>                                                             <C>
      SEC registration fee........................................... $     50
      Blue Sky fees and expenses.....................................   10,000*
      Accountant's fees and expenses.................................   30,000*
      Attorney's fees and expenses...................................   75,000*
      Trustee's fees and expenses....................................   15,000*
      Printing and engraving expenses................................  150,000*
      Rating Agency fees.............................................  150,000*
      Miscellaneous..................................................    4,950*
                                                                      --------
      Total.......................................................... $435,000*
                                                                      ========
</TABLE>
--------
* Estimated

Item 16. Exhibits and Financial Statement Schedules

    (a) Exhibits:

<TABLE>
     <C>    <S>
        1.1 --Underwriting Agreement dated as of     , 2001*
     (1)3.1 --Certificate of Incorporation of Green Tree Floorplan Funding
              Corp.
     (1)3.2 --Bylaws of Green Tree Floorplan Funding Corp.
     (2)4.1 --Pooling and Servicing Agreement dated December 1, 1995
        4.2 --Series 2001-1 Supplement to the Pooling and Servicing Agreement
              dated as of      , 2001**
     (2)4.3 --Receivables Purchase Agreement dated December 1, 1995
     (3)4.4 --Amendment No. 1 to the Pooling and Servicing Agreement dated
              as of March 11, 1998
        5.1 --Opinion and consent of Dorsey & Whitney LLP as to legality*
        8.1 --Opinion and consent of Dorsey & Whitney LLP as to tax matters*
       23.1 --Consent of Dorsey & Whitney LLP (included as part of Exhibit
              5.1)*
       23.2 --Consent of Dorsey & Whitney LLP (included as part of Exhibit
              8.1)*
       24.1 --Power of attorney from officers and directors of the Registrants
              (included on the signature page hereto)**
</TABLE>
--------
*   To be filed by amendment.
**  Filed herewith.
(1)  Incorporated by reference to the corresponding exhibit numbers in
     Amendment No. 1 to the Company's Registration Statement on Form S-1,
     Registration No. 33-62433, filed November 8, 1995.
(2)  Incorporated by reference to the corresponding exhibit in the Company's
     Registration Statement on Form S-1, Registration No. 333-15285, filed
     October 31, 1996.
(3)  Incorporated by reference to the corresponding exhibit to Post Effective
     Amendment No. 1 to the Registration Statement on Form S-1, Registration
     No. 333-47533, filed April 15, 1998.

    (b) Financial Statements:

      Not Applicable.

Item 17. Undertakings

    Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the

                                      II-1
<PAGE>

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 the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the 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
issuer.

    The undersigned registrant hereby undertakes that:

  (1)  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 Securities Act shall be
       deemed to be part of this registration statement as of the time it
       was declared effective.

  (2)  For the purpose of determining any liability under the Securities Act
       of 1933, each post-effective amendment that contains a form of
       prospectus shall be deemed to be a new registration statement
       relating to the securities offered therein, and the offering of such
       securities at that time shall be deemed to be the initial bona fide
       offering thereof.

                                      II-2
<PAGE>

                                   SIGNATURES

    Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Saint Paul, State of
Minnesota, on the 23rd day of January, 2001.

                                     Green Tree Floorplan Funding Corp.

                                                  /s/ Brian F. Corey
                                     By: ______________________________________
                                                    Brian F. Corey
                                          Senior Vice President and Secretary

    Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities and on the
date indicated. Each person whose signature to this Registration Statement
appears below hereby constitutes and appoints Brian F. Corey and Phyllis A.
Knight as his/her true and lawful attorney-in-fact and agent, with full power
of substitution, to sign on his behalf individually and in the capacity stated
below and to perform any acts necessary to be done in order to file all
amendments and post-effective amendments to this Registration Statement, and
any and all instruments filed as part of or in connection with this
Registration Statement or the amendments thereto and each of the undersigned
does hereby ratify and confirm all that said attorney-in-fact and agent, or his
substitutes, shall do or cause to be done by virtue hereof.

<TABLE>
<CAPTION>
             Signature                         Title                  Date
<S>                                  <C>                        <C>
      /s/ Bruce A. Crittenden        President and Director     January 23, 2001
____________________________________  (Principal Executive
        Bruce A. Crittenden           Officer)

       /s/ Phyllis A. Knight         Senior Vice President and  January 23, 2001
____________________________________  Treasurer (Principal
         Phyllis A. Knight            Financial Officer and
                                      Principal Accounting
                                      Officer)

         /s/ Brian F. Corey          Senior Vice President,     January 23, 2001
____________________________________  Secretary and Director
           Brian F. Corey

         /s/ Paul A. Boyum           Director                   January 23, 2001
____________________________________
           Paul A. Boyum

                                     Director
____________________________________
           Gary P. Mills
</TABLE>

<PAGE>

                                   SIGNATURES

    Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Saint Paul, State of
Minnesota, on the 23rd day of January, 2001.

                                     Green Tree Floorplan
                                     Receivables Master Trust

                                     By Green Tree Floorplan Funding Corp.

                                                 /s/ Brian F. Corey
                                     By: ______________________________________
                                                   Brian F. Corey
                                        Senior Vice President and Secretary
<PAGE>

                               INDEX TO EXHIBITS

<TABLE>
<CAPTION>
 <C>    <S>                                                                 <C>
    1.1 --Underwriting Agreement dated as of     , 2001*
 (1)3.1 --Certificate of Incorporation of Green Tree Floorplan Funding
          Corp.
 (1)3.2 --Bylaws of Green Tree Floorplan Funding Corp.
 (2)4.1 --Pooling and Servicing Agreement dated December 1, 1995
    4.2 --Series 2001-1 Supplement to the Pooling and Servicing Agreement
          dated as of     , 2001**
 (2)4.3 --Receivables Purchase Agreement dated December 1, 1995
 (3)4.4 --Amendment No. 1 to the Pooling and Servicing Agreement dated as
          of March 11, 1998
    5.1 --Opinion and consent of Dorsey & Whitney LLP as to legality*
    8.1 --Opinion and consent of Dorsey & Whitney LLP as to tax matters*
   23.1 --Consent of Dorsey & Whitney LLP (included as part of Exhibit
          5.1)*
   23.2 --Consent of Dorsey & Whitney LLP (included as part of Exhibit
          8.1)*
   24.1 --Power of attorney from officers and directors of the
          Registrants (included on the signature page hereto)**
</TABLE>
--------
*   To be filed by amendment.
**  Filed herewith.
(1)  Incorporated by reference to the corresponding exhibit numbers in
     Amendment No. 1 to the Company's Registration Statement on Form S-1,
     Registration No. 33-62433, filed November 8, 1995.
(2)  Incorporated by reference to the corresponding exhibit in the Company's
     Registration Statement on Form S-1, Registration No. 333-15285, filed
     October 31, 1996.
(3)  Incorporated by reference to the corresponding exhibit to Post Effective
     Amendment No. 1 to the Registration Statement on Form S-1, Registration
     No. 333-47533, filed April 15, 1998.
[{"type": "S-1", "sequence": "1", "filename": "0001.txt", "description": "FORM S-1", "secsgml_size_bytes": 468499}]
[{"company-data": {"conformed-name": "GREENTREE FLOORPLAN FUNDING CORP", "cik": "0001026002", "assigned-sic": "6189", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-1", "act": "33", "file-number": "333-54190", "film-number": "1513759"}, "business-address": {"street1": "500 LANDMARK TOWERS", "street2": "345 ST PETER ST", "city": "MINNEAPOLIS", "state": "MN", "zip": "55102-1639", "phone": "6122833400"}, "mail-address": {"street1": "500 LANDMARK TOWERS", "street2": "345 ST PETER ST", "city": "MINNEAPOLIS", "state": "MN", "zip": "55102-1639"}}, {"company-data": {"conformed-name": "GREEN TREE FLOORPLAN RECIEVABLES MASTER TRUST", "cik": "0001058999", "assigned-sic": "6189", "irs-number": "416433537", "state-of-incorporation": "MN", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-1", "act": "33", "file-number": "333-54190-01", "film-number": "1513760"}, "business-address": {"street1": "1100 LANDMARK TOWERS", "street2": "345 ST PETER ST", "city": "SAINT PAUL", "state": "MN", "zip": "55102-1639", "phone": "6122933400"}, "mail-address": {"street1": "1100 LANDMARK TOWERS", "street2": "345 ST PETER ST", "city": "SAINT PAUL", "state": "MN", "zip": "55102-1639"}}]
As filed with the Securities and Exchange Commission on January 23, 2001
                                                   Registration Nos. 333-   -01
                                                                      333-
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                   FORM S-1

                            REGISTRATION STATEMENT
                                     Under
                          The Securities Act of 1933

                 GREEN TREE FLOORPLAN RECEIVABLES MASTER TRUST
                 (Issuer with respect to Offered Certificates)

                      GREEN TREE FLOORPLAN FUNDING CORP.
                  (Originator of the Trust described herein)
            (Exact name of registrant as specified in its charter)

        Delaware                    6189                    41-1823871
     (State or other          (Primary Standard          (I.R.S. Employer
     jurisdiction of             Industrial             Identification No.)
    incorporation or         Classification Code
      organization)                Number)

                              500 Landmark Towers
            345 St. Peter Street, Saint Paul, Minnesota 55102-1639
                                (651) 293-3400
  (Address, including zip code, and telephone number, including area code, of
                   registrant's principal executive offices)

                             Brian F. Corey, Esq.
                             1100 Landmark Towers
            345 St. Peter Street, Saint Paul, Minnesota 55102-1639
                                (651) 293-3400
(Name, address, including zip code, and telephone number, including area code,
                             of agent for service)

                                  Copies to:
          Charles F. Sawyer                        Renwick D. Martin
        Dorsey & Whitney LLP                       Brown & Wood LLP
       220 South Sixth Street                   One World Trade Center
    Minneapolis, Minnesota 55402               New York, New York 10048
           (612) 343-7986                           (212) 839-5300

   Approximate date of commencement of proposed sale of securities to the
public: On or after the effective date of the registration statement, as
determined by market conditions.

   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 this Form is a post-effective amendment filed pursuant to Rule 462(d)
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     Maximum
                                 Amount      Maximum     Aggregate  Amount of
    Title of Each Class of       to be    Offering Price Offering  Registration
  Securities to Be Registered  Registered  Per Unit(1)   Price(1)      Fee
-------------------------------------------------------------------------------
Class A Certificates..........  $100,000       100%      $100,000     $25.00
-------------------------------------------------------------------------------
Class B Certificates..........  $100,000       100%      $100,000     $25.00
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
(1) Estimated solely for the purposes of calculating the registration fee.

   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 the Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a)
may determine.

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+Information contained in this prospectus is subject to completion or          +
+amendment. These securities may not be sold nor may offers to buy be accepted +
+prior to the time this prospectus becomes final. This prospectus shall not    +
+constitute an offer to sell or the solicitation of an offer to buy nor shall  +
+there by 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, dated January 23, 2001

                                                Filed Pursuant to Rule 424(b)(4)
                                                          File Nos. 333-82443-01
                                                                    333-82443

                                                                  [CONSECO LOGO]

PROSPECTUS

                                    $200,000

                 Green Tree Floorplan Receivables Master Trust

 $100,000 Floating Rate Floorplan Receivable Trust Certificates, Series 2001-1,
                                    Class A

 $100,000 Floating Rate Floorplan Receivable Trust Certificates, Series 2001-1,
                                    Class B

                       Green Tree Floorplan Funding Corp.
                                   Transferor

                             Conseco Finance Corp.
                                    Servicer

  Before investing in the certificates, you should read the information under
"Risk Factors" beginning on page 10.

  The certificates represent interests in the trust only and are not interests
in or obligations of any other entity.
Underwriting Proceeds to     Scheduled
              Price     Discounts    Transferor  Payment Date(1)      Interest Rate
-----------------------------------------------------------------------------------------
Class A     100%            %           %                      Lesser of (a) LIBOR plus
                                                                   % per annum and (b)
                                                                 net receivables rate
-----------------------------------------------------------------------------------------
  Class B     100%            %           %                      Lesser of (a) LIBOR plus
                                                                   % per annum and (b)
                                                                 net receivables rate
-----------------------------------------------------------------------------------------
  Total    $           $            $
-----
(1)  Under some circumstances, you may receive principal distributions before
     or after the Scheduled Payment Date specified above.

  The certificates will be delivered in book-entry form only on or about
     , 2001.

    Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.

                                 [Underwriters]

                                        , 2001
Content of Prospectus

    You should rely only on the information contained in this document. We have
not authorized anyone to provide you with different information.

    We include cross-references in this document to captions in this document
where you can find further related discussions. The Table of Contents on page 3
of this document provides the pages on which these captions are located.

    You can find a listing of pages where capitalized terms used in this
document are defined under the caption "Index of Principal Terms" beginning on
page 122 in this prospectus.

    Investors and their representatives who receive an electronic prospectus
can receive a paper prospectus, without charge, by contacting the underwriters.

Limitations on Offers or Solicitations

    We do not intend this document to be an offer or solicitation:

  (A) if used in a jurisdiction in which such offer or solicitation is not
      authorized;

  (B) if the person making such offer or solicitation is not qualified to do
      so; or

  (C) if such offer or solicitation is made to anyone to whom it is unlawful
      to make such offer or solicitation.

Transactions That May Affect the Price of the Certificates

    The underwriters may engage in transactions that stabilize, maintain, or
otherwise affect the price of the certificates. Those transactions may include
stabilizing, the purchase of certificates to cover syndicate short positions
and the imposition of penalty bids. For a description of these activities, see
"Underwriting" herein.

                                       2
TABLE OF CONTENTS
SUMMARY OF TERMS............................................................   5
 Offered Certificates.......................................................   5
 Issuer.....................................................................   5
 Transferor.................................................................   5
 Servicer...................................................................   5
 Trustee....................................................................   5
 Closing Date...............................................................   5
 Trust Assets...............................................................   5
 Series 2001-1 and Other Series.............................................   6
 Distribution Dates.........................................................   6
 Interest...................................................................   6
 Principal..................................................................   6
 Priority of Application of Collections and Allocation of Losses............   7
 Credit Enhancement.........................................................   7
 Optional Repurchase........................................................   8
 Tax Status.................................................................   8
 ERISA Considerations.......................................................   8
 Ratings....................................................................   8
 Address and Telephone Numbers..............................................   9
 Listing....................................................................   9
RISK FACTORS................................................................  10
THE TRUST...................................................................  21
THE TRANSFEROR..............................................................  21
CONSECO FINANCE CORP. AND ITS COMMERCIAL LENDING DIVISION...................  22
 Recent Developments........................................................  22
 Commercial Lending Division--General.......................................  23
 Floorplan Receivables--General.............................................  24
 Floorplan Agreements With Manufacturers....................................  24
 Floorplan Credit Underwriting Process......................................  24
 Creation of Floorplan Receivables..........................................  25
 Floorplan Payment Terms....................................................  26
 Floorplan Billing Procedures...............................................  26
 Floorplan Dealer Monitoring................................................  26
 Participations in Floorplan Receivables....................................  27
 Participation Arrangements.................................................  27
 Asset-Based Receivables....................................................  28
 Realization on the Receivables.............................................  29
THE RECEIVABLES.............................................................  29
 Eligible Receivables and Eligible Accounts.................................  30
THE ACCOUNTS................................................................  33
 General....................................................................  33
 Description of Conseco Finance's Portfolio.................................  33
 Yield Information..........................................................  35
 Major Customers; Major Manufacturers.......................................  35
 Delinquency Experience.....................................................  36
 Loss Experience............................................................  36
 Aging Experience...........................................................  37
MATURITY CONSIDERATIONS.....................................................  38
USE OF PROCEEDS.............................................................  43
DESCRIPTION OF THE OFFERED CERTIFICATES.....................................  43
 General....................................................................  43
 Book-Entry Registration....................................................  44
 Definitive Certificates....................................................  48
 Replacement of Definitive Certificates.....................................  49
 Interest Payments..........................................................  50
 Principal Payments.........................................................  52
 Postponement of Controlled Accumulation Period.............................  53
Interest Collections; Principal Collections...............................  53
 Subordination of the Class B Certificates.................................  54
 Transfer and Assignment of Receivables and Collateral Security............  55
 Exchanges; Creation of New Series.........................................  56
 Representations and Warranties............................................  59
 Addition of Accounts......................................................  64
 Removal of Accounts.......................................................  66
 Trust Accounts............................................................  67
 Excess Funding Account....................................................  68
 Pre-Funding Account.......................................................  69
 Allocation Percentages....................................................  70
 The Overconcentration Amounts.............................................  74
 Reallocation of Cash Flows................................................  75
 Reallocated Principal Collections.........................................  75
 Application of Collections................................................  79
 Coverage of Certain Interest Shortfalls...................................  89
 Defaulted Receivables.....................................................  89
 Investor Charge-offs......................................................  90
 Companion Series..........................................................  91
 Final Payment of Principal; Termination...................................  91
 Pay Out Events............................................................  93
 Servicing Compensation and Payment of Expenses............................  96
 Certain Matters Regarding the Transferor and the Servicer.................  96
 Servicer Default..........................................................  98
 Reports to Certificateholders.............................................  99
 Reports; Notices.......................................................... 101
 Evidence as to Compliance................................................. 101
 Amendments................................................................ 101
 List of Certificateholders................................................ 102
 The Trustee............................................................... 102
DESCRIPTION OF THE PURCHASE AGREEMENT...................................... 103
 Transfer of Receivables................................................... 103
 Representations and Warranties............................................ 103
 Certain Covenants......................................................... 104
 Termination............................................................... 105
CERTAIN LEGAL ASPECTS OF THE RECEIVABLES................................... 105
 Transfer of Receivables................................................... 105
 Certain Matters Relating to Bankruptcy.................................... 106
 Security Interests in the Related Products................................ 109
FEDERAL INCOME TAX CONSEQUENCES............................................ 109
 State and Local Tax Consequences.......................................... 115
ERISA CONSIDERATIONS....................................................... 116
 Availability of Exemptions for Class A Certificates....................... 117
 Review by Benefit Plan Fiduciaries........................................ 118
UNDERWRITING............................................................... 119
LISTING AND GENERAL INFORMATION............................................ 120
LEGAL MATTERS.............................................................. 121
INDEX OF PRINCIPAL TERMS................................................... 122
ANNEX A: GLOBAL CLEARANCE SETTLEMENT AND TAX DOCUMENTATION PROCEDURES...... A-1
 Initial Settlement........................................................ A-1
 Secondary Market Trading.................................................. A-2
Certain U.S. Federal Income Tax Documentation Requirements................. A-4
ANNEX B: OTHER SERIES...................................................... B-1
3
Note on forward-looking statements: All statements, trend analyses and
other information contained in this prospectus and elsewhere (such as in
filings by Conseco Finance with the Securities and Exchange Commission, press
releases, presentations by Conseco Finance or its management or oral
statements) relative to markets for Conseco Finance's products and trends in
Conseco Finance's operations or financial results, as well as other statements
including words such as "anticipate," "believe," "plan," "estimate," "expect,"
"intend," "should," "could," "goal," "target," "on track," "comfortable with"
and other similar expressions, constitute forward-looking statements under the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements are subject to known and unknown risks, uncertainties and other
factors which may cause actual results to be materially different from those
contemplated by the forward-looking statements. Such factors include, among
other things:

  .   general economic conditions and other factors, including prevailing
      interest rate levels and stock and credit market performance, which
      may affect (among other things) Conseco Finance's ability to make
      loans and access capital resources and the costs associated therewith,
      and the level of defaults and prepayments of loans made by Conseco
      Finance;

  .   Conseco Finance's ability to achieve anticipated synergies and levels
      of operational efficiencies;

  .   customer response to new products, distribution channels and marketing
      initiatives;

  .   performance of its investments;

  .   changes in the federal income tax laws and regulations which may
      affect the relative tax advantages of some of Conseco Finance's
      products;

  .   increasing competition in the finance business;

  .   regulatory changes or actions, including those relative to regulation
      of financial services;

  .   the outcome of Conseco Finance's efforts to sell assets and the
      availability of capital during this process;

  .   actions by rating agencies and the effects of past or future actions
      by these agencies on Conseco Finance's business; and

  .   the risk factors or uncertainties listed from time to time in the
      filings of Conseco Finance or its parent, Conseco, Inc., with the
      Securities and Exchange Commission.

                                       4
SUMMARY OF TERMS

    The following summary is a short, concise description of the main terms of
the certificates. For this reason, the summary does not contain all the
information that is important to you. You will find a detailed description of
the terms of the certificates following this summary.

Offered Certificates
Aggregate
        Principal
  Class   Amount     Interest Rate
-----------------------------------------
A    $100,000  Lesser of (a)      %
                   LIBOR plus
                   per annum and
                   (b) the net
                   receivables rate
-----------------------------------------
    B    $100,000  Lesser of (a)      %
                   LIBOR plus
                   per annum and
                   (b) the net
                   receivables rate
The offered certificates will be book-entry securities clearing through The
Depository Trust Company (in the United States) or Clearstream or Euroclear (in
Europe) in minimum denominations of $1,000 and integral multiples thereof.

Issuer

    Green Tree Floorplan Receivables Master Trust.

Transferor

    Green Tree Floorplan Funding Corp., a wholly owned subsidiary of Conseco
Finance.

Servicer

    Conseco Finance Corp. ("Conseco Finance" or the "Servicer").

Trustee

    Wells Fargo Bank Minnesota, N. A.

Closing Date

          , 2001

Trust Assets

    The Trust assets include receivables and the collections thereon. The
receivables arise from revolving credit agreements between Conseco Finance or
its affiliates and dealers, manufacturers and distributors located throughout
the United States to finance their production and inventory of consumer and
commercial products. The receivables constitute payment obligations arising
from time to time under those revolving credit agreements.

    On the Closing Date, the Trust expects that it will deposit not more than
$      from the net proceeds of the Series 2001-1 certificates into a pre-
funding account for Series 2001-1. Funds in the pre-funding account will be
released to the Transferor as deposits are made into the principal account for
Series 1998-2 and Series 1999-1, which are prior Series issued by the Trust
that are in their early amortization periods. Any funds in the pre-funding
account that have not been invested in receivables by       , 2001 will be
deposited in the excess funding account and be available for use by all series.
Also, approximately $      of the proceeds paid to the Transferor on the
closing date will reflect the amount on deposit in the principal account for
Series 1998-2 and Series 1999-1. Until Series 1998-2 and Series 1999-1 are paid
in full, no interest collections or principal

                                       5
collections on the receivables that relate to either of those amounts will be
allocated to the Series 2001-1 certificates. We estimate that Series 1998-2 and
Series 1999-1 will be paid in full on       , 2001, but we cannot guarantee
that it will be so paid.

Series 2001-1 and Other Series

    The Trust issues its certificates in series. The class A certificates and
the class B certificates, together with the class C certificates and class D
certificates that are discussed below, constitute Series 2001-1. The Trust has
other series of certificates outstanding. Each series is entitled to a share of
the Trust's collections on its assets and uses those collections to make
distributions on its certificates. The Transferor also owns a share of the
Trust's collections. The amount of each series' share of collections is
determined by various formulas described in this document and may vary over
time.

    For a summary of the terms of the previously issued series, see "Annex B:
Other Series."

Distribution Dates

    Distributions on the certificates will be made on the 13th day of each
month (or, if not a business day, on the next business day), beginning on
13, 2001.

Interest

    The interest rates for the class A certificates and the class B
certificates are specified above. Interest will be distributable on each
distribution date and will be calculated on the basis on the actual number of
days in the interest accrual period divided by 360.

Principal

    Scheduled Principal Payments.
Class                                                    Scheduled Payment Date
 -----                                                    ----------------------
A......................................................
 B......................................................
The Trust expects to pay the entire principal of such class on the
scheduled payment date. The Trust expects to be able to do this by accumulating
the Series 2001-1 share of principal collections on the receivables during an
accumulation period prior to the scheduled payment date. If the Trust is not
able to repay a class in full on that date, the class will amortize monthly to
the extent of available collections until it is fully repaid. The Trust will
not distribute any principal payments on the class B certificates until it has
distributed the entire principal amount of the class A certificates to the
class A certificateholders.

    For more information on scheduled principal payments, see "Maturity
Considerations," "Description of the Offered Certificates--Principal Payments,"
"--Postponement of Controlled Accumulation Period" and "--Application of
Collections--Payment of Principal."

    Possible Early Repayment of Principal. Principal may be repaid on the
offered certificates earlier than the scheduled payment dates described above
if a pay out event occurs. If a pay out event occurs, principal collections
allocated to Series 2001-1 will be distributed on each distribution date on the
class A certificates until they are repaid in full and then on the class B
certificates until they are repaid in full. Pay out events include (1) a net
loss ratio for the receivables in excess of a

                                       6
specified level, (2) the Trust's non-receivables assets exceeding a certain
percentage of the Trust's principal receivables for a specified period of time,
(3) the occurrence of certain shortfalls in required payments, (4) other
performance requirements related to the receivables and (5) various other
events.

    For more information on pay out events, see "Maturity Considerations" and
"Description of Offered Certificates--Pay Out Events."

Priority of Application of Collections and Allocation of Losses

    The Series 2001-1 certificates will be entitled to receive a share of the
collections on the Trust's assets. The Trust will apply that share of
collections, in the order of priority described in this prospectus, to pay its
expenses, to make required distributions on the Series 2001-1 certificates and
to cover losses allocated to Series 2001-1. Any collections allocated to Series
2001-1 in excess of those required amounts will be used by other series to the
extent needed or will be paid to the Transferor. In general, the Series 2001-1
share of collections will be applied to make required distributions, first, on
the class A certificates and then on the class B certificates. Prior to the
commencement of the accumulation period or application of the Series 2001-1
principal collections for principal distributions, those principal collections
will be paid to the Transferor or shared with other series that are
accumulating or distributing principal collections.

    Series 2001-1 will also be allocated its share of losses on the
receivables. Those losses will in turn be allocated to the then most
subordinate Series 2001-1 class whose principal balance has not yet been
reduced to zero by prior losses.

    For further information on allocations of collections and losses, see
"Description of the Offered Certificates--Allocation Percentages," "--
Application of Collections" and "--Investor Charge-Offs."

Credit Enhancement

    The credit enhancement for the offered certificates is the subordination of
the junior classes of the Series 2001-1 certificates, as follows:
Subordinated
 Class                                                                Classes
 -----                                                              ------------
A................................................................   B, C and D
 B................................................................   C and D
The effect of the subordination arrangement is that (1) collections
allocated to a subordinated class will be used to cover cash shortfalls on a
more senior class and (2) net losses allocated to Series 2001-1 will be borne
by the most subordinate class whose principal balance has not already been
reduced to zero because of prior losses. If the subordination arrangement does
not cover all net losses allocated to Series 2001-1, your interest
distributions may be reduced and you may suffer a loss of principal. The
initial principal balance of the class C certificates will be $      and the
initial principal balance of the class D certificates will be $     . When
Series 1998-2 and Series 1999-1 have been paid in full, the principal amount of
the class D certificates will be reduced to $     .

                                       7
For more information on the subordination arrangement, see "Description of
Offered Certificates--Reallocated Principal Collections," "--Defaulted
Receivables" and "--Investor Charge-Offs."

Optional Repurchase

    The class A certificates, the class B certificates and the class C
certificates will be subject to optional repurchase by the Transferor on any
distribution date after the invested amount of the class A certificates, the
class B certificates and the class C certificates is reduced to an amount less
than or equal to $      (20% of the initial outstanding principal amount of the
class A certificates, the class B certificates and the class C certficates), if
certain conditions are met. The repurchase price will be equal to the invested
amount for those classes plus accrued and unpaid interest on the class A
certificates, the class B certificates and the class C certificates through the
day preceding the distribution date on which the repurchase occurs. See
"Description of the Offered Certificates--Final Payment of Principal;
Termination."

Tax Status

    In the opinion of counsel to Conseco Finance and the Transferor, the class
A certificates and the class B certificates will be characterized as debt and
the Trust will not be characterized as an association, publicly traded
partnership or taxable mortgage pool taxable as a corporation for federal
income tax purposes under existing law.

    See "Federal Income Tax Consequences" for additional information concerning
the application of federal income tax laws.

ERISA Considerations

    An employee benefit plan subject to the requirements of the fiduciary
responsibility provisions of the Employee Retirement Income Security Act of
1974, as amended, or the provisions of Section 4975 of the Internal Revenue
Code of 1986, as amended, contemplating the purchase of the class A
certificates should consult its counsel before making a purchase, and the
fiduciary and such legal advisors should consider whether the class A
certificates will satisfy all of the requirements of the "publicly offered
securities" exemption described herein and the possible application of other
ERISA prohibited transaction exemptions described herein. Although we expect
that the "publicly offered securities" exemption or the other ERISA prohibited
transaction exemptions will apply to certain purchases of the class A
certificates by employee benefit plans, we cannot assure you that any of those
exemptions will apply to all purchases of the class A certificates by employee
benefit plans.

    An employee benefit plan is not permitted to purchase class B certificates.

    See "ERISA Considerations."

Ratings

    On the Closing Date the class A certificates will be rated "AAA" by
Standard & Poor's, "Aaa" by Moody's Investors Service, Inc. and "AAA" by Fitch
IBCA, Inc.

    On the Closing Date, the class B certificates will be rated at least "A" by
Standard & Poor's, "A2" by Moody's and "AA-" by Fitch.

                                       8
A rating is not a recommendation to buy, sell or hold securities and may be
subject to revision or withdrawal at any time by the assigning rating agency.

    See "Risk Factors--Certificate ratings are not guarantees, and may change."

Address and Telephone Numbers

    The mailing address of the Transferor is 500 Landmark Towers, 345 St. Peter
Street, St. Paul, Minnesota 55102-1639. Its telephone number is (651) 293-3400.

[Listing

    Application will be made to list the Offered Certificates on the Luxembourg
Stock Exchange.]

                                       9
RISK FACTORS

    You should consider the following risk factors in deciding whether to
purchase the offered certificates.

Limited prior experience   Conseco Finance began originating and servicing
with the receivables may   revolving credit accounts in February 1994 and thus
be different from future   has less underwriting and servicing experience and
experience with them.      limited delinquency, default and loss experience
                           with those accounts compared to some of its other
                           lending operations. Conseco Finance's substantial
                           experience in underwriting and servicing retail
                           installment sales contracts does not necessarily
                           indicate that satisfactory results will be
                           experienced on the receivables. See "Conseco
                           Finance Corp. and Its Commercial Lending Division."

                           Conseco Finance's historical loss experience with
                           respect to its portfolio of revolving credit
                           accounts is presented under "The Accounts--Loss
                           Experience." However, because Conseco Finance's
                           portfolio has grown rapidly in the past six years,
                           and Conseco Finance expects to create receivables
                           from new obligors that will be transferred to the
                           Trust in the future, the actual loss experience
                           with respect to the receivables owned by the Trust
                           may be different than Conseco Finance's historical
                           loss experience. Since a substantial number of the
                           accounts in Conseco Finance's portfolio were only
                           recently originated, the receivables in those
                           accounts may not have yet exhibited a loss
                           experience that is representative of the losses
                           that may be experienced over a longer period of
                           time. There can be no assurance that the loss
                           experience for the receivables in the future will
                           be similar to Conseco Finance's historical
                           experience. In addition, Conseco Finance's
                           historical experience includes the effect of the
                           financial obligations of manufacturers in respect
                           of repossessed products as described under "Conseco
                           Finance Corp. and Its Commercial Lending Division--
                           Floorplan Agreements with Manufacturers." If
                           manufacturers are not able to perform their
                           obligations in the future, the loss experience of
                           the Receivables may be adversely affected.

                                       10
Future receivables         The Transferor expects, and in some cases will be
purchased by the Trust     obligated, to designate new accounts from which the
may come from new          Trust will acquire receivables. New accounts may
obligors, may be           include accounts with dealers originated by Conseco
underwritten with new      Finance under criteria different from those which
criteria or may be based   were applied before the Closing Date. Those
on new products. The       receivables may also provide financing for products
performance of these new   of types different from those included in the Trust
receivables may            on the Closing Date. Consequently, there can be no
adversely affect the       assurance that receivables from new accounts in the
Trust's ability to make    future will relate to the same types of products or
distributions to you.      will be of the same credit quality as receivables
                           from previously designated accounts or that new
                           product types that may secure the receivables in
                           new accounts will provide security that is as
                           favorable as that provided by manufactured homes or
                           other existing product types. The designation of
                           new accounts will be subject to the satisfaction of
                           certain conditions described under "Description of
                           the Offered Certificates--Addition of Accounts."

Master trust               In addition to Series 2001-1 and the series
considerations: creation   described in Annex B hereto, the Trust, as a master
of new series could        trust, is expected to issue additional series from
adversely affect your      time to time. The terms of any additional series
certificates.              will not be subject to the prior review or consent
                           of holders of the certificates of any previously
                           issued series. The principal terms of a new series
                           may include methods for determining allocations of
                           collections, provisions creating security or credit
                           enhancement, different classes of certificates
                           (including subordinated classes of certificates),
                           provisions subordinating a new series to another
                           series or another series to the new series (if the
                           terms of such other series so permit) and other
                           terms. Pay out events will not necessarily be the
                           same for each series. In addition, the provisions
                           of a new series may give the holders of the
                           certificates of that series consent, approval, or
                           other rights that could result in such holders
                           having the power to cause the Transferor, the
                           Servicer or the Trustee to take or refrain from
                           taking certain actions without regard to the
                           interest of the Series 2001-1. A provider of any
                           credit enhancement for any new Series may have
                           similar rights. However, each rating agency that
                           has rated any outstanding series must deliver
                           written confirmation to the Trustee that the
                           issuance of the new series will not result in such
                           rating agency reducing or withdrawing its rating on
                           any outstanding series. We cannot assure you,
                           however, that the principal terms of any other
                           series might not have an adverse impact on the

                                       11
timing and amount of payments received by you or
                           the value of your certificates even if there is no
                           change in the rating of any outstanding series. See
                           "Description of the Offered Certificates--
                           Exchanges; Creation of New Series."

Series 2001-1 is a         Series 2001-1 is a companion series with respect to
companion series with      Series 1998-2 and Series 1999-1. As principal
Series 1998-2 and          collections are deposited into the principal
Series 1999-1 and may      accounts for Series 1998-2 and Series 1999-1, an
experience a delay in      equal amount will be released from the pre-funding
allocations of principal   account for Series 2001-1 and paid to the
and will experience a      Transferor. However, until Series 1998-2 and
delay in allocations of    Series 1999-1 have been paid in full, Series 2001-1
interest.                  will not receive any allocation of interest
                           collections or principal collections on the
                           receivables with respect to the "Pre-Allocated
                           Invested Amount," which is the sum of (1) the
                           initial amount in the pre-funding account and
                           (2) the amount in the Series 1998-2 and
                           Series 1999-1 principal account on the closing
                           date. Also, if a pay out event occurs with respect
                           to Series 2001-1 before the payment in full of
                           Series 1998-2 and Series 1999-1, Series 2001-1 will
                           receive no allocations of principal collections
                           with respect to the Pre-Allocated Invested Amount
                           until Series 1998-2 and Series 1999-1 are paid in
                           full. In the case of a pay out event, Series 1998-2
                           and Series 1999-1 will receive the funds on deposit
                           in the principal account for Series 1998-2 and
                           Series 1999-1, but Series 2001-1 would not have a
                           corresponding amount of funds in its pre-funding
                           account. We cannot assure you as to when Series
                           1998-2 and Series 1999-1 will be paid in full. See
                           "Description of the Offered Certificates--
                           Allocation Percentages."

The insolvency of          Conseco Finance. Conseco Finance has warranted to
Conseco Finance or the     the Transferor that the sale of the receivables by
Transferor could delay     it to the Transferor is a valid sale. Conseco
or reduce distributions    Finance has taken and will take all actions that
to you or could            are required under Minnesota law to perfect the
accelerate distributions   Transferor's ownership interest in the receivables.
to you.                    However, if Conseco Finance were to become a debtor
                           in a bankruptcy case and a creditor or trustee-in-
                           bankruptcy of Conseco Finance, or Conseco Finance
                           itself as debtor-in-possession, were to take the
                           position that any sale of receivables to the
                           Transferor should be recharacterized as a pledge of
                           such receivables to secure a borrowing of Conseco
                           Finance, then the following things could happen:

                               .   the Trust and you could experience a delay
                                   in payments.

                                       12
.   if a court rules that the transfers were
                                   pledges rather than sales, the Trust and
                                   you could receive reduced payments, in
                                   which case you will incur a loss. In
                                   addition, the Trust may have to sell its
                                   assets, in which case you would be repaid
                                   earlier than you expected and you may still
                                   incur a loss.

                               .   if a court rules that the transfers were
                                   pledges, a tax or government lien on the
                                   property of Conseco Finance arising before
                                   receivables come into existence may have
                                   priority over the Trust's interest in those
                                   receivables and therefore reduce payments
                                   to the Trust and you, in which case you
                                   will incur a loss.

                           It is possible that the risk of recharacterization
                           may be increased by the following factors:

                               .   the Transferor will, initially, retain the
                                   class C certificates, the class D
                                   certificates and its other interests in the
                                   Trust.

                               .   Conseco Finance may guarantee the class D
                                   certificates if they are sold.

                               .   for accounting purposes, Conseco Finance
                                   and the Transferor will treat the
                                   certificates as debt and the transfer of
                                   the receivables allocable to Series 2001-1
                                   from the Transferor to the Trust as a
                                   pledge rather than a sale.

                           See "Certain Legal Aspects of the Receivables--
                           Certain Matters Relating to Bankruptcy." If the
                           transfer of receivables to the Transferor were
                           respected as a sale, the receivables would not be
                           part of Conseco Finance's bankruptcy estate and
                           would not be available to Conseco Finance's
                           creditors.

                           In addition, if a bankruptcy court in a Conseco
                           Finance insolvency were to order that the
                           Transferor be substantively consolidated with
                           Conseco Finance, the Trust and you could experience
                           delays in payments and reductions in payments, and
                           you may incur a loss.

                           Transferor. Although the pooling and servicing
                           agreement provides that the Transferor is selling
                           the receivables to the Trust (for certain non-tax
                           purposes), a court could treat these

                                       13
transactions as a grant of a security interest for
                           the benefit of holders of certificates issued by
                           the Trust. It is possible that the risk of such
                           treatment may be increased by the factors set forth
                           in the second preceding paragraph. The Transferor
                           has represented and warranted in the pooling and
                           servicing agreement that the transfer of the
                           receivables to the Trust is either a valid transfer
                           and assignment of the receivables to the Trust or
                           the grant to the Trust of a security interest in
                           the receivables. The Transferor has taken and will
                           take those actions required to perfect the Trust's
                           interest in the receivables. The Transferor will
                           warrant that if the transfer to the Trust is
                           recharacterized as a grant to the Trust of a
                           security interest in the receivables, the Trustee
                           will have a first priority perfected security
                           interest therein, subject only to liens permitted
                           in the pooling and servicing agreement. If the
                           transfer of the receivables to the Trust is deemed
                           to create a security interest therein, a tax or
                           government lien on property of the Transferor
                           arising before Receivables come into existence may
                           have priority over the Trust's interest in these
                           Receivables. In the event of the insolvency of the
                           Transferor, some administrative expenses may also
                           have priority over the Trust's interest in these
                           Receivables. If the Transferor becomes insolvent,
                           the Trust and you could experience delays in
                           payments and reductions in the amount of those
                           payments, and you could incur a loss. See "Certain
                           Legal Aspects of the Receivables--Transfer of
                           Receivables."

                           Servicer. If a bankruptcy trustee or receiver were
                           appointed for the Servicer, and no Servicer Default
                           other than such bankruptcy or receivership or
                           insolvency of the Servicer exists, the bankruptcy
                           trustee or receiver may have the power to prevent
                           either the Trustee or the certificateholders from
                           effecting a transfer of servicing to a successor
                           Servicer.

                           Pay out event. If a bankruptcy trustee or receiver
                           were appointed for the Transferor or Conseco
                           Finance, a pay out event would occur with respect
                           to all series. New receivables would not be
                           transferred to the Trust and the Trust would sell
                           the receivables, subject to voting provisions
                           specified in the pooling and servicing agreement.
                           You would incur a loss if the net proceeds
                           allocable to your certificates were insufficient to
                           repay you in full. If the only pay out event to
                           occur is either the insolvency of the Transferor or
                           the

                                       14
appointment of a bankruptcy trustee or receiver for
                           the Transferor, the bankruptcy trustee or receiver
                           may have the power to continue to require the
                           Transferor to transfer new receivables to the Trust
                           and to prevent the early disposition of the
                           receivables and the commencement of the
                           amortization of your certificates. In addition, a
                           bankruptcy trustee or receiver for the Transferor
                           may have the power to cause early payment of your
                           certificates. See "Certain Legal Aspects of the
                           Receivables--Certain Matters Relating to
                           Bankruptcy."

Participations in          The receivables may include floorplan receivables
receivables do not         or asset-based receivables acquired by Conseco
provide the Trust with     Finance in the form of participation interests in
direct rights against      those receivables. In purchasing participation
the obligor and may        interests, the Trust may have a contractual
expose the Trust to the    relationship only with the selling institution and
credit of the selling      not the obligor on the receivable. The Trust may
institution.               have no right directly to enforce compliance by the
                           obligor on the receivable with the terms thereof or
                           any rights of set-off against the obligor. The
                           Trust may not have the right to object to certain
                           changes to the terms of the receivables agreed to
                           by the selling institution. The Trust may not
                           directly benefit from any security for the
                           receivable and may be subject to any rights of set-
                           off the obligor has against the selling
                           institution.

                           In addition, in the event of the insolvency of the
                           selling institution, the Trust may be treated as a
                           general creditor of the selling institution and may
                           not have any exclusive or senior claim with respect
                           to the receivables participated by such selling
                           institution or any security therefor.

Your certificate rate      The receivables will bear interest at a variable
may be lower than the      rate above a designated index rate. See "Conseco
interest rate specified    Finance Corp. and Its Commercial Lending Division--
on the cover page.         Floorplan Payment Terms." Your certificates will
                           bear interest at the lesser of (1) a floating rate
                           based on LIBOR plus a margin and (2) the net
                           receivables rate. If there is a decline in such
                           index rate, the amount of interest collections on
                           the receivables may be reduced. It is possible that
                           LIBOR plus the margin used to compute your
                           certificate rate for an interest accrual period
                           will exceed the applicable net receivables rate. In
                           such event, interest will accrue on your
                           certificates during that interest
                           accrual period at a rate equal to the net
                           receivables rate. The

                                       15
Servicer has the right to change the discount
                           factor to offset any such reduced Interest
                           Collections, but is not obligated to do so. The
                           interest rates borne by the receivables will be
                           limited by the applicable state usury laws.

