<PAGE>
                                                                 EXECUTION COPY









                            INDEMNIFICATION AGREEMENT


                                      among

                       FINANCIAL SECURITY ASSURANCE INC.,

                    LONG BEACH ACCEPTANCE RECEIVABLES CORP.,

                         GREENWICH CAPITAL MARKETS, INC.

                                       and

                          CITIGROUP GLOBAL MARKETS INC.








                            Dated as of June 1, 2003

               Long Beach Acceptance Auto Receivables Trust 2003-B

                $48,000,000 0.990% Asset Backed Notes, Class A-1

                $84,200,000 1.114% Asset Backed Notes, Class A-2

                $44,000,000 1.575% Asset Backed Notes, Class A-3

                $73,800,000 2.178% Asset Backed Notes, Class A-4




<PAGE>





                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                                        PAGE
<S>                                                                                  <C>

Section 1.   Definitions...................................................................1

Section 2.   Representations, Warranties and Agreements of Financial Security..............3

Section 3.   Representations, Warranties and Agreements of the Underwriters................6

Section 4.   Indemnification...............................................................6

Section 5.   Indemnification Procedures....................................................7

Section 6.   Contribution..................................................................8

Section 7.   Miscellaneous.................................................................9

EXHIBIT A - Opinion of Assistant General Counsel

</TABLE>
                                            i

<PAGE>


                            INDEMNIFICATION AGREEMENT



                  INDEMNIFICATION AGREEMENT, dated as of June 1, 2003, among
FINANCIAL SECURITY ASSURANCE INC. ("Financial Security"), LONG BEACH ACCEPTANCE
RECEIVABLES CORP. (the "Company"), GREENWICH CAPITAL MARKETS, INC. ("RBS GC")
and CITIGROUP GLOBAL MARKETS INC., ("Citigroup" and, together with RBS GC, the
"Underwriters"):

                  Section 1.   Definitions.  For purposes of this Agreement,
the following terms shall have the meanings provided below:

                  "Agreement" means this Indemnification Agreement, as the same
may be amended, supplemented or otherwise modified from time to time in
accordance with the terms hereof.

                  "Commission" means the Securities and Exchange Commission.

                  "Company Party" means any of the Company, its parent,
subsidiaries and affiliates and any shareholder, director, officer, employee,
agent or "controlling person" (as such term is used in the Securities Act) of
any of the foregoing.

                  "Federal Securities Laws" means the Securities Act, the
Securities Exchange Act of 1934, the Trust Indenture Act of 1939, the Investment
Company Act of 1940, the Investment Advisers Act of 1940 and the Public Utility
Holding Company Act of 1935, each as amended from time to time, and the rules
and regulations in effect from time to time under such Acts.

                  "Financial Security Agreements" means this Agreement, the
Spread Account Agreement and the Insurance Agreement.

                  "Financial Security Information" has the meaning provided in
Section 2(g) hereof.

                  "Financial Security Party" means any of Financial Security,
its parent, subsidiaries and affiliates, and any shareholder, director, officer,
employee, agent or "controlling person" (as such term is used in the Securities
Act) of any of the foregoing.

                  "Indemnified Party" means any party entitled to any
indemnification pursuant to Section 4 hereof.

                  "Indemnifying Party" means any party required to provide
indemnification pursuant to Section 4 hereof.

                  "Insurance Agreement" means the Insurance and Indemnity
Agreement, dated as of June 1, 2003, among Financial Security, the Company and
LBAC, and Long


<PAGE>




Beach Acceptance Auto Receivables Trust 2003-B as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereof.

                  "LBAC" means Long Beach Acceptance Corp., a Delaware
Corporation.

