<PAGE>   1
                                                                    EXHIBIT 10.2


                               SERVICING AGREEMENT

         THIS SERVICING AGREEMENT, dated as of _______________, 2001 (the
"Servicing Agreement"), is entered into by and between Transition Leasing
Management, Inc., a Texas corporation ("Transition Leasing"), in its capacity as
servicer of certain motor vehicles lease contracts (the "Servicer"), and
Transition Auto Finance IV, Inc., a Texas corporation ("Buyer").

                                   WITNESSETH:

         WHEREAS, subject to the terms and conditions of that certain Master
Purchase Agreement dated of even date herewith between Transition Leasing and
Buyer relating to the acquisition of certain motor vehicles and motor vehicle
lease contracts by Buyer from or through Transition Leasing (the "Master
Purchase Agreement"). All capitalized terms used herein and not otherwise herein
defined shall have the same meaning as set forth in the Master Purchase
Agreement or that certain Indenture between Buyer and Trust Management, Inc.
Buyer desires to acquire certain Leased Vehicles and Contracts that will be
described in Monthly Report Certificates to be delivered by Transition Leasing
to Buyer pursuant to Section 2 of the Master Purchase Agreement; and

         WHEREAS, Buyer has requested the Servicer to undertake the collection
and servicing responsibilities with respect to any and all of the Contracts and
to account to Buyer therefor as provided herein;

         NOW, THEREFORE, the parties agree as follows:

         1. APPOINTMENT OF AND ACCEPTANCE BY THE SERVICER OF SERVICING
OBLIGATIONS.

                  A. The Servicer, on behalf of Buyer, shall during the term of
the Servicing Agreement manage, administer and collect each of the Contracts and
shall exercise discretionary powers involved in such management, administration
and collection, and shall bear all costs and expenses incurred in connection
therewith, that may be necessary or advisable in carrying out the Agreement. In
the management, administration and collection of the Contracts, the Servicer
shall use at least the same care and apply the same policies that it would
exercise if it owned the Contracts, including but not limited to the servicing
criteria as set forth in EXHIBIT A attached hereto.

                  B. The Servicer shall have the full power and authority to do
those things in connection with such servicing, administration and collection
activities that it may deem necessary or desirable in order to maximize receipts
collected from Obligors or foreclosure and sale of Lease Vehicles underlying the
Contracts. Without limiting the generality of the foregoing, the Servicer is
hereby authorized and empowered to execute and deliver, on behalf of Buyer,
instruments of satisfaction or cancellation, or of partial or full release or
discharge, and all other comparable instruments, in order to evidence payments
received with respect to the Contracts and, after the delinquency of any
Contracts and to the extent permitted under and in compliance with applicable
law and regulations, to commence enforcement proceedings with respect to such
Contracts; PROVIDED, HOWEVER, that the Servicer shall not commence any



<PAGE>   2

legal action against an Obligor in the name of Buyer without the prior written
consent of Buyer, which Buyer shall furnish the Servicer to carry out its
servicing and administrative duties hereunder.

         2. TERM. The Servicing Agreement shall commence as of the date first
written above and shall continue so long as the Buyer has any outstanding
Contracts that remain to be collected, absent a Servicer Event of Default (as
defined herein below).

         3. COMPENSATION. In exchange for the services provided to Buyer as
described and governed herein, Servicer shall receive on or before the fifteenth
day of the month following a month in which such services are provided, and upon
receipt by Buyer of all required, duly prepared and properly executed Monthly
Report Certificates from Acquisition Agent, a Contract Servicing Fee (herein so
called) equal to Thirty-Five and 00/100 Dollars ($35.00) times the aggregate
number of Contracts serviced by Servicer during the previous month. Such
aggregate number of Contracts shall equal the sum of all Contracts identified in
the Monthly Report Certificates, less all Contracts that have been previously
paid in full by their Obligors, and less all Contracts in which an Obligor
default has occurred and Servicer has assigned the related Leased Vehicle for
repossession.

         Additionally, any third-party expenditures pursuant to Section II(C)
and III(A) of EXHIBIT A to the Servicing Agreement with respect to any
particular Contract shall be paid for from the proceeds from collection or from
resale of the repossessed Leased Vehicle relating to that Contract.

         4. REPRESENTATIONS AND WARRANTIES OF THE SERVICER. The Servicer
represents, warrants and covenants to Buyer that:

                  A. ORGANIZATION AND GOOD STANDING. The Servicer is a
corporation duly organized, existing and in good standing under the laws of
Texas, and has full corporate power, authority and legal right to own its
properties and conduct its business as such properties are presently owned and
such business is presently contemplated, and to execute, deliver and perform its
obligations under the Servicing Agreement.

