Exhibit 10.89







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                  ASSET PURCHASE/LIABILITY ASSUMPTION AGREEMENT


                          Dated as of December 11, 2001


                                      Among

                         National Australia Bank Limited
                              (ABN 12 004 044 937),
                             HomeSide Lending, Inc.
                                       and
                          HomeSide International, Inc.,
                                   as Sellers

                                       and

                           Washington Mutual Bank, FA


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<PAGE>


                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----




                                    ARTICLE I

                                   Definitions

1.01  Defined Terms............................................................2

1.02  Interpretation..........................................................13


                                   ARTICLE II

                       Purchase And Delivery of Purchased
                    Assets; Assumption of Assumed Liabilities

2.01  Delivery of Purchased Assets; Assumption of Assumed Liabilities.........13

2.02  Consideration for Purchased Assets......................................20

2.03  Proration of Expenses...................................................21

2.04  Calculation of Purchase Price...........................................22

2.05  Settlement Date Payments................................................23

2.06  Allocation of Purchase Price............................................23

2.07  No Offset...............................................................23

2.08  Interim Settlement......................................................24

2.09  Co-Issue................................................................24


                                   ARTICLE III

                      Closing, Transfers and Related Items

3.01  Closing and Closing Date................................................24

3.02  Assignment and Assumption Documents.....................................25

3.03  Further Assistance and Assurances.......................................26



                                       -i-
<PAGE>


3.04  Other Consents..........................................................26


                                   ARTICLE IV

                         Representations and Warranties

4.01  Disclosure Schedules....................................................26

4.02  Representations and Warranties of Sellers...............................27

4.03  Representations and Warranties of Buyer.................................42

4.04  No Other Representations or Warranties..................................45


                                    ARTICLE V

                                    Covenants

5.01  Conduct of Business.....................................................45

5.02  Access; Confidentiality.................................................48

5.03  Taking of Necessary Action..............................................50

5.04  Disclosure..............................................................51

5.05  Missing Mortgage Loan Documents.........................................51

5.06  Post-Closing Collection of Certain Receivables..........................52

5.07  Granted Licenses........................................................52

5.08  Insurance Matters.......................................................52

5.09  No Solicitation.........................................................53

5.10  Non-Competition Agreement...............................................53

5.11  Non-Solicitation of Employees...........................................53

5.12  Transitional Matters....................................................54

5.13  MSR Purchases by Buyer..................................................56

5.14  Damage or Deterioration of 7301 Baymeadows Way..........................56


                                       -ii-
<PAGE>

                                   ARTICLE VI

                                Employee Matters

6.01  Employees and Service Crediting.........................................56


                                   ARTICLE VII

                            Conditions To The Closing

7.01  Conditions to Each Party's Obligation to Effect the Purchase............59

7.02  Conditions to Obligation of Buyer.......................................60

7.03  Conditions to Obligations of Sellers....................................60


                                  ARTICLE VIII

                                   Termination

8.01  Termination.............................................................61

8.02  Effect of Termination and Abandonment...................................62


                                   ARTICLE IX

                                   Tax Matters

9.01  Cooperation.............................................................62

9.02  Transfer Taxes..........................................................62


                                    ARTICLE X

                                 Indemnification

10.01 Indemnification Not Subject to Limitations..............................63

10.02 Indemnification Subject to Limitations..................................65

10.03 Survival Periods........................................................65