                  "Losses" means (a) any actual out-of-pocket damages incurred
by the party entitled to indemnification or contribution hereunder, (b) any
actual out-of-pocket costs or expenses incurred by such party, including
reasonable fees or expenses of its counsel and other expenses incurred in
connection with investigating or defending any claim, action or other proceeding
which entitle such party to be indemnified hereunder (subject to the limitations
set forth in Section 5 hereof), to the extent not paid, satisfied or reimbursed
from funds provided by any other Person other than an affiliate of such party
(provided that the foregoing shall not create or imply any obligation to pursue
recourse against any such other Person), plus (c) interest on the amount paid by
the party entitled to indemnification or contribution from the date of such
payment to the date of payment by the party who is obligated to indemnify or
contribute hereunder at the statutory rate applicable to judgments for breach of
contract.

                  "Offering Document" means the Prospectus, Prospectus
Supplement and any other material or documents delivered by the Underwriters or
any Underwriter Party to any Person in connection with the offer or sale of the
Securities; provided, however, the Preliminary Computational Materials dated
June 19, 2003, in respect of the Securities shall not be included in this
definition of "Offering Document".

                  "Person" means any individual, partnership, joint venture,
corporation, trust, unincorporated organization, limited liability company,
limited liability partnership or other organization or entity (whether
governmental or private).

                  "Policy" means the financial guaranty insurance policy
delivered by Financial Security with respect to the Securities.

                  "Prospectus" means, collectively, the Prospectus relating to
the Securities dated January 18, 2002, and the Prospectus Supplement.

                  "Prospectus Supplement" means the Prospectus Supplement dated
June 25, 2003 relating to the Securities.

                  "Rating Agencies" has the meaning provided in the last
paragraph of Section 2 hereof.

                  "Representative" means Greenwich Capital Markets, Inc. as
representative of the Underwriters.

                  "Securities" means the Long Beach Acceptance Auto Receivables
Trust 2003-B $48,000,000 0.990% Asset Backed Notes, Class A-1, $84,200,000
1.114% Asset


                                   2

<PAGE>


Backed Notes, Class A-2, $44,000,000 1.575% Asset Backed Notes, Class A-3, and
$73,800,000 2.178% Asset Backed Notes, Class A-4, each as described in the
Prospectus Supplement and covered by the Policy.

                  "Securities Act" means the Securities Act of 1933, as amended
from time to time, and any rule or regulation in effect from time to time under
such Act.

                  "Spread Account Agreement" means the Master Spread Account
Agreement, dated as of June 1, 2003 among the Company, the Collateral Agent
specified therein, Financial Security and the Trustee specified therein, as the
same may be amended, supplemented or otherwise modified from time to time in
accordance with the terms thereof.

                  "Underwriters" means Greenwich Capital Markets, Inc. and
Citigroup Global Markets Inc.

                  "Underwriter Information" has the meaning provided in Section
3(c) hereof.

                  "Underwriter Party" means any of the Underwriters, its
respective parent, subsidiaries and affiliates and any shareholder, director,
officer, employee, or agent of the "controlling person" (as such item is used in
the Securities Act) of any of the foregoing.

                  "Underwriting Agreement" means the Underwriting Agreement
dated as of June 20, 2003 among the Company, LBAC and the Underwriters with
respect to the offer and sale of the Securities, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereof.

                  Section 2.  Representations, Warranties and Agreements of
Financial Security. Financial Security represents, warrants and agrees with the
parties hereto as follows:

                 (a) Organization, Etc.  Financial Security is a stock insurance
company duly organized, validly existing and authorized to transact financial
guaranty insurance business under the laws of the State of New York.

                 (b) Authorization, Etc.  The Policy and the Financial Security
Agreements have been duly authorized, executed and delivered by Financial
Security.

                 (c) Validity, Etc. The Policy and the Financial Security
Agreements constitute valid and binding obligations of Financial Security,
enforceable against Financial Security in accordance with their terms, subject,
as to the enforcement of remedies, to bankruptcy, insolvency, reorganization,
rehabilitation, moratorium and other similar laws affecting the enforceability
of creditors' rights generally applicable in the event of the bankruptcy or
insolvency of Financial Security and to the application of general principles of
equity and subject, in the case of this Agreement, to principles of

                                         3


<PAGE>


public policy limiting the right to enforce the indemnification provisions
contained herein.