Social, economic and       Conseco Finance's ability to generate new
other factors, including   receivables, and the obligors' ability to make
competition, will affect   payments on the receivables owned by the Trust,
the performance of the     will depend upon the retail sales of the products
Trust.                     securing these receivables. The level of retail
                           sales of these products will be affected by a
                           variety of social and economic factors, including
                           national and regional unemployment levels and
                           levels of economic activity in general, interest
                           rates and consumer perceptions of economic
                           conditions. In addition, Conseco Finance competes
                           with various other financing sources, including
                           independent finance companies, manufacturer-
                           affiliated finance companies and banks that are in
                           the business of providing floorplan financing
                           arrangements. If, for any reason, Conseco Finance
                           were unable to or ceased to generate sufficient new
                           receivables, a pay out event would occur and you
                           would begin receiving principal earlier than you
                           expected. See "The certificates may pay principal
                           earlier than expected" below.

You may have a limited     The underwriters currently intend to assist in the
ability to resell your     resales of the offered certificates but are not
certificates.              obligated to do so. A secondary market may not
                           develop for the offered certificates, or, if one
                           does develop, you still might not be able to resell
                           your certificates. Any secondary market may not
                           continue to exist for the term of your
                           certificates.

Your only source of        You will not have recourse for payment of your
repayment is collections   certificates to any assets of the Transferor
on the receivables; you    (except to the extent it holds subordinated Series
have no recourse to        2001-1 certificates), Conseco Finance or any of its
Conseco Finance, the       affiliates. Consequently, you must rely solely upon
Transferor, any of their   payments of the receivables for the payments on
affiliates or any other    your certificates. Furthermore, your certificates
entity.                    are only entitled to a share of the collections on
                           the receivables as determined in the pooling and
                           servicing agreement. If the receivables do not
                           perform as expected, that share of collections may
                           not be sufficient to repay the certificates in
                           full.

The certificates may pay   The receivables may be paid at any time. There is
principal earlier than     no assurance that Conseco Finance will originate
expected.                  additional receivables or that any particular
                           pattern of originations or repayments will occur. A
                           significant decline in the amount of receivables
                           generated could result in the occurrence of a pay

                                       16
out event and the commencement of early repayment.
                           See "Maturity Considerations" and "Description of
                           the Offered Certificates--Pay Out Events" for a
                           discussion of pay out events. If a pay out event
                           occurs, your principal will be paid sooner than you
                           expected. You may not be able to reinvest that
                           principal in suitable investments with a comparable
                           rate of return.

                           Floorplan receivables are generally payable upon
                           the retail sale of the related product. Asset-based
                           receivables are payable as described under "Conseco
                           Finance Corp. and Its Commercial Lending Division--
                           Asset-Based Receivables." The payment of principal
                           on your certificates is dependent on the receipt of
                           principal collections during the accumulation
                           period in which the Trust will accumulate the
                           Series 2001-1 share of those collections for
                           payment on your scheduled final payment date. No
                           assurance can be given that the Trust will
                           accumulate enough principal collections to repay
                           you in full on that date.

Subordination of class B   The class B certificates will be subordinated in
certificates may cause     right of payment of interest and principal to the
losses on the class B      class A certificates. Payments of principal in
certificates.              respect of the class B certificates will not
                           commence until the class A certificates have been
                           paid in full. Collections allocable to the class B
                           certificates will be used, if needed, to cover
                           distributions due on the class A certificates or
                           losses allocated to the class A certificates. Such
                           reallocation of the class B share of collections
                           will occur only if the other credit enhancements
                           for the class A certificates are not available. If
                           the principal collections allocable to the class B
                           certificates are used to support the class A
                           certificates, then the interest collections
                           allocable to the class B certificates will be
                           reduced. If the reallocated principal collections
                           are not reimbursed, the amount of principal
                           distributable to the class B certificateholders
                           will be reduced, and they will incur a loss. See
                           "Description of the Offered Certificates--
                           Allocation Percentages," "--Reallocated Principal
                           Collections,"""--Investor Charge-Offs" and "--
                           Subordination of the Class B Certificates."

Negative carry will        Funds in the pre-funding account and funds, if any,
reduce interest            in the excess funding account will be invested in
collections.               short-term investments that are expected to earn a
                           rate of return lower than the interest rates borne
                           by the receivables. Accordingly, funds in the pre-
                           funding account and any funds in the excess

                                       17
funding account may be expected to reduce the
                           amount of interest collections available to make
                           distributions on your certificates, until Conseco
                           Finance is able to generate sufficient eligible
                           receivables to permit funds to be released from the
                           pre-funding account or the excess funding account.
                           The Transferor's share of interest collections
                           will, however, be applied toward any such negative
                           carry amounts. See "Description of the Offered
                           Certificates--Coverage of Certain Interest
                           Shortfalls."

The Servicer may change    The Servicer will have the right, on behalf of the
payment terms of the       Transferor, to change the payment terms, including,
receivables. This could    without limitation, the interest rate and repayment
result in the Trust        terms, and various other terms of receivables. A
having less cash for       decrease in the interest rate borne by the
distributions to you.      receivables or an increase in interest-free periods
                           without an increase in the discount factor would
                           decrease the amount of interest collections
                           available to make distributions on your
                           certificates. This decrease could result in the
                           occurrence of a pay out event. Conseco Finance will
                           covenant that generally it will only change the
                           terms relating to the receivables if in its
                           reasonable judgment no pay out event will occur as
                           a result of the change and the interests of the
                           certificateholders of all outstanding series will
                           not be materially adversely affected. Otherwise,
                           there are no restrictions on the ability of the
                           Servicer to change the terms of the receivables.
                           While the Servicer has no current intention of
                           taking actions which would change the payment or
                           other terms of the receivables, other than in
                           accordance with its customary and usual procedures,
                           there can be no assurance that changes in the
                           marketplace or prudent business practice might not
                           result in a determination to do so.

                           Conseco Finance will have the right to generate new
                           receivables with payment terms that are generally
                           longer than the current payment terms on the
                           receivables. Such a lengthening of the payment
                           period could result in a reduction of the monthly
                           payment rate and consequently a reduction in the
                           yield on the receivables that have been discounted,
                           unless the discount factor is increased
                           accordingly.

You will not have          Subject to certain exceptions, the consent of the
control over certain       holders of a specified percentage of the aggregate
actions under the          unpaid principal amount of all outstanding investor
pooling and servicing      certificates of each series will be required to
agreement.                 direct certain actions to be taken under the
                           pooling and servicing agreement or the related

                                       18
supplement. In determining whether the required
                            percentage of certificateholders have given their
                            consent, except as otherwise specified, the class
                            A certificateholders, the class B
                            certificateholders and the class C
                            certificateholders of Series 2001-1 will be
                            treated as a single series. Accordingly, the class
                            A certificateholders, as the largest class, will
                            have the power to determine whether any such
                            action is taken without regard to the position or
                            interests of the class B certificateholders or the
                            class C certificateholders relating to such
                            action. Neither the class B certificateholders nor
                            the class C certificateholders will have similar
                            power. However, under some circumstances the
                            consent of a specified percentage of the aggregate
                            invested amount of all series outstanding or of
                            the invested amount of each class of each series
                            may be required to direct certain actions,
                            including requiring the appointment of a successor
                            Servicer following a servicer default, amending
                            the pooling and servicing agreement in certain
                            circumstances, directing the servicer not to sell
                            the receivables upon the occurrence of an
                            insolvency event of Conseco Finance or the
                            Transferor and directing a repurchase of all
                            outstanding series upon the breach of certain
                            representations and warranties by the Transferor.
                            In such instances, it may be difficult for you to
                            achieve the results that you desire.

Certificate ratings are not On the Closing Date the class A certificates will
guarantees, and may change. have a rating of "AAA" from Standard & Poor's,
                            "Aaa" from Moody's and "AAA" from Fitch. On the
                            Closing Date the class B certificates will have a
                            rating of "A" from Standard & Poor's, "A2" from
                            Moody's and "AA-" from Fitch. However, any such
                            rating will not address the likelihood that the
                            principal of, or interest on, the class A
                            certificates will be paid by the class A scheduled
                            payment date or that the principal of, or interest
                            on, the class B certificates will be paid by the
                            class B scheduled payment date. The ratings will
                            be based primarily on the value of the
                            receivables, the funds in the pre-funding account
                            and the funds, if any, on deposit in the excess
                            funding account (and the manner in which such
                            funds are invested). The ratings are not a
                            recommendation to purchase, hold, or sell your
                            certificates, and the ratings do not comment as to
                            the market price or suitability for a particular
                            investor. There can be no assurance that the
                            ratings will remain in effect for any given period
                            of time or that a rating agency will not lower or

                                       19
withdraw any rating if in its judgment circumstances
                           so warrant. Any reduction in the rating of your
                           certificates will adversely affect their market
                           value.

                           There can be no assurance as to whether any rating
                           agency not requested to rate your certificates will
                           nonetheless issue a rating for your certificates.
                           If it does, there can be no assurance what such
                           rating would be. An unrequested rating assigned to
                           your certificates may be lower than the ratings
                           assigned by the rating agencies pursuant to the
                           Transferor's request.

During the funding         The pre-funded amount represents the proceeds from
period, Series 2001-1      the sale of the Series 2001-1 certificates that
will be entitled only to   will not be invested in receivables on the Closing
some interest and          Date because there are not sufficient receivables
principal collections.     at that time. The amount in the pre-funding account
                           will be released to the Transferor as deposits are
                           made into the principal account for Series 1998-2
                           and Series 1999-1, which are prior Series issued by
                           the Trust that are in their early amortization
                           periods. As principal collections are deposited
                           into the principal account for Series 1998-2 and
                           Series 1999-1, an equal amount will be released
                           from the pre-funding account for Series 2001-1 and
                           paid to the Transferor. However, until Series 1998-
                           2 and Series 1999-1 have been paid in full, Series
                           2001-1 will not receive any allocation of interest
                           collections or principal collections on the
                           receivables with respect to (1) the initial amount
                           in the pre-funding account and (2) the amount in
                           the Series 1998-2 and Series 1999-1 principal
                           account on the closing date. Also, Series 1998-2
                           and Series 1999-1 will receive the funds on deposit
                           in the principal account for Series 1998-2 and
                           Series 1999-1, but Series 2001-1 would not have a
                           corresponding amount of funds in the pre-funding
                           account. Funds in the excess funding account are
                           assets of the entire Trust allocated to all series
                           and to the Transferor's interest and will be
                           applied as described in "Description of the Offered
                           Certificates--Excess Funding Account." Such funds
                           may be released to holders of certificates of other
                           series in connection with a reduction of the
                           principal balance of the certificates of such other
                           series.

                                       20
THE TRUST

    The Trust has been formed, in accordance with the laws of the State of
Minnesota, pursuant to the pooling and servicing agreement between the
Transferor, Conseco Finance, as Servicer, and the Trustee (the "Pooling and
Servicing Agreement"). The Trust was formed for the transactions described in
this prospectus and similar transactions. The Trust will not engage in any
business activity, other than as described in this prospectus. It will only
acquire and hold the receivables described in this prospectus (the
"Receivables") and related assets, issue the Series 2001-1 certificates (the
"Certificates"), the Exchangeable Transferor Certificate, and certificates
representing other series (each, a "Series") and engage in related activities
(including, with respect to any Series, entering into any credit enhancement
and credit enhancement agreement relating thereto) and make payments thereon.
As a consequence, the Trust is not expected to have any need for additional
capital resources. The Trust has previously issued seven Series of
certificates: Series 1995-1, Series 1996-1, Series 1996-2, Series 1998-1,
Series 1998-A, Series 1998-2 and Series 1999-1. See Annex B hereto. The
Series 1995-1 Certificates, Series 1996-2 Certificates and the Series 1998-A
Certificates have been retired, the Series 1998-1 Certificates will be retired
by April 2001, and the Transferor expects that the Series 1998-2 and Series
1999-1 Certificates will be retired within a few months after the issuance of
the Series 2001-1 Certificates.

                                 THE TRANSFEROR

    Green Tree Floorplan Funding Corp., a wholly owned subsidiary of Conseco
Finance, was incorporated in Delaware in September 1995. The Transferor was
organized for the limited purposes of purchasing receivables from Conseco
Finance pursuant to a receivables purchase agreement (the "Purchase Agreement")
and transferring such receivables to third parties, and any activities
incidental to and necessary or convenient for the accomplishment of these
purposes. The principal executive offices of the Transferor are located at 500
Landmark Towers, 345 St. Peter Street, St. Paul, Minnesota 55102-1639
(telephone (651) 293-3400).

    The Transferor has taken, and will take in connection with the creation of
each Series of Certificates, steps intended to ensure that the voluntary or
involuntary application for relief by Conseco Finance under the United States
Bankruptcy Code or similar applicable state laws ("Insolvency Laws") will not
result in consolidation of the assets and liabilities of the Transferor with
those of Conseco Finance. These steps include the creation of the Transferor as
a separate, limited-purpose subsidiary pursuant to a certificate of
incorporation containing various limitations (including restrictions on the
nature of the Transferor's business and a restriction on the Transferor's
ability to commence a voluntary case or proceeding under any Insolvency Laws
without the unanimous affirmative vote of all of its directors). The
Transferor's certificate of incorporation includes a provision that requires
the Transferor to have two directors who qualify under the certificate of
incorporation as "Independent Directors," meaning a person who is not and has
not been a director or officer of, employed by, or the holder of any beneficial
economic interest in any Affiliate, and who may at no time hold any beneficial
or economic interest in the Transferor. "Affiliate" means any entity other than
the Transferor (i) which owns beneficially, directly or indirectly, 10%

                                       21
or more of the outstanding shares of Common Stock of the Transferor, or (ii) of
which 10% or more of the outstanding shares of its Common Stock is owned
beneficially, directly or indirectly, by any entity described in clause (i)
above, or (iii) which is controlled by an entity described in clause (i) above,
as the term "control" is defined under the Rules and Regulations of the
Securities and Exchange Commission. No assurance can be given, however, that
such a consolidation will not occur. See "Risk Factors--The insolvency of
Conseco Finance or the Transferor could delay or reduce distributions to you or
could accelerate distributions to you."

                           CONSECO FINANCE CORP. AND
                        ITS COMMERCIAL LENDING DIVISION

    Conseco Finance Corp. is a diversified financial services company with
operations serving customers in the consumer finance, commercial finance and
insurance markets. Through its various divisions, Conseco Finance purchases,
pools, sells and services retail installment sales contracts for manufactured
housing, home improvements and a variety of consumer products, provides sale
and lease financing for a variety of commercial equipment, and provides
inventory financing to dealers, manufacturers and distributors of various
consumer and commercial products. Conseco Finance also offers revolving credit
and originates home equity and mortgage loans. Conseco Finance is currently the
largest servicer of manufactured housing government insured or guaranteed
contracts, and is one of the largest servicers of conventional manufactured
housing contracts, in the United States. Through its principal offices in Saint
Paul, Minnesota and service centers throughout the United States, Conseco
Finance services all 50 states. Its principal executive offices are located at
1100 Landmark Towers, 345 St. Peter Street, St. Paul, Minnesota 55102-1639
(telephone (651) 293-3400). Conseco Finance's Annual Report on Form 10-K for
the year ended December 31, 1999, and, when available, subsequent quarterly or
annual reports are available from Conseco Finance upon written request. The
Certificates do not represent an interest in or obligation of Conseco Finance,
the Transferor or any of their affiliates, and no Certificateholder will have
recourse for payment of its Certificates to any assets of any of Conseco
Finance, the Transferor (other than the Exchangeable Transferor Certificate (as
defined herein) and any class of investor certificates retained by the
Transferor (a "Transferor Retained Class"), to the extent described herein) or
any of their affiliates.

Recent Developments

    In recent months, rating agencies lowered their ratings of the debt
obligations of Conseco Finance and placed some ratings of Conseco Finance's
debt obligations on review as the rating agencies analyze the impact of
developing events. The uncertainty surrounding the ultimate outcome of Conseco,
Inc.'s efforts to sell Conseco Finance, which Conseco, Inc. announced in March
2000, made it more difficult for Conseco Finance to complete new public
securitization transactions.

    On July 27, 2000, Conseco, Inc. announced a restructuring program for
Conseco Finance that includes selling or running off five of Conseco Finance's
business units. Conseco Finance's floorplan funding division is not one of
these five units.

                                       22
On August 8, 2000, Moody's reduced the rating of the long-term senior
unsecured debt obligations of Conseco Finance to B1 from Ba3. We cannot assure
you that further downgrades will not occur.

    Conseco Finance has been served with various lawsuits in the United States
District Court for the District of Minnesota. These lawsuits were generally
filed as purported class actions on behalf of persons or entities who purchased
common stock or options to purchase common stock of Conseco Finance during
alleged class periods that generally run from February 1995 to January 1998.
One of these lawsuits did not include class action claims. In addition to
Conseco Finance, some of Conseco Finance's current and former officers and
directors are named as defendants in one or more of the lawsuits. The lawsuits
have been consolidated into two complaints, one relating to an alleged class of
purchasers of Conseco Finance's common stock and the other relating to an
alleged class of traders in options for Conseco Finance's common stock. In
addition to these two complaints, a separate non-class action lawsuit
containing similar allegations was also filed. Plaintiffs in the lawsuits
assert claims under Sections 10(b) and 20(a) of the Securities Exchange Act of
1934. In each case, plaintiffs allege that Conseco Finance and the other
defendants violated federal securities laws by making false and misleading
statements about Conseco Finance's current state and Conseco Finance's future
prospects, particularly about prepayment assumptions and performance of some of
our loan portfolios, which allegedly rendered Conseco Finance's financial
statements false and misleading. Conseco Finance filed motions to dismiss these
lawsuits. On August 24, 1999, Conseco Finance's motions to dismiss were granted
with prejudice. The plaintiffs subsequently appealed the decision to the U.S.
Court of Appeals for the 8th Circuit, and the appeal is currently pending.
Conseco Finance believes that the lawsuits are without merit and intends to
defend the lawsuits vigorously. However, the ultimate outcome of these lawsuits
cannot be predicted with certainty.

Commercial Lending Division--General

    The Receivables sold and to be sold to the Transferor were and will be
selected from extensions of credit made by Conseco Finance's Commercial Lending
Division ("CLD") under revolving credit agreements with dealers, manufacturers
and distributors of various consumer and commercial products. The lending party
to such an agreement may be a subsidiary of Conseco Finance. "Floorplan
Receivables" represent the financing of product inventory for retail dealers of
a variety of consumer products. "Asset-Based Receivables" generally represent
the financing of production and inventory by manufacturers and distributors,
such financing being secured by finished goods inventory, accounts receivable
arising from the sale of such inventory, certain work-in-process, raw materials
and component parts, as well as other assets of the borrower, which may include
commercial real estate in some cases. The dealers, manufacturers and
distributors obligated under the Receivables are collectively referred to as
"Dealers." The products securing the Floorplan Receivables currently include
manufactured housing, recreational vehicles, marine products, and lawn and
garden equipment. Conseco Finance expects to provide financing to additional
Dealers in the future and expects that the financing needs of Dealers will
change over time, whether as a result of seasonality or other changes in the
Dealers' business. Accordingly,

                                       23
though the types of credit arrangements are expected to remain the same, the
products securing those arrangements are expected to expand and change over
time, and the relative proportions of the various types of product collateral
will change over time. In addition, Conseco Finance may from time to time sell
participation interests in Floorplan Receivables arising in certain accounts
prior to designating such account as an Additional Account and transferring to
the Transferor that portion of the Receivables arising in such accounts and
owned by Conseco Finance.

Floorplan Receivables--General

    The Floorplan Receivables are secured by the products being financed and
the Dealer's other inventory, together with personal guaranties in some
instances. The amount of the advance is generally equal to 100% of the
wholesale invoice price of the product. The Floorplan Receivables are generally
full recourse obligations of the related Dealer.

Floorplan Agreements with Manufacturers

    Conseco Finance will provide financing for products for a particular
Dealer, in most instances, only if Conseco Finance has also entered into an
inventory repurchase agreement (the "Floorplan Agreement") with the
manufacturer, distributor or other vendor of that product. We refer to any
manufacturer, distributor or other vendor as the "manufacturer." Pursuant to
the Floorplan Agreement, the manufacturer will agree, among other matters, to
purchase from Conseco Finance those products sold by a manufacturer to a Dealer
and financed by Conseco Finance if Conseco Finance acquires possession of such
products pursuant to repossession, voluntary surrender, or other circumstances.
The terms of these repurchase obligations may vary, both by industry and by
manufacturer. In some instances, the manufacturer will be obligated to
repurchase the product for a price equal to the unpaid principal balance owed
by the Dealer for the product in question whenever Conseco Finance acquires
possession of the product. On occasion, different terms may be negotiated.
These terms may provide for a smaller purchase price, or a purchase price which
declines over time, or time periods beyond which no obligation to purchase by
the Manufacturer shall apply. Some Floorplan Agreements may also eliminate the
repurchase obligation or reduce the purchase price payable by the manufacturer,
depending upon the condition of the inventory acquired by Conseco Finance.

Floorplan Credit Underwriting Process

    A Dealer requesting the establishment of a credit line with Conseco Finance
is required to submit an application and financial information, including
audited or unaudited financial statements and, in some cases, tax returns. CLD
attempts to talk to, or receive reference letters from, several of the
applicant's current creditors and may also obtain a credit agency report on the
applicant's credit history. In addition to such current financial information
and historical credit information, CLD will consider the following factors: the
reason for the request for the extension of credit; the need for the credit
line; the products to be financed and the financial status of the manufacturer
of such products, if any, that would enter into a related Floorplan Agreement;
and the experience of the Dealer's management. The

                                       24
determination of whether to extend credit and the amount to be extended is
based upon a weighing of the above factors.

    Extensions of credit lines in excess of $5,000,000 must be approved at the
corporate level of Conseco Finance. Extensions of credit up to $5,000,000 may
be approved by division level credit officers and up to $1,000,000 by a
business center vice president. CLD reviews individual Dealer credit limits (i)
prior to any increase in such credit limit, (ii) generally every 12 to 18
months and (iii) upon becoming aware that the Dealer is experiencing financial
difficulties or is in default on its obligations under its agreement with
Conseco Finance.

Creation of Floorplan Receivables

    Conseco Finance's floorplan business is typically documented by an
agreement between Conseco Finance and the Dealer which provides for both the
extension of credit and a grant of a security interest. Such agreements are
generally for an unspecified period of time and create discretionary lines of
credit, which Conseco Finance may terminate at any time in its sole discretion,
subject, however, to prevailing standards of commercial reasonableness and good
faith. Absent default by the Dealer, the outstanding Floorplan Receivables owed
by a Dealer generally cannot be accelerated, even if the line of credit is
terminated. After the effective date of termination, Conseco Finance is under
no obligation to continue to provide additional financing, but the then-current
outstanding balance will be repayable in accordance with the payment terms of
the Dealer's program with Conseco Finance, as described below.

    Advances made for the purchase of inventory are most commonly arranged in
the following manner. The Dealer will contact the manufacturer and place a
purchase order for a shipment of inventory. If the manufacturer has been
advised that Conseco Finance is the Dealer's inventory financing source, the
manufacturer will contact Conseco Finance to obtain an approval number with
respect to that purchase order. Upon such request, Conseco Finance will
determine whether (i) the manufacturer is in compliance with its Floorplan
Agreement, (ii) the Dealer is in compliance with its program with Conseco
Finance and (iii) the purchase order is within the Dealer's credit limit. If
all of such requirements are met, Conseco Finance will issue an approval number
to the manufacturer. The manufacturer will then ship the inventory and submit
its invoice for the purchase order directly to Conseco Finance for payment.
Interest or finance charges normally begin to accrue on the Dealer's accounts
as of the invoice date. The proceeds of the loan being made by Conseco Finance
to the Dealer are paid directly to the manufacturer in satisfaction of the
invoice price and will normally be funded at that time. In some cases, however,
Conseco Finance will negotiate a delay in funding the advance for a period
which in most cases does not exceed 10 days after the date of the invoice.
Conseco Finance and the manufacturer may also agree that Conseco Finance may
discount the invoice price of the inventory ordered by the Dealer. Under this
arrangement, the manufacturer will deem itself paid in full upon receipt of
such discounted amount. Typically, in exchange for the increased yield created
by the discount, Conseco Finance will agree to provide the manufacturer's
Dealers with reduced interest, or perhaps no interest, for some period of time.
Thus, the Dealer's financing program may provide for

                                       25
so-called "interest free" or "free flooring" periods during which no interest
or finance charges will accrue on their accounts. The price paid by the Trust
for such a Receivable will be the full amount payable by the Dealer.

Floorplan Payment Terms

    The Dealer is obligated to pay interest or finance charges monthly, but
principal repayment with respect to any particular item of inventory financed
by Conseco Finance is due and payable only upon the sale of that item by the
Dealer, subject in some cases to an ultimate maturity date. In addition,
Conseco Finance requires Dealers to begin repaying principal in installments if
the unit has not been sold within a specified period of time. These payments
are referred to as "curtailments." Even if a unit is subject to curtailment
payments, the outstanding balance with respect to such unit will remain fully
payable upon the sale of the unit.

      Floorplan receivables generally accrue interest (subject to any "interest
free" or "free flooring" periods as described above) at a floating rate based
on a generally published prime rate or other index. Conseco Finance may charge
the Dealer a documentation, handling and inspection fee for each unit financed
("DHI Fees"). These fees will be included in the Interest Collections owned by
the Trust. Interest and DHI Fees are due and payable on a monthly basis.

Floorplan Billing Procedures

    At the beginning of each month, Conseco Finance sends to each Dealer a
billing statement for the interest, DHI Fees, curtailments, if any, and any
other non-principal charges accrued or arising in the prior month. Payment is
due in the same month.

Floorplan Dealer Monitoring

    Inventory inspections are performed to physically verify the collateral
used to secure a Dealer's loan, check the condition of the inventory, account
for any missing inventory and collect any funds due. The inventory inspection
is one of the key tools utilized by CLD for monitoring inventory financed by
Conseco Finance, and is performed generally on a monthly basis with respect to
each Dealer account (and each location within a Dealer account to the extent
that a dealer conducts its business in more than one location). If an
inspection reveals that the Dealer has sold any inventory without immediate
repayment to Conseco Finance, the inventory is considered "sold and unpaid"
("SAU") and Conseco Finance demands immediate repayment from the Dealer or
initiates other appropriate steps to resolve the SAU. Inspection dates within
each month may vary, as all inspections are unscheduled and are performed
whenever CLD deems it appropriate. CLD also requires regular rotation of the
individuals conducting a Dealer's inspections.

    In addition, Area Managers, within their respective portfolio of Dealers,
monitor each Dealer as to the Dealer's performance and adherence to Conseco
Finance's requirements. This includes a regular review of annual and interim
financial statements for trends, payments for sold inventory between
inspections, monitoring of Conseco Finance's ongoing perfected security
interests in the inventory, existence of proper insurance coverage with

                                       26
respect to the inventory at all times, timely payment of interest, DHI Fees and
curtailments, proper recording of invoices, the maintenance of the Manufacturer
Statements of Origin which are on file with respect to each item of inventory
financed, and the requirement that all inventory stays within the repurchase
period in effect with respect to each manufacturer.

Participations in Floorplan Receivables

    Conseco Finance may also acquire participation interests in floorplan
receivables established by other lenders. Such participation interests, rather
than the receivables themselves, would be transferred to the Transferor and, in
turn, to the Trust. These receivables would have terms similar to those of
Floorplan Receivables originated by Conseco Finance, and would be serviced by
the lead lender in a manner similar to Conseco Finance's servicing standards.

Participation Arrangements

    From time to time Conseco Finance will enable other financing sources to
participate in some of its credit facilities ("Participations"). Pursuant to a
typical Participation, the documentation for the underlying line of credit will
remain in the name of Conseco Finance, as lender. In a separate contractual
arrangement with Conseco Finance, the participant will agree to provide a
portion of the funding for a facility in exchange for an agreed-upon interest
rate. Occasionally, fees and other charges may also be shared with the
participant. In some cases, Conseco Finance will advise a borrower that the
size of its credit facility is expressly conditioned upon the availability of
participants in the facility. In those situations, if no participants can be
found, or if such participants cease to participate, the size of the credit
facility may be reduced. In other circumstances, there will be no such
condition, and Conseco Finance may be obligated to maintain a credit facility
notwithstanding its expectation that a portion of it would be participated. The
Receivables to be sold by Conseco Finance to the Transferor, and in turn by the
Transferor to the Trust, may include the non-participated portion of
receivables from accounts which have been participated. In addition, subject to
substantially the same limitations that apply to the removal of Accounts, the
Transferor may cause the Trust to transfer an interest in certain Receivables
to the Transferor, which may thereafter transfer such interest to another
person in the form of a Participation. Conseco Finance may also sell to the
Transferor (who will then transfer to the Trust) floorplan receivables and
asset-based receivables subject to a participation interest granted to another
lender, or Conseco Finance may sell to the Transferor (who will then transfer
to the Trust) interests in a partnership or other limited-purpose entity whose
sole assets will be receivables that are subject to the participation interests
of other lenders. In addition, Conseco Finance may, from time to time, enter
into syndicated credit facilities, pursuant to which multiple lenders,
including Conseco Finance, will jointly establish a credit facility
administered by a lender agent. Under these facilities, Conseco Finance and its
co-lenders will agree, pursuant to the terms of the loan agreement with the
borrower, to provide a portion of the overall credit facility up to their
respective maximum commitment amounts. In return, Conseco Finance and its co-
lenders generally share in the interest and principal payments and other fees
and charges on a pro-rata basis.

                                       27
Asset-Based Receivables

    Asset-Based Receivables that may be sold to the Transferor arise from
asset-based revolving credit facilities provided to certain manufacturers,
retailers and distributors. These facilities typically involve a revolving line
of credit, for a contractually committed period of time, pursuant to which the
borrower may draw the lesser of the maximum amount of such line of credit or a
specifically negotiated loan availability amount, subject to the availability
of adequate collateral. Interest is typically payable monthly, while principal
payments and draws are generally settled weekly or, if earlier, when and to the
extent principal outstandings exceed eligible collateral at negotiated advance
rates (i.e., the maximum percentage of the borrowing base, or portion thereof,
that the borrowed amount can represent). As a result, monthly payment rates for
Asset-Based Receivables will vary depending on the terms of the facility. The
loan availability amount is generally determined by multiplying an agreed upon
advance rate against the value of certain types of assets. In these facilities,
Conseco Finance will most typically lend against finished inventory and
eligible accounts receivable arising from the sale of such inventory which are
free and clear of other liens and otherwise in compliance with specified
standards. Conseco Finance's asset-based revolving credit facilities are
secured by the assets which constitute the borrowing base against which the
loan availability amount is calculated and, occasionally, by other personal
property, mortgages or other assets of the borrower. Asset-Based Receivables
are generally not supported by any Floorplan Agreement with a manufacturer, and
for that reason generally have significantly lower advance rates than a
borrowing agreement supported by a Floorplan Agreement with a Manufacturer.

    Conseco Finance's underwriting of Asset-Based Receivables gives
consideration to a variety of factors, including, among others, the financial
condition of the borrowing entity, its credit history and relationship with
current and previous lenders and its historical performance and trends. Upon
satisfaction of certain credit criteria, terms and conditions, an account is
approved for a revolving line of credit, the size of which is based on a
variety of factors including the needs of the borrower.

    Upon approval of the credit, Conseco Finance performs an evaluation of the
borrowing base and establishes advance rates based on the type of collateral.
For purposes of evaluating items such as finished goods inventory, work-in-
process, raw materials and component parts, Conseco Finance may obtain an
independent appraisal for use in establishing advance rates. With respect to
accounts receivable, Conseco Finance establishes eligibility criteria,
typically excluding items past due in excess of 60 days or aged over 120 days
from invoice date, and concentration limits with respect to the individual
items within the receivables base. Next, Conseco Finance determines an advance
rate on eligible receivables based on a review of historical and projected
data, giving consideration to factors such as credit loss experience, dilution,
contingent sales and aged items. The intended result of the above analyses is
to set eligibility criteria and advance rates such that, under a collateral
liquidation scenario, Conseco Finance would fully recover any principal dollars
advanced on the revolving line of credit.

    The credit facilities giving rise to the Asset-Based Receivables may also
provide for control of all cash receipts of the borrower through a bank lockbox
facility. The adequacy of

                                       28
the borrowing base is monitored weekly and audited quarterly. Collateral
inspections may occur on a more frequent basis. In addition, the financial
condition of the borrower is monitored in connection with financial covenants
set forth in the loan agreements, and is subject to audit by Conseco Finance at
any time. In cases in which Conseco Finance is a co-lender with other lenders
one of which is a lead lender, the lead lender may perform such monitoring.

Realization on the Receivables

    Upon any default by a Dealer of its obligations to Conseco Finance under
the related financing agreement and expiration of any and all applicable notice
and cure periods that may have been agreed to between Conseco Finance and that
Dealer, Conseco Finance may declare that Dealer's obligations immediately due
and payable and enforce all of its legal rights and remedies, including
commencement of proceedings to realize upon any collateral, subject to
prevailing standards of commercial reasonableness and good faith. Upon learning
of such a default relating to Floorplan Receivables, Conseco Finance makes
contact with the Dealer to determine whether it can develop a workout
arrangement with the Dealer to cure all defaults. If disputes with the Dealer
exist, these disputes may be submitted to arbitration. If Conseco Finance
determines that this arrangement to cure a default cannot be successfully
implemented, it accelerates the Dealer's payment obligations. Conseco Finance
then attempts to obtain possession of the collateral. If a manufacturer is
obligated to repurchase the collateral under a Floorplan Agreement as described
above under "Floorplan Agreements with Manufacturers," Conseco Finance turns
the collateral over to the related manufacturer. Conseco Finance repossesses,
stores and then attempts to sell all other salable collateral in a commercially
reasonable manner. See "The Accounts--Loss Experience."

    Upon default by the borrower under an Asset-Based Receivable revolving
credit arrangement, which, among other conditions, may arise as a result of the
borrower's failure to comply with certain specified debt covenants or failure
to maintain an adequate borrowing base to support outstanding balances, Conseco
Finance will continue its ongoing assessment of the borrower's financial
condition and determine its best course of action for purposes of obtaining
repayment, including the possibility of immediate liquidation of all
collateral.

                                THE RECEIVABLES

    The receivables conveyed to the Trust (the "Receivables") represent the
amounts owed from time to time under the revolving financing arrangements (the
"Accounts"). The Accounts were selected from Conseco Finance's portfolio of
accounts on the basis of criteria set forth in the Pooling and Servicing
Agreement as applied on December 1, 1995 (the "Cut-off Date") and, with respect
to Accounts designated after the Cut-off Date ("Additional Accounts"), as of
the related date of their designation (collectively the "Trust Portfolio").
Most of the Accounts were originated by subsidiaries of Conseco Finance.
Subject to certain limitations in the Pooling and Servicing Agreement, the
Transferor has the right, and in some circumstances will be obligated, to
designate from time to time Additional Accounts and to transfer to the Trust
all Receivables arising from such Additional Accounts,

                                       29
whether such Receivables are then existing or thereafter created. Conseco
Finance expects to transfer Receivables in Additional Accounts to the
Transferor, which will transfer such Receivables to the Trust, as Conseco
Finance's commercial finance business continues to grow. Any Additional
Accounts must be Eligible Accounts as of the date the Transferor designates
such accounts as Additional Accounts. Furthermore, subject to certain
limitations in the Pooling and Servicing Agreement, the Transferor has the
right to designate certain Accounts as Removed Accounts and to require the
Trustee to reconvey all Receivables in such Removed Accounts to the Transferor,
whether such Receivables are then existing or thereafter created. The Accounts
from which the Receivables arise will be the Accounts designated by the
Transferor on the Cut-off Date plus any Additional Accounts minus any Removed
Accounts. Pursuant to the Pooling and Servicing Agreement, the Transferor will
represent and warrant to the Trust that, as of the date Receivables are
conveyed to the Trust, such Receivables meet certain eligibility requirements.
See "Description of the Offered Certificates--Representations and Warranties."

Eligible Receivables and Eligible Accounts

    The Receivables must arise under an Eligible Account. An "Eligible Account"
is defined to mean, as of the Cut-off Date (or, with respect to Additional
Accounts, as of their date of designation for inclusion in the Trust), an
arrangement to provide a revolving extension of credit by Conseco Finance or
one of its subsidiaries to a Dealer (i) in order to finance the purchase by a
Dealer of consumer and commercial product inventory or (ii) as a line of credit
secured by unencumbered assets of such Dealer, which extension of credit, as of
the date of determination thereof,

  (a) is in existence and maintained with Conseco Finance or such
      subsidiary,

  (b) is payable in United States dollars,

  (c) is with a Dealer whose most recent billing address is in the United
      States or its territories or possessions,

  (d) has been originated by Conseco Finance or such subsidiary in the
      ordinary course of its business or acquired by Conseco Finance through
      the acquisition of an Eligible Account from another lender upon
      satisfying Conseco Finance's customary underwriting standards,

  (e) in respect of which no amounts have been charged off by Conseco
      Finance or such subsidiary as uncollectible in its customary and usual
      manner as of the Cut-off Date (or, with respect to Additional
      Accounts, as of their date of designation for inclusion in the Trust),
      and

  (f) is with a Dealer that is not involved in insolvency proceedings.

The definition of Eligible Account may be changed by amendment to the Pooling
and Servicing Agreement without the consent of the Certificateholders if (i)
the Transferor delivers to the Trustee a certificate of an authorized officer
to the effect that, in the reasonable belief of the Transferor, such amendment
will not as of the date of such amendment adversely affect in any material
respect the interest of the Certificateholders, and

                                       30
(ii) such amendment will not result in a withdrawal or reduction of the rating
of any outstanding Series issued by the Trust.

    An "Eligible Receivable" is defined as a Receivable

  (a) that was originated by Conseco Finance or one of its subsidiaries in
      the ordinary course of business or acquired by Conseco Finance through
      the acquisition of an Eligible Account from another lender upon
      satisfying Conseco Finance's customary underwriting standards,

  (b) that has arisen under an Eligible Account,

  (c) that was created in compliance with all requirements of law applicable
      thereto and pursuant to a floorplan or asset-based financing agreement
      that complies with all requirements of law applicable thereto,

  (d) with respect to which all consents, licenses or authorizations of, or
      registrations with, any governmental authority required to be obtained
      or given by Conseco Finance or such subsidiary or the Transferor in
      connection with the creation of such Receivable, or the transfer
      thereof to the Trust or the execution, delivery, creation and
      performance by Conseco Finance or such subsidiary of the related
      floorplan or asset-based financing agreement have been duly obtained
      or given and are in full force and effect as of the date of the
      creation of such Receivable,

  (e) as to which, at the time of its creation, the Transferor had good and
      marketable title free and clear of all liens and security interests
      (other than certain liens permitted pursuant to the Pooling and
      Servicing Agreement), and at all times following the transfer of such
      Receivables to the Trust, the Trust will have good and marketable
      title free and clear of all liens and security interests (other than
      certain liens permitted pursuant to the Pooling and Servicing
      Agreement) or the grant of a first priority security interest therein,

  (f) that is the legal, valid, binding and assignable payment obligation of
      the related Dealer, legally enforceable against such Dealer in
      accordance with its terms (with certain bankruptcy related
      exceptions),

  (g) that constitutes "chattel paper," an "account" or a "general
      intangible" under Article 9 of the UCC as then in effect in the State
      of Minnesota,

  (h) if such Receivable has the benefit of a Floorplan Agreement with a
      manufacturer, such Floorplan Agreement provides, subject to the
      specific terms thereof and any limitations therein (which may vary
      among Floorplan Agreements), that the manufacturer is obligated to
      repurchase the products securing the Receivables upon the Servicer's
      repossession thereof upon the related Dealer's default,

  (i) which has been the subject of a valid transfer and assignment from the
      Transferor to the Trust of all the Transferor's interest therein and
      in the related Collateral Security (including any proceeds thereof),

                                       31
(j) which at the time of transfer to the Trust is not subject to any right
      of rescission, setoff, or any other defense (including defenses
      arising out of violations of usury laws) of the Dealer,

  (k) as to which, at the time of transfer of such Receivable to the Trust,
      Conseco Finance (or such subsidiary) and the Transferor have satisfied
      all their respective obligations with respect to such Receivable
      required to be satisfied at such time,

  (l) as to which, at the time of transfer of such Receivable to the Trust,
      neither Conseco Finance (or such subsidiary) nor the Transferor has
      taken or failed to take any action which would impair the rights of
      the Trust or the certificateholders therein, and

  (m) which represents the obligation of a Dealer to repay an advance made
      to or on behalf of such Dealer to finance products or the accounts
      receivable arising from the sale of such products.

In addition, participation interests described above under "Conseco Finance
Corp. and Its Commercial Lending Division--Participations in Floorplan
Receivables" and Receivables described above under "Conseco Finance Corp. and
Its Commercial Lending Division--Participation Arrangements" will be
Receivables.

    The products financed by the receivables in Conseco Finance's portfolio as
of      , 2000 are shown below under "The Accounts--Description of Conseco
Finance's Portfolio." Currently, substantially all of the Floorplan Receivables
are owed by manufactured housing, recreational vehicle, marine product
(primarily boats, outboard motors and boat trailers), lawn and garden
equipment, aircraft, motorcycle and truck dealers. These Receivables enable
dealers to finance their inventory pending resale to consumers. Conseco Finance
expects that it will establish Accounts for other Dealers in the future, whose
related Receivables will finance other types of products. The Asset-Based
Receivables generally arise under revolving credit facilities for
manufacturers, retailers and distributors of various products. Conseco Finance
expects that the composition of the Receivables will change over time.

    In order to reduce the Trust's exposure to any single Dealer or any single
industry, certain diversification thresholds ("Overconcentration Amounts") will
be tested at the end of each Monthly Period. Initially, the Overconcentration
Amounts will be as follows:

  .   no more than   % of the Receivables may be Asset-Based Receivables

  .   no more than  % (or, with respect to certain designated Dealers,  %)
      of the Receivables may have arisen under an Account with a single
      Dealer

  .   no more than   % (or, with respect to certain designated
      manufacturers, up to   %) of the Receivables may be Floorplan
      Receivables financing products from a single manufacturer

  .   no more than  % of the Receivables may be Floorplan Receivables
      financing marine products

                                       32
.   no more than   % of the Receivables may be Floorplan Receivables
      financing recreational vehicles

  .   no more than   % of the Receivables may be Floorplan Receivables
      financing lawn and garden equipment

  .   no more than   % of the Receivables may be Floorplan Receivables
      financing products other than manufactured housing, marine products,
      recreational vehicles, or lawn and garden equipment.

    Conseco Finance expects that the Receivables will from time to time exceed
one or more of these thresholds. To the extent that any such threshold is
exceeded at the end of a month, the Class D Invested Amount will be increased
by an equivalent amount. These threshold percentages may, however, be increased
or decreased in the future without the consent of any Certificateholder, to a
level acceptable to each rating agency referred to under "Summary of Terms"
(each, a "Rating Agency") without any reduction or withdrawal of its rating of
the Class A Certificates or Class B Certificates. See "Description of the
Offered Certificates--The Overconcentration Amounts."