                  B. DUE QUALIFICATION. The Servicer is duly qualified and has
registered as a foreign corporation in each state where such qualification is
required in order to service the Contracts as required by the Servicing
Agreement and has obtained all necessary licenses, approvals or consents as are
required under applicable law to perform its duties hereunder.

                  C. DUE AUTHORIZATION. The execution, delivery and performance
of the Servicing Agreement has been duly authorized by the Servicer by all
necessary corporate action on the part of the Servicer.

                  D. BINDING OBLIGATION. The Servicing Agreement constitutes a
legal, valid and binding obligation of the Servicer, enforceable in accordance
with its terms, except as



                                       2
<PAGE>   3

enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereinafter in effect,
affecting the enforcement of creditors' rights in general and such
enforceability may be limited by general principles of equity (whether
considered in a proceeding at law or in equity).

                  E. NO VIOLATION. The execution and delivery of the Servicing
Agreement by the Servicer and the performance of the transactions contemplated
by the Servicing Agreement and the fulfillment of the terms hereof applicable to
the Servicer, will not conflict with, violate, result in any breach of any of
the material terms and provisions of, or constitute (with or without notice or
lapse of time or both) a default under, any requirement of law applicable to the
Servicer or any indenture, contract, agreement, mortgage, deed of trust or other
instrument to which the Servicer is a party or by which it is bound.

         5. COVENANTS OF THE SERVICER. From and after the date hereof until such
time as the Servicing Agreement terminates, Servicer, as an independent
contractor, shall at its own expense, direct all Obligors on the Contracts to
remit all collections and payments directly to, or otherwise cause all payments
on the Contracts to be deposited in, Servicer's Master Collections Account.
Servicer shall have no ownership in or authority to amend, modify, change or
terminate the Master Collections Account without the prior written consent of
the Buyer. Servicer agrees and covenants that all Obligors will utilize payment
books with remittance instructions or monthly statements directing all payments
to be remitted directly to the Master Collections Account, and Servicer
additionally agrees that all cash, checks, notes, drafts or other items that it
receives otherwise than through the Master Collections Account attributable to
the Contracts including proceeds from resale of repossessed Leased Vehicles,
Leased Vehicles returned upon the expiration of their lease terms and recoveries
on insurance claims, shall be deposited in the Master Collections Account within
two business days of receipt.

         The Servicer acknowledges that any collections or proceeds from the
Contracts in the Master Collection Account, or otherwise in the possession or
control of the Servicer, are the Buyer's property and subject to the security
interest granted to the Trustee under the Indenture. In holding such proceeds
and collections, the Servicer agrees to act as custodian and bailee of the Buyer
and the Trustee at all times. The Servicer agrees, for the benefit of the Buyer,
the Trustee and the holders of the Notes, to act as such custodian and bailee,
and to hold and deal with such proceeds and collections, as custodian and bailee
for the Buyer and the Trustee, in accordance with the provisions of the
Indenture. It is intended that the Trustee, as a secured party, shall be deemed
to have possession of such proceeds and collections for purposes of Section
9-305 of the UCC of the state in which such property is located.

                  A. OPERATIONS. The Servicer shall collect the Contracts in an
orderly and efficient manner consistent with good business practices and in
accordance with all applicable federal, state and local laws and regulations.

                  B. RECORDS. So long as Buyer has not given notice of
termination pursuant to SECTION 9, the Servicer shall (i) hold in trust and
safely keep all Contract Closing



                                       3
<PAGE>   4

Documents and such other documents as may be required for the enforcement of the
Contracts; (ii) keep such accounts and other records as will enable Buyer to
determine the status of the Contracts; (iii) keep such books and records at its
offices identified in SECTION 14 herein; and (iv) permit Buyer and its
representatives at any time to inspect, audit, check and make abstracts from
Servicer's accounts, records, correspondence and other papers pertaining to the
Contracts, together with the account balance of such accounts and the payment
history related thereto. The Servicer shall provide Buyer with monthly reports
updating the information relating to account balances and activity and
certifying the amounts collected on the Contracts during the preceding month.

                  C. CONTINUATION STATEMENTS. If Buyer so requests, the Servicer
shall execute and file documents that shall reflect Buyer as the owner of the
Leased Vehicle, including registration of the Certificates of Title in the name
of Buyer and/or any other documents requested by Buyer or that may be required
by law to preserve fully and protect the interest of Buyer in and to the
Contracts.

                  D. PRINCIPAL EXECUTIVE OFFICE. The Servicer shall not, without
providing thirty days' notice to Buyer, and without filing such amendments to
any previously filed financing statements as Buyer may require, (i) change the
county where its principal executive office or the offices where the records
relating to the Contracts are kept, or (ii) change its name, identity or
corporate structure in any manner that would, could or might make any financing
statement or continuation statement filed by Buyer or the Servicer or any
provision hereof seriously misleading within the meaning of Section 9-402(7) of
any applicable enactment of the Uniform Commercial Code.