                 (d) Exemption From Registration. The Policy is exempt from
registration under the Securities Act.

                 (e) No Conflicts. Neither the execution or delivery by
Financial Security of the Policy or the Financial Security Agreements, nor the
performance by Financial Security of its obligations thereunder, will conflict
with any provision of the certificate of incorporation or the bylaws of
Financial Security nor result in a breach of, or constitute a default under, any
material agreement or other instrument to which Financial Security is a party or
by which any of its property is bound nor violate any judgment, order or decree
applicable to Financial Security of any governmental or regulatory body,
administrative agency, court or arbitrator having jurisdiction over Financial
Security (except that, in the published opinion of the Securities and Exchange
Commission, the indemnification provisions of this Agreement, insofar as they
relate to indemnification for liabilities arising under the Securities Act, are
against public policy as expressed in the Securities Act and are therefore
unenforceable).

                 (f) Financial Information. The consolidated balance sheets of
Financial Security as of December 31, 2002 and December 31, 2001 and the related
consolidated statements of income, changes in shareholder's equity and cash
flows for the fiscal years then ended, and the interim consolidated balance
sheet for Financial Security as of March 31, 2003, and the related statements of
income, changes in shareholders equity and cash flows for the interim period
then ended, furnished by Financial Security to the Underwriters fairly present
in all material respects the financial condition of Financial Security as of
such dates and for such periods in accordance with generally accepted accounting
principles consistently applied (subject as to interim statements to normal
year-end adjustments) and since the date of the most current interim
consolidated balance sheet referred to above there has been no change in the
financial condition of Financial Security which would materially and adversely
affect its ability to perform its obligations under the Policy.

                 (g) Financial Security Information. The information in the
Prospectus Supplement set forth under the caption "THE INSURER" (as revised from
time to time in accordance with the provisions hereof, the "Financial Security
Information") is limited and does not purport to provide the scope of disclosure
required to be included in a prospectus with respect to a registrant in
connection with the offer and sale of securities of such registrant registered
under the Securities Act. Within such limited scope of disclosure, however, as
of the date of the Prospectus Supplement and as of the date hereof, the
Financial Security Information does not contain any untrue statement of a
material fact, or omit to state a material fact necessary to make the statements
contained therein, in the light of the circumstances under which they were made,
not misleading.

                                       4
<PAGE>


                 (h) Additional Information. Financial Security will furnish to
the Underwriters or the Company, upon request of the Underwriters or the
Company, as the case may be, copies of Financial Security's most recent
financial statements (annual or interim, as the case may be) which fairly
present in all material respects the financial condition of Financial Security
as of the dates and for the periods indicated, in accordance with generally
accepted accounting principles consistently applied except as noted therein
(subject, as to interim statements, to normal year-end adjustments). In
addition, if the delivery of a Prospectus relating to the Securities is required
at any time prior to the expiration of nine months after the time of issuance of
the Prospectus in connection with the offering or sale of the Securities, the
Company or the Underwriters will notify Financial Security of such requirement
to deliver a Prospectus and Financial Security will promptly provide the
Underwriters and the Company with any revisions to the Financial Security
Information that are in the judgment of Financial Security reasonably necessary
to prepare a supplement to the Prospectus.

                 (i) Opinion of Counsel. Financial Security will furnish to the
Underwriters and the Company, on the closing date for the sale of the
Securities, an opinion of its Assistant General Counsel, to the effect set forth
in Exhibit A attached hereto, dated such closing date and addressed to the
Company and the Underwriters.

                 (j) Consents and Reports of Independent Accountants. Financial
Security will furnish to the Underwriters and the Company, upon request, as
comfort from its independent accountants in respect of its financial condition
(i) at the expense of the Person specified in the Insurance Agreement, a copy of
the Prospectus, including either a manually signed consent or a manually signed
report of Financial Security's independent accountants and (ii) the quarterly
review letter by Financial Security's independent accountants in respect of the
most recent interim financial statements of Financial Security.