                                  THE ACCOUNTS

General

    The Receivables have arisen or will arise in the Accounts. The Accounts
were selected from all the accounts that were Eligible Accounts (the "Eligible
Portfolio") at the Cut-off Date or, in the case of Additional Accounts, as of
the date of their designation. Eligible Accounts, including Additional
Accounts, are described under "The Receivables--Eligible Receivables and
Eligible Accounts" and "Description of the Offered Certificates--
Representations and Warranties" and "--Addition of Accounts."

Description of Conseco Finance's Portfolio

    The following tables set forth the composition of the receivables in
Conseco Finance's servicing portfolio of revolving credit agreements, as of
    , 2000, by business line and other criteria. Because Conseco Finance
expects to designate Additional Accounts from time to time, the business lines
and the actual composition of the Receivables in the Trust Portfolio by
business line are expected to change over time. In addition, due to the
variability and uncertainty with respect to the rates at which Receivables in
the Trust Portfolio are created, paid or otherwise reduced, the characteristics
set forth below may vary significantly as of any other date of determination.
Percentages may not add to 100% due to rounding.

    In general, Conseco Finance considers any number of revolving financing
arrangements established with a group of affiliated Dealers to be a single
account, because the affiliated Dealers represent a consolidated credit risk.
However, Conseco Finance also measures its exposure to Dealers in various
industries. For this purpose Conseco Finance would, for example, consider
revolving financing arrangements with a group of affiliated dealers

                                       33
engaged in sales of manufactured housing and recreational vehicles to be
separate accounts, one relating to a group of manufactured housing dealers and
one relating to a group of recreational vehicle dealers. Accordingly, the total
number of Accounts in the tables below may vary.

 Composition of Receivables in Conseco Finance's Portfolio by Business Line as
                                of       , 2000
Percentage of
                                                  Receivables     Receivables
Business Line                                       Balance         Balance
-------------                                  ----------------- -------------
Manufactured Housing Floorplan Receivables.... $                          %
Recreational Vehicle Floorplan Receivables....
Marine Floorplan Receivables..................
Motorcycle Floorplan Receivables..............
Aircraft Floorplan Receivables................
Truck Floorplan Receivables...................
Trailer Floorplan Receivables.................
Real Estate...................................
Lawn and Garden Equipment.....................
Asset-Based Receivables.......................
                                               -----------------    ------
  Total....................................... $                    100.00%(1)
                                               =================    ======
--------
(1) The sum of the individual Receivables balance percentages may not total
    100.00% due to rounding.

Composition of Receivables in Conseco Finance's Portfolio by Account Balance as
                                of       , 2000
Percentage of           Percentage
                            Receivables     Receivables  Number of  of Number
Account Balance Range         Balance         Balance    Accounts  of Accounts
---------------------    ----------------- ------------- --------- -----------
$0 to $100,000.......... $                          %                      %
$100,000.01 to
 $500,000...............
$500,000.01 to
 $1,000,000.............
$1,000,000.01 to
 $5,000,000.............
$5,000,000.01 to
 $10,000,000............
Over $10,000,000........
                         -----------------    ------       -----     ------
  Total................. $                    100.00%                100.00%
                         =================    ======       =====     ======
34
Geographic Distribution of Receivables in Conseco Finance's Portfolio as of
                                       , 2000
Percentage of           Percentage
                              Receivables     Receivables  Number of  of Number
Dealer Location(1)              Balance         Balance    Accounts  of Accounts
------------------         ----------------- ------------- --------- -----------
..................... $                          %                      %
     .....................
     .....................
     .....................
     .....................
     .....................
     .....................
     .....................
     .....................
     .....................
     .....................
Other States (2)..........
                           -----------------    ------       -----     ------
  Total................... $                    100.00%                100.00%
                           =================    ======       =====     ======
--------
(1) For purposes of this table, the Dealer's location is based on the Dealer's
    headquarters address rather than the actual location of the Dealer's place
    of business. For purposes of this table, the accounts of affiliated Dealers
    have not been aggregated. This table excludes Dealers with Receivables of
    less than $5.00.
(2) The percentage of the Receivables balance represented by Receivables in
    each state not specifically listed is less than 3% of the Receivables
    balance.

Yield Information

    The Receivables bear interest in their accrual periods at rates generally
equal to an index rate selected in the related financing agreement, which as of
the date hereof is generally a prime rate, plus a margin. Some Receivables do
not bear interest for a specified period after their origination. During the
[   ] months ended       , 2000, the receivables in Conseco Finance's portfolio
had a yield of   % per annum. The Trust's yield on its Receivables will be
affected by the interest rates borne by Receivables, the Discount Factor, if
any, and the rate at which the Receivables balances are paid.

Major Customers; Major Manufacturers

    At       , 2000, no one Floorplan Dealer accounted for more than    % of
the aggregate balance of the Receivables in Conseco Finance's portfolio. At
      , 2000, except as discussed below, no one manufacturer was obligated
under Floorplan Agreements relating to receivables in Conseco Finance's
portfolio aggregating more than    % of the aggregate receivables balance. [At
     , 2000, Fleetwood Enterprises, Inc. and Champion Enterprises, Inc. were
obligated under their Floorplan Agreements with Conseco Finance with respect to
receivables aggregating    % and    %, respectively, of Conseco Finance's
portfolio, and aggregating    % and    %, respectively, of the Receivables
owned by the Trust.] No prediction can be made as to what percentage of the
Receivables in the future may be obligations of a single Dealer or be related
to a single manufacturer under its Floorplan Agreement. Such percentages are

                                       35
subject to the effect of Overconcentration Amounts. See "Description of the
Offered Certificates--The Overconcentration Amounts."

Delinquency Experience

    The following table sets forth the delinquency experience as of the dates
indicated for Conseco Finance's Floorplan portfolio. Because Conseco Finance's
portfolio has grown rapidly in the past year, and Conseco Finance expects to
create a substantial number of Additional Accounts that will be transferred to
the Trust in the future, the actual delinquency experience with respect to the
Receivables may be different. There can be no assurance that the delinquency
experience for the Receivables in the future will be similar to the experience
shown below.

   Delinquency Experience for the Floorplan Portfolio(1) Receivables Balance
                             (Dollars in Thousands)
December 31, December 31, December 31, December 31, December 31,  December
                             1995         1996         1997         1998         1999      31, 2000
                         ------------ ------------ ------------ ------------ ------------ -----------
Aggregate Principal
 Balance................   $539,615    $1,022,534   $1,496,433   $1,989,985   $           $
SAU/NSF (2).............      1,558         1,319        1,447        3,413
SAU/NSF as a Percentage
 of Aggregate Principal
 Balance................       0.29%         0.13%        0.10%        0.17%           %            %
--------
(1) Excludes Asset-Based Receivables.
(2) A "SAU/NSF" Receivable is one that is deemed delinquent when (i) there is
    an unpaid receivable balance as to which the related product has been sold
    and such receivable balance has not been paid by the related Dealer or (ii)
    a payoff check from the related Dealer has been returned because of
    insufficient funds.

Loss Experience

    The following table sets forth Conseco Finance's average principal
receivables balance and loss experience for each of the periods shown with
respect to its portfolio. Because Conseco Finance's portfolio has grown rapidly
in the past three years, and Conseco Finance expects to create a substantial
number of Additional Accounts that will be designated for the Trust in the
future, actual loss experience with respect to the Receivables may be
different. Since a substantial number of receivables from which the Receivables
will be taken were only recently originated, it may be expected that such
receivables have not yet exhibited a loss experience that is representative of
the losses that may be experienced over a longer period of time. There can be
no assurance that the loss experience for the Receivables in the future will be
similar to the historical experience set forth below with respect to the
portfolio. The historical experience set forth below includes the effect of the
financial obligations of manufacturers in respect of repossessed products as
described above under "Conseco Finance Corp. and Its Commercial Lending
Division--Floorplan Agreements with Manufacturers." If Manufacturers are not
able to perform such obligations in the future, the loss experience in respect
of the portfolio and the Receivables may be adversely affected.

                                       36
Loss Experience for the Conseco Finance Portfolio
                             (Dollars in Thousands)
Twelve       Twelve       Twelve       Twelve       Twelve       Twelve
                         Months Ended Months Ended Months Ended Months Ended Months Ended Months Ended
                         December 31, December 31, December 31, December 31, December 31, December 31,
                             1995         1996         1997         1998         1999         2000
                         ------------ ------------ ------------ ------------ ------------ ------------
Average Principal
 Receivables Balance
 (1)....................   $380,226    $1,048,260   $1,657,940   $2,319,637   $            $
Gross Losses............         24           612        1,667        1,045
Recoveries..............                     (104)        (239)        (221)
Net Losses (Recoveries)
 (2)....................         24           508        1,428          824
Net Losses (Recoveries)
 as a percentage of
 Average Principal
 Receivables Balance....      0.006%        0.049%       0.086%       0.036%           %            %
--------
(1) Average Principal Receivables Balance is the average daily principal
    balances for the twelve months ended December 31, 1995, 1996, 1997, 1998,
    1999 and 2000, respectively.
(2) Net losses (recoveries) in any period are gross losses less recoveries for
    that period. Recoveries include recoveries from collateral security in
    addition to recoveries from the products.

Aging Experience

    The following table provides the age distribution of inventory for all
dealers in the Floorplan portfolio, as a percentage of total principal
outstanding at the date indicated. Because the Eligible Accounts will only be a
portion of the entire portfolio, actual age distribution with respect to the
Eligible Accounts may be different.

                Age Distribution for the Floorplan Portfolio(1)
                               as of       , 2000
Percentage of
                                                     Receivables    Receivables
                                                       Balance        Balance
                                                    -------------- -------------
Days
 0-90.............................................. $                       %
 91-180............................................
 181-365...........................................
 366-730...........................................
 Over 731..........................................
                                                    --------------    ------
  Total............................................ $                 100.00%
                                                    ==============    ======
--------
(1) Excludes Asset-Based Receivables.

                                       37
MATURITY CONSIDERATIONS

    Unless a Pay Out Event has occurred, principal of the Class A Certificates
is expected to be paid on the Distribution Date (as defined herein) in
(the "Class A Scheduled Payment Date"), and principal of the Class B
Certificates is expected to be paid on the Distribution Date in       (the
"Class B Scheduled Payment Date"). If the Class A Invested Amount is not
reduced to zero on the Class A Scheduled Payment Date, principal will be paid
to the Class A Certificateholders on each Distribution Date thereafter until
the earlier of the date on which the Class A Invested Amount has been paid in
full and       (the "Series 2001-1 Termination Date"). After the Class A
Invested Amount has been paid in full, principal will be paid to the Class B
Certificateholders on each Distribution Date until the earlier of the date on
which the Class B Invested Amount has been paid in full or the Series 2001-1
Termination Date.

    Controlled Accumulation Period. The determination of the "Controlled
Accumulation Period" is described under "Description of the Offered
Certificates--Postponement of Controlled Accumulation Period." It will start no
earlier than       and no later than      . On each business day during the
Controlled Accumulation Period, Principal Collections (as defined herein)
allocable to the Class A, Class B and Class C Certificates, Shared Principal
Collections (as defined herein), if any, from other Series available to Series
2001-1 and certain other available amounts will be deposited into the Principal
Account (as defined herein) until that account contains an amount (the
"Controlled Deposit Amount") equal to the sum of (i) the Controlled
Accumulation Amount for the related Monthly Period and (ii) the Accumulation
Shortfall, if any, for that Monthly Period. A "Monthly Period" is a calendar
month. The "Controlled Accumulation Amount" is the amount that, if accumulated
for each month in the Controlled Accumulation Period, will equal the initial
Class A Invested Amount. The "Accumulation Shortfall" for a Monthly Period is
the amount by which the Controlled Deposit Amount for the prior Monthly Period
exceeds the amount actually deposited into the Principal Account during that
prior Monthly Period.

    At the end of the Controlled Accumulation Period, we expect that there will
be enough funds in the Principal Account to distribute the entire Class A
Invested Amount to the Class A Certificateholders on the Class A Scheduled
Payment Date and the entire Class B Invested Amount to the Class B
Certificateholders on the Class B Scheduled Payment Date. Although we
anticipate that the Trust will be able to make these accumulations and
distributions within that time frame, we cannot assure you that the Trust will
accumulate enough principal to pay these amounts on these dates.

    Early Amortization Period. If a Pay Out Event occurs, the "Early
Amortization Period" will commence and any amounts on deposit in the Principal
Account will be paid to the Class A Certificateholders on the Distribution Date
in the month following the commencement of the Early Amortization Period. In
addition, payments of principal equal to the Principal Collections allocable to
the Class A, Class B and Class C Certificateholders' Interest plus Shared
Principal Collections, if any, from other Series allocable to the Class A,
Class B and Class C Certificates, plus certain other amounts comprising
Class A, Class B

                                       38
and Class C Principal, will distributed on each Distribution Date in the
following order of priority:

  (1)   to the Class A Certificateholders until the Class A Invested Amount
        is reduced to zero;

  (2)  to the Class B Certificateholders until the Class B Invested Amount
       is reduced to zero;

  (3) to the Class C Certificateholders until the Class C Invested Amount is
      reduced to zero; and

  (4)  to the Class D Certificateholders until the Class D Invested Amount
       is reduced to zero.

    If a Pay Out Event occurs with respect to the Series 2001-1 Certificates
prior to the payment in full of the Series 1998-2 and Series 1999-1
Certificates, Series 2001-1 Certificateholders will receive no allocations of
principal (other than funds then on deposit in the Pre-Funding Account) until
the Series 1998-2 and Series 1999-1 Certificates are paid in full or funds in
respect thereof have been deposited in the Principal Account. In addition,
funds in the Pre-Funding Account will be released to the Transferor as funds
are deposited in the Principal Account for Series 1998-2 and Series 1999-1. If
a Pay Out Event occurs with respect to Series 2001-1 before the payment in full
of Series 1998-2 and Series 1999-1, Series 1998-2 and Series 1999-1 will
receive the funds on deposit in the Principal Account for Series 1998-2 and
Series 1999-1, but Series 2001-1 would not have a corresponding amount of funds
in the Pre-Funding Account.

    A "Pay Out Event" occurs, either automatically or after specified notice,
upon

  (1)   failure by the Transferor to convey Receivables in Additional
        Accounts to the Trust within five Business Days after the day on
        which it is required to convey such Receivables pursuant to the
        Pooling and Servicing Agreement;

  (2)  failure on the part of the Transferor, the Servicer or Conseco
       Finance, as applicable,

     (a) to make any payment or deposit required by the Pooling and
         Servicing Agreement or the Purchase Agreement, on or before the
         date such payment or deposit is required to be made therein, which
         failure is not cured within five business days after written
         notice from the Trustee of such failure; or

     (b) to deliver a Distribution Date statement as required under the
         Pooling and Servicing Agreement within ten business days after
         written notice from the Trustee of such failure; or

     (c) to comply with its covenant not to create any lien on a Receivable
         which failure has a material adverse effect on the holders of the
         Certificates and which continues unremedied for a period of 60
         days after written notice to it; provided, however, that any Pay
         Out Event shall not be deemed to have

                                       39
occurred if the Transferor shall have repurchased the related
         Receivables or, if applicable, all the Receivables during such
         period in accordance with the provisions of the Pooling and
         Servicing Agreement; or

     (d) to observe or perform in any material respect any other covenants
         or agreements set forth in the Pooling and Servicing Agreement or
         the Purchase Agreement, which failure has a materially adverse
         effect on the Certificateholders and which continues unremedied
         for a period of 45 days after written notice of such failure;

  (3)  any representation or warranty made by Conseco Finance in the
       Purchase Agreement or by the Transferor in the Pooling and Servicing
       Agreement or any information required to be given by the Transferor
       to the Trustee to identify the Accounts proves to have been incorrect
       in any material respect when made and continues to be incorrect in
       any material respect for a period of 60 days after written notice and
       as a result the interests of the Certificateholders are materially
       and adversely affected (excluding, however, any representation or
       warranty made by the Transferor that the Pooling and Servicing
       Agreement constitutes, or the transfer of the Receivables to the
       Trust is, a valid sale, transfer and assignment to the Trust of all
       right, title and interest of the Transferor in the Receivables and
       the Collateral Security (as defined herein) if the Pooling and
       Servicing Agreement constitutes the grant of a security interest in
       the Receivables and Collateral Security); provided, however, that any
       Pay Out Event shall not be deemed to occur thereunder if the
       Transferor has repurchased the related Receivables or all such
       Receivables, if applicable, during such period in accordance with the
       provisions of the Pooling and Servicing Agreement;

  (4)   the occurrence of certain events of bankruptcy, insolvency or
        receivership relating to Conseco Finance or the Transferor;

  (5)    the Trust or the Transferor becomes an investment company within
         the meaning of the Investment Company Act of 1940, as amended;

  (6)   any Servicer Default (as defined herein) occurs;

  (7)  on any Determination Date, the average of the Monthly Payment Rates
       for the three preceding Monthly Periods, where the Monthly Payment
       Rate for a Monthly Period is the percentage obtained by dividing the
       aggregate of the Receivables balances (without deducting therefrom
       any discount portion) collected during such Monthly Period by the
       average daily aggregate Receivables balance (without deducting
       therefrom any discount portion) for such Monthly Period, is less than
         %;

  (8) the failure to pay the outstanding principal amount of the Class A or
      Class B Certificates by the Class A Scheduled Payment Date or the
      Class B Scheduled Payment Date, as applicable;

  (9)   the ratio (expressed as a percentage) of (i) the average for each
        month of the net losses on the Receivables (exclusive of the
        Ineligible Receivables (as defined herein)) owned by the Trust
        (i.e., gross losses less recoveries on any such

                                      40
Receivables (including, without limitation, recoveries from collateral
      security in addition to recoveries from the products, recoveries from
      manufacturers and insurance proceeds)) during any three consecutive
      calendar months to (ii) the average of the month-end aggregate
      balances of such Receivables (without deducting therefrom the discount
      portion) for such three-month period, exceeds  % on an annualized
      basis;

  (10)  the sum of all Cash Equivalents and amounts on deposit in the Excess
        Funding Account represents more than 50% of the sum of the aggregate
        amount of Principal Receivables (without deducting therefrom any
        discount portion) on each of six or more consecutive Determination
        Dates, after giving effect to all payments made or to be made on the
        Distribution Date next succeeding each such respective Determination
        Date; or

  (11) if Principal Collections allocable to the Class D Certificateholder's
       Interest have been reallocated in any Monthly Period to cover any
       Required Amounts and have not been reimbursed as of the Determination
       Date in such Monthly Period.

    A "Determination Date" is the second Business Day preceding a Distribution
Date.

    The amount of new Receivables generated in any month and payment rates on
the Receivables may vary because of seasonal variations in product sales and
inventory levels, retail incentive programs provided by product manufacturers
and various economic factors affecting product sales generally. The following
table sets forth the monthly payment rates ("MPR") for the receivables
originated by Conseco Finance from Dealers for each month since January 1995
and the average monthly payment rates for such receivables for all months
during the periods shown, in each case calculated by dividing the total
collections during a given month by total opening monthly balances of such
receivables during the periods shown and expressing such amounts as a
percentage. The payment rates shown in the table reflect payments on Floorplan
Receivables only. As of       , 2000, approximately     % of the receivables
in Conseco Finance's portfolio were Asset-Based Receivables.

                                      41
Monthly Payment Rates for the Portfolio
Payment Rate
                                                   ----------------------------------
Month                                              1995  1996  1997  1998  1999  2000
-----                                              ----  ----  ----  ----  ----  ----
January...........................................  22%   20%   17%   16%   15%     %
February..........................................  19    19    17    18    16
March.............................................  24    23    22    21    21
April.............................................  25    27    23    24    20
May...............................................  28    26    24    22    20
June..............................................  29    25    25    26    22
July..............................................  29    27    28    26    21
August............................................  33    28    25    25    22
September.........................................  28    26    26    25
October...........................................  30    26    26    25
November..........................................  28    23    22    22
December..........................................  24    21    22    21
                                                   ---   ---   ---   ---   ---   ---
Average...........................................  26%   24%   23%   23%   20%     %
                                                   ===   ===   ===   ===   ===   ===
The amount of collections on Receivables may vary from month to month due
to seasonal fluctuations in sales of the products securing the Receivables and
other factors. There can be no assurance that Principal Collections with
respect to the Trust, and thus the rate at which funds are deposited in the
Principal Account during the Controlled Accumulation Period, will be similar to
the historical experience set forth above. If a Pay Out Event occurs, the
average life and maturity of the Class A Certificates and the Class B
Certificates (the "Offered Certificates") could be significantly reduced.
Certificateholders will bear the risk of being able to reinvest principal
received on the Certificates at a yield at least equal to their yield on the
Certificates. If an investor acquires a Certificate at a discount, the
repayment of principal on the Certificate later than on the related Scheduled
Payment Date will likely result in a lower than anticipated yield. In addition,
if an investor acquires a Certificate at a premium, repayment of principal
earlier than the related Scheduled Payment Date will result in a yield to that
investor that is lower than anticipated by that investor.

                                       42
USE OF PROCEEDS

    The net proceeds from the sale of the Offered Certificates, expected to be
$       , will be paid by the Underwriters directly to the Transferor. The
Transferor will apply such net proceeds to reduce the principal amount of the
Series 1998-2 and Series 1999-1 Certificates, to pay the purchase price of
Receivables and to fund the Pre-Funding Account (as defined herein) to the
extent of the Pre-Funded Amount (as defined herein).

                    DESCRIPTION OF THE OFFERED CERTIFICATES

    The Offered Certificates will be issued pursuant to the Pooling and
Servicing Agreement and the Series 2001-1 Supplement. Pursuant to the Pooling
and Servicing Agreement, the Transferor and the Trustee have executed
Supplements for the Series 1995-1 Certificates (which have been paid), the
Series 1996-1 Certificates, the Series 1996-2 Certificates (which have been
retired), the Series 1998-1 Certificates (which will be retired by April 2001),
the Series 1998-A Certificates (which have been retired), the Series 1998-2
Certificates and the Series 1999-1 Certificates, as summarized in Annex B, and
may execute additional Supplements in order to issue additional Series.

General

    The Offered Certificates will represent undivided interests in certain
assets of the Trust, including the right to the investor allocation percentage
of all payments on the Receivables in the Trust. Each Class A Certificate and
Class B Certificate represents the right to receive payments of interest at the
Class A Certificate Rate (as defined herein) or the Class B Certificate Rate
(as defined herein), as the case may be, funded from Series Available Interest
Collections (as defined herein) and the right to receive payments of principal
on or after the Class A Scheduled Payment Date or the Class B Scheduled Payment
Date, as applicable, in each case funded from Principal Collections allocated
to the Class A, Class B and Class C Certificateholders' Interests.

    The Transferor will own the Exchangeable Transferor Certificate and the
Class D Certificates and may either own or privately sell the Class C
Certificates. The "Exchangeable Transferor Certificate" will represent an
undivided interest in the Trust, including the right to a percentage (the
"Transferor Percentage") of all payments on the Receivables in the Trust equal
to 100% minus the sum of the applicable investor allocation percentages (which
shall not exceed 100%) for all Series of certificates then outstanding. See "--
Certain Matters Regarding the Transferor and the Servicer."

    The "Invested Amount" is the sum of the Class A Invested Amount, the Class
B Invested Amount, the Class C Invested Amount and the Class D Invested Amount
(each as defined herein). The "Certificateholders' Interest" is the interest in
the Trust's assets allocated to the holders of the Certificates (the
"Certificateholders"). The "Transferor Interest" is the Transferor's rights in
the assets of the Trust not allocated to the Series 2001-1 Certificateholders'
interest or the interest of the holders of certificates of any other

                                       43
Series pursuant to the Pooling and Servicing Agreement and the applicable
Series supplements thereto. During the Revolving Period (as defined herein),
the amount of the Invested Amount will remain constant except under certain
limited circumstances. See "--Defaulted Receivables" and "--The
Overconcentration Amounts." The amount of Principal Receivables in the Trust,
however, will vary each day as new Receivables arise in the Accounts and other
Receivables are paid. The amount of the Transferor Interest (or the amount in
the Excess Funding Account (as defined herein), if necessary) will fluctuate
each day, therefore, to reflect the changes in the amount of the Principal
Receivables in the Trust, except to the extent another Series absorbs such
change. During the Controlled Accumulation Period or an Early Amortization
Period, dealer payments of Principal Receivables will be collected and
distributed to the Certificateholders. As a result, except to the extent
another Series (which may be a Companion Series (as defined herein)) absorbs
such change, the Transferor Interest will generally increase as principal
payments are made to certificateholders of a Series, reducing the invested
amount of such Series. The Transferor Interest will also change to reflect the
variations in the amount of the Principal Receivables in the Trust. The
Transferor Interest may be reduced as the result of an Exchange. See""--
Exchanges."

    Each Class of Offered Certificates initially will be represented by
certificates registered in the name of the nominee of The Depository Trust
Company ("DTC" and, together with any successor depository selected by the
Transferor, the "Depository"), except as set forth below. Beneficial interests
in each Class of Offered Certificates will be available for purchase in minimum
denominations of $1,000 and integral multiples of $1,000 in excess thereof in
book-entry form only. The Transferor has been informed by DTC that DTC's
nominee will be Cede & Co. Accordingly, Cede & Co. is expected to be the holder
of record of the Offered Certificates. Unless and until Definitive Certificates
are issued under the limited circumstances described herein, no beneficial
owner of a Certificate (a "Certificate Owner") acquiring an interest in any
Class of Offered Certificates will be entitled to receive a certificate
representing such Certificate Owner's interest in such Certificates. Until such
time, all references herein to actions by Certificateholders of any Class of
Offered Certificates will refer to actions taken by the Depository upon
instructions from its participating organizations ("DTC Participants" or
"Participants") and all references herein to distributions, notices, reports,
and statements to Certificateholders of any Class of Offered Certificates will
refer to distributions, notices, reports, and statements to the Depository or
its nominee, as the registered holder of the Offered Certificates of such
Class, for distribution to Certificate Owners of such Class in accordance with
the Depository's procedures. See""--Book-Entry Registration" and "--Definitive
Certificates."

Book-Entry Registration

    With respect to each Class of Offered Certificates in book-entry form,
Certificateholders may hold their Certificates through DTC (in the United
States) or Clearstream or Euroclear (in Europe), if they are participants of
such systems, or indirectly through organizations that are participants in such
systems.

                                       44
Cede & Co. as nominee for DTC, will hold the global certificates.
Clearstream and Euroclear will hold omnibus positions on behalf of the
Clearstream Participants and the Euroclear Participants, respectively, through
customers' securities accounts in Clearstream's and Euroclear's names on the
books of their respective depositaries (collectively, the "Depositaries") which
in turn will hold such positions in customers' securities accounts in the
Depositaries' names on the books of DTC.

    DTC is a limited-purpose trust company organized under the New York Banking
Law, 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 New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Exchange Act. DTC
holds securities for its Participants and facilitates the clearance and
settlement among Participants of securities transactions, such as transfers and
pledges, in deposited securities through electronic book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement of
securities certificates. Participants include securities brokers and dealers,
banks, trust companies, clearing corporations, and certain other organizations.
Indirect access to the DTC system is also available to others such as
securities brokers and dealers, banks, and trust companies that clear through
or maintain a custodial relationship with a Participant, either directly or
indirectly ("Indirect Participants"). The rules applicable to DTC and its
Participants are on file with the Commission.

    Transfers between DTC Participants will occur in accordance with DTC rules.
Transfers between Clearstream Participants and Euroclear Participants will
occur in the ordinary way in accordance with their applicable rules and
operating procedures.

    Cross-market transfers between persons holding directly or indirectly
through DTC in the United States, on the one hand, and directly or indirectly
through Clearstream Participants or Euroclear Participants on the other, will
be effected in DTC in accordance with DTC rules on behalf of the relevant
European international clearing system by its Depositary; however, such cross-
market transactions will require delivery of instructions to the relevant
European international clearing system by the counterparty in such system in
accordance with its rules and procedures and within its established deadlines
(European time). The relevant European international clearing system will, if
the transaction meets its settlement requirements, deliver instructions to its
Depositary to take action to effect final settlement on its behalf by
delivering or receiving securities in DTC, and making or receiving payment in
accordance with normal procedures for same-day funds settlement applicable to
DTC. Clearstream Participants and Euroclear Participants may not deliver
instructions directly to the Depositaries.

    Because of time-zone differences, credits of securities in Clearstream or
Euroclear as a result of a transaction with a DTC Participant will be made
during the subsequent securities settlement processing, dated the business day
following the DTC settlement date, and such credits or any transactions in such
securities settled during such processing will be reported to the relevant
Clearstream Participant or Euroclear Participant on such business day. Cash
received in Clearstream or Euroclear as a result of sales of securities by or
through a

                                       45
Clearstream Participant or a Euroclear Participant to a DTC Participant will be
received with value on the DTC settlement date but will be available in the
relevant Clearstream or Euroclear cash account only as of the business day
following settlement in DTC.

    Purchases of Offered Certificates under the DTC system must be made by or
through Participants, which will receive a credit for the Offered Certificates
on DTC's records. The ownership interest of each actual Certificate Owner is in
turn to be recorded on the Participants' and Indirect Participants' 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 Offered Certificates are to be accomplished by entries made on
the books of Participants acting on behalf of Certificate Owners. Certificate
Owners will not receive certificates representing their ownership interest in
Offered Certificates, except in the event that use of the book-entry system for
the Offered Certificates is discontinued.

    To facilitate subsequent transfers, all Offered Certificates deposited by
Participants with DTC are registered in the name of DTC's partnership nominee,
Cede & Co. The deposit of Offered Certificates with DTC and their registration
in the name of Cede & Co. effects no change in beneficial ownership. DTC has no
knowledge of the actual Certificate Owners; DTC's records reflect only the
identity of the Participants to whose accounts such Offered Certificates are
credited, which may or may not be the Certificate Owners. The 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.

    Neither DTC nor Cede & Co. will consent or vote with respect to the Offered
Certificates. Under its usual procedures, DTC mails an omnibus proxy to the
issuer as soon as possible after the record date, which assigns Cede & Co.'s
consenting or voting rights to those Participants to whose accounts the Offered
Certificates are credited on the record date (identified in a listing attached
thereto).

    Principal and interest payments on the Offered Certificates will be made to
DTC. DTC's practice is to credit Participants' accounts on the Distribution
Date in accordance with their respective holdings shown on DTC's records unless
DTC has reason to believe that it will not receive payment on the Distribution
Date. Payments by 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 Participant and not of DTC, the
Trustee or the Transferor, subject to any statutory or regulatory requirements
as may be in effect from time to time. Payment of principal and interest to DTC
is the responsibility of the Trustee, disbursement of such payments to
Participants shall be the responsibility of

                                       46
DTC, and disbursement of such payments to the Certificate Owners shall be the
responsibility of Participants and Indirect Participants.

    DTC may discontinue providing its services as securities depository with
respect to the Offered Certificates at any time by giving reasonable notice to
the Transferor or the Trustee. Under such circumstances, in the event that a
successor securities depository is not obtained, Definitive Certificates are
required to be printed and delivered. The Transferor may decide to discontinue
use of the system of book-entry transfers through DTC (or a successor
securities depository). In that event, Definitive Certificates will be printed
and delivered.

    Clearstream is incorporated under the laws of Luxembourg as a limited
liability company. Clearstream holds securities for its participating
organizations, which are called Clearstream Participants, and facilitates the
clearance and settlement of securities transactions between Clearstream
Participants through electronic book-entry changes in accounts of Clearstream
Participants, thereby eliminating the need for physical movement of
certificates. Transactions may be settled in Clearstream in any of 28
currencies, including United States dollars. Clearstream provides to its
Clearstream Participants, among other things, services for safekeeping,
administration, clearance and settlement of internationally traded securities
and securities lending and borrowing. Clearstream interfaces with domestic
markets in several countries. As a professional depository, Clearstream is
subject to regulation by the Luxembourg Monetary Institute. Clearstream
Participants are recognized financial institutions around the world, including
underwriters, securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations and may include the underwriter.
Indirect access to Clearstream is also available to others, such as banks,
brokers, dealers and trust companies that clear through or maintain a custodial
relationship with a Clearstream Participant, either directly or indirectly.

    The Euroclear System (the "Euroclear System") was created in 1968 to hold
securities for participants of the Euroclear System ("Euroclear Participants")
and to clear and settle transactions between Euroclear Participants through
simultaneous electronic book-entry delivery against payment, thereby
eliminating the need for physical movement of certificates and any risk from
lack of simultaneous transfers of securities and cash. Transactions may now be
settled in any of 32 currencies, including United States dollars. The Euroclear
System includes various other services, including securities lending and
borrowing and interfaces with domestic markets in several countries generally
similar to the arrangements for cross-market transfers with DTC described
above. The Euroclear System is operated by Morgan Guaranty Trust Company of New
York, Brussels, Belgium office (the "Euroclear Operator" or "Euroclear"), under
contract with Euroclear Clearance System, S.C., a Belgian cooperative
corporation (the "Cooperative"). All operations are conducted by the Euroclear
Operator, and all Euroclear securities clearance accounts and Euroclear cash
accounts are accounts with the Euroclear Operator, not the Cooperative. The
Cooperative establishes policy for the Euroclear system on behalf of Euroclear
Participants. Euroclear Participants include banks (including central banks),
securities brokers and dealers and other professional financial intermediaries
and may include the underwriters of any Series of Certificates. Indirect access
to the Euroclear System is also available to other firms that clear

                                       47
through or maintain a custodial relationship with a Euroclear Participant,
either directly or indirectly.

    The Euroclear Operator is the Belgian branch of a New York banking
corporation which is a member bank of the Federal Reserve System. As such, it
is regulated and examined by the Board of Governors of the Federal Reserve
System and the New York State Banking Department, as well as the Belgian
Banking Commission.

    Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Terms and Conditions Governing Use of Euroclear and the
related Operating Procedures of the Euroclear System and applicable Belgian law
(collectively, the "Terms and Conditions"). The Terms and Conditions govern
transfers of securities and cash within the Euroclear System, withdrawal of
securities and cash from the Euroclear System, and receipts of payments with
respect to securities in the Euroclear System. All securities in the Euroclear
System are held on a fungible basis without attribution of specific
certificates to specific securities clearance accounts. The Euroclear Operator
acts under the Terms and Conditions only on behalf of Euroclear Participants
and has no record of or relationship with persons holding through Euroclear
Participants.

    Distributions with respect to Offered Certificates held through Clearstream
or Euroclear will be credited to the cash accounts of Clearstream Participants
or Euroclear Participants in accordance with the relevant system's rules and
procedures, to the extent received by its Depositary. Such distributions will
be subject to tax reporting in accordance with relevant United States tax laws
and regulations. Clearstream or the Euroclear Operator, as the case may be,
will take any other action permitted to be taken by a Certificateholder under
the related Pooling and Servicing Agreement on behalf of a Clearstream
Participant or a Euroclear Participant only in accordance with its relevant
rules and procedures and subject to its Depositary's ability to effect such
actions on its behalf through DTC.

    Although DTC, Clearstream and Euroclear have agreed to the foregoing
procedures in order to facilitate transfers of Offered Certificates among
participants of DTC, Clearstream and Euroclear, they are under no obligation to
perform or continue to perform such procedures and such procedures may be
discontinued at any time.

Definitive Certificates

    Each Class of Offered Certificates will be issued in such registered,
certificated form to the Certificate Owners of such Class or their nominees
("Definitive Certificates"), rather than to the Depository or its nominee, only
if (i) the Transferor advises the Trustee in writing that the Depository is no
longer willing or able to discharge properly its responsibilities as Depository
with respect to the Offered Certificates of such Class, and the Trustee or the
Transferor is unable to locate a qualified successor, (ii) the Transferor, at
its option, advises the Trustee in writing that it elects to terminate the
book-entry system through the Depository, or (iii) after the occurrence of a
Servicer Default, Certificate Owners representing not less than 50% of the
Invested Amount of such Class advise the Trustee and the Depository through
Participants in writing that the continuation of a book-entry system through
the Depository is no longer in the best interest of the Certificate Owners of
such Class.

                                       48
Upon the occurrence of any of the events described in the immediately
preceding paragraph, the Depository is required to notify all Participants of
the availability through the Depository of Definitive Certificates. Upon
surrender by the Depository of the definitive certificate representing the
Offered Certificates of the affected Class and instructions for registration,
the Trustee will issue the Offered Certificates of such Class as Definitive
Certificates, and thereafter the Trustee will recognize the holders of such
Definitive Certificates as Certificateholders under the Pooling and Servicing
Agreement.

    Distribution of principal and interest on the Offered Certificates will be
made by the Trustee directly to Certificateholders in accordance with the
procedures set forth herein and in the Pooling and Servicing Agreement.
Interest payments and any principal payments on each Distribution Date will be
made to Certificateholders in whose names the Definitive Certificates were
registered at the close of business on the related Record Date. Distributions
will be made by check mailed to the address of such Certificateholder as it
appears on the register maintained by the Trustee. The final payment on any
Offered Certificate, however, will be made only upon presentation and surrender
of such Certificate at the office or agency specified in the notice of final
distribution to Certificateholders. The Trustee will provide such notice to
registered Certificateholders mailed not later than the fifth day of the month
of such final distributions.

    Definitive Certificates will be transferable and exchangeable at the
offices of the transfer agent and registrar, which initially will be the
Trustee (in such capacity, the "Transfer Agent and Registrar"). No service
charge will be imposed for any registration of transfer or exchange, but the
Transfer Agent and Registrar may require payment of a sum sufficient to cover
any tax or other governmental charge imposed in connection therewith. The
Transfer Agent and Registrar will not be required to register the transfer or
exchange of Definitive Certificates for the period from the Record Date
preceding the due date for any payment to the Distribution Date with respect to
such Definitive Certificates.

    If Definitive Certificates are issued, such Definitive Certificates will be
transferable and exchangeable at the offices of the transfer agent and such co-
transfer agents. In the event of the transfer of less than all the Invested
Amount represented by a Definitive Certificate, the transfer agent or such co-
transfer agent, as applicable, will issue a new Definitive Certificate to the
transferor thereof representing the Invested Amount not so transferred. The
Trustee may take appropriate steps to contact the remaining Certificateholders
regarding the surrender of their Certificates, and the cost thereof will be
paid out of the fund held by the Trustee for benefit of such
Certificateholders. The Trustee and the Paying Agent will pay to the Transferor
upon request any monies held by them for the payment of principal or interest
which remains unclaimed for two years. After payment to the Transferor,
Investor Certificateholders entitled to the money must look to the Transferor
for payment as general creditors unless an applicable abandoned property law
designates another Person.

Replacement of Definitive Certificates

    In the event that Definitive Certificates are issued, a Class A or a Class
B Certificate that is mutilated, destroyed, lost or stolen may be exchanged or
replaced at the offices of the

                                       49
co-transfer agent and co-registrar in Luxembourg upon presentation of the
Certificate or satisfactory evidence of its destruction, loss or theft to the
co-transfer agent and co-registrar. An indemnity satisfactory to the co-
transfer agent and co-registrar and the Trustee may be required at the expense
of the Class A or the Class B Certificateholder before a replacement Class A or
Class B Certificate will be issued. The Class A or the Class B
Certificateholder will be required to pay any tax or other governmental charge
imposed in connection with such exchange or replacement and any other expenses
(including the fees and expenses of the Trustee and the co-transfer agent and
co-registrar).

Interest Payments

    Interest on the respective outstanding balance of each Class of Offered
Certificates will accrue at the applicable certificate rate and will be payable
on the 13th day of each month, or if such day is not a business day, on the
next succeeding business day (each a "Distribution Date"), beginning on       ,
2001. A "Business Day" is any day other than a Saturday or Sunday or another
day on which banking institutions in New York, New York, London, England or
Luxembourg are authorized or obligated by law or executive order to be closed.
Interest will accrue from and including the preceding Distribution Date (or, in
the case of the first Distribution Date, from and including the Closing Date)
to but excluding such Distribution Date (each, an "Interest Accrual Period")
and will be calculated on the basis of the actual number of days in the related
Interest Accrual Period divided by 360 days.

    Interest on the outstanding principal balance of the Class A Certificates
will accrue for each Interest Accrual Period at the "Class A Certificate Rate,"
which shall equal the lesser of (i) LIBOR (calculated as described below)
determined as of the second LIBOR business day prior to such Interest Accrual
Period (or, in the case of the first Distribution Date, determined as of
      , 2001 for the period from      , 2001 up to but excluding       , 2001)
plus   % per annum or (ii) the Net Receivables Rate (described below). Interest
on the outstanding principal balance of the Class B Certificates will accrue
for each Interest Accrual Period at the "Class B Certificate Rate," which shall
equal the lesser of (i) LIBOR determined as of the second LIBOR business day
prior to such Interest Accrual Period (or, in the case of the first
Distribution Date, determined as of       , 2001 for the period from       ,
2001 up to but excluding       , 2001) plus   % per annum or (ii) the Net
Receivables Rate.

    The "Class C Certificate Rate" will be the lesser of (i) LIBOR plus   % per
annum and (ii) the Net Receivables Rate. The "Class D Certificate Rate" will be
the lesser of (i) LIBOR plus   % per annum and (ii) the Net Receivables Rate.

    On the second London Banking Day prior to the Interest Reset date (as
defined herein) for such Interest Accrual Period (a "LIBOR Determination
Date"), until the Series 2001-1 Termination Date, the Trustee will determine
the rate for deposits in United States dollars for the applicable Index
Maturity, commencing on such Interest Reset Date, which appears on Telerate
Page 3750 as of 11:00 a.m., London time, on the LIBOR Determination Date. If
such rate does not appear on Telerate Page 3750, the rate for the LIBOR
Determination

                                       50
Date will be determined on the basis of the rates at which deposits in United
States dollars are offered by the Reference Banks (as defined herein) at
approximately 11:00 a.m., London time, on that day to prime banks in the London
interbank market for the applicable Index Maturity. The Trustee will request
the principal London office in each of the Reference Banks to provide a
quotation of its rate. If at least two such quotations are provided, the rate
for such LIBOR Determination Date will be the arithmetic mean of the quotations
(rounded upward to the nearest 0.015625%). If fewer than two quotations are
provided as requested, the rate for such LIBOR Determination Date will be the
arithmetic mean (rounded upward to the nearest 0.015625%) of the rates quoted
by major banks in New York City, selected by the Servicer, at approximately
11:00 a.m., New York City time, on that date for loans in United States dollars
to leading European banks for the applicable Index Maturity; provided, however,
that if the Trustee is unable to determine a rate in accordance with one of the
procedures described above, LIBOR shall be LIBOR as determined on the most
recent LIBOR Determination Date. For purposes of calculating LIBOR, "London
Banking Day" means any business day on which dealings in deposits in United
States dollars are transacted in the London interbank market, "Telerate Page
3750" means the display page currently so designated on the Dow Jones Telerate
Service (or such other page as may replace that page on that service for the
purpose of displaying comparable rates or prices), and "Reference Banks" means
three major banks in the London interbank market selected by the Servicer.