                  E. NO IMPAIRMENT. The Servicer will duly fulfill all
obligations on its part to be fulfilled under or in connection with each
Contract and will do nothing to materially impair the rights of Buyer in the
Contracts.

                  F. COMPLIANCE WITH LAW. The Servicer will comply, in all
material respects, with all acts, rules, regulations, orders, decrees and
directions of any governmental authority applicable to the Contracts or any part
thereof; PROVIDED, HOWEVER, that the Servicer may contest any act, regulation,
order, decree or direction in any reasonable manner that shall not materially
and adversely affect the rights of Buyer in the Contracts. The Servicer will
comply, in all material respects, with any obligation of a holder of a Contract
to the Obligor thereof arising under such Contract or under applicable law.

                  G. SECURITY INTEREST. Except for the transfers of Contracts to
the Buyer under the Master Purchase Agreement, the Servicer will not sell,
pledge, assign or transfer to any other person, or grant, create, incur, assume
or suffer to exist any lien on any Contracts, or the books or records relating
to any Contracts, or any interest therein; the Servicer will immediately notify
Buyer of the existence of any lien on any Contracts; the Servicer shall defend
the right, title and interest of Buyer in, to and under the Contracts, whether
now existing or



                                       4
<PAGE>   5

hereafter transferred to Buyer, against all claims of third parties claiming
through or under the Servicer.

                  H. PAYMENT OF FEES AND EXPENSES OF TRUSTEE. The Servicer
shall, if the Buyer does not so pay, pay the fees and expenses of the Trustee
under the Indenture as such fees and expenses become payable from time to time
pursuant to Section 7.7 of the Indenture, and hereby agrees to indemnify the
Trustee and its agents as provided in said Section 7.7. The Servicer shall be
entitled to seek reimbursement for such fees and expenses from any funds of the
Buyer that are not subject to the lien of the Indenture.

                  I. SERVICING COMPENSATION. As compensation for the performance
of its obligations under the Servicing Agreement and subject to the terms of
this SECTION 5(I), the Servicer shall be entitled to receive payment of the
Servicing Fees from the Buyer, out of amounts available for that purpose in the
Operating Account pursuant to Section 4.2 of the Indenture. Payment of such
Servicing Fees shall be conditioned upon the availability in the Operating
Account of amounts intended for such purpose after satisfaction of all higher
priority applications of such funds under Section 4.2(f) of the Indenture and
after creation of a reserve to pay all interest due on the Outstanding
Securities on the next Payment Date, any deficiency being carried over and not
payable (without accountability for interest) until sufficient amounts become
available for that purpose in the Operating Account. The Servicer shall pay all
expenses incurred by it in connection with its servicing activities under the
Servicing Agreement and shall not be entitled to reimbursement of such expenses
except to the extent they constitute Liquidation Expenses and can be reimbursed
out of related Liquidation Proceeds.

                  J. REALIZATION UPON DEFAULTED CONTRACTS. In accordance with
the servicing procedures specified in the Servicing Agreement, the Servicer
shall repossess, or otherwise comparably convert the ownership of, any Leased
Vehicle securing a Defaulted Contract and as to which no satisfactory
arrangements can be made for collection of delinquent payments pursuant to the
Servicing Agreement. In connection with such repossession or other conversion,
the Servicer shall follow such practices and procedures as it shall deem
necessary or advisable and as shall be normal and usual for responsible holders
of lease contracts and as shall be in compliance with all applicable laws, and,
in connection with the repossession of any Leased Vehicle or any Defaulted
Contract, may commence or prosecute any judicial proceedings in respect of such
Contract in its own name, or if the Servicer deems it necessary, in the name of
the Buyer or the Trustee, on behalf of the Buyer or on behalf of the Trustee.
The Servicer's obligations under this Section are subject to the provision that,
in the case of damage to a Leased Vehicle from an insured cause, the Servicer
shall not be required to expend its own funds in repairing such motor vehicle
unless it shall determine (i) that such restoration will increase the
Liquidation Proceeds of the related Contract, after reimbursement to itself for
such expenses, and (ii) that such expenses will be recoverable by it either as
Liquidation Expenses or as expenses recoverable under an applicable insurance
policy. The Servicer shall be responsible for all other costs and expenses
incurred by it in connection with any action taken in respect of a Defaulted
Contract; provided, however, that it shall be entitled to reimbursement of such
costs and expenses to the extent they constitute Liquidation Expenses or
expenses recoverable under an



                                       5
<PAGE>   6

applicable insurance policy. All Liquidation Proceeds (net of Liquidation
Expenses) and Insurance Proceeds (net of expenses incurred by the Servicer and
recoverable under the related insurance policy and net of the portion thereof
applied to the repair of any Leased Vehicle or released to an Obligor in
accordance with the Servicer's normal servicing procedures) shall be deposited
in the Master Collections Account to the extent required by the Servicing
Agreement.