Nothing in this Agreement shall be construed as a representation or warranty by
Financial Security concerning the rating of its insurance financial strength by
Moody's Investors Service, Inc. or its insurer financial strength by Standard &
Poor's Ratings Group, a division of The McGraw-Hill Companies, or any other
rating agency (collectively, the "Rating Agencies"). The Rating Agencies, in
assigning such ratings, take into account facts and assumptions not described in
the Prospectus and the facts and assumptions considered by the Rating Agencies,
and the ratings issued thereby, are subject to change over time.

                 Section 3. Representations, Warranties and Agreements of the
Underwriters. Each of the Underwriters represents, warrants and agrees with the
parties hereto as follows:

                 (a) Compliance With Laws. Such Underwriter will comply in all
material respects with all legal requirements in connection with offers and
sales of the Securities and make such offers and sales in the manner provided in
any Offering Memorandum.

                                       5

<PAGE>


                 (b) Offering Document. Such Underwriter will not use, or
distribute to other broker-dealers for use, any Offering Document in connection
with the offer and sale of the Securities unless such Offering Document includes
such information as has been furnished by Financial Security for inclusion
therein and the information therein concerning Financial Security has been
approved by Financial Security in writing. Financial Security hereby consents to
the information in respect of Financial Security included in the Prospectus
Supplement. Each Offering Document will include the following statement:

         "The Policy is not covered by the property/casualty insurance security
         fund specified in Article 76 of the New York Insurance Law".

         Each Offering Document including financial information (other than
financial information included in the Financial Security Information) with
respect to Financial Security prepared in accordance with generally accepted
accounting principles will include the following statement immediately preceding
such financial information:

         "The New York State Insurance Department recognizes only statutory
         accounting practices for determining and reporting the financial
         condition and results of operations of an insurance company, for
         determining its solvency under the New York Insurance Law, and for
         determining whether its financial condition warrants the payment of a
         dividend to its stockholders. No consideration is given by the New York
         State Insurance Department to financial statements prepared in
         accordance with generally accepted accounting principles in making such
         determinations."

                 (c) Underwriter Information. With respect to any Underwriter,
all material provided by such Underwriter for inclusion in any Offering Document
(as revised from time to time and certified by such Underwriter in writing to
constitute Underwriter Information, the "Underwriter Information"), insofar as
such information relates to such Underwriter, is true and correct in all
material respects. In respect of the Prospectus Supplement, the Underwriter
Information with respect to such Underwriter is limited to the information
relating to such Underwriter set forth (i) in the body of the Prospectus
Supplement under the caption "Underwriting" the first, second and last
paragraphs and (ii) any other information certified in writing by such
Underwriter to be Underwriter Information.


           Section 4. Indemnification.

                 (a) Financial Security agrees, upon the terms and subject to
the conditions provided herein, to indemnify, defend and hold harmless each
Company Party and each Underwriter Party against (i) any and all Losses incurred
by them with respect to the offer and sale of the Securities and resulting from
Financial Security's breach of any of its representations, warranties or
agreements set forth in Section 2 hereof and (ii) any and all Losses to which
any Company Party or Underwriter Party may become

                                       6
<PAGE>




subject, under the Securities Act or otherwise, insofar as such Losses arise out
of or result from an untrue statement of a material fact contained in any
Offering Document or the omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
omission was made in the Financial Security Information included therein in
accordance with the provisions hereof.

                 (b) Each of the Underwriters agrees, severally and not jointly,
upon the terms and subject to the conditions provided herein, to indemnify,
defend and hold harmless each Financial Security Party against (i) any and all
Losses incurred by them with respect to the offer and sale of the Securities and
resulting from such Underwriter's breach of any of its representations,
warranties or agreements set forth in Section 3 hereof and (ii) any and all
Losses to which any Financial Security Party may become subject, under the
Securities Act or otherwise, insofar as such Losses arise out of or result from
an untrue statement of a material fact contained in any Offering Document or the
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or omission was made
in the Underwriter Information with respect to such Underwriter included
therein.