    The "Net Receivables Rate" for a Distribution Date is (1) the weighted
average of the interest rates borne by the Receivables during the second
preceding Monthly Period (because interest payments on the Receivables at such
rates will be due and payable in the Monthly Period preceding such Distribution
Date), plus (2) the product of (x) the Monthly Payment Rate for the Monthly
Period preceding such Distribution Date, (y) the Discount Factor (as defined
herein), if any, for such Distribution Date and (z) twelve, less 1% per annum
if Conseco Finance or an affiliate is the Servicer, or 2% per annum if Conseco
Finance or an affiliate is not the Servicer, unless the Monthly Servicing Fee
has been waived for such Monthly Period. The "Monthly Payment Rate" for a
Monthly Period is the percentage equivalent of a fraction, the numerator of
which is the aggregate of the Receivables balance (without deducting therefrom
the discount portion, if any) collected during such Monthly Period and the
denominator of which is the average daily aggregate Receivables balance
(without deducting therefrom the discount portion, if any) for such Monthly
Period.

    The Class A Certificate Rate and the Class B Certificate Rate applicable to
the then current and immediately preceding Interest Accrual Period may be
obtained by telephoning the Trustee at its Corporate Trust Office at (612) 667-
4959. If the Offered Certificates are listed on the Luxembourg Stock Exchange,
the Trustee will cause the Class A Certificate Rate and the Class B Certificate
Rate applicable to an Interest Accrual Period to be provided to the Luxembourg
Stock Exchange as soon as possible after its determination but in no event
later than the first day of such Interest Accrual Period. If the Offered
Certificates are listed on the Luxembourg Stock Exchange, the Trustee will
publish or cause to be published in the Luxemburger Wort, as soon as possible
after determination, the Certificate Rates for the Interest Accrual Period
commencing on such Distribution Date, as well as the length of such Interest
Accrual Period and the aggregate amount of interest payable on the Class A

                                       51
Certificates and the Class B Certificates on the following Distribution Date,
and will provide notice thereof to the Luxembourg Stock Exchange.

Principal Payments

    The "Revolving Period" begins on the Closing Date and ends on the day
before the earlier of (1) the commencement of the Controlled Accumulation
Period or (2) the occurrence of a Pay Out Event. During the Revolving Period,
no principal payments will be made to the Certificateholders. During the
Controlled Accumulation Period, principal will be deposited in the Principal
Account on each business day and such amounts will be distributed to the Class
A Certificateholders on the Class A Scheduled Payment Date, then to the Class B
Certificateholders on the Class B Scheduled Payment Date, then to the Class C
Certificateholders until the Class C Invested Amount (as defined herein) is
paid in full, and finally to the Class D Certificateholders until the Class D
Invested Amount (as defined herein) is paid in full. The amount of principal
deposited in the Principal Account during each Monthly Period during the
Controlled Accumulation Period will not exceed the Controlled Deposit Amount.
See "--Pay Out Events" for a discussion of events which would cause the
commencement of the Early Amortization Period prior to the first day of the
Controlled Accumulation Period. See "--Application of Collections" for a
discussion of the method by which Principal Collections are allocated during
the Controlled Accumulation Period.

    Principal Collections for any Monthly Period during the Controlled
Accumulation Period allocated to the Class A, Class B and Class C
Certificateholders' Interests will first be used to cover, with respect to such
Monthly Period, required deposits into the Principal Account for the benefit of
the Class A Certificateholders. On and after the date on which an amount equal
to the Class A Invested Amount has been deposited in the Principal Account,
Principal Collections for any Monthly Period allocated to the Class A, Class B
and Class C Certificateholders' Interests will first be used to cover required
deposits into the Principal Account for the benefit of the Class B
Certificateholders. On and after the date on which an amount equal to the Class
B Invested Amount has been deposited in the Principal Account, Principal
Collections for any Monthly Period allocated to the Class A, Class B and Class
C Certificateholders' Interests will first be used to cover required deposits
into the Principal Account for the benefit of the Class C Certificateholders.
The Servicer will determine the amount of Principal Collections for any
business day allocated to the Class A, Class B and Class C Certificateholders'
Interests that remain after covering required deposits or payments of principal
to the Certificateholders and any similar amount remaining with respect to
certificates of any other Series (other than amounts allocated to Transferor
Retained Classes) (collectively, "Shared Principal Collections"). The Servicer
will allocate the Shared Principal Collections to cover any scheduled or
permitted principal distributions to certificateholders and deposits to
principal funding accounts, if any, for any Series that have not been covered
out of the Principal Collections allocable to such Series and certain other
amounts ("Principal Shortfalls"). Shared Principal Collections will not be used
to cover investor charge-offs for any Series. If Principal Shortfalls exceed
Shared Principal Collections on any business day, Shared Principal Collections
will be allocated pro rata

                                       52
among the applicable Series based on the relative amounts of their Principal
Shortfalls. To the extent that Shared Principal Collections exceed Principal
Shortfalls, the balance will, subject to certain limitations, be paid to the
holder of the Exchangeable Transferor Certificate.

Postponement of Controlled Accumulation Period

    The Controlled Accumulation Period is currently expected to commence at the
close of business on     . However, the date on which the Controlled
Accumulation Period actually commences may be delayed if the Accumulation
Period Length is less than the number of months remaining between the Period
Length Determination Date and the Class A Scheduled Payment Date. On      , the
Servicer will determine the "Accumulation Period Length." The "Accumulation
Period Length" will be one, two, three or four months and will be calculated as
the product, rounded upwards to the nearest integer, of (a) four and (b) a
fraction, the numerator of which is the Invested Amount as of       (after
giving effect to all changes therein on such date) and the denominator of which
is the sum of such Invested Amount and the invested amounts as of       (after
giving effect to all changes therein on such date) of all other outstanding
Series whose respective revolving periods are not scheduled to end before the
last day of the       Monthly Period. Depending on whether the Accumulation
Period Length is one month, two months, three months or four months, the
"Accumulation Period Commencement Date" will be the first day of the
Monthly Period, the       Monthly Period, the       Monthly Period or the
Monthly Period, respectively. Notwithstanding the foregoing, the Accumulation
Period Commencement Date will be       if, prior to such date, any other
outstanding Series has entered into an early amortization period. The effect of
the foregoing calculation is to reduce the Accumulation Period Length based on
the invested amounts of other Series that are scheduled to be in their
revolving periods and thus scheduled to create Shared Principal Collections
during the Controlled Accumulation Period.

Interest Collections; Principal Collections

    The Servicer will allocate the aggregate amount of Collections available in
the Collection Account (or shall instruct the Trustee to so allocate from
amounts on deposit in the Collection Account if all Collections are being
deposited therein as described below under "--Application of Collections--
Allocations") on each business day to Interest Collections and Principal
Collections. "Collections" are payments in respect of the Receivables,
including proceeds from any Collateral Security. "Interest Collections" are
calculated as the sum of (A) all collections of interest and other fees on the
Receivables, (B) all Imputed Yield Collections (if a Discount Factor is then in
effect), (C) investment earnings on amounts on deposit in the Trust Accounts
(as defined herein) on such business day and (D) Recoveries on such business
day. The Transferor may designate as interest collections ("Imputed Yield
Collections") a percentage (the "Discount Factor") of the amount of Receivables
arising after that designation that would otherwise be Principal Receivables.
The Discount Factor, if any, may vary from time to time (subject to the
limitations set forth in the Series 2001-1 Supplement), and initially will be
zero. "Principal

                                       53
Collections" are Collections other than Interest Collections. "Trust Accounts"
include the Interest Funding Account, the Principal Account, the Distribution
Account, the Collection Account, the Excess Funding Account and the Pre-Funding
Account (each as defined under "--Trust Accounts"). "Recoveries" are amounts
received by the Servicer in respect of Receivables that were previously
charged-off as uncollectible in accordance with its customary servicing
procedures.

Subordination of the Class B Certificates

    The Class B Certificates will be subordinated to the extent necessary to
fund certain payments with respect to the Class A Certificates. To the extent
the Class B Invested Amount is reduced, the percentage of Interest Collections
allocated to the Class B Certificateholders will be reduced. Moreover, to the
extent the amount of such reduction in the Class B Invested Amount is not
reimbursed, the amount of principal distributable to the Class B
Certificateholders will be reduced.

    The Class C Certificates will be subordinated to the extent necessary to
fund certain payments with respect to the Class A Certificates and the Class B
Certificates. To the extent the Class C Invested Amount is reduced, the
percentage of Interest Collections allocated to the Class C Certificateholders
will be reduced. Moreover, to the extent the amount of such reduction in the
Class C Invested Amount is not reimbursed, the amount of principal
distributable to the Class C Certificateholders will be reduced.

    If, on any Determination Date, the aggregate Investor Default Amount (as
defined herein), if any, for each business day in the preceding Monthly Period
exceeds the sum of

  (a) the aggregate amount of Series Available Interest Collections applied
      to the payment thereof as described in clauses (iv) and (v) of "--
      Application of Collections--Payment of Fees, Interest, and Other
      Items,"

  (b) the amount of Excess Interest Collections allocated thereto as
      described in "--Reallocation of Cash Flows," and

  (c) the amount of Reallocated Principal Collections allocated with respect
      thereto as described in "--Reallocated Principal Collections,"

then the Class D Invested Amount will be reduced by the amount by which the
aggregate Investor Default Amount exceeds the amount applied with respect
thereto during the preceding Monthly Period. Such reductions of the Class D
Invested Amount will thereafter be reimbursed and the Class D Invested Amount
increased on each business day by the amount, if any, of Series Available
Interest Collections and Excess Interest Collections allocated and available
for that purpose. The Class D Invested Amount will initially be $      , will
be reduced to $       on the Distribution Date on which Series 1998-2 and
Series 1999-1 are paid in full and may be adjusted under the circumstances
described under "--The Overconcentration Amounts" below.

    If any reduction of the Class D Invested Amount would cause the Class D
Invested Amount to be a negative number, the Class D Invested Amount will be
reduced to zero and

                                       54
the Class C Invested Amount will be reduced by the amount by which the Class D
Invested Amount would have been reduced below zero, but not more than the
remaining aggregate Investor Default Amount for the preceding Monthly Period.
Such reductions of the Class C Invested Amount will thereafter be reimbursed
and the Class C Invested Amount increased during the Monthly Period by the
amount, if any, of such Series Available Interest Collections and Excess
Interest Collections for such business day allocated and available for that
purpose.

    If any reduction of the Class C Invested Amount would cause the Class C
Invested Amount to be a negative number, the Class C Invested Amount will be
reduced to zero and the Class B Invested Amount will be reduced by the amount
by which the Class C Invested Amount would have been reduced below zero, but
not more than the remaining aggregate Investor Default Amount for such Monthly
Period. Such reductions of the Class B Invested Amount will thereafter be
reimbursed and the Class B Invested Amount increased on each business day by
the amount, if any, of Series Available Interest Collections and Excess
Interest Collections for such business day allocated and available for that
purpose.

    If the Class B Invested Amount is reduced to zero, the Class A Invested
Amount will be reduced by the amount by which the Class B Invested Amount would
have been reduced below zero, but not more than the remaining aggregate
Investor Default Amount for such Monthly Period. Such reductions of the Class A
Invested Amount will thereafter be reimbursed and the Class A Invested Amount
increased on each business day by the amount, if any, of Series Available
Interest Collections and Excess Interest Collections allocated and available
for that purpose.

    See "--Reallocation of Cash Flows," "--Reallocated Principal Collections"
and "--Investor Charge-Offs."

Transfer and Assignment of Receivables and Collateral Security

    Pursuant to the Purchase Agreement, Conseco Finance has contributed and
sold to the Transferor all of its interest in the outstanding Receivables and
the related Collateral Security, all the Receivables and the related Collateral
Security arising in the Accounts from time to time thereafter, and the proceeds
of all of the foregoing. Pursuant to the Pooling and Servicing Agreement, the
Transferor has transferred and assigned to the Trust all of its interest in the
outstanding Receivables and the related Collateral Security and all the
Receivables and the related Collateral Security arising in the Accounts from
time to time thereafter. The "Collateral Security" is the security interest in
the assets securing a Receivable.

    Conseco Finance, for itself and as Servicer, will identify in its computer
files that the Receivables have been assigned to the Trust. Conseco Finance, as
Servicer, will retain and will not deliver to the Trustee any other records or
agreements relating to the Receivables. The records and agreements relating to
the Receivables will not be segregated from those relating to other accounts
and receivables of Conseco Finance and the physical documentation relating to
the Receivables will not be stamped or marked to reflect the

                                       55
transfer of the Receivables to the Trust. The Trustee will have reasonable
access to such records and agreements as required by applicable law or to
enforce the rights of the Certificateholders. Conseco Finance has filed one or
more UCC-1 financing statements in accordance with the Uniform Commercial Code
to perfect the Transferor's interest in the Receivables and the proceeds
thereof, as applicable. The Transferor has filed one or more UCC-1 financing
statements in accordance with applicable state law to perfect the Trust's
interest in the Receivables and the proceeds thereof. The UCC-1 financing
statements that perfect Conseco Finance's (or the relevant subsidiary's)
security interest in the Collateral Security will not be amended to reflect
such transfers. See "Risk Factors" and "Certain Legal Aspects of the
Receivables."

Exchanges; Creation of New Series

    The Pooling and Servicing Agreement provides for the Trustee to issue two
types of certificates: (1) one or more Series of certificates, each of which
may have one or more classes, and (2) the Exchangeable Transferor Certificate.
The Exchangeable Transferor Certificate will evidence the Transferor Interest,
will initially be held by the Transferor, and will be transferable only as
provided in the Pooling and Servicing Agreement. The Pooling and Servicing
Agreement also provides that, pursuant to any one or more supplements (each, a
"Supplement") to the Pooling and Servicing Agreement, the holder of the
Exchangeable Transferor Certificate may tender such certificate, or the
Exchangeable Transferor Certificate and the certificates evidencing any Series
of certificates, to the Trustee in exchange for one or more new Series and a
reissued Exchangeable Transferor Certificate (an "Exchange"). Under the Pooling
and Servicing Agreement, the holder of the Exchangeable Transferor Certificate
may define for any newly issued Series certain terms including:

  (1)    its name or designation;

  (2)   its initial invested amount (or method for calculating such amount);

  (3)   its certificate rate (or the method of allocating interest payments
        or other cash flows to such Series);

  (4)   the closing date;

  (5)    the rating agency or agencies, if any, rating the Series;

  (6)   the interest payment date or dates and the date or dates from which
        interest shall accrue;

  (7)   the name of the clearing agency, if any;

  (8)   the method for allocating collections to certificateholders of such
        Series with respect to Principal Collections, Interest Collections,
        and Defaulted Receivables (as defined herein) and the method by
        which the principal amount of such Series will amortize or accrue;

  (9)   the names of any accounts to be used by such Series and the terms
        governing the operation of any such accounts;

                                       56
(10)    the percentage used to calculate monthly servicing fees;

  (11)    the Minimum Transferor Interest (as defined herein);

  (12)   the credit enhancement provider, if applicable, and the terms of
         any credit enhancement with respect to such Series;

  (13)  the base rate applicable to such Series;

  (14)   the terms on which the certificates of such Series may be
         repurchased or remarketed to other investors;

  (15)    the termination date of such Series;

  (16)   any deposit into any account provided for such Series;

  (17)  the number of classes of such Series and, if more than one class,
        the rights and priorities of each such class;

  (18)  the fees, if any, to be included in funds available to
        certificateholders in such Series;

  (19)   the subordination, if any, of such new Series with respect to any
         other Series;

  (20)    the rights, if any, of the holder of the Exchangeable Transferor
          Certificate that have been transferred to the holders of such
          Series;

  (21)   the pool factor (consisting of a seven-digit decimal expressing the
         ratio of the invested amount to the initial invested amount);

  (22)  whether such Series will be part of a group or subject to being
        paired with any other prefunded Series;

  (23)  whether such Series will be prefunded; and

  (24)  any other relevant terms, including whether or not such Series will
        be pledged as collateral for an issuance of any other securities,
        including commercial paper

(all such terms, the "Principal Terms" of such Series).

    None of the Transferor, the Servicer, the Trustee, or the Trust is required
or intends to obtain the consent of any Certificateholder to issue any
additional Series or in connection with the determination of the Principal
Terms thereof. However, as a condition of an Exchange, the holder of the
Exchangeable Transferor Certificate will deliver to the Trustee written
confirmation that the Exchange will not result in any Rating Agency reducing or
withdrawing its rating of any outstanding Series, including the Offered
Certificates. The Transferor may offer any Series to the public or other
investors in transactions either registered under the Securities Act of 1933,
as amended (the "Securities Act") or exempt from registration thereunder,
directly, through one or more underwriters or placement agents, in fixed-price
offerings, in negotiated transactions, or otherwise. Any such Series may be
issued in fully registered or book-entry form in minimum denominations
determined by the Transferor. The Transferor currently intends to offer, from
time to time, additional Series.

                                       57
The Pooling and Servicing Agreement provides that the holder of the
Exchangeable Transferor Certificate may perform Exchanges and define the
Principal Terms of each Series, including the period during which amortization
of the principal amount thereof is intended to occur, which period may have a
different length and begin on a different date than such period for any other
Series. Accordingly, one or more Series may be in their amortization periods
while other Series are not. Moreover, any Series may have the benefit of a
credit enhancement that is available only to that Series. Under the Pooling and
Servicing Agreement, the Trustee will hold any such form of credit enhancement
only on behalf of the Series with respect to which it relates. Likewise, with
respect to each such form of credit enhancement, the holder of the Exchangeable
Transferor Certificate may deliver a different form of credit enhancement
agreement. The Pooling and Servicing Agreement also provides that the holder of
the Exchangeable Transferor Certificate may specify different coupon rates and
monthly servicing fees with respect to each Series or a particular class within
such Series. Collections allocated to Interest Receivables not used to pay
interest on the certificates, the monthly servicing fee, the investor default
amount, or investor charge-offs with respect to any Series will be allocated as
provided in such credit enhancement agreement, if applicable. The holder of the
Exchangeable Transferor Certificate also has the option under the Pooling and
Servicing Agreement to vary between Series the terms upon which a Series or a
particular class within such Series may be repurchased by the Transferor or
remarketed to other investors. Additionally, certain Series may be subordinated
to other Series, and classes within a Series may have different priorities. The
Series 2001-1 Supplement does not permit the subordination of the Certificates
to any other Series that may be issued by the Trust (except to the limited
extent described herein with respect to Shared Principal Collections and Excess
Interest Collections). There is no limit to the number of Exchanges that may be
performed under the Pooling and Servicing Agreement.

    An Exchange may occur only upon the satisfaction of certain conditions
provided in the Pooling and Servicing Agreement. The holder of the Exchangeable
Transferor Certificate may perform an Exchange by notifying the Trustee at
least five business days in advance of the date upon which the Exchange is to
occur. The notice will state the designation of any Series to be issued on the
date of the Exchange and the following:

  (1)   its initial principal amount (or method for calculating such
        amount),

  (2)  its certificate rate (or the method of allocating interest payments
       or other cash flows to such Series), and

  (3) the provider of the credit enhancement, if any, which is expected to
      provide credit support with respect to it.

    The Pooling and Servicing Agreement provides that on the date of the
Exchange, the Trustee will authenticate any such Series only upon delivery to
the Trustee of the following:

  (1)   a Supplement to the Pooling and Servicing Agreement specifying the
        Principal Terms of such Series,

                                       58
(2)  an opinion of counsel to the effect that the certificates of such
       Series will be characterized as indebtedness or as partnership
       interests under existing law for federal and applicable state income
       tax purposes and that the issuance of such Series will not materially
       adversely affect the federal income tax characterization of any
       outstanding Series, including Series 2001-1, or result in the trust
       being subject to tax at the entity level for federal or applicable
       state tax purposes,

  (3) if required by such Supplement, the form of credit enhancement and an
      appropriate credit enhancement agreement with respect thereto executed
      by the Transferor and the issuer of the credit enhancement,

  (4)  written confirmation from each Rating Agency that the Exchange will
       not result in such Rating Agency's reducing or withdrawing its rating
       on any then-outstanding Series rated by it, including Series 2001-1,

  (5)   the existing Exchangeable Transferor Certificate and, if applicable,
        the certificates representing the Series to be exchanged, and

  (6)  an officer's certificate of the Transferor stating that, after giving
       effect to such Exchange, (a) the Transferor Interest would be at
       least equal to the Minimum Transferor Interest, and (b) taking into
       account the certificates of the newly issued Series, more than 20%
       (by Invested Amount and by value) of the outstanding certificates
       issued by the Trust with respect to which no opinion of counsel was
       issued that the applicable class would be treated as debt for federal
       income tax purposes (including the Exchangeable Transferor
       Certificate and each Transferor Retained Class) shall, by their
       terms, be prohibited from being transferred.

    Under the Pooling and Servicing Agreement, the Transferor may also exchange
the Exchangeable Transferor Certificate for a newly issued Exchangeable
Transferor Certificate and a second certificate (a "Supplemental Certificate")
the terms of which will be defined in a Supplement upon the satisfaction of
certain conditions provided in the Pooling and Servicing Agreement.

Representations and Warranties

    The Transferor has made and will make representations and warranties to the
Trust relating to the Accounts, the Receivables and the Collateral Security to
the effect, among other things, that

  (1) as of the Cut-off Date, the Closing Date and the date of issuance of
      any other Series (a "Series Issuance Date") (or, in the case of an
      Additional Account, as of the date of its designation for inclusion in
      the Trust and the date the related Receivables are transferred to the
      Trust (an "Addition Date")), each Account or Additional Account was or
      is an Eligible Account or, if it was or is an Ineligible Account on
      such date, such Account is being removed from the Trust in accordance
      with the requirements of the Pooling and Servicing Agreement,

                                       59
(2) as of the Cut-off Date (or as of the specified cut-off date, in the
      case of any Additional Accounts) or as of the date any Receivable is
      generated (a "Receivables Transfer Date"), each Receivable is an
      Eligible Receivable,

  (3) each Receivable and all Collateral Security conveyed to the Trust on
      the Closing Date and on each Receivables Transfer Date or, in the case
      of Additional Accounts, on the Addition Date, and all of the
      Transferor's right, title and interest in the Purchase Agreement, have
      been conveyed to the Trust free and clear of any liens, and

  (4) all appropriate consents and governmental authorizations required to
      be obtained by the Transferor in connection with the conveyance of
      each such Receivable have been duly obtained.

    If the Transferor breaches any representation and warranty described in
this paragraph, such breach remains uncured for 30 days (or such longer period
as may be agreed to by the Trustee) after the earlier to occur of the discovery
of such breach by the Transferor or the Servicer or receipt of written notice
of such breach by the Transferor or the Servicer, and such breach has a
materially adverse effect on the Certificateholders' Interest or the interests
of the holders of other outstanding Series in any Receivable or Account, the
Certificateholders' Interest and such other certificateholders' interests in
such Receivable or, in the case of a breach relating to an Account, all
Receivables in the related Account ("Ineligible Receivables") will be
reassigned to the Transferor on the terms and conditions set forth below and
such Account shall no longer be included as an Account.

    Each Ineligible Receivable will be reassigned to the Transferor on or
before the end of the Monthly Period in which such reassignment obligation
arises by the Transferor directing the Servicer to deduct the balance of such
Receivable (discounted by the Discount Factor, if any, for the Monthly Period
preceding such Determination Date) from the Pool Balance (as defined under "--
Allocation Percentages"). If such deduction would cause the Transferor Interest
to be less than the Minimum Transferor Interest on the preceding Determination
Date (after giving effect to the allocations, distributions, withdrawals and
deposits to be made on such Distribution Date), on the date on which such
reassignment is to occur the Transferor will be obligated to make a deposit
into the Collection Account in immediately available funds in an amount equal
to the amount by which the Transferor Interest would be less than the Minimum
Transferor Interest (the amount of any such deposit being referred to herein as
a "Transfer Deposit Amount"). If the Transfer Deposit Amount is not so
deposited, the principal balance of the related Receivables will be deducted
from the Pool Balance only to the extent the Transferor Interest is not reduced
below the Minimum Transferor Interest and any principal balance not so deducted
will not be reassigned and will remain part of the Trust. The reassignment of
any such Receivable to the Transferor and the payment of any related Transfer
Deposit Amount will be the sole remedy respecting any breach of the
representations and warranties described in the preceding paragraph with
respect to such Receivable available to Certificateholders or the Trustee on
behalf of Certificateholders.

                                       60
The Transferor will make representations and warranties to the Trust in the
Pooling and Servicing Agreement to the effect, among other things, that as of
the closing date of each Series

  (1) the Transferor is duly organized, validly existing, and in good
      standing under the laws of the State of Delaware and has the corporate
      power and authority to execute, deliver and perform its obligations
      under the Pooling and Servicing Agreement, the related Supplement, and
      the Purchase Agreement,

  (2) the Transferor is duly qualified to do business and in good standing
      (or is exempt from such requirement) in any state required in order to
      conduct its business and has obtained all necessary licenses and
      approvals required under federal, Minnesota and Delaware law,

  (3) the execution and delivery of the Pooling and Servicing Agreement, the
      related Supplement, and the Purchase Agreement, and the consummation
      of the transactions provided for therein, have been duly authorized by
      the Transferor by all necessary corporate action on its part,

  (4) the Pooling and Servicing Agreement constitutes a legal, valid and
      binding obligation of the Transferor, and

  (5) the transfer of Receivables and the Collateral Security by it to the
      Trust under the Pooling and Servicing Agreement constitutes either a
      valid transfer and assignment to the Trust of all right, title and
      interest of the Transferor in and to the Receivables and the
      Collateral Security (other than Receivables in Accounts designated as
      Additional Accounts after such closing date), whether then existing or
      thereafter created and the proceeds thereof (including amounts in any
      of the accounts established for the benefit of Certificateholders) or
      the grant of a first priority perfected security interest in such
      Receivables (except for certain liens permitted pursuant to the
      Pooling and Servicing Agreement) and the proceeds thereof (including
      amounts in any of the accounts established for the benefit of
      Certificateholders), which is effective as to each such Receivable
      upon the creation thereof.

    In the event of a breach of any of the representations and warranties
described in this paragraph, either the Trustee or the Holders of Certificates
evidencing undivided interests in the Trust aggregating more than 50% of the
aggregate investor interest of the related Series outstanding may direct the
Transferor to accept reassignment of an amount of Principal Receivables equal
to the invested amount to be reassigned (as described below) within 60 days of
such notice, or within such longer period specified in such notice. The
Transferor will thereupon be obligated to accept reassignment of such
Receivables on a Distribution Date occurring within such applicable period.
Such reassignment will not be required to be made, however, if at any time
during such applicable period, or such longer period, the representations and
warranties shall then be true and correct in all material respects. The amount
to be deposited by the Transferor for distribution to certificateholders in
connection with such reassignment will be equal to the invested amount for all
Series of certificates

                                       61
required to be reassigned on the last day of the Monthly Period preceding the
Distribution Date on which the reassignment is scheduled to be made, less the
amount, if any, previously allocated for payment of principal to such
certificateholders on such Distribution Date, plus an amount equal to all
interest accrued but unpaid on such certificates at the applicable certificate
rate through the last day of the related Interest Accrual Period, less the
amount transferred to the Distribution Account from the Interest Funding
Account (each as defined under "--Trust Accounts") in respect of interest on
such certificates for the month ending on such last day of the Monthly Period.
The payment of the reassignment deposit amount and the transfer of all other
amounts deposited for the preceding month in the Distribution Account will be
considered a payment in full of the investor interest for all Series of
certificates required to be repurchased and will be distributed upon
presentation and surrender of the certificates for each such Series. If the
Trustee or certificateholders give a notice as provided above, the obligation
of the Transferor to make any such deposit will constitute the sole remedy
available to the Trustee and the certificateholders with respect to any breach
of the Transferor's representations and warranties.

    An "Eligible Account" is defined to mean, as of the Cut-off Date (or, with
respect to Additional Accounts, as of their date of designation for inclusion
in the Trust), an arrangement to provide a revolving extension of credit by
Conseco Finance or one of its subsidiaries to a Dealer (i) in order to finance
the purchase by a Dealer of consumer and commercial product inventory or (ii)
as a line of credit secured by unencumbered assets of such Dealer, as of the
date of determination thereof,

  (a) that is in existence and maintained with Conseco Finance or such
      subsidiary,

  (b) that is payable in United States dollars,

  (c) that is with a Dealer whose most recent billing address is in the
      United States or its territories or possessions,

  (d) that has been originated by Conseco Finance or such subsidiary in the
      ordinary course of business or acquired by Conseco Finance through the
      acquisition of an Eligible Account from another lender upon satisfying
      Conseco Finance's customary underwriting standards,

  (e) in respect of which no amounts have been charged off by Conseco
      Finance or such subsidiary as uncollectible in its customary and usual
      manner as of the Cut-off Date (or, with respect to Additional
      Accounts, as of their date of designation for inclusion in the Trust),
      and

  (f) that is with a Dealer that is not involved in insolvency proceedings.

The definition of Eligible Account may be changed by amendment to the Pooling
and Servicing Agreement without the consent of the Certificateholders if (i)
the Transferor delivers to the Trustee a certificate of an authorized officer
to the effect that, in the reasonable belief of the Transferor, such amendment
will not as of the date of such amendment adversely affect in any material
respect the interest of the Certificateholders, and (ii) such amendment will
not result in a withdrawal or reduction of the rating of any outstanding Series
under the Trust.

                                       62
An "Eligible Receivable" is defined to mean each Receivable

  (a) that was originated or acquired by Conseco Finance or one of its
      subsidiaries in the ordinary course of business or acquired by Conseco
      Finance through the acquisition of an Eligible Account from another
      lender upon satisfying Conseco Finance's customary underwriting
      standards,

  (b) that has arisen under an Eligible Account,

  (c) that was created in compliance with all requirements of law applicable
      thereto and pursuant to a floorplan or asset-based financing agreement
      that complies with all requirements of law applicable thereto,

  (d) with respect to which all consents, licenses or authorizations of, or
      registrations with, any governmental authority required to be obtained
      or given by Conseco Finance or such subsidiary or the Transferor in
      connection with the creation of such Receivable or the transfer
      thereof to the Trust or the execution, delivery, creation and
      performance by Conseco Finance or such subsidiary of the related
      floorplan or asset-based financing agreement have been duly obtained
      or given and are in full force and effect as of the date of the
      creation of such Receivable,

  (e) as to which, at the time of its creation, the Transferor had good and
      marketable title free and clear of all liens and security interests
      (other than certain liens permitted pursuant to the Pooling and
      Servicing Agreement), and at all times following the transfer of such
      Receivables to the Trust, the Trust will have good and marketable
      title free and clear of all liens and security interests (other than
      certain liens permitted pursuant to the Pooling and Servicing
      Agreement) or the grant of a first priority security interest therein,

  (f) that is the legal, valid, binding and assignable payment obligation of
      the related Dealer, legally enforceable against such Dealer, in
      accordance with its terms (with certain bankruptcy related
      exceptions),

  (g) that constitutes "chattel paper," an "account" or a "general
      intangible" under Article 9 of the Uniform Commercial Code as then in
      effect in the State of Minnesota,

  (h) if such Receivable has the benefit of a Floorplan Agreement with a
      manufacturer, such Floorplan Agreement provides, subject to the
      specific terms thereof and any limitations therein (which may vary
      among Floorplan Agreements), that the manufacturer is obligated to
      repurchase the products securing the Receivables upon the Servicer's
      repossession thereof upon the related Dealer's default,

  (i) that has been the subject of a valid transfer and assignment from the
      Transferor to the Trust of all the Transferor's interest therein and
      in the related Collateral Security (including any proceeds thereof),

  (j) that at the time of transfer to the Trust is not subject to any right
      of rescission, setoff, or any other defense (including defenses
      arising out of violations of usury laws) of the Dealer,

                                       63
(k) as to which, at the time of transfer of such Receivable to the Trust,
      Conseco Finance (or such subsidiary) and the Transferor have satisfied
      all their respective obligations with respect to such Receivable
      required to be satisfied at such time,

  (l) as to which, at the time of transfer of such Receivable to the Trust,
      neither Conseco Finance or such subsidiary nor the Transferor has
      taken or failed to take any action which would impair the rights of
      the Trust or the certificateholders therein, and

  (m) that represents the obligation of a Dealer to repay an advance made to
      or on behalf of such Dealer to finance products or the accounts
      receivable arising from the sale of such products.

    In addition, participation interests described above under "Conseco Finance
Corp. and Its Commercial Lending Division--Participations in Floorplan
Receivables" and Receivables described above under "Conseco Finance Corp. and
Its Commercial Lending Division--Participation Arrangements" will be
Receivables.

    The Trustee will not make any initial or periodic general examination of
the Receivables or any records relating to the Receivables for the purpose of
establishing the presence or absence of defects, compliance with the
Transferor's representations and warranties or for any other purpose. The
Servicer, however, will deliver to the Trustee on or before March 31 of each
year, an opinion of counsel with respect to the validity of the security
interest of the Trust in and to the Receivables and certain other components of
the Trust Portfolio.

Addition of Accounts

    Subject to the conditions described below, the Transferor will have the
right to designate, from time to time, Additional Accounts to be included as
Accounts with respect to the Trust. In addition, the Transferor will be
required to designate Additional Accounts if (i) the Transferor Interest on the
last day of any Monthly Period is less than the Minimum Transferor Interest or
(ii) the Pool Balance is less than the Minimum Aggregate Principal Receivables
(less any amounts in the Excess Funding Account or amounts deposited in the
Principal Account with respect to any Series from the Excess Funding Account).
The Transferor will convey to the Trust its interest in all Receivables in such
Additional Accounts, whether such Receivables are then existing or thereafter
created. The "Minimum Transferor Interest" is the sum of the product, for each
Series, of (a) its Minimum Transferor Percentage and (ii) its invested amount.
The "Minimum Transferor Percentage" for Series 2001-1 is   %.

    Each Additional Account must be an Eligible Account at the time of its
designation. However, Additional Accounts may not be of the same credit quality
as the initial Accounts and may have been originated by Conseco Finance using
credit criteria different from those which were applied by Conseco Finance to
the initial Accounts.

                                       64
A conveyance by the Transferor to the Trust of Receivables in Additional
Accounts is subject to the following conditions, among others:

  (1)   each such Additional Account must be an Eligible Account;

  (2)  the Transferor shall represent and warrant that the addition of such
       Additional Accounts shall not, in the reasonable belief of the
       Transferor, cause a Pay Out Event to occur;

  (3) the Transferor shall not select such Additional Accounts in a manner
      that it believes is adverse to the interests of the certificateholders
      or any credit enhancement provider;

  (4)  the Transferor shall deliver a Tax Opinion, other than in the case of
       a required addition, and certain other opinions of counsel with
       respect to the addition of such Additional Accounts to the Trustee,
       each Rating Agency and any credit enhancement provider, and

  (5)   if the Automatic Addition Condition (as described below) is not
        satisfied, the applicable Rating Agencies shall have provided
        written confirmation that such addition will not result in a
        reduction or withdrawal of the rating of the Certificates or any
        other rated outstanding Series or class of certificates.

    If the Automatic Addition Condition is satisfied and the Account being
added will contain Receivables secured by a security interest in a type of
product not previously financed by Conseco Finance, then such addition is
subject to each Rating Agency confirming that the addition of such Account
would not result in the reduction or the withdrawal of the rating of the
Certificates.

    The "Automatic Addition Condition" means, with respect to the addition of
Accounts, that

  (1)   during the calendar quarter in which such addition occurs, the
        number of new Accounts for Dealers that are financing products of
        the type already being financed by Conseco Finance does not exceed
        5% of the number of all Accounts at the end of the preceding
        calendar quarter,

  (2)  during the twelve months ending at the beginning of such calendar
       quarter, the number of such new Accounts does not exceed 20% of the
       number of all Accounts at the beginning of such twelve month period,

  (3) the average for the three months preceding the month of such addition
      of the aggregate balance of Receivables that have been delinquent for
      more than 30 days does not exceed 1.25% of the Pool Balance at the end
      of the month preceding the month of such addition, and

  (4)  the annualized average for such three month period of the net losses
       incurred in respect of the Receivables does not exceed 1.75% of the
       Pool Balance at the end of the month preceding the month of such
       addition.

                                       65
In addition to the periodic reports otherwise required to be filed by the
Servicer with the Commission pursuant to the Exchange Act, the Servicer intends
to file, on behalf of the Trust, a Report on Form 8-K with respect to any
addition to the Trust of Receivables in Additional Accounts that would have a
material effect on the composition of the assets of the Trust.

Removal of Accounts

    The Transferor shall have the right at any time to require the removal from
the Trust of Eligible Accounts, including all amounts then held by the Trust or
thereafter received by the Trust in respect of the Eligible Accounts to be
removed. To remove any Eligible Account and such amounts, the Transferor (or
the Servicer on its behalf) shall, among other things,

  (1)   on or before the fifth business day prior to the Determination Date
        on which such removal will occur (the "Removal Date"), furnish to
        the Trustee, any credit enhancement provider and each Rating Agency
        a written notice (the "Removal Notice") specifying the Removal Date;

  (2)  on or before the fifth business day after the Removal Date, the
       Transferor shall have furnished to the Trustee a computer file,
       microfiche list or other list of the Accounts (the "Removed
       Accounts") that were removed on the Removal Date, specifying for each
       Removed Account as of the date of the Removal Notice its number, the
       aggregate amount outstanding in such Removed Account and the
       aggregate amount of Principal Receivables therein;

  (3) represent and warrant that the removal of any such Eligible Account on
      the Removal Date will not, in the reasonable belief of the Transferor,
      cause a Pay Out Event to occur or cause the Transferor Interest to be
      less than the Minimum Transferor Interest amount as of such date;

  (4)  represent and warrant that no selection procedures believed by the
       Transferor to be adverse to the interest of the certificateholders
       were utilized in selecting the Removed Accounts;

  (5)   obtain a statement from each Rating Agency that such removal will
        not result in a reduction or withdrawal of the rating of the Class A
        or Class B Certificates or any other outstanding Series or class of
        certificates; and

  (6)  on or before the related Removal Date, deliver to the Trustee and any
       credit enhancement provider an Officer's certificate confirming the
       items set forth in clauses (3), (4) and (5) above and a Tax Opinion
       with respect to such removal.

    All Receivables existing in the Removed Accounts will be reassigned to the
Transferor as of the Removal Date. On any date on which an Account becomes an
Ineligible Account (which date will be deemed the Removal Date for such
Account), the Transferor will commence the removal of such Account from the
Trust. However, all Receivables existing in any such Account (other than an
Account that was an Ineligible Account at the time it was originally designated
as an Account) as of the Removal Date will continue to be a Trust asset.

                                       66
Accounts that are terminated by their Dealers after they have paid the
related Receivables in full will be deemed to be removed from the Trust without
having to follow the procedures described above.

Trust Accounts

    The Trustee will establish and maintain with a Qualified Institution in the
name of the Trust, for the benefit of the Certificateholders, two separate
accounts, each in a segregated trust account (which need not be a deposit
account), consisting of an "Interest Funding Account" and a "Principal
Account." The Trustee will also establish a "Distribution Account" for the
benefit of the certificateholders of each Series which will be a non-interest
bearing segregated demand deposit account established with a Qualified
Institution. The Servicer will establish and maintain, in the name of the
Trust, for the benefit of certificateholders of all Series, a "Collection
Account," which will be a segregated account established by and maintained by
the Servicer with a Qualified Institution. A "Qualified Institution" is a
depository institution or trust company, which may include the Trustee,
organized under the laws of the United States or any one of the states thereof,
which at all times has a certificate of deposit rating of P-1 by Moody's
Investor Services, Inc. ("Moody's), of A-1+ by Standard & Poor's, a division of
McGraw-Hill, Inc. ("Standard & Poor's"), and of F-1+ by Fitch IBCA, Inc.
("Fitch") if rated by Fitch or long-term unsecured debt obligation (other than
such obligation the rating of which is based on collateral or on the credit of
a person other than such institution or trust company) rating of Aaa by
Moody's, of AAA by Standard & Poor's and of AAA by Fitch if rated by Fitch and
deposit insurance provided by the Federal Deposit Insurance Corporation, or a
depository institution, which may include the Trustee, which is acceptable to
the Rating Agencies; provided, however, that no such rating shall be required
of an institution which shall have corporate trust powers and which maintains
the Collection Account, any principal account, any interest funding account or
any other account maintained for the benefit of Certificateholders as a fully
segregated trust account with the trust department of such institution which is
rated at least Baa3 by Moody's. Funds in the Principal Account and the Interest
Funding Account will be invested, at the direction of the Transferor, in "Cash
Equivalents" consisting of:

  (1)   obligations fully guaranteed by the United States of America,

  (2)  time deposits, promissory notes, or certificates of deposit of
       depository institutions or trust companies, the certificates of
       deposit of which are rated P-1 by Moody's, A-1+ by Standard & Poor's
       and F-1+ by Fitch if rated by Fitch,

  (3)  commercial paper having, at the time of the Trust's investment, a
       rating of P-1 by Moody's, of A-1+ by Standard & Poor's and F-1+ by
       Fitch if rated by Fitch,

  (4)  bankers' acceptances issued by any depository institution or trust
       company described in clause (ii) above,

  (5)   money market funds which have the highest rating from, or have
        otherwise been approved in writing by, each of Moody's, Standard &
        Poor's and Fitch (each, a "Rating Agency"),

                                       67
(6)   certain open end diversified investment companies,

  (7)  Eurodollar time deposits that have been rated P-1 by Moody's, A-1+ by
       Standard & Poor's and F-1+ by Fitch if rated by Fitch, and

  (8)  any other investment that each Rating Agency confirms in writing will
       not adversely affect its then current rating of any outstanding
       Certificates.

Any earnings (net of losses and investment expenses) on funds in the Interest
Funding Account and the Principal Account will be deposited in the Collection
Account as part of Series Available Interest Collections. The Servicer has the
revocable power to withdraw funds from the Collection Account, and to instruct
the Trustee to make withdrawals and payments from the Interest Funding Account
and the Principal Account, for the purpose of carrying out the Servicer' duties
under the Pooling and Servicing Agreement. The agent making payments to the
Certificateholders (the "Paying Agent") has the revocable power to withdraw
funds from the Distribution Account for the purpose of making distributions to
Certificateholders. The Paying Agent initially will be the Trustee.

Excess Funding Account

    The Trustee will establish and maintain in the name of the Trust, for the
benefit of the certificateholders of all Series, an "Excess Funding Account"
which will be a segregated account established by and maintained by the
Servicer with a Qualified Institution. At any time during which the Transferor
Interest (plus any funds deposited in the Principal Account with respect to any
Series from the Excess Funding Account) does not exceed the Minimum Transferor
Interest, funds (to the extent available therefor as described herein)
otherwise payable to the Transferor will be deposited in the Excess Funding
Account on any business day until the Transferor Interest is at least equal to
the Minimum Transferor Interest. Funds on deposit in the Excess Funding Account
will be withdrawn and paid to the Transferor to the extent that on any day the
Transferor Interest exceeds the Minimum Transferor Interest as a result of the
addition of new Receivables to the Trust. Such deposits in and withdrawals from
the Excess Funding Account may be made on a daily basis. No funds will be
deposited in the Excess Funding Account, however, if any Series is in an
amortization or accumulation period (including any early amortization period),
unless the principal account for such Series has been fully funded for such
Monthly Period.