                  K. APPOINTMENT OF CUSTODIAN FOR CONTRACT DOCUMENTS. Except as
otherwise provided in the Indenture, upon delivery of the Contract Documents to
the Trustee for any Contracts purchased by the Buyer under Section 4.3 of the
Indenture, possession of the Contract Documents will be retained by the Trustee
or any other financial institution appointed by the Buyer and the Trustee to act
as custodian and bailee of the Contract Documents for the Trustee and the Buyer.
If another financial institution is appointed, it is intended that the Trustee,
as secured party, shall be deemed to have possession of the Contract Documents
for purposes of Section 9-305 of the UCC of the state in which the Contract
Documents are located.

                  L. COLLECTING TITLE DOCUMENTS NOT DELIVERED AT THE CLOSING
DATE. If the Title Document for a Leased Vehicle does not reflect the Buyer as
owner and first lienholder and the Trustee as second lienholder at the time of
the Buyer's purchase direct from a Dealer of the Leased Vehicle, the Servicer
shall confirm, prior to the Buyer's purchase, that an appropriate application
has been made to transfer the title of the Title Document to the Buyer with such
Title Document reflecting the Buyer as owner and first lienholder and the
Trustee as second lienholder.

         In the case of any Contract in respect of which the Title Document for
the related Leased Vehicle showing the Buyer as owner and first lienholder and
the Trustee as second lienholder has been applied for in connection with the
purchase of the Contract, the Servicer shall use reasonable efforts to obtain
such Title Document and promptly upon receipt thereof to make application for
the transfer of the ownership noted thereon to the Buyer and the second lien in
favor of the Trustee. In the case of any Contract in respect of which the Title
Document for the related Leased Vehicle showing the Buyer as owner and first
lienholder and the Trustee as second lienholder has been applied for in
connection with the purchase of the Contract or thereafter, the Servicer shall
use reasonable efforts to obtain such Title Document and to deliver it to the
Trustee (or other financial institution appointed as custodian for the Contract
Documents) as promptly as possible. If such Title Document showing the Buyer as
owner and first lienholder and Trustee as second lienholder is not received by
the Trustee (or other custodian) within 30 days after the Purchase Date, then
the representation and warranty in Section 4.4 of the Indenture in respect of
such Contract shall be deemed to have been incorrect in a manner that materially
and adversely affects the Security holders.

         The Servicer shall deliver to the Trustee on a monthly basis a listing
of Contracts that as of the date prior to such delivery do not show the Buyer as
owner and first lienholder and the Trustee as second lienholder on the Title
Documents for such Contracts.



                                       6
<PAGE>   7

         Any fees charged for the transfer of ownership or liens on the Title
Documents for the Leased Vehicles into or out of the Buyer's or Trustee's name,
as appropriate, shall be paid by the Buyer as an Allowed Expense.

                  M. REPORTING BY THE SERVICER. On or prior to each Servicer
Report Date, the Servicer shall render to the Buyer the Monthly Report, in
respect of the immediately preceding Collection Period, which shall set forth
the following:

                           (i)      A confirmation that all proceeds (including
                                    all written instruments, Full Prepayments,
                                    Net Liquidation Proceeds and Net Insurance
                                    Proceeds) received by Servicer during such
                                    Collection Period and attributable to the
                                    Contracts (and any related Leased Vehicles)
                                    owned the Buyer have been deposited into the
                                    Master Collections Account;

                           (ii)     A confirmation that all funds that were
                                    deposited into the Master Collections
                                    Account during such Collection Period and
                                    that were attributable to the Contracts and
                                    related Leased Vehicles owned by the Buyer
                                    have been transferred to the Operating
                                    Account;

                           (iii)    Attached to the Monthly report should be
                                    detailed collection, receivables and
                                    delinquencies reports listing, by Contract
                                    Number, the daily proceeds received from
                                    each Contract during such Collection Period
                                    and deposited in the Master Collections
                                    Account (including any Net Liquidation
                                    Proceeds and Net Insurance Proceeds and any
                                    prepayments by Obligors) and the unpaid
                                    installment balance and the past due
                                    installments as of the end of the Collection
                                    Period for each Contract;

                           (iv)     Attached to the Monthly Report should be a
                                    detailed repossession, liquidation and loss
                                    report listing, by Contract Number,
                                    Contracts assigned for repossession,
                                    repossessions of Leased Vehicles, the sales
                                    of repossessed Leased Vehicles or Leased
                                    Vehicles returned upon the termination of
                                    their Contracts and resulting proceeds, any
                                    Net Insurance Proceeds and any other Net
                                    Liquidation Proceeds during the Collection
                                    Period; and

                           (v)      Any other information relating to the
                                    Contracts reasonably requested by the Buyer
                                    or the Trustee.