                 (c) Upon the incurrence of any Losses for which a party is
entitled to indemnification hereunder, the Indemnifying Party shall reimburse
the Indemnified Party promptly upon establishment by the Indemnified Party to
the Indemnifying Party of the Losses incurred.

         Section 5. Indemnification Procedures. Except as provided below in
Section 6 with respect to contribution, the indemnification provided herein by
an Indemnifying Party shall be the exclusive remedy of any and all Indemnified
Parties for the breach of a representation, warranty or agreement hereunder by
an Indemnifying Party; provided, however, that each Indemnified Party shall be
entitled to pursue any other remedy at law or in equity for any such breach so
long as the damages sought to be recovered shall not exceed the Losses incurred
thereby resulting from such breach. In the event that any action or regulatory
proceeding shall be commenced or claim asserted which may entitle an Indemnified
Party to be indemnified under this Agreement, such party shall give the
Indemnifying Party written or telegraphic notice of such action or claim
reasonably promptly after receipt of written notice thereof. The Indemnifying
Party shall be entitled to participate in and, upon notice to the Indemnified
Party, assume the defense of any such action or claim in reasonable cooperation
with, and with the reasonable cooperation of, the Indemnified Party. The
Indemnified Party shall have the right to employ separate counsel in any such
action and to participate in the defense thereof at the expense of the
Indemnified Party; provided, however, that the fees and expenses of such
separate counsel shall be at the expense of the Indemnifying Party if (i) the
Indemnifying Party has agreed to pay such fees and expenses, (ii) the
Indemnifying Party shall have failed to assume the defense of such action or
proceeding and employ counsel satisfactory to the Indemnified Party in any such
action or proceeding or (iii) the named parties to any such action or proceeding
(including any impleaded parties) include

                                       7
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both the Indemnified Party and the Indemnifying Party, and the Indemnified Party
shall have been advised by counsel that (A) there may be one or more legal
defenses available to it which are different from or additional to those
available to the Indemnifying Party and (B) the representation of the
Indemnifying Party and the Indemnified Party by the same counsel would be
inappropriate or contrary to prudent practice, in which case, if the Indemnified
Party notifies the Indemnifying Party in writing that it elects to employ
separate counsel at the expense of the Indemnifying Party, the Indemnifying
Party shall not have the right to assume the defense of such action or
proceeding on behalf of such Indemnified Party, it being understood, however,
that the Indemnifying Party shall not, in connection with any one such action or
proceeding or separate but substantially similar or related actions or
proceedings in the same jurisdiction arising out of the same general allegations
or circumstances, be liable for the reasonable fees and expenses of more than
one separate firm of attorneys at any time for all the Company Parties, one such
firm for all Underwriter Parties and one such firm for all Financial Security
Parties, as the case may be, which firm shall be designated in writing by the
Company in respect of the Company Parties, by the Representative in respect of
the Underwriter Parties and by Financial Security in respect of the Financial
Security Parties. The Indemnifying Party shall not be liable for any settlement
of any such claim or action unless the Indemnifying Party shall have consented
thereto or be in default in its obligations hereunder. Any failure by an
Indemnified Party to comply with the provisions of this Section shall relieve
the Indemnifying Party of liability only if such failure is prejudicial to the
position of the Indemnifying Party and then only to the extent of such
prejudice.

         Section 6. Contribution.

                 (a) To provide for just and equitable contribution if the
indemnification provided by any Indemnifying Party is determined to be
unavailable for any Indemnified Party (other than due to application of this
Section), each Indemnifying Party shall contribute to the Losses arising from
any breach of any of its representations, warranties or agreements contained in
this Agreement on the basis of the relative fault of each of the parties as set
forth in Section 6(b) below; provided, however, that an Indemnifying Party shall
in no event be required to contribute to all Indemnified Parties an aggregate
amount in excess of the Losses incurred by such Indemnified Parties resulting
from the breach of representations, warranties or agreements contained in this
Agreement.