    Any funds on deposit in the Excess Funding Account at the beginning of the
Controlled Accumulation Period or Early Amortization Period will be deposited
in the Principal Account as part of Class A Principal, Class B Principal, or
Class C Principal, as applicable, for any Distribution Date. In the event that
more than one Series begins its amortization or accumulation period at the same
time, amounts on deposit in the Excess Funding Account (other than any amounts
in the Class D Subaccount) will be paid out to each such Series pro rata based
on the aggregate invested amount of each such Series. A Pay Out Event will
occur if the sum of all Cash Equivalents and other amounts on deposit in the
Excess Funding Account as a percentage of the sum of the aggregate amount of
Principal Receivables (without deducting therefrom any discount portion) plus
the amount on deposit in the Excess

                                       68
Funding Account shall equal or exceed 50% on the last day of six consecutive
Monthly Periods.

      Funds on deposit in the Excess Funding Account will be invested by the
Trustee at the direction of the Transferor in Cash Equivalents. On each
Distribution Date, all net investment income earned on amounts in the Excess
Funding Account since the preceding Distribution Date will be withdrawn from
the Excess Funding Account and treated as Interest Collections. Amounts, if
any, in the Excess Funding Account may be expected to earn interest at a rate
that is less than the Base Rate (as defined under "-- Coverage of Certain
Interest Shortfalls"). The difference between the amount of interest actually
earned on investments in the Excess Funding Account on any day and the amount
of interest that would have been earned on such investments at the Base Rate is
the "Negative Carry Amount" for such day. See "--Coverage of Certain Interest
Shortfalls" below.

Pre-Funding Account

    The Servicer will establish and maintain in the name of the Trustee, on
behalf of the Trust, the "Pre-Funding Account." The Pre-Funding Account will be
established and maintained with the trust department of the Trustee. Funds on
deposit in the Pre-Funding Account (the "Pre-Funded Amount") will be withdrawn
and paid to the Transferor during the period from      , 2001 to      , 2001
(the "Funding Period") as a result of (a) funds being deposited in the
principal account for Series 1998-2 and Series 1999-1, or (b) an increase in
the amount of Receivables in the Trust, in accordance with the Series 2001-1
Supplement. If a Pay Out Event were to occur during the Funding Period, the
amounts remaining on deposit in the Pre-Funding Account would be payable as
principal first to the Class A Certificateholders until the Class A Invested
Amount is paid in full, then to the Class B Certificateholders until the Class
B Invested Amount is paid in full, then to the Class C Certificateholders until
the Class C Invested Amount is paid in full, and then to the Class D
Certificateholders until the Class D Invested Amount is paid in full. Should
the Pre-Funded Amount be greater than zero at the end of the      , 2001
Monthly Period, such amount will be deposited in the Excess Funding Account.

    All amounts on deposit in the Pre-Funding Account will be invested by the
Trustee at the direction of the Servicer in Cash Equivalents. On each
Distribution Date with respect to the Funding Period, all investment income
earned on amounts in the Pre-Funding Account since the preceding Distribution
Date will be withdrawn from the Pre-Funding Account and deposited into the
Collection Account for application as Series Available Interest Collections for
distribution to the Certificateholders.

    Amounts on deposit in the Pre-Funding Account may be expected to earn
interest at a rate that is less than the Base Rate. In addition, no Interest
Collections will be allocated to the Pre-Allocated Invested Amount until Series
1998-2 and Series 1999-1 are paid in full. See "--Coverage of Certain Interest
Shortfalls" for a discussion of sources intended to cover such interest
shortfalls.

                                       69
Allocation Percentages

    Pursuant to the Pooling and Servicing Agreement, during each Monthly
Period, the Servicer will allocate all Interest Collections and Principal
Collections and the amount of all Defaulted Receivables among the Class A
Certificateholders' Interest, the Class B Certificateholders' Interest, the
Class C Certificateholders' Interest, the Class D Certificateholders' Interest,
the Transferor Interest, and the holders of all other Series issued and
outstanding from time to time pursuant to the Pooling and Servicing Agreement
and applicable Supplements.

    Interest Collections and the amount of Defaulted Receivables will be
allocated at all times, and Principal Collections will be allocated during the
Revolving Period, to the Class A Certificateholders' Interest, the Class B
Certificateholders' Interest, the Class C Certificateholders' Interest and the
Class D Certificateholders' Interest, based on the percentage equivalent of a
fraction, the numerator of which is the Class A Invested Amount, the Class B
Invested Amount, the Class C Invested Amount, or the Class D Invested Amount,
respectively, at the end of the preceding business day and the denominator of
which is the greater of (a) the Pool Balance (plus amounts, if any, on deposit
in the Excess Funding Account) as of the end of the preceding business day and
(b) the sum of the numerator for all classes of all Series then outstanding
used to calculate the applicable allocation percentage (the "Class A Floating
Allocation Percentage," the "Class B Floating Allocation Percentage," the
"Class C Floating Allocation Percentage," and the "Class D Floating Allocation
Percentage," respectively; the sum of all such percentages, the "Floating
Allocation Percentage").

    During the Revolving Period, all Principal Collections allocable to the
Certificates will be allocated and paid to the Transferor (except for
collections applied as Reallocated Principal Collections and Shared Principal
Collections paid to the holders of certificates of other Series, if any, and
except for any funds deposited in the Excess Funding Account). On any business
day during the Controlled Accumulation Period or the Early Amortization Period,
Principal Collections will be allocated to the Certificateholders' Interest
based on the percentage equivalent of a fraction, the numerator of which is the
Class A Invested Amount, the Class B Invested Amount, the Class C Invested
Amount or the Class D Invested Amount, respectively, at the end of the last day
of the Revolving Period and the denominator of which is the greater of (a) the
Pool Balance (plus amounts, if any, on deposit in the Excess Funding Account)
at the end of the preceding business day and (b) the sum of the numerators used
to calculate the allocation percentages with respect to Principal Collections
for all Series (the "Class A Fixed/Floating Allocation Percentage," the "Class
B Fixed/Floating Allocation Percentage," the "Class C Fixed/Floating Allocation
Percentage," and the "Class D Fixed/Floating Allocation Percentage,"
respectively; the sum of all such percentages the "Fixed/Floating Allocation
Percentage").

    On any business day when Principal Collections are being allocated for
payment to the Class A, Class B or Class C Certificates, Principal Collections
will be allocated to the Class A, Class B or Class C Certificateholders'
Interest based on the percentage equivalent of a fraction, the numerator of
which is the sum of the Class A Invested Amount, the

                                       70
Class B Invested Amount and the Class C Invested Amount at the end of the last
day of the Revolving Period and the denominator of which is the greater of
(a) the sum of the Pool Balance and the amount on deposit in the Excess Funding
Account at the end of the preceding business day and (b) the sum of the
numerators used to calculate the allocation percentages with respect to
Principal Collections for all Series (the "ABC Fixed/Floating Allocation
Percentage"). Because the allocation percentages are based on the Invested
Amount, the 2001-1 Certificates will not be allocated any Interest Collections
in respect of the Pre-Funded Amount until Series 1998-2 and Series 1999-1 are
paid in full. Also, if a Pay Out Event occurs with respect to the Series 2001-1
Certificates prior to the payment in full of the Series 1998-2 and Series 1999-
1 Certificates, Series 2001-1 Certificateholders will receive no allocations of
principal with respect to the Pre-Funded Amount until the Series 1998-2 and
1999-1 Certificates are paid in full. No assurance can be given as to when the
Series 1998-2 and Series 1999-1 Certificates will be paid in full. See "Risk
Factors--Series 2001-1 is a companion series with Series 1998-2 and Series
1999-1 and may experience delay in allocations of principal and will experience
a delay in allocations of interest."

    "Pool Balance" means, as of the time of determination thereof, the product
of (i) the total amount of Principal Receivables at such time multiplied by
(ii) one minus the Discount Factor, if any.

    "Class A Invested Amount" means an amount equal to

  (a) the initial principal balance of the Class A Certificates, minus (i)
      the Class A Percentage of the Pre-Allocated Invested Amount, plus (ii)
      the Class A Percentage of (x) any withdrawals from the Pre-Funding
      Account in connection with the addition of Receivables to the Trust
      and (y) after Series 1998-2 and Series 1999-1 are paid in full, the
      Pre-Allocated Invested Amount less the amount in clause (x) and the
      amount, if any, in clause (iii), plus (iii) the Class A Percentage of
      any withdrawals from the Pre-Funding Account at the end of the Funding
      Period, for deposit into the Excess Funding Account,

      minus (b) the aggregate amount of principal payments (except principal
      payments made from the Pre-Funding Account) made to Class A
      Certificateholders prior to such date,

      minus (c) the aggregate amount of Class A Investor Charge-Offs for all
      prior Determination Dates, equal to the amount by which the Class A
      Invested Amount has been reduced to fund the Investor Default Amount
      on all prior Distribution Dates as described under "--Investor Charge-
      Offs," and

      plus (d) the aggregate amount of Series Available Interest
      Collections, Excess Interest Collections and Reallocated Principal
      Collections (defined under""--Reallocated Principal Collections")
      applied on all prior Distribution Dates for the purpose of reimbursing
      amounts deducted pursuant to the foregoing clause (c).

    "Class B Invested Amount" for any date means an amount equal to

  (a) the initial principal balance of the Class B Certificates, minus (i)
      the Class B Percentage of the Pre-Allocated Invested Amount, plus (ii)
      the Class B Percentage

                                       71
of (x) any withdrawals from the Pre-Funding Account in connection with
      the addition of Receivables to the Trust and (y) after Series 1998-2
      and Series 1999-1 are paid in full, the Pre-Allocated Invested Amount
      less the amount in clause (x) and the amount, if any, in clause (iii),
      plus (iii) the Class B Percentage of any withdrawals from the Pre-
      Funding Account at the end of the Funding Period, for deposit into the
      Excess Funding Account,

      minus (b) the aggregate amount of principal payments (except principal
      payments made from the Pre-Funding Account) made to Class B
      Certificateholders prior to such date,

      minus (c) the aggregate amount of Class B Investor Charge-Offs for all
      prior Determination Dates, equal to the amount by which the Class B
      Invested Amount has been reduced to fund the Investor Default Amount
      on all prior Distribution Dates as described under "--Investor Charge-
      Offs,"

      minus (d) the aggregate amount of Reallocated Class B Principal
      Collections (defined under "--Reallocated Principal Collections") for
      which neither the Class D Invested Amount nor the Class C Invested
      Amount has been reduced for all prior Distribution Dates, and

      plus (e) the aggregate amount of Series Available Interest
      Collections, Excess Interest Collections and Reallocated Class C
      Principal Collections and Reallocated Class D Principal Collections
      applied on all prior Distribution Dates for the purpose of reimbursing
      amounts deducted pursuant to the foregoing clauses (c) and (d).

    "Class C Invested Amount" for any date means an amount equal to

  (a) the initial principal balance of the Class C Certificates, minus (i)
      the Class C Percentage of the Pre-Allocated Invested Amount, plus (ii)
      the Class C Percentage of (x) any withdrawals from the Pre-Funding
      Account in connection with the addition of Receivables to the Trust
      and (y) after Series 1998-2 and Series 1999-1 are paid in full, the
      Pre-Allocated Invested Amount less the amount in clause (x) and the
      amount, if any, in clause (iii), plus (iii) the Class C Percentage of
      any withdrawals from the Pre-Funding Account at the end of the Funding
      Period, for deposit into the Excess Funding Account,

      minus (b) the aggregate amount of principal payments (except principal
      payments made from the Pre-Funding Account) made to Class C
      Certificateholders prior to such date,

      minus (c) the aggregate amount of Class C Investor Charge-Offs for all
      prior Determination Dates, equal to the amount by which the Class C
      Invested Amount has been reduced to fund the Investor Default Amount
      on all prior Distribution Dates as described under "--Investor Charge-
      Offs,"

      minus (d) the aggregate amount of Reallocated Class B Principal
      Collections and Reallocated Class C Principal Collections (defined
      under "--Reallocated Principal

                                       72
Collections") for which the Class D Invested Amount has not been
      reduced for all prior Distribution Dates, and

      plus (e) the aggregate amount of Series Available Interest
      Collections, Excess Interest Collections, Reallocated Class D
      Principal Collections and certain other amounts as may be available
      applied on all prior Distribution Dates for the purpose of reimbursing
      amounts deducted pursuant to the foregoing clauses (c) and (d).

    "Class D Invested Amount" means an amount equal to

  (a) the initial principal balance of the Class D Certificates,

      plus (b) the Class D Incremental Invested Amount (described below
      under "--The Overconcentration Amounts") for the related Monthly
      Period,

      minus (c) $       when the Series 1998-2 and Series 1999-1
      Certificates are paid in full,

      plus (d) any Additional Class D Invested Amount,

      minus (e) the aggregate amount of principal payments made to Class D
      Certificateholders prior to such date,

      minus (f) the aggregate amount of Class D Investor Charge-Offs for all
      prior Determination Dates, equal to the amount by which the Class D
      Invested Amount has been reduced to fund the Investor Default Amount
      on all prior Distribution Dates as described under "--Investor Charge-
      Offs,"

      minus (g) the aggregate amount of Reallocated Class D Principal
      Collections (defined under "--Reallocated Principal Collections") for
      all prior Distribution Dates,

      plus (h) the aggregate amount of Series Available Interest Collections
      and Excess Interest Collections applied on all prior Distribution
      Dates for the purpose of reimbursing amounts deducted pursuant to the
      foregoing clauses (f) and (g).

    "Invested Amount" means the sum of the Class A Invested Amount, the Class B
Invested Amount, the Class C Invested Amount and the Class D Invested Amount.

    "Class A Percentage," "Class B Percentage" and "Class C Percentage" means,
respectively, the percentage derived from dividing the initial principal amount
of the related Class by the sum of the initial principal amounts of all of
those Classes.

    "Transferor's Percentage" means (a) when used with respect to Principal
Collections during the Revolving Period and Interest Collections and the amount
of Defaulted Receivables at all times, 100% minus the sum of the Floating
Allocation Percentage and the floating allocation percentages for all other
Series and (b) when used with respect to Principal Collections during the
Controlled Accumulation Period or Early Amortization Period, 100% minus the sum
of the Fixed/Floating Allocation Percentage and the allocation percentages used
with respect to Principal Collections for all other Series.

                                       73
As a result of the Floating Allocation Percentage, Interest Collections and
the portion of Defaulted Receivables allocated to the Certificateholders will
change each business day based on the relationship of the Class A Invested
Amount, the Class B Invested Amount, the Class C Invested Amount, and Class D
Invested Amount to the Pool Balance and amounts on deposit in the Excess
Funding Account on the preceding business day.

The Overconcentration Amounts

    The Class D Invested Amount will be adjusted to reflect, on each
Distribution Date, the aggregate principal amount of Receivables in the Trust
on such Distribution Date which are Asset-Based Receivable Overconcentrations,
Dealer Overconcentrations, Manufacturer Overconcentrations and Product Line
Overconcentrations (the "Overconcentration Amount") allocable to the
Certificateholders' Interest. The Overconcentration Amount is intended to
provide additional protection to Class A, Class B and Class C
Certificateholders against the risk of a decrease in credit diversification of
the Receivables caused by such Overconcentrations. There can be no assurance,
however, that the adjustment to the Class D Invested Amount will provide
sufficient protection against losses on the Receivables. Moreover, if Conseco
Finance is unable to continue to generate new Receivables that satisfy these
diversification requirements, the resulting increase in the Class D Invested
Amount due to the Overconcentration Amount, resulting in a corresponding
decrease in the Transferor Interest, could cause a Pay Out Event to occur.

    "Asset-Based Receivable Overconcentration" on any Distribution Date means
the excess of (a) the aggregate of all amounts of Principal Receivables in
Accounts for Asset-Based Receivables on the last day of the Monthly Period
immediately preceding such Distribution Date over (b)   % of the Principal
Receivables on the last day of such immediately preceding Monthly Period.

    "Dealer Overconcentration" on any Distribution Date means, with respect to
any Account with a Dealer, the excess of (a) the aggregate amount of Principal
Receivables in such Account on the last day of the Monthly Period immediately
preceding such Distribution Date over (b)   % of the Principal Receivables on
the last day of such immediately preceding Monthly Period. Certain designated
Dealers may be subject to a higher percentage limit with Rating Agency
approval, but in no case higher than  %.

    "Manufacturer Overconcentration" on any Distribution Date means the excess
of (a) the aggregate of all amounts of Principal Receivables in Accounts
created pursuant to Floorplan Agreements with a single manufacturer on the last
day of the Monthly Period immediately preceding such Distribution Date over (b)
  % of the Principal Receivables on the last day of such immediately preceding
Monthly Period. Certain designated manufacturers may be subject to a higher
percentage limit with Rating Agency approval, but in no case higher than   %.

    "Product Line Overconcentration" on any Distribution Date means the excess
of (a) the aggregate of all amounts of Principal Receivables in the Accounts
that represent

                                       74
financing for a single product line (other than Asset-Based Receivables and
Receivables that represent financing for manufactured housing) on the last day
of the Monthly Period immediately preceding such Distribution Date over (b)   %
for marine products,   % for recreational vehicles,   % for lawn and garden
equipment, and   % for any other products in total, of the Principal
Receivables on the last day of such immediately preceding Monthly Period. If
Receivables are transferred to the Trust in the future and such Receivables are
secured by products in a product line that is new to the Trust, the Rating
Agencies may create a separate category of product line overconcentration with
its own overconcentration limits, and such new product line overconcentration
will become part of the Overconcentration Amount.

    The Class D Invested Amount will be adjusted to reflect changes in the
Class D Incremental Invested Amount, as described under "--Allocation
Percentages" above. The "Class D Incremental Invested Amount" for any Monthly
Period will equal the product of (a) a fraction, the numerator of which is the
Invested Amount (exclusive of the Class D Incremental Invested Amount) on the
last day of the immediately preceding Monthly Period, and the denominator of
which is the Pool Balance on such last day, times (b) the Overconcentration
Amount for the Distribution Date in such Monthly Period.

    Notwithstanding the above, in the case of each such Overconcentration, the
percentage in clause (b) for such Overconcentration may be increased or
decreased by the Transferor, without the consent of any Certificateholder, to a
level acceptable to each Rating Agency without any reduction or withdrawal of
its rating of the Class A or Class B Certificates. Any such increase in such a
percentage may involve an adjustment, upward or downward, of the Class D
Invested Amount (if upward, an "Additional Class D Invested Amount").

Reallocation of Cash Flows

    On the first business day following the end of each Monthly Period, the
Servicer will determine the Required Amount, if any. Commencing on such first
business day, the Servicer will apply all or a portion of the Excess Interest
Collections of other Series with respect to such business day allocable to the
Series 2001-1 Certificates in an amount equal to the remaining Required Amount.
Excess Interest Collections from other Series allocable to the Series 2001-1
Certificates for any business day will be equal to the product of (x) Excess
Interest Collections available from all other Series for such business day and
(y) a fraction, the numerator of which is the Required Amount for such business
day and the denominator of which is the aggregate amount of shortfalls in
required amounts or other amounts to be paid from available Interest
Collections for all Series for such business day.

Reallocated Principal Collections

    On the first business day following the end of each Monthly Period, the
Servicer will apply or cause the Trustee to apply an amount, not to exceed the
Class D Invested Amount, equal to the product of (a)(i) during the Revolving
Period, the Class D Floating Allocation Percentage or (ii) during the
Controlled Accumulation Period or Early Amortization Period,

                                       75
the Class D Fixed/Floating Allocation Percentage and (b) the amount of
Principal Collections with respect to such business day to the following
amounts in the following priority (such collections applied in accordance with
clause (a) below are called "Reallocated Class D Principal Collections"):

  (a) an amount equal to the sum of (i) the remaining Class A Required
      Amount, if any, with respect to the prior Monthly Period, (ii) the
      remaining Class B Required Amount, if any, with respect to the prior
      Monthly Period and (iii) the remaining Class C Required Amount, if
      any, with respect to the prior Monthly Period will be applied first to
      the components of the Class A Required Amount, then to the components
      of the Class B Required Amount and then to the components of the Class
      C Required Amount in the same priority in which Available Series
      Interest Collections are applied to such components as described in
      "--Application of Collections--Payment of Fees, Interest and Other
      Items"; and

  (b) any such collections not applied in the foregoing manner (and
      therefore not constituting Reallocated Class D Principal Collections)
      (i) on business days with respect to the Revolving Period and the
      Controlled Accumulation Period or Early Amortization Period prior to
      the payment in full of the Class C Invested Amount will be paid to the
      Transferor in order to maintain the Class D Invested Amount, (ii) on
      business days during the Controlled Accumulation Period following
      payment in full of the Class C Invested Amount will be included in the
      funds available to make principal payments to the Class D
      Certificateholders until the Class D Invested Amount is paid in full
      and (iii) on business days during an Early Amortization Period will be
      deposited in a subaccount (the "Class D Subaccount") of the Excess
      Funding Account to be held until the Class C Invested Amount is paid
      in full and to be available to be applied as Reallocated Class D
      Principal Collections.

    On each business day, the Servicer will apply or cause the Trustee to apply
an amount, not to exceed the Class C Invested Amount, equal to the product of
(a)(i) during the Revolving Period, the Class C Floating Allocation Percentage
or (ii) during the Controlled Accumulation Period or Early Amortization Period,
the Class C Fixed/Floating Allocation Percentage and (b) the amount of
Principal Collections with respect to such business day to the following
amounts in the following priority (such collections applied in accordance with
clause (a) below are called "Reallocated Class C Principal Collections"):

  (a) an amount equal to the sum of (i) the remaining Class A Required
      Amount, if any, with respect to the prior Monthly Period over the
      amount of Reallocated Class D Principal Collections applied with
      respect thereto for such Monthly Period and (ii) the remaining Class B
      Required Amount, if any, with respect to the prior Monthly Period over
      the amount of Reallocated Class D Principal Collections applied with
      respect thereto for such Monthly Period, will be applied first to the
      remaining components of the Class A Required Amount and then to the
      remaining components of the Class B Required Amount in the same
      priority in which Series

                                       76
Available Interest Collections are applied to such components as
      described in "--Application of Collections--Payment of Fees, Interest
      and Other Items"; and

  (b) any such collections not applied in the foregoing manner (and
      therefore not constituting Reallocated Class C Principal Collections)
      will, on business days with respect to the Revolving Period, be
      applied as Shared Principal Collections and on business days with
      respect to the Controlled Accumulation Period or Early Amortization
      Period will be included in the funds available to make principal
      payments to the Class A Certificateholders until the Class A Invested
      Amount is paid in full and then to the Class B Certificateholders
      until the Class B Invested Amount is paid in full and then to the
      Class C Certificateholders until the Class C Invested Amount is paid
      in full.

    On each business day, the Servicer will apply or cause the Trustee to apply
an amount, not to exceed the Class B Invested Amount, equal to the product of
(a)(i) during the Revolving Period, the Class B Floating Allocation Percentage
or (ii) during the Controlled Accumulation Period or Early Amortization Period,
the Class B Fixed/Floating Allocation Percentage and (b) the amount of
Principal Collections with respect to such business day to the following
amounts in the following priority (such collections applied in accordance with
clause (a) below are called "Reallocated Class B Principal Collections" and the
sum of Reallocated Class D Principal Collections, Reallocated Class C Principal
Collections and Reallocated Class B Principal Collections is called
"Reallocated Principal Collections"):

  (a) an amount equal to the excess, if any, of the remaining Class A
      Required Amount, if any, with respect to the prior Monthly Period over
      the sum of the amount of Reallocated Class D Principal Collections and
      Reallocated Class C Principal Collections applied with respect thereto
      for the prior Monthly Period will be applied to the remaining
      components of the Class A Required Amount in the same priority in
      which Series Available Interest Collections are applied to such
      components as described in "--Application of Collections--Payment of
      Fees, Interest and Other Items"; and

  (b) any such collections not applied in the foregoing manner (and
      therefore not constituting Reallocated Class B Principal Collections)
      will, on business days with respect to the Revolving Period, be
      applied as Shared Principal Collections and on business days with
      respect to the Controlled Accumulation Period or Early Amortization
      Period will be included in the funds available to make principal
      payments to the Class A Certificateholders until the Class A Invested
      Amount is paid in full and then to the Class B Certificateholders
      until the Class B Invested Amount is paid in full.

    On each Determination Date, the Class D Invested Amount will be reduced by
the amount of unreimbursed Reallocated Principal Collections for the related
Monthly Period. In the event that such reduction would cause the Class D
Invested Amount to be a negative number, the Class D Invested Amount will be
reduced to zero and the Class C Invested Amount will be reduced by the amount
by which the Class D Invested Amount would have

                                       77
been reduced below zero. In the event that the amount of Reallocated Principal
Collections for such Distribution Date would cause the Class C Invested Amount
to be a negative number, the Class C Invested Amount will be reduced to zero
and the Class B Invested Amount will be reduced by the amount by which the
Class C Invested Amount would have been reduced below zero. In the event that
the amount of Reallocated Principal Collections for such Distribution Date
would cause the Class B Invested Amount to be a negative number on any
Distribution Date, the amount of Reallocated Class B Principal Collections on
such Distribution Date will be an amount not to exceed the amount which would
cause the Class B Invested Amount to be reduced to zero.

    "Class A Required Amount" is the amount determined by the Servicer on each
Business Day in a Monthly Period equal to the excess, if any, of (x) the sum of
(1) Class A Monthly Interest for the prior Monthly Period, (2) any Class A
Monthly Interest due but not paid on any previous Distribution Date plus any
Class A Additional Interest previously due but not paid to the Class A
Certificateholders on a prior Distribution Date, (3) if Conseco Finance or an
Affiliate of Conseco Finance is no longer the Servicer, the Class A Floating
Allocation Percentage of the Monthly Servicing Fee for the prior Monthly Period
and (4) the Class A Floating Allocation Percentage of the Default Amount, to
the extent not previously paid, for any Business Day in the prior Monthly
Period over (y) the Series Available Interest Collections plus any Excess
Interest Collections from other Series allocated with respect to the amounts
described in clauses (x)(1) through (4).

    "Class B Required Amount" is the amount determined by the Servicer on each
Business Day in a Monthly Period equal to the excess, if any, of (x) the sum of
(1) Class B Monthly Interest for the prior Monthly Period, (2) any Class B
Monthly Interest due but not paid on any previous Distribution Date plus any
Class B Additional Interest previously due but not paid to the Class B
Certificateholders on a prior Distribution Date, (3) if Conseco Finance or an
Affiliate of Conseco Finance is no longer the Servicer, the Class B Floating
Allocation Percentage of the Monthly Servicing Fee for the prior Monthly Period
and (4) the Class B Floating Allocation Percentage of the Default Amount, to
the extent not previously paid, for any Business Day in the prior Monthly
Period over (y) the Series Available Interest Collections plus any Excess
Interest Collections from other Series allocated with respect to the amounts
described in clauses (x)(1) through (4).

    "Class C Required Amount" is the amount determined by the Servicer on each
Business Day in a Monthly Period equal to the excess, if any, of (x) the sum of
(1) if the Class A Certificates and Class B Certificates have been reduced to
zero, interest accrued on the Class C Certificates for the prior Monthly
Period, (2) if the Class A Certificates and Class B Certificates have been
reduced to zero, any interest due on the Class C Certificates but not paid on
any previous Distribution Date plus any interest at the Class C Certificate
Rate (to the extent lawful) on interest on the Class C Certificates previously
due but not paid to the Class C Certificateholders on a prior Distribution
Date, (3) if Conseco Finance or an Affiliate of Conseco Finance is no longer
the Servicer, the Class C Floating Allocation Percentage of the Monthly
Servicing Fee for the prior Monthly Period and (4) the Class C

                                       78
Floating Allocation Percentage of the Default Amount, to the extent not
previously paid, for any Business Day in the prior Monthly Period over (y) the
Series Available Interest Collections plus any Excess Interest Collections from
other Series allocated with respect to the amounts described in clauses (x)(1)
through (4).

Application of Collections

    Allocations. Payments on the Receivables will be made to the Servicer, and
it will deposit all such payments (other than collections allocable to the
Exchangeable Transferor Certificate, subject to certain exceptions specified
herein) in the Collection Account no later than the second business day
following the date of processing. On the day on which any deposit to the
Collection Account is available, the Servicer will make the deposits and
payments to the accounts and parties as indicated below. However, as long as
Conseco Finance or any affiliate of Conseco Finance remains the Servicer, then
the Servicer may make such deposits and payments on a net basis on the business
day immediately prior to the Distribution Date (the "Transfer Date") of such
deposits and if (a)(i) the Servicer provides to the Trustee a letter of credit
or other form of credit enhancement rated in the highest rating category by
each Rating Agency covering the risk of collection of the Servicer and (ii) the
Transferor shall not have received a notice from any Rating Agency that making
payments monthly rather than daily would result in the lowering of such Rating
Agency's then-existing rating of any Series of certificates then outstanding or
(b) the Servicer has and maintains a short-term credit rating of P-1 by
Moody's, A-1 by Standard & Poor's and F-1 by Fitch. During the Revolving
Period, upon the retail sale of a product securing a Receivable where Conseco
Finance is providing the customer financing for such retail sale, Conseco
Finance will not, except under certain limited circumstances, be obligated to
deposit cash in the Collection Account in respect of the principal amount of
such Receivable but may instead replace such Receivable with other Receivables.

    If clause (a) or clause (b) set forth in the immediately preceding
paragraph is satisfied, payments on the Receivables collected by the Servicer
will not be segregated from the assets of the Servicer. Until such payments on
the Receivables collected by the Servicer are deposited into the Collection
Account, such funds may be used by the Servicer for its own benefit, and the
proceeds of any short-term investment of such funds will accrue to the
Servicer. During such times as the Servicer holds funds representing payments
on the Receivables collected by the Servicer and is permitted to use such funds
for its own benefit, the Certificateholders are subject to risk of loss,
including risk resulting from the bankruptcy or insolvency of the Servicer. The
Servicer will pay no fee to the Trust or any Certificateholder for any use by
the Servicer of funds representing collections on the Receivables.

    Notwithstanding the foregoing, whether the Servicer is required to make
daily or monthly deposits to the Collection Account, the Servicer is only
required to deposit Collections from the Collection Account into any Trust
Account or any account for any other Series up to the required amount to be
deposited therein and is permitted to withdraw from the Collection Account any
funds not required to be so deposited.

                                       79
The Servicer will withdraw the following amounts from the Collection
Account for application on each business day as indicated:

  (1)   an amount equal to the Transferor Percentage plus, prior to the
        Class D Principal Payment Commencement Date, the Class D Floating
        Allocation Percentage or the Class D Fixed/Floating Allocation
        Percentage, as applicable, of the aggregate amount of Principal
        Collections (less the amount thereof which may be applied as
        Reallocated Class D Principal Collections) and any amounts to be
        paid in respect of the Class D Investor Default Amount will be paid
        to the Transferor to maintain the Class D Invested Amount;

  (2)  an amount equal to the Transferor Percentage of the aggregate amount
       of Interest Collections will be paid to the holder of the
       Exchangeable Transferor Certificate to the extent such funds are not
       applied to cover Negative Carry Amounts or Principal Funding
       Investment Shortfalls, or allocated to any Series as set forth in the
       applicable Supplement;

  (3)  an amount equal to the sum of (a) the Floating Allocation Percentage
       of the aggregate amount of Interest Collections and (b) Excess
       Interest Collections of other Series allocable to Series 2001-1, will
       be allocated and paid as described below in "--Payment of Fees,
       Interest, and Other Items;"

  (4)  during the Revolving Period, an amount equal to the sum of the Class
       A Floating Allocation Percentage, the Class B Floating Allocation
       Percentage and the Class C Floating Allocation Percentage of
       Principal Collections (less the amount thereof which may be applied
       as Reallocated Class B Principal Collections and Reallocated Class C
       Principal Collections) will be applied as Shared Principal
       Collections;

  (5)   during the Controlled Accumulation Period or Early Amortization
        Period and prior to the date on which an amount equal to the Class A
        Invested Amount has been deposited in the Principal Amount, an
        amount equal to the ABC Fixed/Floating Allocation Percentage of
        Principal Collections (less the amount thereof which may be applied
        as Reallocated Class B Principal Collections or Reallocated Class C
        Principal Collections), any amount on deposit in the Excess Funding
        Account (exclusive of any amount in the Class D Subaccount), any
        amounts to be paid in respect of the ABC Investor Default Amount,
        Class A Investor Charge-Offs, Class B Investor Charge-Offs and Class
        C Investor Charge-Offs and any amount of Shared Principal
        Collections allocated to the Certificates on such business day up to
        (a) during the Controlled Accumulation Period, the Controlled
        Deposit Amount or (b) during the Early Amortization Period, the
        Class A Invested Amount, will be deposited in the Principal Account;

  (6)  during the Controlled Accumulation Period or Early Amortization
       Period and on or after the date on which an amount equal to the Class
       A Invested Amount has been deposited in the Principal Account, an
       amount equal to the ABC Fixed/Floating Allocation Percentage of such
       Principal Collections (less the amount thereof which may be applied
       as Reallocated Class B Principal

                                       80
Collections or Reallocated Class C Principal Collections), any
       remaining amount on deposit in the Excess Funding Account (exclusive
       of any amount in the Class D Subaccount), any amounts to be paid in
       respect of the ABC Investor Default Amount, Class B Investor Charge-
       Offs and Class C Investor Charge-Offs and any amount of Shared
       Principal Collections allocated to the Certificates on such business
       day, up to (a) during the Controlled Accumulation Period, the
       Controlled Deposit Amount or (b) during the Early Amortization Period,
       the Class B Invested Amount, will be deposited in the Principal
       Account;

  (7)  during the Controlled Accumulation Period or Early Amortization Period
       and on or after the date on which an amount equal to the Class B
       Invested Amount has been deposited in the Principal Account, an amount
       equal to the ABC Fixed/Floating Allocation Percentage of such
       Principal Collections (less the amount thereof which may be applied as
       Reallocated Class C Principal Collections), any remaining amount on
       deposit in the Excess Funding Account (exclusive of any amount in the
       Class D Subaccount), any amounts to be paid in respect of the ABC
       Investor Default Amount, and Class C Investor Charge-Offs and any
       amount of Shared Principal Collections allocated to the Certificates
       on such business day, up to the Class C Invested Amount, will be
       deposited into the Principal Account;

  (8)  Shared Principal Collections will be allocated to each outstanding
       Series pro rata based on any Principal Shortfalls with respect to any
       Series which is in its amortization period. The Servicer will pay any
       remaining Shared Principal Collections on such business day to the
       holder of the Exchangeable Transferor Certificate; and

  (9)   Excess Interest Collections (as defined herein) will be allocated as
        set forth below in paragraph (xiv) to "--Payment of Fees, Interest,
        and Other Items."

   Any Shared Principal Collections and other amounts described above as being
payable to the Transferor will not be paid to the Transferor if the Transferor
Interest on any date, after giving effect to the inclusion in the Trust of all
Receivables on or prior to such date and the application of all prior payments
to the Transferor, does not exceed the Minimum Transferor Interest. Any such
amounts otherwise payable to the Transferor will be deposited into and held in
the Excess Funding Account, and on the commencement of the accumulation period
or amortization period with respect to any Series, such amounts will be
deposited in the principal account of such Series to the extent specified in
the related Supplement until the applicable principal account of such Series
has been funded in full or the holders of certificates of such Series have
been paid in full. See "--Excess Funding Account."

   Payment of Fees, Interest and Other Items. On each business day during a
Monthly Period, the Servicer will determine the Floating Allocation Percentage
of Interest Collections (the "Series Available Interest Collections") and will
distribute from the Collection Account

                                      81
the following amounts in the following priority (in each case, subject to the
limit of the Series Available Interest Collections less all amounts distributed
pursuant to a higher priority):

  (i) an amount equal to the excess of

     (A) the sum of (1) the Class A Monthly Interest, (2) the amount of any
         Class A Monthly Interest previously due but not deposited in the
         Interest Funding Account in prior Monthly Periods, and (3) any
         additional interest (to the extent permitted by applicable law) at
         the Class A Certificate Rate with respect to interest amounts that
         were due but not paid in a prior Monthly Period over

     (B) the amount which has already been deposited in the Interest
         Funding Account with respect to clause (i)(A) in the current
         Monthly Period,

  will be deposited in the Interest Funding Account for distribution on the
  next succeeding Distribution Date to the Class A Certificateholders;

  (ii) an amount equal to the excess of

     (A) the sum of (1) the Class B Monthly Interest, (2) the amount of any
         Class B Monthly Interest previously due but not deposited in the
         Interest Funding Account in prior Monthly Periods, and (3) any
         additional interest (to the extent permitted by applicable law) at
         the Class B Certificate Rate with respect to Class B Monthly
         Interest amounts that were due but not paid in a prior Monthly
         Period over

     (B) the amount which has already been deposited in the Interest
         Funding Account with respect to clause (ii)(A) in the current
         Monthly Period,

  will be deposited in the Interest Funding Account for distribution on the
  next succeeding Distribution Date to the Class B Certificateholders;

  (iii) if Conseco Finance or an affiliate of Conseco Finance is not the
        Servicer, an amount equal to the portion of the Monthly Servicing
        Fee for the current month that has not been previously paid to the
        Servicer plus any prior Monthly Servicing Fee that was due but not
        previously paid to the Servicer, will be distributed to the
        Servicer;

  (iv)  an amount equal to the sum of (1) the aggregate ABC Investor Default
        Amount for such business day and (2) the unpaid ABC Investor Default
        Amount for any prior business day during the then-current Monthly
        Period, will

     (A) during the Revolving Period, be treated as Shared Principal
         Collections,

     (B) during the Controlled Accumulation Period or Early Amortization
         Period on and prior to the date on which an amount equal to the
         Class A Invested Amount has been deposited in the Principal
         Account, be deposited in the Principal Account for payment to the
         Class A Certificateholders,

                                       82
(C) on and after the date on which an amount equal to the Class A
         Invested Amount has been deposited in the Principal Account, be
         deposited in the Principal Account for payment to the Class B
         Certificateholders, and

     (D) on and after the date on which an amount equal to the Class B
         Invested Amount has been deposited in the Principal Account, be
         deposited in the Principal Account for payment to the Class C
         Certificateholders;

  (v)  an amount equal to the sum of (1) the aggregate Class D Investor
       Default Amount for such business day and (2) the unpaid Class D
       Investor Default Amount for any prior business day during the then-
       current Monthly Period, will

     (A) during the Revolving Period and the Controlled Accumulation Period
         prior to the date on which an amount equal to the Class C Invested
         Amount has been deposited in the Principal Account, be paid to the
         Transferor in order to maintain the Class D Invested Amount,

     (B) during the Controlled Accumulation Period or Early Amortization
         Period following the date on which an amount equal to the Class C
         Invested Amount has been deposited in the Principal Account, be
         deposited in the Principal Account for payment to the Class D
         Certificateholders, and

     (C) during the Early Amortization Period prior to the date on which an
         amount equal to the Class C Invested Amount has been deposited in
         the Principal Account, be deposited in the Class D Subaccount of
         the Excess Funding Account, to be held until the Class C Invested
         Amount has been paid in full, and to be available to be applied as
         Reallocated Class D Principal Collections;

  (vi) an amount equal to unreimbursed Class A Investor Charge-Offs, if any,
       will be applied to reimburse Class A Investor Charge-Offs and

     (A) during the Revolving Period, the amount of such reimbursement will
         be treated as Shared Principal Collections,

     (B) during the Controlled Accumulation Period or Early Amortization
         Period but on and prior to the date on which an amount equal to
         the Class A Invested Amount has been deposited in the Principal
         Account, the amount of such reimbursement will be deposited in the
         Principal Account for payment to the Class A Certificateholders,

     (C) on and after the date on which an amount equal to the Class A
         Invested Amount has been deposited in the Principal Account, the
         amount of such reimbursement will be deposited in the Principal
         Account for payment to the Class B Certificateholders and

     (D) on and after the date on which an amount equal to the Class B
         Invested Amount has been deposited in the Principal Account, the
         amount of such reimbursement will be deposited in the Principal
         Account for payment to the Class C Certificateholders;

                                       83
(vii)  an amount equal to the sum of (1) the amount of interest which has
         accrued with respect to the outstanding aggregate principal amount
         of the Class B Certificates at the Class B Certificate Rate but has
         not been deposited in the Interest Funding Account with respect to
         the Class B Certificateholders either on such business day or on a
         prior business day, and (2) any additional interest (to the extent
         permitted by applicable law) at the Class B Certificate Rate with
         respect to such interest amounts that were due but not paid to
         Class B Certificateholders in any previous Monthly Period, will be
         deposited in the Interest Funding Account for distribution on the
         next succeeding Distribution Date to the Class B
         Certificateholders;

  (viii) an amount equal to the sum of (a) unreimbursed Class B Investor
         Charge-Offs, if any, and (b) any unreimbursed reduction in the
         Class B Invested Amount on account of Reallocated Principal
         Collections as described under "--Reallocated Principal
         Collections" will be applied to reimburse such Class B Investor
         Charge-Offs and such reduction and

     (A) during the Revolving Period, the amount of such reimbursement will
         be treated as Shared Principal Collections,

     (B) during the Controlled Accumulation Period or Early Amortization
         Period but prior to the date on which an amount equal to the Class
         A Invested Amount has been deposited in the Principal Account, the
         amount of such reimbursement will be deposited in the Principal
         Account for payment to the Class A Certificateholders,

     (C) on and after the date on which an amount equal to the Class A
         Invested Amount has been deposited in the Principal Account but
         prior to the date on which an amount equal to the Class B Invested
         Amount has been deposited in the Principal Account, the amount of
         such reimbursement will be deposited in the Principal Account for
         payment to the Class B Certificateholders and

     (D) on and after the date on which an amount equal to the Class B
         Invested Amount has been deposited in the Principal Account, the
         amount of such reimbursement will be deposited in the Principal
         Account for payment to the Class C Certificateholders;

  (ix)   an amount equal to the sum of (a) unreimbursed Class C Investor
         Charge-Offs, if any, and (b) any unreimbursed reduction in the
         Class C Invested Amount on account of Reallocated Principal
         Collections as described under "--Reallocated Principal
         Collections" will be applied to reimburse such Class C Investor
         Charge-Offs and such reduction and

     (A) during the Revolving Period, the amount of such reimbursement will
         be treated as Shared Principal Collections,

     (B) during the Controlled Accumulation Period or Early Amortization
         Period but prior to the date on which an amount equal to the Class
         A Invested Amount has been deposited in the Principal Account, the
         amount of such

                                       84
reimbursement be deposited in the Principal Account for payment to
         the Class A Certificateholders,

     (C) on and after the date on which an amount equal to the Class A
         Invested Amount has been deposited in the Principal Account but
         prior to the date on which an amount equal to the Class B Invested
         Amount has been deposited in the Principal Account, the amount of
         such reimbursement be deposited in the Principal Account for
         payment to the Class B Certificateholders and

     (D) on and after the date on which an amount equal to the Class B
         Invested Amount has been deposited in the Principal Account, the
         amount of such reimbursement be deposited in the Principal Account
         for payment to the Class C Certificateholders;

  (x)    an amount equal to the sum of (a) unreimbursed Class D Investor
         Charge-Offs, if any, and (b) any unreimbursed reduction in the
         Class D Invested Amount on account of Reallocated Principal
         Collections as described under "--Reallocated Principal
         Collections" will

     (A) during the Revolving Period and during the Controlled Accumulation
         Period prior to the date on which an amount equal to the Class C
         Invested Amount has been deposited in the Principal Account, be
         paid to the Transferor,

     (B) during the Early Amortization Period, be deposited in the Class D
         Subaccount of the Excess Funding Account, to be held until the
         date on which an amount equal to the Class C Invested Amount has
         been deposited in the Principal Account and to be available to be
         applied as Reallocated Class D Principal Collections, and

     (C) during the Controlled Accumulation Period on or after date on
         which an amount equal to the Class C Invested Amount has been
         deposited in the Principal Account, be deposited in the Principal
         Account for payment to the Class D Certificateholders;

  (xi)   an amount equal to the sum of (1) the amount of interest which has
         accrued with respect to the outstanding aggregate principal amount
         of the Class C Certificates at the Class C Certificate Rate but has
         not been deposited in the Interest Funding Account with respect to
         the Class C Certificateholders either on such business days or on a
         prior business day, and (2) any additional interest (to the extend
         permitted by applicable law) at the interest rate on the Class C
         Certificates with respect to such interest amounts that are due but
         not paid to Class C Certificateholders in any previous Monthly
         Period, will be deposited in the Interest Funding Account for
         distribution on the next succeeding Distribution Date to the Class
         C Certificateholders;

  (xii)  an amount equal to the sum of (1) the amount of interest which has
         accrued with respect to the outstanding aggregate principal amount
         of the Class D Certificates at the Class D Certificate Rate but has
         not been deposited in the Interest Funding

                                       85
Account with respect to the Class D Certificateholders either on
         such business days or on a prior business day, and (2) any
         additional interest (to the extend permitted by applicable law) at
         the interest rate on the Class D Certificate with respect to such
         interest amounts that are due but not paid to Class D
         Certificateholders in any previous Monthly Period, will be
         deposited in the Interest Funding Account for distribution on the
         next succeeding Distribution Date to the Class D
         Certificateholders;

  (xiii) if Conseco Finance or an affiliate of Conseco Finance is the
         Servicer, an amount equal to the portion of the Monthly Servicing
         Fee for the current month that has not been previously paid to the
         Servicer plus any prior Monthly Servicing Fee that was due but not
         previously paid to the Servicer will be distributed to the
         Servicer; and

  (xiv)  any Series Available Interest Collections remaining after making
         the above described distributions will be treated as "Excess
         Interest Collections" which will be available to cover shortfalls,
         if any, in amounts payable from Interest Collections to
         certificateholders of other Series and then to pay any unpaid
         commercially reasonable costs and expenses of a successor Servicer,
         if any. Excess Interest Collections which are not so used will be
         paid to the Transferor.