10.04 Miscellaneous...........................................................65



                                     -iii-

<PAGE>


10.05 De Minimis Liability, Deductible and Cap................................66

10.06 Third-Party Claims......................................................66


                                   ARTICLE XI

                               General Provisions

11.01 Notices.................................................................67

11.02 Amendment and Modification; Waiver......................................69

11.03 Entire Agreement........................................................69

11.04 Fees and Expenses.......................................................69

11.05 Third Party Beneficiaries...............................................70

11.06 Assignment; Binding Effect..............................................70

11.07 Governing Law...........................................................70

11.08 Waiver of Jury Trial....................................................71

11.09 Counterparts............................................................71

11.10 Severability............................................................71

11.11 Affiliates of Buyer.....................................................71



EXHIBITS

Retained Portfolio Subservicing Agreement......................................A

Services Agreement.............................................................B

Intellectual Property Rights Agreements........................................C

Solicitation Rights Agreement..................................................D

Employee Lease.................................................................E

Bill of Sale and Instrument of Assumption of Liabilities.......................F

                                      -iv-


<PAGE>


     ASSET PURCHASE/LIABILITY ASSUMPTION AGREEMENT (this "Agreement"),  dated as
of December  11, 2001,  among  National  Australia  Bank Limited (ABN 12 004 044
937), an Australian  corporation  ("Parent"),  HomeSide Lending, Inc., a Florida
corporation  ("HSL") and HomeSide  International,  Inc., a Delaware  corporation
("HSI")  (collectively,  "Sellers")  and  Washington  Mutual Bank, FA, a federal
savings association ("Buyer").

                                    RECITALS

     A.  HSL,  HSI and the  Selling  Subsidiaries  (collectively,  the  "Selling
Companies") are engaged in the Business.

     B. On the terms and subject to the  conditions  set forth  herein,  Sellers
desire to sell, and Buyer desires to purchase,  all of the assets of the Selling
Companies  that are used in  connection  with the  Business,  other than certain
Excluded Assets.

     C. In connection with the acquisition of the Business, Buyer agrees, on the
terms and  subject  to the  conditions  set  forth  herein,  to  assume  certain
liabilities and obligations of Sellers.

     D. Concurrently with the execution of this Agreement, Sellers and Buyer are
entering into (a) a subservicing agreement (the "Retained Portfolio Subservicing
Agreement"),   which  is  attached   hereto  as  Exhibit  A  providing  for  the
subservicing of the Retained Servicing Portfolio,  (b) a services agreement (the
"Services  Agreement"),  which is attached hereto as Exhibit B pursuant to which
Buyer will provide certain services related to the  administration and servicing
of Parent's Australian mortgages,  (c) an intellectual property rights agreement
(the  "Intellectual  Property  Rights  Agreement"),  which is attached hereto as
Exhibit  C,  (d) a  solicitation  rights  agreement  (the  "Solicitation  Rights
Agreement"),  which is attached  hereto as Exhibit D and (e) an  employee  lease
agreement (the "Employee Lease"), which is attached hereto as Exhibit E pursuant
to  which  Selling  Companies  will  provide  Buyer  with  the  services  of the
Prospective  Employees for a transition  period. At Closing,  Sellers and Buyers
will  enter  into  a  transitional   services   agreement   (the   "Transitional
Agreement"),  pursuant  to  which  Sellers  will  continue  to  provide  certain
transitional  services to Buyer as  described in Section  5.12,  and a licensing
agreement (the "License  Agreement"),  pursuant to which Buyer will grant Parent
and its Affiliates certain rights and licenses as described in Section 5.07.

     NOW,  THEREFORE,  in  consideration  of the  premises  and  of  the  mutual
covenants and  agreements  hereinafter  set forth,  the parties  hereto agree as
follows:

<PAGE>


                                   ARTICLE I.

                                   Definitions

1.01  Defined Terms.

(a)   The following terms are used in this Agreement with the meanings set forth
      below:

     "Action"  means any  action,  suit,  arbitration,  inquiry,  proceeding  or
investigation by or before any court, Regulatory Authority or other Governmental
Authority.

     "Advances"  means,  with respect to any Selling Company and Mortgage Loans,
the moneys  that have been  advanced  by such  Selling  Company on or before the
Closing Date from its funds in  connection  with its  servicing of such Mortgage
Loans in accordance with applicable Regulations (which moneys include principal,
interest, taxes, ground rents, assessments,  insurance premiums and other costs,
fees and expenses pertaining to the acquisition of title to and preservation and
repair of the Mortgaged Properties and including Foreclosure Buyout Claims).