                 (b) The relative fault of each Indemnifying Party, on the one
hand, and of each Indemnified Party, on the other, shall be determined by
reference to, among other things, whether the breach of, or alleged breach of,
any representations, warranties or agreements contained in this Agreement
relates to information supplied by, or action within the control of, the
Indemnifying Party or the Indemnified Party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
breach.

                 (c) The parties agree that Financial Security shall be solely
responsible for the Financial Security Information, each Underwriter shall be
solely

                                       8
<PAGE>



responsible for the Underwriter Information with respect to such Underwriter and
that the balance of each Offering Document shall be the responsibility of LBAC
and the Company.

                 (d) Notwithstanding anything in this Section 6 to the contrary,
no Underwriter shall be required to contribute an amount in excess of the amount
by which the total principal balance of the Securities underwritten by such
Underwriter exceeds the amount of any damages that such Underwriter has
otherwise been required to pay in respect of any breach by such Underwriter of
its representations or warranties contained in Section 3 hereof.

                 (e) No Person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation.

                 (f) Upon the incurrence of any Losses entitled to contribution
hereunder, the contributor shall reimburse the party entitled to contribution
promptly upon establishment by the party entitled to contribution to the
contributor of the Losses incurred.

         Section 7. Miscellaneous.

                 (a) Notices. All notices and other communications provided for
under this Agreement shall be delivered to the address set forth below or to
such other address as shall be designated by the recipient in a written notice
to the other party or parties hereto:

         If to Financial Security:

                             Financial Security Assurance Inc.
                             350 Park Avenue
                             New York, NY 10022
                             Attention: Senior Vice President--Transaction
                             Oversight Department (with a copy to the Attention
                             of the General Counsel)

                             Re: Long Beach Acceptance Auto Receivables
                             Trust 2003-B
                             Policy No. 51422-N

                             Confirmation: (212) 826-0100
                             Facsimile Nos.: (212) 339-3518, (212) 339-3529 (in
                             each case in which notice or other communication
                             to Financial Security refers to an Event of
                             Default, a claim on the Policy or with respect to
                             which failure on the part of Financial Security to
                             respond shall be

                                       9
<PAGE>




                             deemed to constitute consent or acceptance,
                             then a copy of such notice or other communication
                             should also be sent to the attention of each of
                             the General Counsel and the Head-Financial
                             Guaranty Group and shall be marked to indicate
                             "URGENT MATERIAL ENCLOSED.")

         If to the Company:

                             Long Beach Acceptance Receivables Corp.
                             One Mack Centre Drive
                             Paramus, NJ  07652
                             Attention:  General Counsel
                             Facsimile No.: (201) 262-6868
                             Confirmation: (201) 262-5222

         If to the RBS GC:

                             Greenwich Capital Markets, Inc.
                             600 Steamboat Road
                             Greenwich, CT 06830
                             Attention: Asset-Backed Finance
                             Facsimile No:  (203) 618-2164
                             Confirm No:  (203) 622-5666

         If to the Citigroup:

                             Citigroup Global Markets Inc.
                             390 Greenwich Street
                             4th Floor
                             New York, NY 10013
                             Attention: Asset Backed Finance
                             Facsimile No:  (212) 723-8591
                             Confirm No:  (212) 723-9566


                 (b) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

                 (c) Assignments. This Agreement may not be assigned by any
party without the express written consent of each other party. Any assignment
made in violation of this Agreement shall be null and void.

                 (d) Amendments. Amendments of this Agreement shall be in
writing signed by each party hereto.