         On or before 45 days after the end of each fiscal quarter of the
Servicer, the Servicer shall deliver an Officers' Certificate to the Buyer and
the Trustee to the effect that a review of the activities of the Servicer during
the Servicer's preceding fiscal quarter has been made under the supervision of
the officers executing such Officers' Certificate with a view to determining



                                       7
<PAGE>   8

whether during such period the Servicer has performed and observed, in all
material respects, its obligations under the Indenture and the Servicing
Agreement, and either (A) stating that to the best of their knowledge no default
by the Servicer under the Indenture or the Servicing Agreement has occurred and
is continuing, or (B) if such a default has occurred and is continuing,
specifying such default and the nature and status thereof. Such certificate need
not comply with Section 11.4 of the Indenture.

                  N. ANNUAL ACCOUNTANTS' REPORTS. On or before 120 days after
the end of each fiscal year of the Servicer, the Servicer and the Buyer shall
deliver to the Trustee separate reports, prepared by a firm of independent
accountants selected by the Servicer and the Buyer, that (i) they have examined
the balance sheets of the Servicer and the Buyer is of the last day of said
fiscal year and the related statements of operations, retained earnings and
changes in financial position for such fiscal year and have issued an opinion
thereon, specifying the date thereof, (ii) they have also examined certain
documents and the records to the Contracts, (iii) their examination as described
under clauses (i) and (ii) above was made in accordance with generally accepted
auditing standards and accordingly included such tests of the accounting records
and such other auditing procedures as they considered necessary in the
circumstances, and (iv) their examination described under clauses (i) and (ii)
above disclosed no exceptions that, in their opinion, were material, relating to
such Contracts, or, if any such exceptions were disclosed thereby, setting forth
such exceptions that, in their opinion, were material.

                  O. CORPORATE EXISTENCE; STATUS OF SERVICER; MERGER. The
Servicer shall keep in full effect its existence, rights and franchises as a
corporation under the laws of the State of Texas, and will obtain and preserve
its qualification to do business as a foreign corporation in each jurisdiction
in which such qualification is or shall be necessary to protect the validity and
enforceability of the Contract Documents, the Indenture and the Servicing
Agreement.

         The Servicer shall not consolidate with or merge into any other
corporation or convey, transfer or lease substantially all of its assets as an
entirety to any person unless the corporation formed by such consolidation or
into which the Servicer has merged or the person that acquires by conveyance,
transfer or lease substantially all the assets of the Servicer as an entirety is
an entity organized and existing under the laws of the United States or any
state or the District of Columbia and executes and delivers to the Buyer and the
Trustee an agreement in form and substance reasonably satisfactory to the Buyer
and the Trustee, which contains an assumption by such successor entity of the
due and punctual performance and observance of each covenant and condition to be
performed or observed by the Servicer under the Indenture and the Servicing
Agreement.

                  P. THE SERVICER NOT TO RESIGN; ASSIGNMENT. The Servicer shall
not resign from the duties and obligations hereby imposed on it except upon
determination by its Board of Directors that by reason of change in applicable
legal requirements the continued performance by the Servicer of its duties under
the Indenture would cause it to be in violation of such legal requirements in a
manner that would result in a material adverse effect on the Servicer



                                       8
<PAGE>   9

or its financial condition, said determination to be evidenced by a resolution
of its Board of Directors to such effect. No such resignation shall become
effective unless and until a new servicer acceptable to the Buyer is willing to
service the Contracts and enters into a servicing agreement with the Buyer in
form and substance substantially similar to the Servicing Agreement. No such
resignation shall affect the obligation of the Servicer to repurchase any
Contract pursuant to the Servicing Agreement.

         The Servicer may not assign the Servicing Agreement or any of its
rights, powers, duties or obligations hereunder, provided that the Servicer may
assign the Indenture and in connection with a consolidation, merger, conveyance,
transfer or lease made in compliance with SECTION 5(O) and provided further that
the Servicer may contract with industry qualified third parties for the
performance of its duties under the Servicing Agreement, except that any such
contract shall not relieve the Servicer from liability for its obligations under
the Servicing Agreement.