    "Class A Monthly Interest" with respect to any Distribution Date will equal
the product of (1) the Class A Certificate Rate for the related Interest
Accrual Period, (2) the actual number of days in such Interest Accrual Period
divided by 360 and (3) the outstanding principal balance of the Class A
Certificates at the close of business on the first day of such Interest Accrual
Period.

    "Class B Monthly Interest" with respect to any Distribution Date will equal
the product of (1) the Class B Certificate Rate for the related Interest
Accrual Period, (2) the actual number of days in such Interest Accrual Period
divided by 360 and (3) with respect to the Funding Period, the outstanding
principal balance of the Class B Certificates at the close of business on the
first day of such Interest Accrual Period and after the Funding Period, the
Class B Invested Amount at the close of business on the first day of such
Interest Accrual Period.

    "Required Amount" means on the first business day following a Monthly
Period the amount, if any, by which the full amount to be paid pursuant to
clauses (i)-(xiii) above in "--Payments of Fees, Interest, and Other Items" for
such prior Monthly Period exceeds the portion of the Series Available Interest
Collections applied to the payment of the amounts described in such clauses for
such prior Monthly Period.

    Payment of Principal. On each business day during the Revolving Period, the
Trustee, acting in accordance with instructions from the Servicer, will treat
the amount described in clause (4) of "--Allocations" as Shared Principal
Collections which will be applied as described in clause (8) of "--
Allocations." On the Transfer Date preceding the Class A Scheduled Payment
Date, the Trustee, acting in accordance with instructions from the Servicer,
will withdraw the amount on deposit in the Principal Account and deposit such

                                       86
amount in the Distribution Account for distribution to the Class A
Certificateholders on the Class A Scheduled Payment Date. If the amount so
distributed on the Class A Scheduled Payment Date is less than the Class A
Invested Amount, the Class A Certificateholders will be entitled on each
subsequent Distribution Date to receive principal payments to the extent of
Class A Principal until the Class A Invested Amount is paid in full. The Class
B Certificateholders will be entitled to receive payment of the Class B
Invested Amount on the Class B Scheduled Payment Date, but only after the Class
A Invested Amount has been paid in full. The Class C Certificateholders will be
entitled to receive principal payments to the extent of Class C Principal until
the Class C Invested Amount is paid in full only after the Class A Invested
Amount and the Class B Invested Amount have been paid in full. The Class D
Certificateholders will be entitled to receive principal payments only after
the Class A Invested Amount, the Class B Invested Amount, and the Class C
Invested Amount have been paid in full.

    "Class A Principal" with respect to any Distribution Date during the
Controlled Accumulation Period or Early Amortization Period will equal the sum
of,

  (1)    an amount equal to the ABC Fixed/Floating Allocation Percentage of
         all Principal Collections (less the amount of Reallocated Class B
         Principal Collections and Reallocated Class C Principal
         Collections) received during the Monthly Period immediately
         preceding such Distribution Date,

  (2)   any amount on deposit in the Excess Funding Account (other than any
        amount in the Class D Subaccount) or the Pre-Funding Account
        allocated to the Class A Certificates with respect to the preceding
        Monthly Period,

  (3)  the aggregate ABC Investor Default Amount paid from Series Available
       Interest Collections, Excess Interest Collections or Reallocated
       Principal Collections with respect to the preceding Monthly Period
       and any reimbursements from Series Available Interest Collections,
       Excess Interest Collections or Reallocated Principal Collections of
       unreimbursed Class A Investor Charge-Offs, Class B Investor Charge-
       Offs and Class C Investor Charge-Offs, and

  (4)   Shared Principal Collections allocated to the Class A Certificates.

However, with respect to any Distribution Date during the Controlled
Accumulation Period, Class A Principal will not exceed the lesser of (1) the
Controlled Deposit Amount and (2) the Class A Invested Amount. On the Series
2001-1 Termination Date, Class A Principal will be an amount equal to the Class
A Invested Amount.

    "Class B Principal" with respect to any Distribution Date on or after the
Class A Scheduled Payment Date will equal the sum of

  (1) an amount equal to the ABC Fixed/Floating Allocation Percentage of all
      Principal Collections (less the amount of Reallocated Class B
      Principal Collections and Reallocated Class C Principal Collections)
      received during the Monthly Period immediately preceding such
      Distribution Date (or, in the case of the first Distribution Date
      following the date on which an amount equal to the Class A Invested
      Amount is deposited in the Principal Account to be applied to the

                                       87
payment of Class A Principal, the ABC Fixed/Floating Allocation
      Percentage of Principal Collections from the date on which such
      deposit is made),

  (2)   any amount on deposit in the Excess Funding Account (other than any
        amount in the Class D Subaccount) or the Pre-Funding Account
        allocated to the Class B Certificates with respect to the preceding
        Monthly Period,

  (3)  the aggregate ABC Investor Default Amount paid from Series Available
       Interest Collections, Excess Interest Collections or Reallocated
       Principal Collections with respect to the preceding Monthly Period
       and any reimbursements from Series Available Interest Collections,
       Excess Interest Collections or Reallocated Principal Collections of
       unreimbursed Class B Investor Charge-Offs and Class C Investor
       Charge-Offs, and

  (4)   Shared Principal Collections allocated to the Class B Certificates.

However, with respect to any Distribution Date during the Controlled
Accumulation Period, Class B Principal will not exceed the lesser of (1) the
Controlled Deposit Amount and (2) the Class B Invested Amount. On the Series
2001-1 Termination Date, Class B Principal will be an amount equal to the
Class B Invested Amount.

    "Class C Principal" with respect to any Distribution Date on or after the
date on which an amount equal to the Class B Invested Amount has been
deposited in the Principal Account will equal the sum of

  (1)    an amount equal to the ABC Fixed/Floating Allocation Percentage of
         all Principal Collections (less the amount of Reallocated Class C
         Principal Collections) received during the Monthly Period
         immediately preceding such Distribution Date (or, in the case of
         the first Distribution Date following the date on which an amount
         equal to the Class B Invested Amount is deposited in the Principal
         Account to be applied to the payment of Class B Principal, the ABC
         Fixed/Floating Allocation Percentage of Principal Collections from
         the date on which such deposit is made),

  (2)   any amount on deposit in the Excess Funding Account (other than any
        amount in the Class D Subaccount) or the Pre-Funding Account
        allocated to the Class C Certificates with respect to the preceding
        Monthly Period,

  (3)  the aggregate ABC Investor Default Amount paid from Series Available
       Interest Collections, Excess Interest Collections or Reallocated
       Principal Collections with respect to the preceding Monthly Period
       and any reimbursements from Series Available Interest Collections,
       Excess Interest Collections or Reallocated Principal Collections of
       unreimbursed Class C Investor Charge-Offs, and

  (4)   Shared Principal Collections allocated to the Class C Certificates.

On the Series 2001-1 Termination Date, Class C Principal will be an amount
equal to the Class C Invested Amount.

    On the Transfer Date preceding the date on which an amount equal to the
Class C Invested Amount has been deposited in the Principal Account, and on
each Transfer Date

                                      88
thereafter until the Trust is terminated or until the Class D Invested Amount
is paid in full, the Trustee, acting in accordance with instructions from the
Servicer, will withdraw amounts deposited into the Principal Account in respect
of Principal Collections processed during the related Monthly Period and, to
the extent of the Class D Invested Amount, deposit such amounts in the
Distribution Account for distribution to the Class D Certificateholders on the
next succeeding Distribution Date (the "Class D Principal"). The Class D
Certificateholders will be entitled to receive principal payments to the extent
of Class D Principal until the Class D Invested Amount is paid in full.

Coverage of Certain Interest Shortfalls

    To the extent of any shortfall in the amount of Series Available Interest
Collections due to the accumulation of principal in the Excess Funding Account
or the Principal Account and because no Interest Collections or Principal
Collections will be allocated to the Pre-Allocated Invested Amount until Series
1998-2 and 1999-1 are paid in full, the Transferor Interest Collections will be
made available to cover the related Negative Carry Amount and such Principal
Funding Investment Shortfall.

    The "Negative Carry Amount" is the difference between the amount of
interest actually earned on investments in the Excess Funding Account and the
Pre-Funding Account on any day and the amount of interest that would have been
earned on such investments and, until Series 1998-2 and Series 1999-1 are paid
in full, the Pre-Allocated Invested Amount at the Base Rate on such day. The
"Principal Funding Investment Shortfall" for any day is the difference between
the amount of interest actually earned on investments in the Principal Account
on that day and the amount of interest that would have been earned on such
investments at the Base Rate for such day. The "Base Rate" is the sum of (1)
the weighted average of the Class A Certificate Rate, the Class B Certificate
Rate, the Class C Certificate Rate and the Class D Certificate Rate plus (2) 2%
per annum.

    Interest Collections allocable to any Series in excess of the amounts
necessary to make required payments with respect to such Series ("Excess
Interest Collections") will be applied to cover any shortfalls with respect to
amounts payable from Interest Collections allocable to any other Series, pro
rata based upon the amounts of the shortfalls, if any, with respect to such
other Series. Any Excess Interest Collections remaining after covering
shortfalls with respect to all outstanding Series during a Monthly Period will
be paid to the successor Servicer, if any, to cover certain costs and expenses
and then to the holder of the Exchangeable Transferor Certificate.

Defaulted Receivables

    Receivables will be charged off as uncollectible in accordance with the
Servicer's customary and usual policies (a "Defaulted Receivable"). See "The
Accounts--Loss Experience." On each business day, the Servicer will allocate to
the Certificateholders a portion of all Defaulted Receivables in an amount (the
"Investor Default Amount") equal to the product of (a) the Floating Allocation
Percentage applicable on such business day and

                                       89
(b) the aggregate principal amount of Defaulted Receivables identified since
the prior reporting date. On each business day, the Servicer will allocate to
the Class A, Class B and Class C Certificateholders a portion of all Defaulted
Receivables in an amount (the "ABC Investor Default Amount") equal to the
product of (a) the sum of the Class A Floating Allocation Percentage, the Class
B Floating Allocation Percentage and the Class C Floating Allocation Percentage
applicable on such business day and (b) the aggregate principal amount of
Defaulted Receivables identified since the prior reporting date. On each
business day, the Servicer will allocate to the Class D Certificateholders a
portion of all Defaulted Receivables in an amount (the "Class D Investor
Default Amount") equal to the product of (a) the Class D Floating Allocation
Percentage and (b) the aggregate principal amount of Defaulted Receivables
identified since the prior reporting date.

Investor Charge-Offs

    If on the second business day preceding each Distribution Date (the
"Determination Date"), the aggregate Investor Default Amount, if any, for all
business days in the preceding Monthly Period exceeded the aggregate amount of
the Series Available Interest Collections, Excess Interest Collections and
Reallocated Principal Collections allocated with respect thereto during such
Monthly Period, then the Class D Invested Amount will be reduced by the
aggregate amount of such excess, but not more than the remaining aggregate
Investor Default Amount for such Monthly Period (a "Class D Investor Charge-
Off"). The Class D Invested Amount thereafter will be increased (but not in
excess of the aggregate of such reductions in the Class D Invested Amount
previously made that have not been previously reimbursed as described in this
sentence) on any business day by the amounts allocated and available for that
purpose as described under clause (10) of "--Application of Collections--
Payment of Fees, Interest, and Other Items."

    In the event that any such reduction of the Class D Invested Amount would
cause the Class D Invested Amount to be a negative number, the Class D Invested
Amount will be maintained at or reduced to zero, and the Class C Invested
Amount will be reduced by the aggregate amount of such excess, but not more
than the remaining aggregate Investor Default Amount for such Monthly Period (a
"Class C Investor Charge-Off"), which will have the effect of slowing or
reducing the return of principal to the Class C Certificateholders. The Class C
Invested Amount will thereafter be increased (but not in excess of the unpaid
principal balance of the Class C Certificates) on any Monthly Period by the
amounts allocated and available for that purpose as described under clause (9)
of""--Application of Collections--Payment of Fees, Interest, and Other Items."

    In the event that any such reduction of the Class C Invested Amount would
cause the Class C Invested Amount to be a negative number, the Class C Invested
Amount will be reduced to zero, and the Class B Invested Amount will be reduced
by the aggregate amount of such excess, but not more than the remaining
aggregate Investor Default Amount for such Monthly Period (a "Class B Investor
Charge-Off"), which will have the effect of slowing or reducing the return of
principal to the Class B Certificateholders. The Class B Invested Amount will
thereafter be increased (but not in excess of the unpaid principal balance of
the

                                       90
Class B Certificates) on any Monthly Period by the amounts allocated and
available for that purpose as described under clause (8) of "--Application of
Collections--Payment of Fees, Interest, and Other Items."

    In the event that any such reduction of the Class B Invested Amount would
cause the Class B Invested Amount to be a negative number, the Class B Invested
Amount will be reduced to zero, and the Class A Invested Amount will be reduced
by the amount by which the Class B Invested Amount would have been reduced
below zero, but not more than the remaining aggregate Investor Default Amount
for such Monthly Period (a "Class A Investor Charge-Off"). The Class A Invested
Amount will thereafter be increased (but not in excess of the unpaid principal
balance of the Class A Certificates) on any Monthly Period by the amounts
allocated and available for that purpose as described under clause (6) of""--
Application of Collections--Payment of Fees, Interest, and Other Items."

Companion Series

    The Series 2001-1 Certificates may be entirely or partially paired with one
or more other Series (each a "Companion Series"). Each Companion Series either
will be prefunded with an initial deposit to a pre-funding account in an amount
up to the initial principal balance of such Companion Series, funded primarily
from the proceeds of the sale of a Companion Series, or will have a variable
principal amount. Any pre-funding account will be held for the benefit of such
Companion Series and not for the benefit of Series 2001-1 Certificateholders.
As principal is deposited in the Principal Account with respect to the Series
2001-1 Certificates or paid to the Series 2001-1 Certificateholders, either (1)
in the case of a pre-funded Companion Series, an equal amount of funds on
deposit in any pre-funding account for such pre-funded Companion Series will be
released (which funds will be distributed to the Transferor) or (2) in the case
of a Companion Series having a variable principal amount, an interest in such
variable Companion Series in an equal or lesser amount may be sold by the Trust
(and the proceeds thereof will be distributed to the Transferor) and, in either
case, the invested amount in the Trust of the Companion Series will increase by
up to the corresponding amount. Upon payment in full of the Series 2001-1
Certificates, assuming that there have been no unreimbursed charge-offs with
respect to any related Companion Series, the aggregate invested amount of such
related Companion Series will have been increased by an amount up to an
aggregate amount equal to the Series 2001-1 Investor Interest paid to the
Series 2001-1 Certificateholders since the issuance of such Companion Series.
The issuance of a Companion Series will be subject to the conditions described
under "Description of the Certificates--Exchanges." We cannot assure you that
the terms of any Companion Series would have no impact on the timing or amount
of payments received by a Series 2001-1 Certificateholder.

Final Payment of Principal; Termination

    The Class A Certificates, the Class B Certificates, and the Class C
Certificates will each be subject to optional repurchase by the Transferor on
any Distribution Date when the sum of the Class A Invested Amount, the Class B
Invested Amount and the Class C Invested

                                       91
Amount is reduced to an amount less than or equal to $       (20% of the
initial outstanding principal amount of the Class A Certificates, the Class B
Certificates and the Class C Certificates), if certain conditions set forth in
the Pooling and Servicing Agreement are satisfied. The repurchase price will be
equal to the sum of (i) the unpaid Class A Invested Amount plus accrued and
unpaid interest on the Class A Certificates, (ii) the unpaid Class B Invested
Amount plus accrued and unpaid interest on the Class B Certificates, (iii) the
unpaid Class C Invested Amount plus accrued and unpaid interest on the Class C
Certificates and (iv) the unpaid Class D Invested Amount. In each case interest
will accrue through the day preceding the Distribution Date on which the
repurchase occurs.

    The Certificates will be retired on the day following the Distribution Date
on which the final payment of principal is scheduled to be made to the
Certificateholders, whether as a result of optional reassignment to the
Transferor or otherwise. Subject to prior termination as provided above, the
Pooling and Servicing Agreement provides that the final distribution of
principal and interest on the Certificates will be made on the earlier of (i)
the Distribution Date on which the Invested Amount is paid in full and (ii) the
      Distribution Date (the "Series 2001-1 Termination Date"), except to the
extent provided below. In the event that the Invested Amount is greater than
zero, exclusive of any Class held by the Transferor, on the Series 2001-1
Termination Date, the Trustee will sell or cause to be sold interests in the
Receivables or certain Receivables, as specified in the Pooling and Servicing
Agreement and the Series 2001-1 Supplement, in an amount up to 110% of the
Invested Amount at the close of business on such date (but not more than the
total amount of Receivables allocable to the Certificates in accordance with
the Pooling and Servicing Agreement). If the sale contemplated by the preceding
sentence has not occurred by the Series 2001-1 Termination Date, the affected
Certificateholders shall remain entitled to receive proceeds of such sale when
it occurs. The net proceeds of such sale and any collections on the
Receivables, up to an amount equal to the Invested Amount plus accrued interest
due on the Certificates, will be paid on the Series 2001-1 Termination Date in
the following order of priority:

  .   to the Class A Certificateholders until the Class A Invested Amount is
      paid in full,

  .   to the Class B Certificateholders until the Class B Invested Amount is
      paid in full,

  .   to the Class C Certificateholders until the Class C Invested Amount is
      paid in full, and

  .   to the Class D Certificateholders until the Class D Invested Amount is
      paid in full.

    Unless the Servicer and the holder of the Exchangeable Transferor
Certificate instruct the Trustee otherwise, the Trust will terminate on the
earlier of (a) the day after the Distribution Date following the date on which
funds shall have been deposited in the Distribution Account for the payment to
certificateholders outstanding sufficient to pay in full the aggregate investor
interest of all Series outstanding plus interest thereon at the applicable
certificate rates to the next Distribution Date and (b) a date which shall not
be later than        , or (c) if the Receivables are sold, disposed of or
liquidated following the occurrence of an Insolvency Event, immediately
following such sale,

                                       92
disposition or liquidation (such date, the "Trust Termination Date"). Upon the
termination of the Trust and the surrender of the Exchangeable Transferor
Certificate, the Trustee will convey to the holder of the Exchangeable
Transferor Certificate all right, title, and interest of the Trust in and to
the Receivables and other funds of the Trust (other than funds on deposit in
the Distribution Account and other similar bank accounts of the Trust with
respect to any Series).

Pay Out Events

    As described above, the Revolving Period is expected to continue through
the end of the Monthly Period immediately preceding the Controlled Accumulation
Period, unless a Pay Out Event occurs prior to such date. A "Pay Out Event"
refers to any of the following events:

  (1)    failure by the Transferor to convey Receivables in Additional
         Accounts to the Trust within five business days after the day on
         which it is required to convey such Receivables pursuant to the
         Pooling and Servicing Agreement;

  (2)   failure on the part of the Transferor, the Servicer or Conseco
        Finance, as applicable, (a) to make any payment or deposit required
        by the Pooling and Servicing Agreement or the Purchase Agreement, on
        or before the date such payment or deposit is required to be made
        therein, which failure is not cured within five business days after
        written notice from the Trustee of such failure; or (b) to deliver a
        Distribution Date statement as required under the Pooling and
        Servicing Agreement within ten business days after written notice
        from the Trustee of such failure; or (c) to comply with its covenant
        not to create any lien on a Receivable which failure has a material
        adverse effect on the holders of the Certificates and which
        continues unremedied for a period of 60 days after written notice to
        it; provided, however, that any Pay Out Event shall not be deemed to
        have occurred if the Transferor shall have repurchased the related
        Receivables or, if applicable, all the Receivables during such
        period in accordance with the provisions of the Pooling and
        Servicing Agreement; or (d) to observe or perform in any material
        respect any other covenants or agreements set forth in the Pooling
        and Servicing Agreement or the Purchase Agreement, which failure has
        a materially adverse effect on the Certificateholders and which
        continues unremedied for a period of 45 days after written notice of
        such failure;

  (3)  any representation or warranty made by Conseco Finance in the
       Purchase Agreement or by the Transferor in the Pooling and Servicing
       Agreement or any information required to be given by the Transferor
       to the Trustee to identify the Accounts proves to have been incorrect
       in any material respect when made and continues to be incorrect in
       any material respect for a period of 60 days after written notice and
       as a result the interests of the Certificateholders are materially
       and adversely affected (excluding, however, any representation or
       warranty made by the Transferor that the Pooling and Servicing
       Agreement constitutes, or the transfer of the Receivables to the
       Trust is, a valid sale, transfer and assignment to

                                       93
the Trust of all right, title and interest of the Transferor in the
      Receivables and the Collateral Security if the Pooling and Servicing
      Agreement constitutes the grant of a security interest in the
      Receivables and Collateral Security); provided, however, that any Pay
      Out Event shall not be deemed to occur thereunder if the Transferor
      has repurchased the related Receivables or all such Receivables, if
      applicable, during such period in accordance with the provisions of
      the Pooling and Servicing Agreement;

  (4)   the occurrence of certain events of bankruptcy, insolvency or
        receivership relating to Conseco Finance or the Transferor;

  (5)    the Trust or the Transferor becomes an investment company within
         the meaning of the Investment Company Act of 1940, as amended;

  (6)   any Servicer Default occurs;

  (7)  on any Determination Date, the average of the Monthly Payment Rates
       for the three preceding Monthly Periods, where the Monthly Payment
       Rate for a Monthly Period is the percentage obtained by dividing the
       aggregate of the Receivables balance (without deducting therefrom any
       discount portion) collected during such Monthly Period by the average
       daily aggregate Receivables balance (without deducting therefrom any
       discount portion) for such Monthly Period, is less than   %;

  (8) the failure to pay the outstanding principal amount of the Class A
      Certificates or Class B Certificates by the Class A Scheduled Payment
      Date or the Class B Scheduled Payment Date, as applicable;

  (9)   the ratio (expressed as a percentage) of (a) the average for each
        month of the net losses on the Receivables (exclusive of the
        Ineligible Receivables) owned by the Trust (i.e., gross losses less
        recoveries on any such Receivables (including, without limitation,
        recoveries from collateral security in addition to recoveries from
        the products, recoveries from manufacturers and insurance proceeds))
        during any three consecutive calendar months to (b) the average of
        the month-end aggregate balances of such Receivables (without
        deducting therefrom the discount portion) for such three-month
        period, exceeds  % on an annualized basis;

  (10)    the sum of all Cash Equivalents and other amounts on deposit in
          the Excess Funding Account represents more than 50% of the
          aggregate amount of Principal Receivables (without deducting
          therefrom any discount portion) on each of six or more consecutive
          Determination Dates, after giving effect to all payments made or
          to be made on the Distribution Date next succeeding each such
          respective Determination Date; or

  (11)   if Principal Collections allocable to the Class D
         Certificateholder's Interest have been reallocated in any Monthly
         Period to cover any Required Amounts and have not been reimbursed
         as of the Determination Date in such Monthly Period.

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In the case of any event described in clause (2), (3) or (6) above, a Pay
Out Event will be deemed to have occurred with respect to the Certificates only
if, after any applicable grace period, the Certificateholders evidencing
undivided interests aggregating more than 50% of the Invested Amount, by
written notice to the Transferor and the Servicer, declare that a Pay Out Event
has occurred with respect to the Certificates as of the date of such notice. In
the case of any event described in clause (4) or (5) above, a Pay Out Event
with respect to all Series then outstanding, and in the case of any event
described in clause (1), (7), (8), (9), (10) or (11) above, a Pay Out Event
with respect only to the Certificates, will be deemed to have occurred without
any notice or other action on the part of the Trustee or the Certificateholders
or all certificateholders, as appropriate, immediately upon the occurrence of
such event. On the date on which a Pay Out Event is deemed to have occurred,
the Early Amortization Period will commence. In such event, distributions of
principal to the Certificateholders will begin on the first Distribution Date
following the month in which such Pay Out Event occurred. If, because of the
occurrence of a Pay Out Event, the Early Amortization Period begins,
Certificateholders will begin receiving distributions of principal earlier than
they otherwise would have, which may shorten the average life of the
Certificates.

    In addition to the consequences of a Pay Out Event discussed above, if,
pursuant to certain provisions of federal law, the Transferor voluntarily
enters liquidation or a trustee in bankruptcy is appointed for the Transferor
(an "Insolvency Event"), the Transferor will immediately cease to transfer
Receivables to the Trust and promptly give notice to the Trustee of such event.
Within 15 days, the Trustee will publish a notice of the liquidation or the
appointment stating that the Trustee intends to sell, dispose of, or otherwise
liquidate the Receivables in a commercially reasonable manner. With respect to
each Series outstanding at such time (or, if any such Series has more than one
class, of each class of such Series excluding any class or portion thereof held
by the Transferor), unless otherwise instructed within a specified period by
certificateholders representing undivided interests aggregating more than 50%
of the invested amount of such Series (or class excluding any class or portion
thereof held by the Transferor) and the holders (other than the Transferor) of
any Supplemental Certificates or any other interest in the Exchangeable
Transferor Certificate, the Trustee will sell, dispose of, or otherwise
liquidate the portion of the Receivables allocable to the Series that did not
vote to continue the Trust in accordance with the Pooling and Servicing
Agreement in a commercially reasonable manner and on commercially reasonable
terms. The proceeds from the sale, disposition, or liquidation of the
Receivables will be treated as collections of the Receivables allocable to such
Certificateholders and will be distributed to the applicable Certificateholders
as provided above in "--Application of Collections."

    If the only Pay Out Event to occur is either the bankruptcy or insolvency
of the Transferor or the appointment of a bankruptcy trustee or receiver for
the Transferor, the bankruptcy trustee or receiver may have the power to
prevent the early sale, liquidation, or disposition of the Receivables and the
commencement of the Early Amortization Period. In addition, a bankruptcy
trustee or receiver may have the power to cause the early sale of the
Receivables and the early retirement of the Certificates.

                                       95
Servicing Compensation and Payment of Expenses

    The Servicer's compensation for its servicing activities and reimbursement
for its expenses will take the form of the payment to it of a servicing fee in
an amount for any Monthly Period equal to the sum of (1) with respect to each
Series, one-twelfth of the product of (x) the applicable servicing fee rate
with respect to such Series and (y) the Invested Amount of such Series on the
first day of such Monthly Period and (2) one-twelfth of the product of the
weighted average servicing fee rate for all Series and the average Transferor
Interest for such Monthly Period. The servicing fee will be allocated between
the Transferor Interest, the Certificateholders' Interest, and the investor
interest for all other Series. The portion of the servicing fee allocable to
the Certificateholders' Interest during each Monthly Period (the "Monthly
Servicing Fee") will be equal to one-twelfth of the product of (x) 2.00% per
annum and (y) the Invested Amount on the first day of the related Monthly
Period or, in the case of the first Distribution Date, the initial principal
amount of the Certificates. The Monthly Servicing Fee will be funded from
Interest Collections allocated to the Certificateholders' Interest, and will be
paid each month from the amount so allocated and on deposit in the Collection
Account. See "--Application of Collections--Payment of Fees, Interest, and
Other Items" above. The remainder of the servicing fee will be allocable to the
Transferor Interest and the investor interests of other Series. Neither the
Trust nor the Certificateholders will have any obligation to pay such portion
of the servicing fee.

    The Servicer will be permitted to waive its right to receive the Monthly
Servicing Fee on any Distribution Date, so long as it believes that sufficient
Interest Collections will be available on a future Distribution Date to pay
such waived Monthly Servicing Fee, in which case the Monthly Servicing Fee for
such Distribution Date shall be deemed to be zero.

    The Servicer will pay from its servicing compensation certain expenses
incurred in connection with servicing the Receivables, including, without
limitation, payment of the fees and disbursements of the Trustee and
independent certified public accountants and other fees which are not expressly
stated in the Pooling and Servicing Agreement to be payable by the Trust or the
Certificateholders other than federal, state, and local income and franchise
taxes, if any, of the Trust.

Certain Matters Regarding the Transferor and the Servicer

    The Servicer may not resign from its obligations and duties under the
Pooling and Servicing Agreement, except upon determination that performance of
its duties is no longer permissible under applicable law. No such resignation
will become effective until the Trustee or a successor to the Servicer has
assumed the Servicer's responsibilities and obligations under the Pooling and
Servicing Agreement. The Servicer may delegate some or all of its servicing
duties; provided, however, such delegation will not relieve the Servicer of its
obligation to perform such duties in accordance with the Pooling and Servicing
Agreement. In addition, any affiliate of Conseco Finance may be substituted in
all respects for Conseco Finance as Servicer, provided that Conseco Finance
will remain jointly and severally liable with such affiliate.

                                       96
The Pooling and Servicing Agreement provides that the Servicer will
indemnify the Trust and the Trustee from and against any reasonable loss,
liability, expense, damage, or injury suffered or sustained by reason of any
acts or omissions or alleged acts or omissions of the Servicer with respect to
the activities of the Trust or the Trustee; provided, however, that the
Servicer will not indemnify (a) the Trustee for liabilities imposed by reason
of fraud, negligence, or willful misconduct by the Trustee in the performance
of its duties under the Pooling and Servicing Agreement, (b) the Trust, the
Certificateholders, or the Certificate Owners for liabilities arising from
actions taken by the Trustee at the request of Certificateholders, (c) the
Trust, the Certificateholders, or the Certificate Owners for any losses,
claims, damages, or liabilities incurred by any of them in their capacities as
investors, including without limitation, losses incurred as a result of
Defaulted Receivables, or (d) the Trust, the Certificateholders, or the
Certificate Owners for any liabilities, costs, or expenses of the Trust, the
Certificateholders, or the Certificate Owners arising under any tax law,
including without limitation, any federal, state, or local income or franchise
tax or any other tax imposed on or measured by income (or any interest or
penalties with respect thereto or arising from a failure to comply therewith)
required to be paid by the Trust, the Certificateholders, or the Certificate
Owners in connection with the Pooling and Servicing Agreement to any taxing
authority.

    In addition, the Pooling and Servicing Agreement provides that, subject to
certain exceptions, the Transferor will indemnify the Trust and the Trustee
from and against any reasonable loss, liability, expense, damage, or injury
(other than to the extent that any of the foregoing relate to any tax law or
any failure to comply therewith) suffered or sustained by reason of any acts or
omissions or alleged acts or omissions arising out of or based upon the
arrangement created by the Pooling and Servicing Agreement as though the
Pooling and Servicing Agreement created a partnership under the Minnesota
Uniform Partnership Act in which the Transferor is a general partner.

    The Pooling and Servicing Agreement provides that, except for the foregoing
indemnities, neither the Transferor nor the Servicer nor any of their
respective directors, officers, employees, or agents will be under any
liability to the Trust, the Trustee, the Certificateholders, or any other
person for any action taken, or for refraining from taking any action pursuant
to the Pooling and Servicing Agreement. Neither the Transferor nor the Servicer
nor any of their respective directors, officers, employees, or agents will be
protected against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith, or gross negligence of the Transferor, the
Servicer, or any such person in the performance of its duties thereunder or by
reason of reckless disregard of obligations and duties thereunder. In addition,
the Pooling and Servicing Agreement provides that the Servicer is not under any
obligation to appear in, prosecute, or defend any legal action that is not
incidental to its servicing responsibilities under the Pooling and Servicing
Agreement and which in its opinion may expose it to any expense or liability.

    Under the Pooling and Servicing Agreement, the Transferor will be liable
directly to an injured party for the entire amount of any losses, claims,
damages or liabilities (other than those incurred by a Certificateholder in the
capacity of an investor in the Certificates) arising

                                       97
out of or based on the arrangement created by the Pooling and Servicing
Agreement or the actions of the Servicer taken pursuant to the Pooling and
Servicing Agreement as though the Pooling and Servicing Agreement created a
partnership under the Minnesota Uniform Partnership Act in which the Transferor
is a general partner. The Transferor will also pay, indemnify and hold harmless
each Certificateholder for any such losses, claims, damages or liabilities
(other than those incurred by a Certificateholder in the capacity of an
investor in the Certificates) except to the extent that they lapse from any
action by any Certificateholder. In the event of a Service Transfer, the
successor Servicer will indemnify the Transferor for any losses, claims,
damages and liabilities of the Transferor as described in this paragraph
arising from the actions or omissions of such successor.

Servicer Default

    In the event of any Servicer Default (as defined below), either the Trustee
or certificateholders representing undivided interests aggregating more than
50% of the aggregate investor interests for all outstanding Series, by written
notice to the Servicer (and to the Trustee if given by the certificateholders),
may terminate all of the rights and obligations of the Servicer as servicer
under the Pooling and Servicing Agreement and in and to the Receivables and the
proceeds thereof and the Trustee may appoint a new Servicer (a "Service
Transfer"). The rights and interest of the Transferor under the Pooling and
Servicing Agreement and in the Transferor Interest will not be affected by such
termination. Upon such termination, the Trustee will as promptly as possible
appoint a successor Servicer. If no such Servicer has been appointed and has
accepted such appointment by the time the Servicer ceases to act as Servicer,
all authority, power, and obligations of the Servicer under the Pooling and
Servicing Agreement will pass to and be vested in the Trustee. If the Trustee
is unable to obtain any bids from eligible servicers and the Servicer delivers
an Officer's Certificate to the effect that it cannot in good faith cure the
applicable Servicer Default, and if the Trustee is legally unable to act as a
successor Servicer, then the Trustee will give the Transferor the right to
accept reassignment of all of the Receivables on terms equivalent to the best
purchase offer as determined by the Trustee.

    A "Servicer Default" refers to any of the following events:

  (1)  failure by the Servicer to make any payment, transfer, or deposit, or
       to give instructions to the Trustee to make certain payments,
       transfers, or deposits within five business days after the date the
       Servicer is required to do so under the Pooling and Servicing
       Agreement or any Supplement; provided, however, that any such failure
       caused by a nonwillful act of the Servicer shall not constitute a
       Servicer Default if the Servicer promptly remedies such failure
       within five business days after receiving notice of such failure or
       otherwise becoming aware of such failure;

  (2) failure on the part of the Servicer duly to observe or perform in any
      respect any other covenants or agreements of the Servicer which has a
      material adverse effect on the certificateholders of any Series then
      outstanding and which continues unremedied for a period of 60 days
      after written notice of such failure, requiring the same to be
      remedied, shall have been given to the Servicer by the Trustee, or

                                       98
to the Servicer and the Trustee by holders of Certificates evidencing
      undivided interests aggregating not less than 50% of the Invested
      Amount of any Series materially adversely affected thereby and
      continues to have a material adverse effect on the certificateholders
      of any Series then outstanding for such period; or the delegation by
      the Servicer of its duties under the Pooling and Servicing Agreement,
      except as specifically permitted thereunder;

  (3) any representation, warranty, or certification made by the Servicer in
      the Pooling and Servicing Agreement, or in any certificate delivered
      pursuant to the Pooling and Servicing Agreement, proves to have been
      incorrect when made which has a material adverse effect on the
      certificateholders of any Series then outstanding, and which continues
      to be incorrect in any material respect for a period of 60 days after
      written notice of such failure, requiring the same to be remedied,
      shall have been given to the Servicer by the Trustee, or to the
      Servicer and Trustee by the holders of Certificates evidencing
      undivided interests aggregating not less than 50% of the Invested
      Amount of any Series materially adversely affected thereby and
      continues to have a material adverse effect on such certificateholders
      for such period; or

  (4)  the occurrence of certain events of bankruptcy, insolvency, or
       receivership of the Servicer.

    Notwithstanding the foregoing, a delay in or failure of performance
referred to in clause (1) above for a period of five business days, or referred
to under clause (2) or (3) for a period of 60 business days, will not
constitute a Servicer Default if such delay or failure could not be prevented
by the exercise of reasonable diligence by the Servicer and such delay or
failure was caused by an act of God or other similar occurrence. Upon the
occurrence of any such event, the Servicer will not be relieved from using its
best efforts to perform its obligations in a timely manner in accordance with
the terms of the Pooling and Servicing Agreement, and the Servicer will provide
the Trustee, any provider of credit enhancement, the Transferor, and the
holders of certificates of all Series outstanding prompt notice of such failure
or delay by it, together with a description of the cause of such failure or
delay and its efforts to perform its obligations.

    In the event of a Servicer Default due to the bankruptcy of the Servicer,
if no Servicer Default other than such bankruptcy or the insolvency of the
Servicer exists, the bankruptcy trustee or the Servicer itself as debtor-in-
possession may have the power to prevent either the Trustee or the majority of
the Certificateholders from effecting a Service Transfer.

Reports to Certificateholders

    On each Distribution Date, the Paying Agent will forward to each
Certificateholder of record (which is expected to be Cede & Co., as nominee for
DTC, unless Definitive Certificates are issued) a statement prepared by the
Servicer setting forth, among other things, with respect to such Series:

  (a) the total amount distributed,

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(b) the amount of the distribution allocable to principal on the Class A
      Certificates, the Class B Certificates, the Class C Certificates and
      the Class D Certificates,

  (c) the amount of such distribution allocable to interest on the Class A
      Certificates and the Class B Certificates,

  (d) the amount of Principal Collections processed during the related
      Monthly Period and allocated in respect of the Class A Certificates,
      the Class B Certificates, the Class C Certificates and the Class D
      Certificates, respectively,

  (e) the amount of Interest Collections processed during the preceding
      Monthly Period and allocated in respect of the Class A Certificates,
      the Class B Certificates, the Class C Certificates and the Class D
      Certificates, respectively,

  (f) the aggregate amount of Principal Receivables, the Invested Amount,
      the Class A Invested Amount, the Class B Invested Amount, the Class C
      Invested Amount, the Class D Invested Amount, the Floating Allocation
      Percentage, and during the Controlled Accumulation Period or Early
      Amortization Period, the ABC Fixed/Floating Allocation Percentage with
      respect to the Principal Receivables in the Trust as of the close of
      business on the Record Date,

  (g) the aggregate outstanding balance of Receivables which are current,
      30-59, 60-89 and 90 or more days delinquent as of the end of the day
      on the Record Date,

  (h) the Aggregate Investor Default Amount for the related Monthly Period,

  (i) the aggregate amount of Class A Investor Charge-Offs, Class B Investor
      Charge-Offs, Class C Investor Charge-Offs and Class D Investor Charge-
      Offs for the preceding Monthly Period,

  (j) the amount of the Monthly Servicing Fee for the preceding Monthly
      Period, and

  (k) the aggregate amount of funds in the Excess Funding Account as of the
      last day of the Monthly Period immediately preceding the Distribution
      Date.

Unless and until Definitive Certificates are issued, such reports with respect
to the Series 2001-1 Certificates will be sent to Cede & Co., as registered
holder of the Certificates and the nominee of DTC. Certificate Owners may
receive copies of such reports upon written request, together with a
certification that they are Certificate Owners and payment of reproduction and
postage expenses associated with the distribution of such reports, from the
Trustee. See "Reports to Certificateholders."

    The Paying Agent will furnish to each person who at any time during the
preceding calendar year was a Certificateholder of record (which is expected to
be Cede & Co., as nominee for DTC, unless Definitive Certificates are issued) a
statement prepared by the Servicer containing the information required to be
contained in the regular monthly report to Certificateholders, as set forth in
clauses (a), (b), and (c) above aggregated for such calendar year or the
applicable portion thereof during which such person was a Certificateholder,
together with, on or before March 31 of each year, such customary information
(consistent with the treatment of the Certificates as debt) as the Servicer or
Trustee deems necessary or

                                      100
desirable for tax reporting purposes. Moreover, as long as the
Certificateholder of record is Cede & Co., as nominee for DTC, Certificate
Owners will receive tax and other information from Participants and Indirect
Participant rather than from the Trustee.

Reports; Notices

    If the Offered Certificates are listed on the Luxembourg Stock Exchange,
the Trustee will publish or will cause to be published following each
Distribution Date in the Luxemburger Wort a notice to the effect that
Servicer's reports described above will be available for review at the main
office of the Listing Agent of the Trust in Luxembourg, Luxembourg.

    Following the listing of the Offered Certificates on the Luxembourg Stock
Exchange, notices to Certificateholders will be given by publication in the
Luxemburger Wort. In the event that Definitive Certificates are issued, notices
to Certificateholders will also be given by mail to the addresses of such
holders as they appear in the certificate register.