                                       10
<PAGE>


                 (e) Survival, Etc. The indemnity and contribution agreements
contained in this Agreement shall remain operative and in full force and effect,
regardless of (i) any investigation made by or on behalf of any Indemnifying
Party, (ii) the issuance of the Securities or (iii) any termination of this
Agreement or the Policy. The indemnification provided in this Agreement will be
in addition to any liability which the parties may otherwise have and shall in
no way limit any obligations of LBAC or the Company under the Underwriting
Agreement or under the Insurance Agreement.

                 (f) Counterparts. This Agreement may be executed in
counterparts by the parties hereto, and all such counterparts shall constitute
one and the same instrument.


                     [Remainder of Page Intentionally Blank]

                                       11
<PAGE>



                  IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the date first above written.


                                  FINANCIAL SECURITY ASSURANCE INC.



                                  By: _______________________________________
                                      Name:
                                      Title:



                                  LONG BEACH ACCEPTANCE RECEIVABLES CORP.



                                  By: _______________________________________
                                      Name:
                                      Title:



                                  GREENWICH CAPITAL MARKETS, INC.



                                  By: _______________________________________
                                      Name:
                                      Title:



                                  CITIGROUP GLOBAL MARKETS INC.



                                  By: ______________________________________
                                      Name:
                                      Title:


                                       12
<PAGE>




                                    EXHIBIT A


                      OPINION OF ASSISTANT GENERAL COUNSEL


            Based upon the foregoing, I am of the opinion that:

            1. Financial Security is a stock insurance company duly organized,
validly existing and authorized to transact financial guaranty insurance
business under the laws of the State of New York.

            2. The Policy, the Insurance Agreement and the Indemnification
Agreement been duly authorized, executed and delivered by Financial Security.

            3. The Policy, the Insurance Agreement and the Indemnification
Agreement constitute valid and binding obligations of Financial Security,
enforceable against Financial Security in accordance with their terms, subject,
as to the enforcement of remedies, to bankruptcy, insolvency, reorganization,
rehabilitation, moratorium and other similar laws affecting the enforceability
of creditors' rights generally applicable in the event of the bankruptcy or
insolvency of Financial Security and to the application of general principles of
equity and subject, in the case of the Indemnification Agreement, to principles
of public policy limiting the right to enforce the indemnification provisions
contained therein insofar as they relate to indemnification for liabilities
arising under applicable securities laws.

            4. The Policy is exempt from registration under the Securities Act
of 1933, as amended (the "Act").

            5. Neither the execution or delivery by Financial Security of the
Policy or the Insurance Agreement or the Indemnification Agreement, nor the
performance by Financial Security of its obligations thereunder, will conflict
with any provision of the certificate of incorporation or the bylaws of
Financial Security or, to the best of my knowledge, result in a breach of, or
constitute a default under, any agreement or other instrument to which Financial
Security is a party or by which it or any of its property is bound or, to the
best of my knowledge, violate any judgment, order or decree applicable to
Financial Security of any governmental or regulatory body, administrative
agency, court or arbitrator having jurisdiction over Financial Security (except
that in the published opinion of the Securities and Exchange Commission the
indemnification provisions of the Indemnification Agreement, insofar as they
relate to indemnification for liabilities arising under the Act, are against
public policy as expressed in the Act and are therefore unenforceable).

            6. In addition, please be advised that I have reviewed the
description of Financial Security under the caption "THE INSURER" in the
Prospectus Supplement dated June 25, 2003, (the "Offering Document" of the
Company with respect to the Securities. The information provided in the Offering
Document with respect to Financial Security is limited and does not purport to
provide the scope of disclosure required to be

                                       13
<PAGE>





included in a prospectus with respect to a registrant under the Securities Act
of 1933, as amended, in connection with the public offer and sale of securities
of such registrant. Within such limited scope of disclosure, however, there has
not come to my attention any information which would cause me to believe that
the description of Financial Security referred to above, as of the date of the
Prospectus Supplement or the date hereof, contained any untrue statement of a
material fact or omitted to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading (except that no opinion is rendered with respect to any
financial statements or other financial information contained or referred to
therein).

                                       14