                  Q. PURCHASE OF CERTAIN CONTRACTS. The representations and
warranties of the Servicer set forth in Section 4.4 of the Indenture with
respect to each Contract shall survive delivery of the Contract Documents to the
Trustee and shall continue so long as such Contract remains outstanding. Upon
discovery by the Buyer, the Servicer or the Trustee that any of such
representations or warranties was incorrect as of the time made or that any of
the Contract Documents relating to any such Contract has not been properly
executed by the Obligor or the Servicer or contains a material defect or has not
been received by the Trustee, the party making such discovery shall give prompt
notice to the other and to the Trustee (other than in cases where the Trustee
has given notice thereof). If any such defect, incorrectness or omission
materially and adversely affects the interest of the Security holders in and to
the related Contract, the Servicer shall, within 90 days after discovery thereof
or receipt of notice thereof, cure the defect or eliminate or otherwise cure the
circumstances or condition in respect of which representation or warranty was
incorrect as of the time made. If the Servicer is unable to do so, it shall
purchase such Contract from the Buyer through a deposit into the Master
Collections Account no later than the end of the Collection Period during which
such 90-day period expired of an amount equal to the purchase price paid by the
Buyer for such Contract less any lease payments from the Obligor relating to the
Contract after the Buyer's purchase of the Contract. Upon such deposit, the
Servicer shall be entitled to request a release of the defective Contract from
the lien of the Indenture pursuant to Section 4.4(a) of the Indenture. Upon any
such purchase, the Buyer and the Trustee shall execute and deliver such
instruments of transfer or assignment, in each case without recourse, as shall
be necessary to vest in the Servicer any Contract purchased hereunder.

         It is understood that, without limiting the meaning of the term
"materially and adversely affects," the interest of the Securityholders shall be
deemed materially and adversely affected if (i) the Buyer, the Trustee or of any
such Securityholders are put under any obligation to pay any other Person any of
such money as a result of any such defect or misrepresentation, or (ii) the
Trustee or the Holders of Securities representing not less than 25% of the
aggregate principal amount of the Outstanding Securities, acting reasonably,
determine, by notice to the Buyer, that



                                       9
<PAGE>   10

such defect or misrepresentation materially and adversely affects the interests
of the Holders of Securities in and to a Contract.

         6. MAINTENANCE OF INTERNAL CONTROL AND PROCEDURES. Servicer shall, at
all times during the term of the Servicing Agreement, follow internal control
procedures consistent with loan servicing industry standards and, at the request
of Buyer, will supply same in written form for review purposes.

         7. COMPUTER. Servicer shall, at all times during the term of the
Servicing Agreement, utilize in the operation of its business the industry
standard computer software and contract information maintenance system, such
system to be approved by Buyer.

         8. SERVICER EVENTS OF DEFAULT. The occurrence and continuation of any
one of the following events shall be a "Servicer Event of Default" under the
Servicing Agreement:

                  A. Failure on the part of the Servicer to remit collections on
the Contracts to the Master Collections Account when due and continuance of such
failure for four Business Days; or

                  B. An involuntary case is commenced or filed against the
Servicer under the federal bankruptcy laws, as now or hereafter in effect, or
any other present or future federal or state bankruptcy, insolvency or similar
law, or for the appointment of a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official of the Servicer or of any
substantial part of its property, or for the winding up of the affairs of,
liquidation, dissolution, or reorganization of the Servicer and the continuance
of such case or filing unstayed for a period of thirty consecutive days; or

                  C. An order for relief shall be entered in a case under title
11 of the United States Code on which the Servicer is a debtor, or the Servicer
shall become insolvent or admit in writing it s inability to pay its debts as
they come due, or the commencement by the Servicer of a voluntary case under the
federal bankruptcy laws, as now or hereafter in effect, or any other present or
future federal or state bankruptcy, insolvency or similar law, or the consent by
the Servicer to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Servicer or of any substantial part of its property or the making by the
Servicer of an assignment for the benefit of creditors or the failure by the
Servicer generally to pay its debts as such debts become due or the taking of
corporate action by the Servicer in furtherance of any of the foregoing.

                  D. Failure by Servicer to service and collect amounts due from
Obligors under Contracts in accordance with the servicing criteria described in
EXHIBIT A attached hereto.



                                       10
<PAGE>   11

         9. REMEDIES.

                  A. If a Servicer Event of Default shall have occurred, Buyer
may, by notice given in writing to the Servicer, terminate all of the rights and
obligations of the Servicer under the Servicing Agreement. Notwithstanding any
termination of the rights and obligations of the Servicer, the Servicer shall
remain responsible for any acts or omissions to act by it as Servicer prior to
such termination.