Evidence as to Compliance

    The Pooling and Servicing Agreement provides that on or before March 31 of
each calendar year, the Servicer will cause a firm of independent public
accountants which is a member of the American Institute of Certified Public
Accountants to furnish a report to the effect that such accounting firm has
examined selected documents and records relating to the servicing of the
Accounts in accordance with certain procedures agreed upon with the Servicer,
and that, on the basis of such agreed upon procedures, such firm states that
such servicing was conducted in compliance with the Pooling and Servicing
Agreement during the period covered by such report except for such significant
exceptions or errors in records that, in the opinion of such firm, generally
accepted auditing standards requires it to report.

Amendments

    The Pooling and Servicing Agreement and any Supplement may be amended by
the Transferor, the Servicer, and the Trustee, without the consent of
Certificateholders, for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of the Pooling and Servicing
Agreement and Supplements or of modifying in any manner the rights of the
Certificateholders; provided that (1) the Transferor delivers an opinion of
counsel acceptable to the trustee to the effect that the amendment will not
adversely affect in any material respect the interest of the
Certificateholders, and (2) the amendment will not result in a withdrawal or
reduction of the rating of any outstanding series.

    The Pooling and Servicing Agreement and the Supplement may be amended by
the Transferor, the Servicer, and the Trustee with the consent of the holders
of certificates evidencing undivided interests aggregating not less than 66
2/3% of the investor interests of each and every Series adversely affected (and
with respect to Series 2001-1, the holders of not less than 66 2/3% of the
Invested Amount of each Class of Certificates adversely

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affected), for the purpose of adding any provisions to, changing in any manner
or eliminating any of the provisions of the Pooling and Servicing Agreement, or
any Supplement or of modifying in any manner the rights of certificateholders
of any then outstanding Series. No such amendment, however, may (a) reduce in
any manner the amount of, or delay the timing of, distributions required to be
made on any such Series, (b) change the definition of or the manner of
calculating the interest of any certificateholder of such Series, or (c) reduce
the aforesaid percentage of investor interests the holders of which are
required to consent to any such amendment, in each case without the consent of
all certificateholders of all Series adversely affected. Promptly following the
execution of any amendment to the Pooling and Servicing Agreement, the Trustee
will furnish written notice of the substance of such amendment to each
Certificateholder. Any Supplement and any amendments regarding the addition or
removal of Receivables from the Trust will not be considered an amendment
requiring certificateholder consent under the provisions of the Pooling and
Servicing Agreement and any Supplement.

List of Certificateholders

    Upon written request of Certificateholders representing undivided interests
in the Trust aggregating not less than 10% of the Invested Amount, the Trustee,
after having been adequately indemnified by such Certificateholders for its
costs and expenses and having given the Servicer notice that such request has
been made, will afford such Certificateholders access during business hours to
the current list of Certificateholders of the Trust for purposes of
communicating with other Certificateholders with respect to their rights under
the Pooling and Servicing Agreement. See "--Book-Entry Registration" and "--
Definitive Certificates."

The Trustee

    The Transferor, the Servicer, and their respective affiliates may from time
to time enter into normal banking, lending and trustee relationships with the
Trustee and its affiliates. The Trustee, the Transferor, the Servicer, and any
of their respective affiliates may hold Certificates in their own names. In
addition, for purposes of meeting the legal requirements of certain local
jurisdictions, the Trustee will have the power to appoint a co-trustee or
separate trustees of all or any part of the Trust. In the event of such
appointment, all rights, powers, duties, and obligations conferred or imposed
upon the Trustee by the Pooling and Servicing 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 shall 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.

    The Trustee may resign at any time, in which event the Transferor will be
obligated to appoint a successor Trustee. The Transferor may also remove the
Trustee if the Trustee ceases to be eligible to continue as such under the
Pooling and Servicing Agreement or if the Trustee becomes insolvent. In such
circumstances, the Transferor will be obligated to appoint a successor Trustee.
Any resignation or removal of the Trustee and appointment of a

                                      102
successor Trustee does not become effective until acceptance of the appointment
by the successor Trustee.

    If the Trustee fails to perform any of its obligations under the Pooling
and Servicing Agreement, and a certificateholder delivers written notice of
such failure to the Trustee, and the Trustee shall not have corrected such
failure for 60 days thereafter, then the holders of investor certificates
representing more than 50% of the aggregate invested amount of all Series
(including related commitments) shall have the right to remove the Trustee and
(with the consent of the Transferor, which shall not be unreasonably withheld)
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.

                     DESCRIPTION OF THE PURCHASE AGREEMENT

    The following summary describes certain terms of the Receivables Purchase
Agreement (the "Purchase Agreement") and is qualified in its entirety by
reference to the Purchase Agreement.

Transfer of Receivables

    Pursuant to the Purchase Agreement, Conseco Finance has sold and
transferred to the Transferor all of its right, title and interest in and to
all of the outstanding Receivables and the Collateral Security as of the Cut-
off Date and will sell and transfer all of the Receivables thereafter created.
As described herein, pursuant to the Pooling and Servicing Agreement, the
Transferor has transferred to the Trust all of its right, title and interest in
and to the Purchase Agreement.

    In connection with each such sale or transfer of Receivables to the
Transferor, Conseco Finance will indicate in its computer files that such
Receivables have been sold or transferred to the Transferor, and that such
Receivables have been transferred by the Transferor to the Trust. In addition,
Conseco Finance will provide to the Transferor a computer file or microfiche or
written list containing a true and complete list of all such Receivables,
identifying the balances of the Receivables as of the Cut-off Date. The records
and agreements relating to such Accounts and Receivables will not be segregated
by Conseco Finance from other documents and agreements relating to other
accounts and receivables and will not be stamped or marked to reflect the sale
or transfer of such Receivables to the Transferor, but the computer records of
Conseco Finance will be marked to evidence such sale or transfer. Conseco
Finance will file UCC financing statements with respect to the Receivables
meeting the requirements of Minnesota state law. See "Risk Factors--Transfer of
the Receivables; Insolvency Risk Considerations" and "Certain Legal Aspects of
the Receivables--Transfer of Receivables."

Representations and Warranties

    Pursuant to the Purchase Agreement, Conseco Finance made certain
representations and warranties to the Transferor that, among other things, (a)
it has been duly incorporated and is

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in good standing and that it has the authority to consummate the transactions
contemplated by the Purchase Agreement and (b) as of the Cut-off Date (or, in
the case of an Additional Account, as of the specified cut-off Date and the
Addition Date), each Account or Additional Account was an Eligible Account.

    Pursuant to the Purchase Agreement, Conseco Finance will make certain
representations and warranties to the Transferor relating to the Receivables
that, among other things, (a) as of the Cut-off Date and each Closing Date,
each of the Accounts was an Eligible Account or, if it was or is an Ineligible
Account on such date, such Account is being removed from the Trust in
accordance with the requirements of the Pooling and Servicing Agreement, and
(b) as of the date any new Receivable is created, such Receivable is an
Eligible Receivable. In the event of a breach of any representation and
warranty set forth in this paragraph which results in an Ineligible Receivable
and the requirement that the Transferor accept retransfer of such Ineligible
Receivable pursuant to the Pooling and Servicing Agreement, then Conseco
Finance will be obligated to repurchase such Ineligible Receivable from the
Transferor on the date of such retransfer. The purchase price for such
Ineligible Receivable will be the face amount thereof plus any accrued and
unpaid interest thereon, of which at least the amount of any cash deposit
required to be made by the Transferor under the Pooling and Servicing Agreement
in respect of the retransfer of such Ineligible Receivable must be paid in
cash.

    Pursuant to the Purchase Agreement, Conseco Finance also made
representations and warranties to the Transferor that, among other things, as
of each Closing Date, (a) the Purchase Agreement constitutes a legal, valid and
binding obligation of Conseco Finance and (b) the Purchase Agreement
constitutes a valid sale or transfer to the Transferor of all right, title and
interest of Conseco Finance in and to the Receivables, whether then existing or
thereafter created in the Accounts, the Collateral Security, all related
security interests and other related rights and the proceeds thereof, which is
effective as to each Receivable upon the creation thereof. If the breach of any
of the representations and warranties described in this paragraph results in
the obligation of the Transferor under the Pooling and Servicing Agreement to
accept retransfer of the Receivables, Conseco Finance will be obligated to
repurchase the Receivables retransferred to Conseco Finance for an amount of
cash equal to the amount of cash the Transferor is required to deposit under
the Pooling and Servicing Agreement in connection with such retransfer.

    Conseco Finance has agreed to indemnify the Transferor and to hold the
Transferor harmless from and against any and all losses, damages and expenses
(including reasonable attorneys' fees) suffered or incurred by the Transferor
if the foregoing representations and warranties are materially false.

Certain Covenants

    Pursuant to the Purchase Agreement, Conseco Finance covenants that it will
perform its obligations under the agreements relating to the Receivables and
the Accounts in conformity with its then-current policies and procedures
relating to the Receivables and Accounts.

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Conseco Finance further covenants that, except for the sale and conveyance
under the Purchase Agreement and the interests created under the Pooling and
Servicing Agreement and the Series Supplement, Conseco Finance will not sell,
pledge, assign or transfer any interest in the Receivables to any other person.
Conseco Finance also covenants to defend and indemnify the Transferor for any
loss, liability or expense incurred by the Transferor in connection with a
breach by Conseco Finance of any of its representations, warranties or
covenants contained in the Purchase Agreement.

    In addition, Conseco Finance expressly acknowledges and consents to the
Transferor's assignment of its rights relating to the Receivables under the
Purchase Agreement to the Trustee.

Termination

    The Purchase Agreement will terminate immediately after the Trust
terminates. In addition, if Conseco Finance becomes party to any bankruptcy or
similar proceeding (other than as a claimant) and, if such proceeding is not
voluntary and is not dismissed within 60 days of its institution, Conseco
Finance will immediately cease to sell or transfer Receivables to the
Transferor and will promptly give notice of such event to the Transferor and to
the Trustee.

                    CERTAIN LEGAL ASPECTS OF THE RECEIVABLES

Transfer of Receivables

    On the Series 1995-1 Closing Date, Conseco Finance sold and assigned the
Receivables arising in the Initial Accounts to the Transferor pursuant to the
Purchase Agreement, and the Transferor immediately sold and assigned such
Receivables to the Trust pursuant to the Pooling and Servicing Agreement.
Conseco Finance has since designated Additional Accounts from time to time and
sold and assigned the Receivables arising in such Additional Accounts to the
Transferor, and the Transferor immediately sold and assigned such Receivables
to the Trust. The Transferor represented and warranted in the Pooling and
Servicing Agreement that each such sale to the Trust constituted a valid
transfer and assignment to the Trust of all right, title and interest of the
Transferor in and to the Receivables, except for the interest of any investor
certificate of any Series then held by it, or the grant to the Trust of a
security interest in the Receivables. The Transferor has also represented and
warranted in the Pooling and Servicing Agreement that, in the event the
transfer of the Receivables by the Transferor to the Trust is deemed to create
a security interest under the UCC, there will exist a valid, subsisting, and
enforceable first priority perfected security interest in such Receivables
created thereafter in favor of the Trust on and after their creation, subject
to certain tax liens. For a discussion of the Trust's rights arising from these
representations and warranties not being satisfied, see "Description of the
Offered Certificates--Representations and Warranties."

    Each of Conseco Finance and the Transferor has represented that the
Receivables are "general intangibles," "chattel paper" or "accounts" for
purposes of the UCC as in effect

                                      105
in Minnesota. If the Receivables are deemed to be general intangibles and the
transfer thereof by either Conseco Finance to the Transferor or by the
Transferor to the Trust is deemed to be a sale, Minnesota common law applies
and neither possession nor a financing statement is required. If the
Receivables are deemed to be general intangibles and the transfer thereof by
either Conseco Finance to the Transferor or by the Transferor to the Trust is
deemed to create a security interest, the UCC as in effect in Minnesota applies
and the transferee must file an appropriate financing statement or statements
in order to perfect its interest therein. If the Receivables are deemed to be
chattel paper and the transfer thereof by either Conseco Finance to the
Transferor or by the Transferor to the Trust is deemed either to be a sale or
to create a security interest, the UCC as in effect in Minnesota applies and
the transferee must either take possession of the chattel paper or file an
appropriate financing statement or statements in order to perfect its interest
therein. If the Receivables are treated as accounts and the transfer thereof by
either by Conseco Finance to the Transferor or the Transferor to the Trust is
deemed either to be a sale or create a security interest, the transferee must
file an appropriate financing statement or statements in order to perfect its
interest therein under the UCC as in effect in Minnesota. Financing statements
covering the Receivables will be filed under the UCC as in effect in Minnesota
by both the Transferor and the Trust to perfect their respective interests in
the Receivables and continuation statements will be filed as required to
continue the perfection of such interests. The Receivables will not be stamped
to indicate the interest of the Transferor or the Trustee.

      There are certain limited circumstances under the UCC and other
applicable law in which prior or subsequent transferees of Receivables could
have an interest in such Receivables with priority over the Trust's interest. A
purchaser of the Receivables that are chattel paper who gives new value and
takes possession of the instruments that evidence the Receivables (i.e., the
chattel paper) in the ordinary course of such purchaser's business may, under
certain circumstances, have priority over the interest of the Trust in such
Receivable. Under the Purchase Agreement, Conseco Finance warrants to the
Transferor, and under the Pooling and Servicing Agreement and the Series 2001-1
Supplement the Transferor warrants to the Trust, that the Receivables have been
transferred free and clear of the lien of any third party. Each of Conseco
Finance and the Transferor will also covenant that it will not sell, pledge,
assign, transfer or grant any lien on any Receivable or, except as described
under "Description of the Offered Certificates--Exchanges," the Exchangeable
Transferor's Certificate (or any interest therein) other than to the Trust. A
tax or other government lien on property of Conseco Finance or the Transferor
arising prior to the time a Receivable comes into existence may also have
priority over the interest of the Trust in such Receivable. In addition, while
Conseco Finance is the Servicer, cash collections on the Receivables may, under
certain circumstances, be commingled with the funds of Conseco Finance prior to
each Distribution Date and, in the event of bankruptcy of Conseco Finance, the
Trust may not have a perfected interest in such collections.

Certain Matters Relating to Bankruptcy

    Conseco Finance warrants to the Transferor in the Purchase Agreement that
the sale of the Receivables by it to the Transferor is a valid sale of the
Receivables to the Transferor. In

                                      106
addition, pursuant to the Purchase Agreement, Conseco Finance and the
Transferor have agreed to treat the transactions described herein as a sale of
such Receivables to the Transferor, and Conseco Finance will take all actions
that are required under Minnesota law to perfect the Transferor's ownership
interest in the Receivables. Notwithstanding the foregoing, if Conseco Finance
were to become a debtor in a bankruptcy case and a creditor or trustee-in-
bankruptcy of Conseco Finance or Conseco Finance itself as debtor-in-possession
were to take the position that the sale of Receivables from Conseco Finance to
the Transferor should be recharacterized as a pledge of such Receivables to
secure a borrowing from Conseco Finance, then delays in payments of collections
of Receivables to the Transferor could occur or (should the court Rule in favor
of any such trustee, debtor-in-possession or creditor) reductions in the amount
of such payments could result.

    It is possible that the risk of recharacterization may be increased by the
following factors:

  .   the Transferor will initially retain the Class C Certificates, the
      Class D Certificates and its other interests in the Trust.

  .   Conseco Finance may guarantee the Class D Certificates if they are
      sold.

  .   for accounting purposes, Conseco Finance and the Transferor will treat
      the Certificates as debt and the transfer of the Receivables allocable
      to Series 2001-1 from Transferor to the Trust as a pledge rather than
      a sale.

If the transfer of Receivables to the Transferor were respected as a sale, the
Receivables would not be part of Conseco Finance's bankruptcy estate and would
not be available to Conseco Finance's creditors.

    In addition, if Conseco Finance were to become a debtor in a bankruptcy
case and a creditor or trustee-in-bankruptcy of such debtor or Conseco Finance
itself were to request a court to order that Conseco Finance should be
substantively consolidated with the Transferor, delays in payments on the
Certificates could result. Should the bankruptcy court Rule in favor of any
such creditor, trustee-in-bankruptcy or Conseco Finance, reductions in such
payments could result.

    The Transferor warrants to the Trust that the transfer of the Receivables
to the Trust is a sale of the Receivables to the Trust or the grant of a
security interest in the Receivables to the Trust. The Transferor is required
to take all actions that are required under Minnesota law to perfect the
Trust's ownership interest or security interest in the Receivables and the
Transferor warrants to the Trust that the Trust will at all times have a first
priority perfected ownership interest or security interest therein and, with
certain exceptions, the proceeds thereof. Nevertheless, a tax or government
lien on property of Conseco Finance or the Transferor arising prior to the time
a Receivable is conveyed to the Trust may have priority over the interest of
the Trust in such Receivable. The Transferor's certificate of incorporation
provides that, under certain circumstances, the Transferor is required to have
two independent directors (as defined therein) in which event it shall not file
a voluntary application for relief under Title 11 of the United States Code
(the "Bankruptcy Code") without the affirmative vote of its two independent
directors. Pursuant to the Pooling and

                                      107
Servicing Agreement, the Trustee, all certificateholders and any credit
enhancement provider with respect to any other series have covenanted that they
will not at any time institute against the Transferor any bankruptcy,
reorganization or other proceedings under any federal or state bankruptcy or
similar law. Notwithstanding such steps, if the Transferor were to become a
debtor in a bankruptcy case, and a bankruptcy trustee for the Transferor or the
Transferor as debtor in possession or a creditor of the Transferor were to take
the position that the transfer of the Receivables from the Transferor to the
Trust should be recharacterized as a pledge of such Receivables, then delays in
payments on the Certificates or (should the court Rule in favor of any such
trustee, debtor in possession or creditor) reductions in the amount of such
payments could result. The risk of such a recharacterization may be increased
by the factors set forth in the second preceding paragraph.

    The Transferor does not intend to file, and Conseco Finance has agreed that
it will not cause the Transferor to file, a voluntary application for relief
under the Bankruptcy Code or any similar applicable state law with respect to
the Transferor so long as the Transferor is solvent and does not foresee
becoming insolvent.

    If Conseco Finance or the Transferor were to become a debtor in a
bankruptcy case causing a Pay Out Event to occur, then, pursuant to the
Purchase Agreement, new Receivables would no longer be transferred to the
Transferor and, pursuant to the Pooling and Servicing Agreement, only
collections on Receivables theretofore sold to the Transferor and transferred
to the related Trust would be available to be applied to pay interest accruing
on the Certificates and to pay the principal amount of the Certificates. Under
such circumstances, the Servicer is obligated to allocate all Principal
Collections to the oldest principal balance first. If such allocation method
were to be altered by the bankruptcy court, the rate of payment on the
Certificates might be adversely affected. In addition, distributions of
principal on each Certificate would not be subject to the applicable Controlled
Accumulation Amount. If the only Pay Out Event to occur is either the
insolvency of the Transferor or the appointment of a bankruptcy trustee or
receiver for the Transferor, the receiver or bankruptcy trustee for the
Transferor may have the power to continue to require the Transferor to transfer
new Principal Receivables to the Trust and to prevent the early sale,
liquidation, or disposition of the Receivables and the commencement of the
Early Amortization Period. See "Description of the Offered Certificates--Pay
Out Events."

    The occurrence of certain events of bankruptcy, insolvency or receivership
with respect to the Servicer will result in a Servicer Default, which Servicer
Default, in turn, will result in a Pay Out Event. If no other Servicer Default
other than the commencement of such bankruptcy or similar event exists, a
trustee-in-bankruptcy of the Servicer may have the power to prevent either the
Trustee or the Certificateholders from appointing a successor Servicer.

    Payments made in respect of repurchases of Receivables by Conseco Finance
or the Transferor pursuant to the Pooling and Servicing Agreement and the
Series 2001-1 Supplement may be recoverable by Conseco Finance or the
Transferor, as debtor in possession, or by a creditor or a trustee-in-
bankruptcy of Conseco Finance or the Transferor as a preferential transfer from
Conseco Finance or the Transferor if such payments are made

                                      108
within one year prior to the filing of a bankruptcy case in respect of Conseco
Finance or the Transferor.

    In Octagon Gas Systems, Inc. v. Rimmer, 995 F.2d 948 (10th Cir. 1993), the
United States Court of Appeals for the 10th Circuit suggested that even where a
transfer of accounts from a seller to a buyer constitutes a "true sale," the
accounts would nevertheless constitute property of the seller's bankruptcy
estate in a bankruptcy of the seller. If Conseco Finance or the Transferor were
to become subject to a bankruptcy proceeding and a court were to follow the
Octagon court's reasoning, Certificateholders might experience delays in
payment or possibly losses in their investment in the Certificates. Counsel has
advised the seller that the reasoning of the Octagon case appears to be
inconsistent with established precedent and the UCC. In addition, because
Conseco Finance, the Transferor, the Trust and the transaction governed by the
Pooling and Servicing Agreement do not have any particular link to the 10th
Circuit, it is unlikely that Conseco Finance or the Transferor would be subject
to a receivership proceeding in the 10th Circuit. Accordingly, the Octagon case
should not be binding precedent on a court in a receivership proceeding.

Security Interests in the Related Products

    The Transferor represents and warrants in the Pooling and Servicing
Agreement that each Receivable is at the time of creation secured by a first
priority security interest in the related product or accounts receivable.
Generally, under applicable state laws, a security interest in goods or
accounts receivable which secure wholesale financing obligations may be
perfected by the filing of UCC financing statements. Conseco Finance endeavors
to take all actions necessary under applicable state laws to perfect Conseco
Finance's (or a subsidiary's) security interest in such goods and accounts
receivable. However, at the time a product is sold or an account receivable is
paid, Conseco Finance's (or a subsidiary's) security interest therein will
terminate. Therefore, if a Dealer fails to remit to Conseco Finance amounts
owed with respect to a product that has been sold or an account receivable that
has been paid, the related Receivables will no longer be secured by such goods
or accounts receivable.

                        FEDERAL INCOME TAX CONSEQUENCES

    Set forth below is a discussion of the material federal income tax
consequences to Certificate Owners. This discussion is based upon present
provisions of the Internal Revenue Code of 1986, as amended (the "Code"), the
regulations promulgated thereunder, and judicial or ruling authority, all of
which are subject to change (which may be retroactive). Dorsey & Whitney LLP,
counsel to Conseco Finance and the Transferor ("Counsel"), is delivering its
opinion regarding certain federal income tax matters discussed below. The
opinion of Counsel specifically addresses only those issues specifically
identified below as being covered by such opinion; however, the opinion of
Counsel also states that the additional discussion set forth below accurately
sets forth Counsel's advice with respect to material tax issues. No ruling on
any of the issues discussed below will be sought from the Internal Revenue
Service (the "IRS"). This discussion does not deal with all aspects of

                                      109
federal income taxation that may be relevant to Offered Certificate Owners in
light of their personal investment circumstances, nor to certain types of
owners subject to special treatment under the federal income tax laws (e.g.,
banks, life insurance companies and tax-exempt organizations). Prospective
investors are encouraged to consult their own tax advisors with regard to the
federal income tax consequences of owning and disposing of the Certificates, as
well as the tax consequences arising under the laws of any applicable state,
foreign country or other jurisdiction.

    Treatment of the Certificates as Indebtedness of the Transferor. The
Transferor and the holders of Certificates will express in the Pooling and
Servicing Agreement the intent that, for federal, state and local income and
franchise tax purposes, the Offered Certificates will be indebtedness secured
by the Receivables and any other Trust assets allocable to the Offered
Certificates. The Transferor, by entering into the Pooling and Servicing
Agreement, and each Offered Certificate Owner, by the acceptance of an interest
in an Offered Certificate, will agree to treat the Offered Certificates as
indebtedness for federal, state and local income and franchise tax purposes.

    The determination of whether the economic substance of a property transfer
is a sale or a loan secured by the transferred property has been made by the
IRS and the courts on the basis of numerous factors designed to determine
whether the transferor has relinquished (and the transferee has obtained)
substantial incidents of ownership in the property. Among those factors, the
primary factors examined are whether the transferee has the opportunity to gain
if the property increases in value and bears the risk of loss if the property
decreases in value. Based upon an analysis of such factors, Counsel's opinion
provides that for federal income tax purposes the Offered Certificates will be
characterized as indebtedness secured by the Receivables and any other Trust
assets, and the Trust will not be characterized as an "association," "publicly
traded partnership" or "taxable mortgage pool" taxable as a corporation.

    Interest Income to Certificate Owners. Assuming the Offered Certificates
are debt obligations for federal income tax purposes, interest on the Offered
Certificates will be taxable as ordinary interest income when received by
Certificate Owners utilizing the cash-basis method of accounting and when
accrued by Certificate Owners utilizing the accrual method of accounting. Under
the applicable regulations, the Offered Certificates would be considered issued
with original issue discount ("OID") if the "stated redemption price at
maturity" of an Offered Certificate (generally equal to its principal amount as
of the date of issuance plus all interest other than "qualified stated
interest" payable prior to or at maturity) exceeds the original issue price (in
this case, the initial offering price at which a substantial amount of the
Offered Certificates are sold to the public). Any OID would be considered de
minimis under the regulation if it does not exceed 0.25% of the stated
redemption price at maturity of an Offered Certificate multiplied by the number
of full years until its maturity date. It is anticipated that the Offered
Certificates will not be considered issued with more than de minimis OID. Under
the OID regulations, an owner of an Offered Certificate issued with a de
minimis amount of OID must include such OID in income, on a pro rata basis, as
principal payments are made on the Offered Certificate.

                                      110
While it is not anticipated that the Offered Certificates will be issued
with more than de minimis OID, it is possible that they will be so issued or
will be deemed to be issued with OID. This deemed OID could arise, for example,
if interest payments on the Offered Certificates are not deemed to be
"qualified stated interest" because the Offered Certificates do not provide for
default remedies ordinarily available to holders of debt instruments or because
no penalties are imposed as a result of any failure to make interest payments
on the Offered Certificates. In addition, under the OID regulations, certain
variable interest rates, including rates based upon the weighted average
interest rate of the Receivables, may not be treated as qualified stated
interest. Based upon existing authority, however, the Transferor and the
Trustee will treat interest payments on the Offered Certificates as qualified
stated interest under the OID regulations. If the Offered Certificates are
issued or are deemed to be issued with OID, all or a portion of the taxable
income to be recognized with respect to the Offered Certificates would be
includible in the income of Certificate Owners as OID. Any amount treated as
OID would not, however, be includible again when the amount is actually
received. If the yield on a class of Offered Certificates were not materially
different from its coupon, this treatment would have no significant effect on
Certificate Owners using the accrual method of accounting. However, cash method
Certificate Owners may be required to report income with respect to the Offered
Certificates in advance of the receipt of cash attributable to such income.

    A Certificate Owner must include OID in income as interest over the term of
the Offered Certificate under a constant yield method. In general, OID must be
included in income in advance of the receipt of cash representing that income.
Each Certificate Owner should consult its own tax advisor regarding the impact
of the OID rules if the Offered Certificates are issued with OID.

    A Certificate Owner who purchases an Offered Certificate at a discount may
be subject to the "market discount" rules of the Code. These rules provide, in
part, for the treatment of gain attributable to accrued market discount as
ordinary income upon the receipt of partial principal payments or on the sale
or other disposition of the Offered Certificate, and for the deferral of
interest deductions with respect to debt incurred to acquire or carry the
market discount Offered Certificate. A Certificate Owner who purchases an
Offered Certificate at a premium may elect to amortize and deduct this premium
over the remaining term of the Offered Certificate in accordance with rules set
forth in Section 171 of the Code.

    As an alternative to the above treatments, accrual method Certificate
Owners may elect to include in gross income all interest with respect to an
Offered Certificate, including stated interest, acquisition discount, OID, de
minimis OID, market discount, de minimis market discount, and unstated
interest, as adjusted by any amortizable bond premium or acquisition premium,
using the constant yield method.

    Disposition of Offered Certificates. Generally, gain or loss will be
recognized on a sale or other taxable disposition of Offered Certificates in an
amount equal to the difference between the amount realized and the seller's tax
basis in the Offered Certificates. A Certificate Owner's tax basis in an
Offered Certificate will generally equal the cost thereof increased by any OID,
market discount and gain previously included by such Certificate

                                      111
Owner in income with respect to the Offered Certificate and decreased by any
bond premium previously amortized and any principal payments previously
received by such Certificate Owner with respect to the Offered Certificate. Any
such gain or loss will be capital gain or loss if the Offered Certificate was
held as a capital asset, except for gain representing accrued interest and
accrued market discount not previously included in income. Any such capital
gain would be taxed at long-term rates if the Offered Certificate is held for
more than one year and at short-term rates if held for not more than one year.

    Information Reporting and Backup Withholding. The Trustee will be required
to report annually to the IRS, and to each Offered Certificateholder of record,
the amount of interest paid on the Offered Certificates (and the amount of
interest withheld for federal income taxes, if any) for each calendar year,
except as to exempt holders (generally, holders that are corporations, tax-
exempt organizations, qualified pension and profit-sharing trusts, individual
retirement accounts, or nonresident aliens who provide certification of their
status as nonresidents). As long as the only "Certificateholder" of record is
Cede & Co., as nominee for DTC, Certificate Owners and the IRS will receive tax
and other information only from Participants and Indirect Participants rather
than from the Trustee. Each nonexempt Certificate Owner will be required to
provide, under penalties of perjury, a certificate on IRS Form W-9 containing
the Certificate Owner's name, address, federal taxpayer identification number
and a statement that such Certificate Owner is not subject to backup
withholding. Should a nonexempt Certificate Owner fail to provide the required
certification, the Trustee (or the Participants or Indirect Participants) will
be required to withhold (or cause to be withheld) 31% of the interest (and
principal) otherwise payable to the Certificate Owner, and remit the withheld
amounts to the IRS as a credit against the Certificate Owner's federal income
tax liability.

    Possible Classification of the Trust as a Partnership or Association. As
described above, it is the opinion of Counsel that for federal income tax
purposes the Offered Certificates will be characterized as debt and the Trust
will not be characterized as an association, publicly traded partnership or
taxable mortgage pool taxable as a corporation. However, this opinion is not
binding on the IRS and no assurance can be given that this characterization
will be sustained.

    If the IRS were to contend successfully that any class of Certificates is
not debt for federal income tax purposes, the Trust might be classified for
federal income tax purposes as a partnership, an association taxable as a
corporation, or a publicly traded partnership taxable as a corporation. In the
opinion of Counsel, if the Class C Certificates were sold to investors and the
IRS were to contend successfully that the Class C Certificates were not debt
for federal income tax purposes (assuming that neither the Class A or Class B
Certificates, nor certificates of any other outstanding series, were also
recharacterized) the arrangement among the Transferor and the Class C
Certificateholders would be classified as a partnership for federal income tax
purposes and would not be treated as a publicly traded partnership because of
an exception for (1) an entity whose income is interest income that is not
derived in the conduct of a financial business or (2) partnership interests
that are privately placed. In such case, the partnership would not be subject
to federal income tax. If the Class A or

                                      112
Class B Certificates are treated as equity interests in a partnership, the
partnership would in all likelihood be treated as a publicly traded
partnership. A publicly traded partnership is, in general, taxable as a
corporation. If the partnership were nevertheless not taxable as a corporation
because of an exception for an entity whose income is interest income that is
not derived in the conduct of a financial business, it would not be subject to
federal income tax. Rather, each item of income, gain, loss, deduction and
credit generated through the ownership of the Receivables by the partnership
would be passed through to the partners in the partnership (including the
Certificate Owners) according to their respective interests therein.

    The income reportable by the Certificate Owners as partners in such a
partnership could differ from the income reportable by them as holders of debt.
However, except as provided below, it is not expected that such differences
would be material. If the Certificate Owners were treated as partners, a cash-
basis Certificate Owner might be required to report income when it accrues to
the partnership rather than when it is received by the Certificate Owner.
Moreover, if the Offered Certificates are interests in a partnership, an
individual Certificate Owner's share of expenses of the partnership would be
miscellaneous itemized deductions that might not be deductible in whole or in
part, causing the Certificate Owner to be taxable on a greater amount of income
than the stated interest on the Offered Certificates. Finally, if any class of
Certificates is treated as equity in a partnership in which other Certificates
are debt, all or part of a tax-exempt Certificate Owner's share of income from
Certificates treated as equity would be treated as unrelated debt-financed
income taxable to the Certificate Owner.

    Alternatively, if the Trust were treated as either an association taxable
as a corporation, a publicly traded partnership or taxable mortgage pool
taxable as a corporation, the resulting entity would be subject to federal
income taxes at corporate tax rates on its taxable income generated by
ownership of the Receivables. Distributions by the entity (other than interest
distributions on classes of Certificates properly characterized as debt) would
probably not be deductible in computing the entity's taxable income. Such an
entity-level tax could result in reduced distributions to Certificate Owners,
and the Certificate Owners could be liable for a share of such a tax. Moreover,
all or part of the distributions on Certificates treated as equity would
probably be treated as dividend income to the recipients, although such
dividends might, under certain circumstances, be eligible for the dividends
received deduction under the Code.

    Since the Transferor will treat the Offered Certificates as indebtedness
for federal income tax purposes, the Trustee (and Participants and Indirect
Participants) will not comply with the tax reporting requirements that would
apply under these alternative characterizations of the Offered Certificates.

    Foreign Investors. If, in accordance with the opinion of Counsel, the
Offered Certificates are classified as debt for federal income tax purposes,
the following information describes the federal income tax treatment of
investors that are not U.S. persons (each a "Foreign Person"). The term
"Foreign Person" means any person other than (1) a citizen or resident of the
United States, (2) a corporation, partnership or other entity organized in or

                                      113
under the laws of the United States or any state, including the District of
Columbia (unless in the case of a partnership, the Treasury Regulations provide
otherwise) subdivision thereof, (3) an estate the income of which is includible
in gross income for U.S. federal income tax purposes, regardless of its source
or (4) a trust if (A) a court within the United States is able to exercise
primary supervision over the administration of the trust and one or more United
States persons have authority to control all substantial decisions of the trust
or (B) the trust was in existence on August 20, 1996, was treated as a United
States person at that time and has in effect an election to continue to be so
treated.

  (a) Interest paid or accrued to a Foreign Person would be exempt from U.S.
      withholding taxes (including backup withholding taxes); provided that
      the Foreign Person complies with applicable identification
      requirements (and does not actually or constructively own 10% or more
      of the voting stock of Conseco Finance, is not a controlled foreign
      corporation with respect to Conseco Finance and is not a bank
      receiving interest described in Section 881(c)(3)(A) of the Code).
      Applicable identification requirements will be satisfied if there is
      delivered to a securities clearing organization (or bank or other
      financial institution that holds the Offered Certificates on behalf of
      the customer in the ordinary course of its trade or business) (i) IRS
      Form W-8 or substitute form signed under penalties of perjury by the
      beneficial owner of the Offered Certificates stating that the owner is
      not a U.S. person and providing the owner's name and address, (ii) IRS
      Form 1001 or substitute form signed by the beneficial owner of the
      Offered Certificates or the owner's agent claiming exemption from
      withholding under an applicable tax treaty, or (iii) IRS Form 4224 or
      substitute form signed by the beneficial owner of the Offered
      Certificates or the owner's agent claiming exemption from withholding
      of tax on income connected with the conduct of a trade or business in
      the United States; provided that in any such case (x) the applicable
      form is delivered pursuant to applicable procedures and is properly
      transmitted to the United States entity otherwise required to withhold
      tax and (y) none of the entities receiving the form has actual
      knowledge that the owner is a U.S. person or that any certification on
      the form is false.

  (b) An owner of an Offered Certificate who is a Foreign Person will not be
      subject to United States federal income tax on gain realized on the
      sale, exchange or redemption of the Offered Certificate, provided that
      (i) the gain is not effectively connected to a trade or business
      carried on by the owner in the United States, (ii) in the case of an
      owner who is an individual, the owner is not present in the United
      States for 183 days or more during the taxable year in which the sale,
      exchange or redemption occurs, (iii) in the case of gain representing
      accrued interest, the conditions described in clause (a) are
      satisfied, and (iv) the Offered Certificate was held as a capital
      asset.

  (c) If the interest, gain or income on an Offered Certificate held by a
      Foreign Person is effectively connected with the conduct of a trade or
      business in the United States by the Foreign Person, the holder
      (although exempt from the withholding tax previously discussed if an
      appropriate statement is furnished) generally will be

                                      114
subject to United States federal income tax on the interest, gain or
      income at regular federal income tax rates. In addition, if the
      Foreign Person is a foreign corporation, it may be subject to a branch
      profits tax equal to 30 percent of its "effectively connected earnings
      and profits" within the meaning of the Code for the taxable year, as
      adjusted for certain items, unless it qualifies for a lower rate under
      an applicable tax treaty.

  (d) An Offered Certificate owned by an individual who at the time of death
      is a nonresident alien will not be subject to United States federal
      estate tax as a result of the owner's death if, immediately before his
      death, (i) the decedent did not actually or constructively own 10% or
      more of the voting stock of Conseco Finance and (ii) the ownership of
      the Offered Certificate was not effectively connected with the conduct
      by the decedent of a trade or business in the United States.

    Final regulations dealing with withholding tax on income paid to foreign
persons, backup withholding tax, and related matters (the "New Withholding
Regulations") were issued by the Treasury Department on October 6, 1997. The
New Withholding Regulations will generally be effective for payments made after
December 31, 2000, subject to certain transition rules. In certain
circumstances, the New Withholding Regulations may impose stricter
certification requirements than the regulations presently in effect.
Prospective holders of Offered Certificates are urged to consult their own tax
advisors with respect to the New Withholding Regulations.

    If the IRS were to contend successfully that the Offered Certificates are
equity interests in a partnership (not taxable as a corporation), a Certificate
Owner that is a Foreign Person might be required to file a U.S. income tax
return and pay tax on its share of partnership income at regular U.S. rates,
including, in the case of a corporation, the branch profits tax (and would be
subject to withholding tax on its share of partnership income). If the Offered
Certificates are recharacterized as equity interests in an association taxable
as a corporation or a publicly traded partnership taxable as a corporation, an
owner who is a Foreign Person would generally be taxed (and be subject to
withholding) on the gross amount of the distributions on the Offered
Certificates, to the extent they are treated as dividends, at the rate of 30%
(unless the rate is reduced by applicable treaty).

State and Local Tax Consequences

    The activities to be undertaken by the Servicer in servicing and collecting
the Receivables will take place in Minnesota. The State of Minnesota imposes an
income tax on individuals, trusts and estates and a franchise tax measured by
net income on corporations. This discussion of Minnesota taxation is based upon
current statutory provisions and the regulations promulgated thereunder, and
applicable judicial or ruling authority, all of which are subject to change
(which may be retroactive). No ruling on any of the issues discussed below will
be sought from the Minnesota Department of Revenue.

                                      115
If the Offered Certificates are treated as debt for federal income tax
purposes, in the opinion of Counsel this treatment will also apply for
Minnesota tax purposes, and the Trust will not be characterized as an
association, publicly traded partnership or taxable mortgage pool taxable as a
corporation for Minnesota tax purposes. Certificate Owners not otherwise
subject to Minnesota income or franchise taxation would not become subject to
such a tax solely because of their ownership of the Offered Certificates.
Certificate Owners already subject to income or franchise taxation in Minnesota
could, however, be required to pay such a tax on all or a portion of the income
generated from ownership of the Offered Certificates.

    If the Trust is treated as a partnership (not taxable as a corporation) for
federal income tax purposes, in the opinion of Counsel the Trust would also be
treated as such a partnership for Minnesota income tax purposes. The
partnership therefore would not be subject to Minnesota taxation. Certificate
Owners that are not otherwise subject to Minnesota income or franchise taxation
would not become subject to such a tax solely because of their interests in the
constructive partnership. Certificate Owners already subject to income or
franchise taxation in Minnesota could, however, be required to pay such a tax
on all or a portion of the income from the constructive partnership.

    If the Offered Certificates are treated as ownership interests in an
association or publicly traded partnership taxable as a corporation, in the
opinion of Counsel this treatment would also apply for Minnesota income and
franchise tax purposes. Pursuant to this treatment, the Trust would be subject
to the Minnesota franchise tax measured by net income (which could result in
reduced distributions to Certificate Owners). Certificate Owners that are not
otherwise subject to Minnesota income or franchise taxation would not become
subject to such a tax solely because of their interests in the constructive
corporation. Certificate Owners already subject to income or franchise taxation
in Minnesota could, however, be required to pay such a tax on all or a portion
of the income from the constructive corporation.

    Because state tax laws vary, it is not possible to describe the tax
consequences to the Certificate Owners in all of the states. Certificate Owners
are therefore urged to consult their own tax advisors with respect to the state
tax treatment of the Offered Certificates and income derived therefrom.

                              ERISA CONSIDERATIONS

    Section 406 of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), and Section 4975 of the Internal Revenue Code prohibit a
pension, profit-sharing or other employee benefit plan from engaging in various
transactions involving "plan assets" with persons that are "parties in
interest" under ERISA or "disqualified persons" under the Code with respect to
the plan. A violation of these "prohibited transaction" rules may generate
excise tax and other liabilities under ERISA and the Code for such person. For
example, a prohibited transaction would arise, unless an exemption were
available, if the Class A Certificates were viewed as debt of the Seller and
the Seller

                                      116
were a disqualified person or party in interest with respect to a plan that
acquired Class A Certificates.

    Moreover, additional prohibited transactions could arise if the assets of
the Trust were deemed to constitute assets of any plan that owned Class A
Certificates. The Department of Labor has issued a final regulation, known as
the plan assets regulation, 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. These plans and accounts are collectively
referred to in this prospectus as "benefit plans". Under the plan assets
regulation the assets and properties of certain corporations, partnerships and
certain other entities in which a benefit plan acquires an "equity interest"
could be deemed to be assets of the benefit plan in some circumstances.
Accordingly, if benefit plans purchase Class A Certificates, the trust could be
deemed to hold plan assets of those benefit plans unless one of the exceptions
under the plan assets regulation is applicable to the trust.

    Class B Certificates will not be eligible for purchase by benefit plans.

Availability of Exemptions for Class A Certificates

    The plan assets regulation contains an exception, known as the "publicly-
offered securities exemption," that provides that if a benefit plan acquires a
"publicly-offered security," the issuer of the security is not deemed to hold
plan assets. A publicly-offered security is a security that is (i) freely
transferable, (ii) part of a class of securities that is owned by 100 or more
investors independent of the issuer and of one another and (iii) either is (A)
part of a class of securities registered under Section 12(b) or 12(g) of the
Exchange Act or (B) sold to the benefit plan as part of an offering of
securities to the public pursuant to an effective registration statement under
the Securities Act and the class of securities of which such security is a part
is registered under the Exchange Act within 120 days, or any later time that
may be allowed by the Securities and Exchange Commission, after the end of the
fiscal year of the issuer during which the offering of the securities to the
public occurred.