                  B. Buyer is hereby authorized and empowered (upon the failure
of the Servicer to cooperate) to execute and deliver, on behalf of the Servicer
as attorney-in-fact or otherwise, all documents and other instruments upon the
failure of the Servicer to execute or deliver such documents or instruments, and
to do and accomplish all other acts or things necessary or appropriate to effect
the purposes of a transfer of servicing rights to a successor servicer.

                  C. The Servicer agrees to cooperate with Buyer and any
successor servicer in effecting the termination of the responsibilities and
rights of the Servicer to conduct servicing hereunder, including, without
limitation, the transfer to such successor servicer of all authority of the
Servicer to service the Contracts provided for under the Servicing Agreement.

                  D. In the event the rights and responsibilities of the
Servicer are terminated, as provided above, Buyer may take such steps as may be
appropriate or necessary to protect and preserve the Trust Estate, and to assure
the orderly transfer of authority and responsibility to the successor Servicer,
and to assure that title to all assets of the Trust Estate are vested in Buyer,
with security interests vested in Buyer and Trustee (including all steps deemed
necessary or advisable by the Trustee), and to do or accomplish all other acts
or things necessary or appropriate to effect such vesting and assumption,
including, without limitation, directing the Obligors to remit Lease payments
and all other payments in respect of the Contracts to an account or address
designated by the Buyer or such new servicer. This right of termination is
cumulative and not exclusive of all other rights and remedies from time to time
conferred upon or reserved to the Buyer or the Trustee that either of them may
have at law or in equity. The right or remedy may be exercised from time to time
and as often as deemed expedient. No delay or omission in insisting upon the
strict observance or performance of any provision of the Servicing Agreement, or
in exercising any right or remedy, shall be construed as a waiver or
relinquishment of such provision, nor shall it impair such right or remedy.

         10. COVENANTS OF THE BUYER. From and after the date hereof until such
time as this Servicing Agreement shall terminate, Buyer shall maintain its right
to do business in Texas as a corporation organized under the laws of the State
of Texas, and shall maintain all licenses and qualifications necessary for it to
conduct its business. It will provide to Servicer all assistance reasonably
requested by Servicer to enable Servicer to perform its obligations under this
Servicing Agreement.

         11. SUCCESSORS AND ASSIGNS. The Servicing Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. The Servicer may contract with industry-qualified
parties for the performance of any or all of its



                                       11
<PAGE>   12

obligations arising hereunder but no such contract shall relieve Servicer from
liability for its performance hereunder.

         12. BUYER EVENT OF DEFAULT; SERVICER'S REMEDIES. In the event that
Buyer should fail to pay any fees or compensation due under the Servicing
Agreement, within ten (10) days of the date they are due, or are submitted for
payment, whichever is less, or shall fail to perform any of its duties or to
observe or perform any other term, covenant, condition or agreement provided
within the Servicing Agreement, said failure shall constitute an event of
default by the Buyer. In the event of such default, Servicer shall have the
option of terminating the Servicing Agreement in addition to all remedies
available in equity or law.

         13. MODIFICATIONS AND WAIVERS. No delay on the part of any party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, not shall any waiver of any right, power or privilege hereunder operate
as a waiver of any other right, power of privilege hereunder, nor shall any
single or partial exercise of any right, power or privilege hereunder preclude
any other or further exercise thereof, or the exercise of any other right, power
or privilege hereunder. All rights and remedies herein provided are cumulative
and are not exclusive of any rights or remedies that the parties hereto may
otherwise have at law or in equity. No waiver shall be valid in the absence of
the written and signed consent of the party against which enforcement of such is
sought.

         14. NOTICE. Except as otherwise specifically provided herein, any
notice hereunder shall be in writing (including telegraphic or telecopy
communication) and, if mailed, shall be deemed to be given when sent by
registered or certified mail, postage prepaid, or if telegraphed when delivered
to the telegraph company, or if telecopied when transmitted, or otherwise when
delivered in person to the addressee and a receipt given for, in all such
instances addressed to the respective party as follows:

                      To Servicer:     Transition Leasing Management, Inc.
                                       8144 Walnut Hill Lane, Number 680
                                       Dallas, Texas 75231
                                       Attn: Ken Lowe, President

                      To Buyer:        Transaction Auto Finance IV, Inc.
                                       8144 Walnut Hill Lane, Number 680
                                       Dallas, Texas 75231
                                       Attn: Ken Lowe, President

         15. AMENDMENT. The Servicing Agreement may be amended, supplemented or
modified only with the written consent of the parties hereto.

         16. CHOICE OF LAW. THE SERVICING AGREEMENT, AND THE VALIDITY AND
ENFORCEMENT HEREOF, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
SUBSTANTIVE LAWS OF THE STATE OF TEXAS.