    It is anticipated that the Class A Certificates will meet the criteria of
the publicly-offered securities exemption as set forth above. The underwriters
expect, although they cannot give any assurance, that the Class A Certificates
will be held by at least 100 persons independent of the trust and of each other
at the conclusion of the offering; there are no restrictions imposed on the
transfer of the Class A Certificates; and the Class A Certificates will be sold
as part of an offering pursuant to an effective registration statement under
the Securities Act, and then will be timely registered under the Exchange Act.
The underwriters will notify the Trustee as to whether or not the Class A
Certificates will be held by 100 independent persons at the conclusion of the
offering. The transferor will not, however, determine whether the 100-investor
requirement of the publicly-offered securities exemption is satisfied with
respect to the Class A Certificates.

    If the Class A Certificates fail to meet the criteria of the publicly-
offered securities exemption and the trust's assets are deemed to include
assets of benefit plans that are holders of those Certificates, transactions
involving the trust and "parties in interest" or "disqualified

                                      117
persons" with respect to such benefit plans might be prohibited under Section
406 of ERISA and Section 4975 of the Internal Revenue Code unless another ERISA
prohibited transaction exemption is applicable. Thus, for example, if a
participant in any benefit plan is an obligor or guarantor of any receivable,
under Department of Labor interpretations the purchase of the Class A
Certificates by that benefit plan could constitute a prohibited transaction.
There are five class exemptions issued by the Department of Labor that may
apply in such event: (1) Department of Labor Prohibited Transaction Exemption
84-14 (Class Exemption for Plan Asset Transactions Determined by Independent
Qualified Professional Asset Managers), (2) Department of Labor Prohibited
Transaction Exemption 91-38 (Class Exemption for Certain Transactions Involving
Bank Collective Investment Funds), (3) Department of Labor Prohibited
Transaction Exemption 90-1 (Class Exemption for Transactions Involving
Insurance Company Pooled Separate Accounts), (4) Department of Labor Prohibited
Transaction Exemption 95-60 (Class Exemption for Transactions Involving
Insurance Company General Accounts), and (5) Department of Labor Prohibited
Transaction Exemption 96-23 (Class Exemption for Plan Asset Transactions
Determined by In-House Asset Managers). We cannot assure you that these
exemptions, even if all of the conditions specified therein are satisfied, will
apply to all transactions involving the trust's assets.

Review by Benefit Plan Fiduciaries

    Due to the complexity of these rules and the penalties imposed upon persons
involved in prohibited transactions, it is especially important that any
benefit plan fiduciary who proposes to cause a benefit plan to purchase Class A
Certificates should consult with its own counsel with respect to the potential
consequences under ERISA and the Internal Revenue Code of the benefit plan's
acquisition and ownership of Class A Certificates. Assets of a benefit plan
should not be invested in the Class A Certificates unless it is clear that the
assets of the trust will not be plan assets or unless it is clear that a
prohibited transaction class exemption will apply and exempt all potential
prohibited transactions.

    In addition, prospective benefit plan investors should consult with their
legal advisors concerning the impact of ERISA and the Internal Revenue Code,
the applicability of the publicly-offered securities exemption, and the
potential consequences in their specific circumstances, prior to making an
investment in the Class A Certificates. Moreover, each benefit plan fiduciary
should determine whether under the general fiduciary standards of investment
prudence and diversification, an investment in the Class A Certificates is
appropriate for the benefit plan, taking into account the overall investment
policy of the benefit plan and the composition of the benefit plan's investment
portfolio.

                                      118
UNDERWRITING

    Subject to the terms and conditions set forth in an Underwriting Agreement
dated        , 2001 (the "Underwriting Agreement"), among the Transferor,
Conseco Finance and the underwriters named below (the "Underwriters"), the
Transferor has agreed to sell to each of the Underwriters, and each of the
Underwriters has severally agreed to purchase from the Transferor, the
principal amount of the Offered Certificates set forth opposite its name below.
Amount of    Amount of
                                                         Class A      Class B
     Underwriters                                      Certificates Certificates
     ------------                                      ------------ ------------
[Underwriters]................................... $            $
                                                       ------------ -----------
         Total........................................ $            $
                                                       ============ ===========
In the Underwriting Agreement, the Underwriters have agreed, subject to the
terms and conditions set forth therein, to purchase all of the Offered
Certificates offered hereby if any Offered Certificates are purchased.

    The Transferor has been advised by the Underwriters that the Underwriters
intend to offer the Class A Certificates to the public at the public offering
price set forth on the cover page of the Prospectus, and to certain dealers at
such price less a concession not in excess of    % of the principal amount of
the Class A Certificates. The Transferor has been advised by the Underwriters
that the Underwriters propose initially to offer the Class B Certificates to
the public at the public offering price set forth on the cover page of this
Prospectus, and to certain dealers at such price less a concession not in
excess of    % of the principal amount of the Class B Certificates. The
Underwriters may allow, and such dealers may reallow, a discount with respect
to the Class A Certificates and the Class B Certificates not in excess of    %
and    %, respectively, of such principal amount to certain other dealers.
After the initial public offering, such public offering prices, concessions and
discounts may be changed.

    The Underwriting Agreement provides that the Transferor and Conseco Finance
will 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.

    The Underwriters have represented and agreed that (i) they have not offered
or sold and, prior to the expiration of the period of six months from the
Closing Date, will not offer or sell any Class A or Class B Certificates to
persons in the United Kingdom, except to persons whose ordinary activities
involve them in acquiring, holding, managing or disposing of investments (as
principal or agent) for the purposes of their businesses or otherwise in
circumstances which have not resulted and will not result in an offer to the
public in the United Kingdom within the meaning of the Public Offers of
Securities Regulation 1995; (ii) they have complied and will comply with all
applicable provisions of the Financial

                                      119
Services Act 1986 with respect to anything done by them in relation to the
Class A or Class B Certificates in, from or otherwise involving the United
Kingdom; and (iii) they have only issued or passed on and will only issue or
pass on in the United Kingdom any document received by them in connection with
the issue of the Class A or Class B Certificates to a person who is of a kind
described in Article 11(3) of the Financial Services Act 1986 (Investment
Advertisements) (Exemptions) Order 1995, or is a person to whom such document
may otherwise lawfully be issued or passed on.

    The Underwriters and their affiliates may from time to time provide banking
and other financial services to the Transferor and the Trust, including
investment vehicles for funds held by the Trust.

    In connection with the offering, the Underwriters may engage in
transactions that stabilize, maintain or otherwise affect the price of the
Offered Certificates. Specifically, the Underwriters may overallot the
offering, creating a syndicate short position. The Underwriters may bid for and
purchase Offered Certificates in the open market to cover syndicate short
positions. In addition, the Underwriters may bid for and purchase Offered
Certificates in the open market to stabilize the price of the Offered
Certificates. These activities may stabilize or maintain the market price of
the Offered Certificates above independent market levels. The Underwriters are
not required to engage in these activities, and may end these activities at any
time.

                        LISTING AND GENERAL INFORMATION

    The Transferor has taken all reasonable care to ensure that the information
in this Prospectus in relation to the Transferor, the Trust, the Offered
Certificates and the Servicer is true and accurate in all material respects and
that in relation to the Transferor, the Trust, the Offered Certificates and the
Servicer there are no material facts the omission of which would make
misleading any statement herein, whether fact or opinion. The Transferor
accepts responsibility for the information contained in this Prospectus.

    Application will be made to list the Offered Certificates on the Luxembourg
Stock Exchange. In connection with the listing application, the Certificate of
Incorporation and Bylaws of the Transferor, as well as legal notice relating to
the issuance of the Offered Certificates will be deposited prior to listing
with the Chief Registrar of the District Court of Luxembourg, where copies
thereof may be obtained upon request. Once the Certificates have been so
listed, trading of the Offered Certificates may be effected on the Luxembourg
Stock Exchange. The Class A Certificates and the Class B Certificates have been
accepted for clearance through the facilities of DTC, Cedel and Euroclear.

    The transactions contemplated in this Prospectus were authorized by
resolutions adopted by the Transferor on September 13, 1995, and       , 2001.

    There have been no material adverse changes in the composition of the Trust
Portfolio since       , 2000.

                                      120
Copies of the Purchase Agreement, the Pooling and Servicing Agreement, the
Series 2001-1 Supplement, a form of Floorplan Agreement, the annual report of
independent public accountants described in "Description of the Offered
Certificates--Evidence as to Compliance" in the Prospectus, the reports to
Certificateholders referred to under "Description of the Offered Certificates--
Reports to Certificateholders" in the Prospectus will be available at the
office of the Listing Agent of the Trust in Luxembourg, whose address is 80,
place de la Gare 1616, Luxembourg. Financial information regarding the
Transferor will be included in the consolidated financial statements of Conseco
Finance Corp. in its Annual Report on Form 10-K for the fiscal year ended
December 31, 1999, which will be available at the office of the Listing Agent
in Luxembourg, along with future quarterly and annual reports of Conseco
Finance Corp. In the event that the Listing Agent is changed or replaced, in
any manner, the Trustee will publish or will cause to be published in the
Luxemburger Wort a notice to the effect that a change in the Listing Agent has
occurred and other relevant information.

    If the Offered Certificates are listed on the Luxembourg Stock Exchange,
the Trustee will publish or will cause to be published following each
Distribution Date in the Luxemburger Wort a notice to the effect that copies of
the statements described under "Description of the Offered Certificates--
Reports to Certificateholders" will be available for collection at the main
office of the Listing Agent of the Trust in Luxembourg.

    If the Offered Certificates are listed on the Luxembourg Stock Exchange,
all notices to Certificateholders will be given by publication in the
Luxemburger Wort. In the event that Definitive Certificates are issued, notices
to Certificateholders will also be given by mail to the address of such holders
as they appear in the Certificate Register.

    The Offered Certificates, the Pooling and Servicing Agreement, the 2001-1
Series Supplement and the Receivables Purchase Agreement are governed by the
laws of the State of Minnesota. The Trust was organized under the laws of the
State of Minnesota.

    The Certificates, the Pooling and Servicing Agreement and the Series 2001-1
Supplement are governed by the laws of the State of Minnesota.

                                 LEGAL MATTERS

    The legality of the Offered Certificates will be passed upon for the
Transferor and Conseco Finance by Dorsey & Whitney LLP, Minneapolis, Minnesota.
The material federal income tax consequences of the Certificates will be passed
upon for the Transferor by Dorsey & Whitney LLP. Certain legal matters relating
to the Offered Certificates will be passed upon for the Underwriters by
          .

                                      121
INDEX OF PRINCIPAL TERMS

    This is a list of defined terms used in this document and the pages on
which the definitions are found.
ABC Fixed/Floating Allocation Percentage.................................     70
ABC Investor Default Amount..............................................     89
Accounts.................................................................     29
Accumulation Period Commencement Date....................................     53
Accumulation Period Length...............................................     53
Accumulation Shortfall...................................................     37
Addition Date............................................................     59
Additional Accounts......................................................     29
Additional Class D Invested Amount.......................................     75
Affiliate................................................................     21
Asset-Based Receivable Overconcentration.................................     74
Asset-Based Receivables..................................................     23
Automatic Addition Condition.............................................     64
Bankruptcy Code..........................................................    107
Base Rate................................................................     89
Business Day.............................................................     49
Capitalized Interest Account.............................................     69
Cash Equivalents.........................................................     67
Clearstream Participants.................................................     46
Certificate Owner........................................................     43
Certificates.............................................................     21
Certificateholders.......................................................     42
Certificateholders' Interest.............................................     42
Class A Certificate Rate.................................................     49
Class A Fixed/Floating Allocation Percentage.............................     70
Class A Floating Allocation Percentage...................................     69
Class A Invested Amount..................................................     70
Class A Investor Charge-Off..............................................     90
Class A Monthly Interest.................................................     86
Class A Percentage.......................................................     73
Class A Principal........................................................     86
Class A Required Amount..................................................     77
Class A Scheduled Payment Date...........................................     37
Class B Certificate Rate.................................................     50
Class B Fixed/Floating Allocation Percentage.............................     70
Class B Floating Allocation Percentage...................................     69
Class B Invested Amount..................................................     71
Class B Investor Charge-Off..............................................     90
Class B Monthly Interest.................................................     86
Class B Percentage.......................................................     73
Class B Principal........................................................     87
Class B Required Amount..................................................     78
Class B Scheduled Payment Date...........................................     37
Class C Certificate Rate.................................................     50
Class C Fixed/Floating Allocation Percentage.............................     70
Class C Floating Allocation Percentage...................................     69
Class C Invested Amount..................................................     71
Class C Investor Charge-Off..............................................     90
Class C Percentage.......................................................     73
Class C Principal........................................................     88
Class C Required Amount..................................................     78
Class D Certificate Rate.................................................     50
Class D Fixed/Floating Allocation Percentage.............................     70
Class D Floating Allocation Percentage...................................     69
Class D Incremental Invested Amount......................................     74
Class D Invested Amount..................................................     72
Class D Investor Charge-Off..............................................     90
Class D Investor Default Amount..........................................     89
Class D Principal........................................................     88
Class D Subaccount.......................................................     76
CLD......................................................................     23
Code.....................................................................    109
Collateral Security......................................................     55
Collections..............................................................     53
Collection Account.......................................................     66
Companion Series.........................................................     90
Controlled Accumulation Amount...........................................     37
Controlled Accumulation Period...........................................     37
Controlled Deposit Amount................................................     37
Cooperative..............................................................     47
Counsel..................................................................    109
Cut-off Date.............................................................     29
Dealer Overconcentration.................................................     74
Dealers..................................................................     23
Defaulted Receivable.....................................................     89
Definitive Certificates..................................................     48
Depositaries.............................................................     43
Depository...............................................................     43
Determination Date....................................................... 40, 89
DHI Fees.................................................................     25
Discount Factor..........................................................     53
Distribution Account.....................................................     66
Distribution Date........................................................     49
DTC......................................................................     43
DTC Participants.........................................................     43
Early Amortization Period................................................     37
Eligible Account......................................................... 29, 61
Eligible Portfolio.......................................................     32
Eligible Receivable...................................................... 30, 62
122
ERISA....................................................................    116
Euroclear................................................................     47
Euroclear Operator.......................................................     47
Euroclear Participants...................................................     46
Euroclear System.........................................................     46
Excess Funding Account...................................................     67
Excess Interest Collections.............................................. 85, 89
Exchange.................................................................     55
Exchangeable Transferor Certificate......................................     42
Fitch....................................................................     66
Fixed/Floating Allocation Percentage.....................................     70
Floating Allocation Percentage...........................................     69
Floorplan Agreement......................................................     23
Floorplan Receivables....................................................     23
Foreign Person...........................................................    113
Funding Period...........................................................     68
Conseco Finance..........................................................      5
Imputed Yield Collections................................................     53
Independent Directors....................................................     21
Indirect Participants....................................................     44
Ineligible Receivables...................................................     59
Insolvency Event.........................................................     95
Insolvency Laws..........................................................     21
Interest Accrual Period..................................................     49
Interest Collections.....................................................     53
Interest Funding Account.................................................     66
Interest Free............................................................     25
Invested Amount.......................................................... 42, 73
Investor Default Amount..................................................     89
IRS......................................................................    109
LIBOR Determination Date.................................................     50
London Banking Day.......................................................     50
Manufacturer Overconcentration...........................................     74
Minimum Transferor Interest..............................................     64
Minimum Transferor Percentage............................................     64
Monthly Payment Rate.....................................................     51
Monthly Period...........................................................     37
Monthly Servicing Fee....................................................     95
Moody's..................................................................     66
MPR......................................................................     40
Negative Carry Amount....................................................     89
Net Receivables Rate.....................................................     50
New Withholding Regulations..............................................    115
Offered Certificates.....................................................     41
OID......................................................................    110
Overconcentration Amount.................................................     73
Overconcentration Amounts................................................     31
Participants.............................................................     43
Participations...........................................................     26
Pay Out Event............................................................ 38, 92
Paying Agent.............................................................     67
Pool Balance.............................................................     70
Pooling and Servicing Agreement..........................................     21
Pre-Allocated Invested Amount...........................................      12
Pre-Funded Amount.......................................................      68
Pre-Funding Account.....................................................      68
Principal Account.......................................................      66
Principal Collections...................................................      53
Principal Funding Investment Shortfall..................................      89
Principal Shortfalls....................................................      52
Principal Terms.........................................................      57
Product Line Overconcentration..........................................      74
Purchase Agreement...................................................... 21, 103
Qualified Institution...................................................      66
Rating Agency...........................................................  32, 67
Reallocated Class B Principal Collections...............................      76
Reallocated Class C Principal Collections...............................      76
Reallocated Class D Principal Collections...............................      75
Reallocated Principal Collections.......................................      77
Receivables.............................................................  21, 29
Receivables Transfer Date...............................................      59
Recoveries..............................................................      53
Reference Banks.........................................................      50
Removal Date............................................................      65
Removal Notice..........................................................      65
Removed Accounts........................................................      65
Required Amount.........................................................      86
Revolving Period........................................................      51
SAU.....................................................................      26
Securities Act..........................................................      57
Series..................................................................      21
Series 1999-1 Termination Date..........................................  37, 91
Series Available Interest Collections...................................      81
Series Issuance Date....................................................      59
Service Transfer........................................................      98
Servicer................................................................       5
Servicer Default........................................................      98
Shared Principal Collections............................................      52
Standard & Poors........................................................      66
Supplement..............................................................      55
Supplemental Certificate................................................      59
Telerate Page 3750......................................................      50
Terms and Conditions....................................................      47
Transfer Agent and Registrar............................................      48
Transfer Date...........................................................      78
Transfer Deposit Amount.................................................      60
Transferor Interest.....................................................      42
Transferor Percentage...................................................  42, 73
Transferor Retained Class...............................................      22
Transferor's Percentage.................................................      73
Trust Accounts..........................................................      53
Trust Portfolio.........................................................      29
Trust Termination Date..................................................      92
Underwriters............................................................     119
Underwriting Agreement..................................................     119
123
ANNEX A

                        GLOBAL CLEARANCE SETTLEMENT AND
                          TAX DOCUMENTATION PROCEDURES

   Except in certain limited circumstances, the globally offered Floating Rate
Floorplan Receivable Trust Certificates, Series 2001-1 (the "Global
Securities") will be available only in book-entry form. Investors in the Global
Securities may hold such Global Securities through any of The Depository Trust
Company ("DTC"), Clearstream or Euroclear. The Global Securities will be
tradeable as home market instruments in both the European and U.S. domestic
markets. Initial settlement and all secondary trades will settle in same-day
funds.

   Secondary market trading between investors holding Global Securities through
Clearstream and Euroclear will be conducted in the ordinary way in accordance
with their normal rules and operating procedures and in accordance with
conventional eurobond practice (i.e., seven calendar day settlement).

   Secondary market trading between investors holding Global Securities through
DTC will be conducted according to the rules and procedures applicable to U.S.
corporate debt obligations.

   Secondary cross-market trading between Clearstream or Euroclear and DTC
Participants holding Certificates will be effected on a delivery-against-
payment basis through the respective Depositaries of Clearstream and Euroclear
(in such capacity) and as DTC Participants.

   Non-U.S. holders (as described below) of Global Securities will be subject
to U.S. withholding taxes unless such holders meet certain requirements and
deliver appropriate U.S. tax documents to the securities clearing organizations
or their participants.

Initial Settlement

   All Global Securities will be held in book-entry form by DTC in the name of
Cede & Co. as nominee of DTC. Investors' interests in the Global Securities
will be represented through financial institutions acting on their behalf as
direct and indirect Participants in DTC. As a result, Clearstream and Euroclear
will hold positions on behalf of their participants through their respective
Depositaries, which in turn will hold such positions in accounts as DTC
Participants.

   Investors electing to hold their Global Securities through DTC will follow
the settlement practices applicable to conventional credit card certificate
issues. Investor securities custody accounts will be credited with their
holdings against payment in same-day funds on the settlement date.

   Investors electing to hold their Global Securities through Clearstream or
Euroclear accounts will follow the settlement procedures applicable to
conventional eurobonds, except

                                      A-1
that there will be no temporary global security and no "lock-up" or restricted
period. Global Securities will be credited to the securities custody accounts
on the settlement date against payment in the same-day funds.

Secondary Market Trading

    Since the purchaser determines the place of delivery, it is important to
establish at the time of the trade where both the purchaser's and Transferor's
accounts are located to ensure that settlement can be made on the desired value
date.

    Trading between DTC Participants. Secondary market trading between DTC
Participants will be settled using the procedures applicable to conventional
credit card certificate issues in same-day funds.

    Trading between Clearstream and/or Euroclear Participants. Secondary market
trading between Clearstream Participants or Euroclear Participants will be
settled using the procedures applicable to conventional eurobonds in same-day
funds.

      Trading between DTC Transferor and Clearstream or Euroclear purchaser.
When Global Securities are to be transferred from the account of a DTC
Participant to the accounts of a Clearstream Participant or a Euroclear
Participant, the purchaser will send instructions to Clearstream or Euroclear
through a Clearstream Participant or Euroclear Participant at least one
business day prior to settlement. Clearstream or Euroclear will instruct the
respective Depositary, as the case may be, to receive the Global Securities
against payment. Payment will include interest accrued on the Global Securities
from and including the last coupon payment date to and excluding the settlement
date, on the basis of actual days elapsed and a 360 day year. Payment will then
be made by the respective Depositary to the DTC Participant's account against
delivery of the Global Securities. After settlement has been completed, the
Global Securities will be credited to the respective clearing system and by the
clearing system, in accordance with its usual procedures, to the Clearstream
Participant's or Euroclear Participant's account. The Global Securities credit
will appear the next day (European time) and the cash debit will be bad-valued
to, and the interest on the Global Securities will accrue from, the value date
(which would be the preceding day when settlement occurred in New York). If
settlement is not completed on the intended value date (i.e., the trade fails),
the Clearstream or Euroclear cash debit will be valued instead as of the actual
settlement date.

    Clearstream Participants and Euroclear Participants will need to make
available to the respective clearing systems the funds necessary to process
same-day funds settlement. The most direct means of doing so is to pre-position
funds for settlement, either from cash on hand or existing lines of credit, as
they would for any settlement occurring within Clearstream or Euroclear. Under
this approach, they may take on credit exposure to Clearstream or Euroclear
until the Global Securities are credited to their accounts one day later.

    As an alternative, if Clearstream or Euroclear has extended a line of
credit to them, Clearstream Participants or Euroclear Participants can elect
not to preposition funds and

                                      A-2
allow that credit line to be drawn upon the finance settlement. Under this
procedure, Clearstream Participants or Euroclear Participants purchasing Global
Securities would incur overdraft charges for one day, assuming they cleared the
overdraft when the Global Securities were credited to their accounts. However,
interest on the Global Securities would accrue form the value date. Therefore,
in many cases the investment income on the Global Securities earned during that
one-day period may substantially reduce or offset the amount of such overdraft
charges, although this result will depend on each Clearstream Participant's or
Euroclear Participant's particular cost of funds.

    Since the settlement is taking place during New York business hours, DTC
Participants can employ their usual procedures for sending Global Securities to
the respective Depositary for the benefit of Clearstream Participants or
Euroclear Participants. The sale proceeds will be available to the DTC
Transferor on the settlement date. Thus, to the DTC Participants a cross-market
transaction will settle no differently than a trade between two DTC
Participants.

    Trading between Clearstream or Euroclear Transferor and DTC purchaser. Due
to time zone differences in their favor, Clearstream Participants and Euroclear
Participants may employ their customary procedures for transactions in which
Global Securities are to be transferred by the respective clearing system,
through the respective Depositary, to a DTC Participant. The Transferor will
send instructions to Clearstream or Euroclear through a Clearstream Participant
or Euroclear Participant at least one business day prior to settlement. In
these cases, Clearstream or Euroclear will instruct the respective Depositary,
as appropriate, to deliver the bonds to the DTC Participant's account against
payment. Payment will include interest accrued on the Global Securities from
and including the last coupon payment date to and excluding the settlement date
on the basis of actual days elapsed and a 360 day year. The payment will then
be reflected in the account of the Clearstream Participant or Euroclear
Participant the following day, and receipt of the cash proceeds in the
Clearstream Participant's or Euroclear Participant's account would be back-
valued to the value date (which would be the preceding day, when settlement
occurred in New York). Should the Clearstream Participant or Euroclear
Participant have a line of credit with its respective clearing system and elect
to be in debt in anticipation of receipt of the sale proceeds in its account,
the back-valuation will extinguish any overdraft charges incurred over that
one-day period. If settlement is not completed on the intended value date
(i.e., the trade fails), receipt of the cash proceeds in the Clearstream
Participant's or Euroclear Participant's account would instead be valued as of
the actual settlement date.

    Finally, day traders that use Clearstream or Euroclear and that purchase
Global Securities from DTC Participants for delivery to Clearstream
Participants or Euroclear Participants should note that these trades would
automatically fail on the sale side unless affirmative action were taken. At
least three techniques should be readily available to eliminate this potential
problem:

  (a)  borrowing through Clearstream or Euroclear for one day (until the
       purchase side of the day trade is reflected in their Clearstream or
       Euroclear accounts) in accordance with the clearing system's
       customary procedures;

                                      A-3
(b) borrowing the Global Securities in the U.S. from a DTC Participant no
      later than one day prior to settlement, which would give the Global
      Securities sufficient time to be reflected in their Clearstream or
      Euroclear account in order to settle the sale side of the trade; or

  (c) staggering the value dates for the buy and sell sides of the trade so
      that the value date for the purchase form the DTC Participant is at
      least one day prior to the value date for the sale to the Clearstream
      Participant or Euroclear Participant.

Certain U.S. Federal Income Tax Documentation Requirements

    A beneficial owner of Global Securities holding securities through
Clearstream or Euroclear (or through DTC if the holder has an address outside
the U.S.) will be subject to the 30% U.S. withholding tax that generally
applies to payments of interest (including original issue discount) on
registered debt issued by U.S. Persons, unless (i) each clearing system, bank
or other financial institution that holds customers' securities in the ordinary
course of its trade or business in the chain of intermediaries between such
beneficial owner and the U.S. entity required to withhold tax complies with
applicable certification requirements and (ii) such beneficial owner takes one
of the following steps to obtain an exemption or reduced tax rate:

    Exemption for non-U.S. Persons (Form W-8). Beneficial owners of
Certificates that are non-U.S. Persons can obtain a complete exemption from the
withholding tax by filing a signed Form W-8 (Certificate of Foreign Status) and
a certificate under penalties of perjury (the "Tax Certificate") that such
beneficial owner is (i) not a controlled foreign corporation (within the
meaning of Section 957(a) of the Code) that is related (within the meaning of
Section 864(d)(4) of the Code) to the Trust or the Transferor and (ii) not a 10
percent shareholder (within the meaning of Section 871(h)(3)(B) of the Code) of
the Trust or the Transferor. If the information shown on Form W-8 or the Tax
Certificate changes, a new Form W-8 or Tax Certificate, as the case may be,
must be filed within 30 days of such change.

    Exemption for non-U.S. Persons with effectively connected income (Form
4224). A non-U.S. Person, including a non-U.S. corporation or bank with a U.S.
branch, for which the interest income is effectively connected with its conduct
of a trade or business in the United States, can obtain an exemption from the
withholding tax by filing Form 4224 (Exemption from Withholding of Tax on
Income Effectively Connected with the Conduct of a Trade or Business in the
United States).

    Exemption or reduced rate for non-U.S. persons resident in treaty countries
(Form 1001). Non-U.S. Persons that are Certificate Owners residing in a country
that has a tax treaty with the United States can obtain an exemption or reduced
tax rate (depending on the treaty terms) by filing Form 1001 (Ownership,
Exemption or Reduced Rate Certificate). If the treaty provides only for a
reduced rate, withholding tax will be imposed at that rate unless the filer
alternatively files Form W-8. Form 1001 may be filed by the Certificate Owner
or his agent.

                                      A-4
Exemption for U.S. Persons (Form W-9). U.S. Persons can obtain a complete
exemption from the withholding tax by filing Form W-9 (Payer's Request for
Taxpayer Identification Number and Certification).

    U.S. Federal Income Tax Reporting Procedure. The Certificate Owner of a
Global Security or, in the case of a Form 1001 or a Form 4224 filer, his agent,
files by submitting the appropriate form to the person through whom it holds
(the clearing agency, in the case of persons holding directly on the books of
the clearing agency). Form W-8 and Form 1001 are effective for three calendar
years and Form 4224 is effective for one calendar year.

    The term "U.S. Person" means (1) a citizen or resident of the United
States, (2) a corporation or partnership organized in or under the laws of the
United States or any political subdivision thereof, (3) an estate the income of
which is includible in gross income for United States tax purposes, regardless
of its source or (4) a trust if (A) a court within the United States is able to
exercise primary supervision over the administration of the trust and (B) one
or more United States trustees have authority to control all substantial
decisions of the trust. This summary does not deal with all aspects of U.S.
Federal income tax withholding that may be relevant to foreign holders of the
Global Securities. Investors are advised to consult their own tax advisors for
specific tax advice concerning their holding and disposing of the Global
Securities.

                                      A-5
ANNEX B

                                  OTHER SERIES

    The table below sets forth the principal characteristics of Series 1996-1,
Series 1996-2, Series 1998-1, Series 1998-A, Series 1998-2 and Series 1999-1,
the only Series heretofore issued by the Trust. Series 1995-1 was paid off in
October 1998, Series 1998-A was retired in October 1998 and Series 1998-1 will
be retired by April 2001. Each of Series 1996-1, Series 1998-A and Series
1999-1 is a series of variable funding certificates, meaning that the aggregate
outstanding principal amount of the Series 1996-1 Certificates, the Series
1998-A Certificates and the Series 1999-1 Certificates may be increased or
decreased from time to time subject to a maximum amount. It is expected that
the aggregate outstanding principal amount of the Series 1996-1 Certificates
will be zero on the Series 1999-1 Closing Date. For more specific information
with respect to any Series, any prospective investor should contact the
Servicer at (651) 293-3400. The Servicer will provide, without charge, to any
prospective purchaser of the Certificates, a copy of the disclosure documents
for any previous publicly issued Series.

Series 1996-1
Scheduled Series Termination Date............ September 27, 2001
Series Issuance Date......................... June 12, 1996
Annual Servicing Fee Percentage.............. 2.0%

Class A Certificates

Invested Amount.............................. Variable (subject to a maximum of
                                              $271,610,000)
Certificate Rate............................. Variable
Enhancement.................................. Subordination of Class B
                                              Certificates, Class C Certificates
                                              and Class D Certificates

Class B Certificates

Invested Amount.............................. Variable (subject to a maximum of
                                              $14,130,000)
Certificate Rate............................. Variable
Enhancement.................................. Subordination of Class C
                                              Certificates and Class D
                                              Certificates

Class C Certificates

Invested Amount.............................. Variable
Certificate Rate............................. None
Enhancement.................................. Subordination of Class D
                                              Certificates

Class D Certificates

Initial Invested Amount...................... Variable (subject to a maximum of
                                              $35,817,679.77)
Certificate Rate............................. None
B-1
Series 1996-2
Scheduled Series Termination Date......... December 13, 2001
Series Issuance Date...................... December 18, 1996
Annual Servicing Fee Percentage........... 2.0%

Class A Certificates

Invested Amount........................... $478,800,000
Certificate Rate.......................... LIBOR + 0.08%
Commencement of Controlled Accumulation
 Period................................... August 1999
Enhancement............................... Subordination of Class B
                                           Certificates, Class C Certificates
                                           and Class D Certificates

Class B Certificates

Invested Amount........................... $21,500,000
Certificate Rate.......................... LIBOR + 0.30%
Enhancement............................... Subordination of Class C
                                           Certificates and Class D
                                           Certificates

Class C Certificates

Invested Amount........................... $8,100,000
Certificate Rate.......................... None
Enhancement............................... Subordination of Class D
                                           Certificates

Class D Certificates

Initial Invested Amount................... $29,600,000 (exclusive of the Class
                                           D Incremental Invested Amount)
Certificate Rate.......................... None

Series 1998-1

Scheduled Series Termination Date......... March 13, 2003
Series Issuance Date...................... April 15, 1998
Annual Servicing Fee Percentage........... 2.00%

Class A Certificates

Invested Amount........................... $400,400,000
Certificate Rate.......................... LIBOR + .05%
Commencement of Controlled Accumulation
 Period................................... October 2000
Enhancement............................... Subordination of Class B
                                           Certificates, Class C Certificates
                                           and Class D Certificates

Class B Certificates

Invested Amount........................... $20,475,000
Certificate Rate.......................... LIBOR + .27%
Enhancement............................... Subordination of Class C
                                           Certificates and Class D
                                           Certificates
B-2
Class C Certificates
Invested Amount............................. $19,337,000
Certificate Rate............................ LIBOR + .70%
Enhancement................................. Subordination of Class D
                                             Certificates

Class D Certificates

Initial Invested Amount..................... $14,788,000 (exclusive of the Class
                                             D Incremental Invested Amount)
Certificate Rate............................ LIBOR + .70%

Series 1998-A

Scheduled Series Termination Date........... March 13, 2001
Series Issuance Date........................ August 3, 1998
Annual Servicing Fee Percentage............. 2.00%

Class A Certificates

Invested Amount............................. Variable (subject to a maximum of
                                             $404,800,000)
Certificate Rate............................ Variable
Commencement of Amortization Period......... December 1998
Enhancement................................. Subordination of Class B
                                             Certificates, Class C Certificates
                                             and Class D Certificates

Class B Certificates

Invested Amount............................. Variable (subject to a maximum of
                                             $20,700,000)
Certificate Rate............................ Variable
Enhancement................................. Subordination of Class C
                                             Certificates and
                                             Class D Certificates

Class C Certificates

Invested Amount............................. Variable (subject to a maximum of
                                             $25,300,000)
Certificate Rate............................ Variable
Enhancement................................. Subordination of Class D
                                             Certificates

Class D Certificates

Initial Invested Amount..................... Variable (subject to a maximum of
                                             $9,200,000)
Certificate Rate............................ Variable
B-3
Series 1998-2
Scheduled Series Termination Date......... April 13, 2004
Series Issuance Date...................... September 14, 1998
Annual Servicing Fee Percentage........... 2.00%

Class A Certificates

Invested Amount........................... $440,000,000
Certificate Rate.......................... LIBOR + .055%
Commencement of Controlled Accumulation
 Period................................... November 2001
Enhancement............................... Subordination of Class B
                                           Certificates, Class C Certificates
                                           and Class D Certificates

Class B Certificates

Invested Amount........................... $22,500,000
Certificate Rate.......................... LIBOR + .225%
Enhancement............................... Subordination of Class C
                                           Certificates and Class D
                                           Certificates

Class C Certificates

Invested Amount........................... $21,250,000
Certificate Rate.......................... LIBOR + .70%
Enhancement............................... Subordination of Class D
                                           Certificates

Class D Certificates

Initial Invested Amount................... $24,921,000 (exclusive of the Class
                                           D Incremental Invested Amount)
Certificate Rate.......................... LIBOR + .70%

Series 1999-1

Scheduled Series Termination Date......... November 13, 2004
Series Issuance Date...................... October 4, 1999
Annual Servicing Fee Percentage........... 2.00%

Class A Certificates

Invested Amount........................... $605,500,000
Certificate Rate.......................... LIBOR + .35%
Commencement of Controlled Accumulation
 Period................................... July 2002
Enhancement............................... Subordination of Class B
                                           Certificates, Class C Certificates
                                           and Class D Certificates

Class B Certificates

Invested Amount........................... $31,500,000
Certificate Rate.......................... LIBOR + 0.65%
Enhancement............................... Subordination of Class C
                                           Certificates and Class D
                                           Certificates
B-4
Class C Certificates
Invested Amount............................. $40,250,000
Certificate Rate............................ LIBOR + 0.95%
Enhancement................................. Subordination of Class D
                                             Certificates

Class D Certificates

Initial Invested Amount..................... $28,000,000 (exclusive of the Class
                                             D Incremental Invested Amount)
Certificate Rate............................ LIBOR + 0.95%
B-5
$200,000

                       [LOGO OF GREEN TREE APPEARS HERE]

                 Green Tree Floorplan Receivables Master Trust

$100,000 Floating Rate Floorplan Receivable Trust Certificates, Series 2001-1,
                                    Class A
$100,000 Floating Rate Floorplan Receivable Trust Certificates, Series 2001-1,
                                    Class B

                      Green Tree Floorplan Funding Corp.
                                  Transferor

                             Conseco Finance Corp.
                                   Servicer

                  ------------------------------------------
                                  PROSPECTUS
                  ------------------------------------------

                                [Underwriters]

Until the expiration of 90 days after the date of this prospectus, all dealers
selling the Class A Certificates or Class B Certificates, whether or not
participating in this distribution, will deliver a prospectus. This delivery
requirement 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.

                                       , 2001
PART II.

                     INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution
SEC registration fee........................................... $     50
      Blue Sky fees and expenses.....................................   10,000*
      Accountant's fees and expenses.................................   30,000*
      Attorney's fees and expenses...................................   75,000*
      Trustee's fees and expenses....................................   15,000*
      Printing and engraving expenses................................  150,000*
      Rating Agency fees.............................................  150,000*
      Miscellaneous..................................................    4,950*
                                                                      --------
      Total.......................................................... $435,000*
                                                                      ========
--------
* Estimated

Item 16. Exhibits and Financial Statement Schedules

    (a) Exhibits:
1.1 --Underwriting Agreement dated as of     , 2001*
     (1)3.1 --Certificate of Incorporation of Green Tree Floorplan Funding
              Corp.
     (1)3.2 --Bylaws of Green Tree Floorplan Funding Corp.
     (2)4.1 --Pooling and Servicing Agreement dated December 1, 1995
        4.2 --Series 2001-1 Supplement to the Pooling and Servicing Agreement
              dated as of      , 2001**
     (2)4.3 --Receivables Purchase Agreement dated December 1, 1995
     (3)4.4 --Amendment No. 1 to the Pooling and Servicing Agreement dated
              as of March 11, 1998
        5.1 --Opinion and consent of Dorsey & Whitney LLP as to legality*
        8.1 --Opinion and consent of Dorsey & Whitney LLP as to tax matters*
       23.1 --Consent of Dorsey & Whitney LLP (included as part of Exhibit
              5.1)*
       23.2 --Consent of Dorsey & Whitney LLP (included as part of Exhibit
              8.1)*
       24.1 --Power of attorney from officers and directors of the Registrants
              (included on the signature page hereto)**
--------
*   To be filed by amendment.
**  Filed herewith.
(1)  Incorporated by reference to the corresponding exhibit numbers in
     Amendment No. 1 to the Company's Registration Statement on Form S-1,
     Registration No. 33-62433, filed November 8, 1995.
(2)  Incorporated by reference to the corresponding exhibit in the Company's
     Registration Statement on Form S-1, Registration No. 333-15285, filed
     October 31, 1996.
(3)  Incorporated by reference to the corresponding exhibit to Post Effective
     Amendment No. 1 to the Registration Statement on Form S-1, Registration
     No. 333-47533, filed April 15, 1998.

    (b) Financial Statements:

      Not Applicable.

Item 17. Undertakings

    Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the

                                      II-1
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 the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the 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
issuer.

    The undersigned registrant hereby undertakes that:

  (1)  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 Securities Act shall be
       deemed to be part of this registration statement as of the time it
       was declared effective.

  (2)  For the purpose of determining any liability under the Securities Act
       of 1933, each post-effective amendment that contains a form of
       prospectus shall be deemed to be a new registration statement
       relating to the securities offered therein, and the offering of such
       securities at that time shall be deemed to be the initial bona fide
       offering thereof.

                                      II-2
SIGNATURES

    Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Saint Paul, State of
Minnesota, on the 23rd day of January, 2001.

                                     Green Tree Floorplan Funding Corp.

                                                  /s/ Brian F. Corey
                                     By: ______________________________________
                                                    Brian F. Corey
                                          Senior Vice President and Secretary

    Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities and on the
date indicated. Each person whose signature to this Registration Statement
appears below hereby constitutes and appoints Brian F. Corey and Phyllis A.
Knight as his/her true and lawful attorney-in-fact and agent, with full power
of substitution, to sign on his behalf individually and in the capacity stated
below and to perform any acts necessary to be done in order to file all
amendments and post-effective amendments to this Registration Statement, and
any and all instruments filed as part of or in connection with this
Registration Statement or the amendments thereto and each of the undersigned
does hereby ratify and confirm all that said attorney-in-fact and agent, or his
substitutes, shall do or cause to be done by virtue hereof.
Signature                         Title                  Date
/s/ Bruce A. Crittenden        President and Director     January 23, 2001
____________________________________  (Principal Executive
        Bruce A. Crittenden           Officer)

       /s/ Phyllis A. Knight         Senior Vice President and  January 23, 2001
____________________________________  Treasurer (Principal
         Phyllis A. Knight            Financial Officer and
                                      Principal Accounting
                                      Officer)

         /s/ Brian F. Corey          Senior Vice President,     January 23, 2001
____________________________________  Secretary and Director
           Brian F. Corey

         /s/ Paul A. Boyum           Director                   January 23, 2001
____________________________________
           Paul A. Boyum

                                     Director
____________________________________
           Gary P. Mills
SIGNATURES

    Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Saint Paul, State of
Minnesota, on the 23rd day of January, 2001.

                                     Green Tree Floorplan
                                     Receivables Master Trust

                                     By Green Tree Floorplan Funding Corp.

                                                 /s/ Brian F. Corey
                                     By: ______________________________________
                                                   Brian F. Corey
                                        Senior Vice President and Secretary
INDEX TO EXHIBITS
1.1 --Underwriting Agreement dated as of     , 2001*
 (1)3.1 --Certificate of Incorporation of Green Tree Floorplan Funding
          Corp.
 (1)3.2 --Bylaws of Green Tree Floorplan Funding Corp.
 (2)4.1 --Pooling and Servicing Agreement dated December 1, 1995
    4.2 --Series 2001-1 Supplement to the Pooling and Servicing Agreement
          dated as of     , 2001**
 (2)4.3 --Receivables Purchase Agreement dated December 1, 1995
 (3)4.4 --Amendment No. 1 to the Pooling and Servicing Agreement dated as
          of March 11, 1998
    5.1 --Opinion and consent of Dorsey & Whitney LLP as to legality*
    8.1 --Opinion and consent of Dorsey & Whitney LLP as to tax matters*
   23.1 --Consent of Dorsey & Whitney LLP (included as part of Exhibit
          5.1)*
   23.2 --Consent of Dorsey & Whitney LLP (included as part of Exhibit
          8.1)*
   24.1 --Power of attorney from officers and directors of the
          Registrants (included on the signature page hereto)**
--------
*   To be filed by amendment.
**  Filed herewith.
(1)  Incorporated by reference to the corresponding exhibit numbers in
     Amendment No. 1 to the Company's Registration Statement on Form S-1,
     Registration No. 33-62433, filed November 8, 1995.
(2)  Incorporated by reference to the corresponding exhibit in the Company's
     Registration Statement on Form S-1, Registration No. 333-15285, filed
     October 31, 1996.
(3)  Incorporated by reference to the corresponding exhibit to Post Effective
     Amendment No. 1 to the Registration Statement on Form S-1, Registration
     No. 333-47533, filed April 15, 1998.