                                       12
<PAGE>   13

         17. SEVERABILITY. If any provision of the Servicing Agreement is held
to be illegal, invalid or unenforceable under present or future laws effective
during the term of the Servicing Agreement, the legality, validity and
enforceability of the remaining provisions of the Servicing Agreement, shall not
be affected thereby, and in lieu of each such illegal, invalid or unenforceable
provision there shall be added automatically as a part of the Servicing
Agreement a provision as similar in terms to such illegal, invalid or
unenforceable provision as may be possible and be legal, valid and enforceable.

         18. ENTIRE AGREEMENT. This instrument embodies the entire agreement
between the parties relating to the subject matter hereof and supersedes all
prior agreements and understandings, if any, relating to the subject matter
hereof.

         19. COUNTERPARTS. The Servicing Agreement may be executed in one or
more counterparts, each of which for all purposes is to be deemed an original.

         20. SURVIVAL. All covenants, agreements, undertakings, indemnities,
representations and warranties made herein shall survive both the execution and
the termination hereof and shall not be affected by any investigation made by
any party.

         21. FURTHER ASSURANCES. Servicer shall furnish to Buyer at the request
of the Buyer such additional information concerning the Contracts as Buyer may
from time to time reasonably request in order to establish compliance with the
terms and conditions of the Servicing Agreement, and shall execute, acknowledge
and deliver, or cause to be executed, acknowledged or delivered, such
supplements hereto and such further instruments as may reasonably be required or
appropriate and permitted by law to further express the intention, or to
facilitate the performance of the Servicing Agreement.

                                        "BUYER"

                                        Transition Auto Finance IV, Inc.



                                        By:
                                            ------------------------------------
                                                   Ken Lowe, President


                                        "SERVICER"

                                        Transition Leasing Management, Inc.



                                        By:
                                            ------------------------------------
                                                   Ken Lowe, President




                                       13
<PAGE>   14

                               SERVICING AGREEMENT

                                    EXHIBIT A

                               SERVICING CRITERIA


         At all times during the term of this Servicing Agreement as set forth
in Section 2 therein, Servicer shall perform its duties in material accordance
with the Servicing Agreement, and observe the following covenants and criteria
(referred to as the "servicing criteria"):

         I.       SERVICING ACTIVITY REPORT

                  A. Servicer shall prepare a Monthly Report Certificate (the
"Certificate") signed by an officer of Servicer who shall certify as to the
authenticity and accuracy therein, that all Contracts managed by Servicer were
collected and repossessed in accordance with the terms and conditions of the
Servicing Agreement, including the servicing criteria described herein, and that
no Servicing Event of Default as described in Section 8 of the Servicing
Agreement has occurred since the date of the last such Certificate.

                  B. The Certificate shall contain collection information on
each Contract since the date of the last such Certificate, including adequately
segregated information of all past due accounts, repossessions, charge-offs, and
extensions. Supporting documents shall be made available to Buyer on a demand
basis, and such records shall be properly and safely maintained.

                  C. The Certificate shall be delivered to Buyer on or before
the tenth day of the month following the month covered thereunder.

         II.      COLLECTION POLICY

                  A. All Obligors under related Contracts will be issued a
preprinted payment book, monthly statements or other remittance advice or
instructions that will specifically request that all payments be made to
Servicer's Master Collections Account lockbox.

                  B. Servicer shall contact any Obligor on a past due Contract
within ten days after the payment due date for the purpose of pursuing
collections and shall adequately update all credit and collection file records
with respect to such activities.

                  C. Any material extensions, modifications, or acceptances of
partial payments by Obligors, and any related necessary Contract amendments
and/or default waivers by Servicer, shall be approved by the chief credit
officer or president of Servicer or its assigns, and all necessary third party
charges and explanations relating thereto shall be documented in the collection
file records.



                                       14
<PAGE>   15

         III.     OBLIGOR DEFAULT

                  A. If, at any time, an Obligor is more than thirty days past
due on a payment owed by him under a Contract, Servicer shall engage an
independent third party contractor to repossess the Leased Vehicle.

                  B. Following repossession of a Leased Vehicle, (i) Servicer
will proceed to cause the Leased Vehicle to be sold at an automobile auction
and deliver the proceeds to Buyer, or (ii), if the Obligor has not previously
defaulted, Servicer may, in its discretion upon the exercise of reasonable
judgment as to the financial responsibility of Obligor and any other pertinent
factors, allow Obligor to regain possession of the Leased Vehicle upon payment
of late charges and repossession costs. In the situation in which Obligor is
allowed to regain possession of the Leased Vehicle, Obligor will be advised that
if default occurs a second time, the Leased Vehicle will be repossessed and
sold, and Obligor will not be given the opportunity to cure the default and
regain possession of the Leased Vehicle, unless otherwise required by applicable
law.



                                       15