     "Affiliate"  means, with respect to any specified Person,  any other Person
directly or indirectly  Controlling,  Controlled by or under common Control with
such specified Person.

     "Agency"  means  FHA,  VA,  GNMA,  FNMA,  FHLMC,  HUD or State  Agency,  as
applicable.

     "Agreement" has the meaning set forth in the preamble to this Agreement, as
this  Agreement may be amended or modified from time to time in accordance  with
the provisions of this Agreement.

     "ALSS  Platform"  means the Selling  Companies'  confidential  information,
Software, equipment, infrastructure,  documentation and rights under license and
other  third party  contracts  constituting  and  related to the ALSS  servicing
platform or embodying the same. The material  components and software modules of
the ALSS Platform are described on Sellers' Disclosure Schedule 4.02(m)(1).

     "ALSS  Platform  Intellectual  Property"  means all  Intellectual  Property
constituting and related to the ALSS Platform.

     "Ancillary Agreements" means the Retained Portfolio Subservicing Agreement,
the  Services  Agreement,   the  Intellectual  Property  Rights  Agreement,  the
Solicitation Rights Agreement, the Employee Lease, the License Agreement and the
Transitional Agreement.


                                       2
<PAGE>


     "Assignment of Mortgage  Instrument" means a written  instrument that, when
recorded  in the  appropriate  office  of the  local  jurisdiction  in which the
related Mortgaged Property is located, will reflect the transfer of the Mortgage
identified therein from the transferor to the transferee named therein.

     "Business"  means  the  business  of  originating,  marketing,  purchasing,
selling, securitizing,  servicing and/or subservicing residential mortgage loans
including  the Servicing of the existing  mortgage  servicing  rights  portfolio
conducted  by the Selling  Companies.  In the  interests  of  clarity,  the term
"Business"  shall  not in any way  include  or refer to the  Excluded  Assets or
Excluded Liabilities.

     "Business  Day"  means any day  except a  Saturday,  Sunday or other day on
which commercial banks in Jacksonville, Florida or Seattle, Washington generally
are required or authorized by law or executive order to close.

     "Certificate  Insurer"  means a provider of an  insurance  policy  insuring
against  certain   specified  losses  or  shortfalls  with  respect  to  certain
mortgage-backed securities.

     "Code"  means  the  Internal  Revenue  Code of 1986,  as  amended,  and any
successor thereto.

     "Compensation  and  Benefit  Plans"  means  bonus,  deferred  compensation,
pension, retirement,  profit-sharing, thrift, savings, employee stock ownership,
stock bonus,  stock  purchase,  deferred and  restricted  stock,  stock  option,
employment,  termination,  severance,  compensation,  medical,  health  or other
plans,  agreements,  policies or arrangements maintained by or contributed to by
the Selling Companies that cover Prospective Employees.

     "Control",  "Controlling"  or  "Controlled"  when used with  respect to any
specified  Person means the power to direct the  management and policies of such
Person,  directly  or  indirectly,  whether  through  the  ownership  of  voting
securities, by contract or otherwise.

     "Custodial Account" means all funds held or controlled by a Selling Company
with respect to any Mortgage  Loan,  including all principal and interest  funds
and any other funds due Investors,  buydown funds, suspense funds, funds for the
payment of taxes,  assessments,  insurance  premiums,  ground  rents and similar
charges,  funds for the payment of  bankruptcy  and fraud  coverage,  funds from
hazard  insurance  loss drafts and other  mortgage  escrow and  impound  amounts
(including interest thereon for the benefit of Mortgagors, if applicable).

     "Custodial  File"  means,  with  respect  to a  Mortgage  Loan,  all of the
documents  that must be maintained on file with a document  custodian or trustee
under applicable Regulations.

     "Damages" means any and all assessments,  judgments,  claims,  liabilities,
losses,  costs,  damages or expenses  (including  without  limitation  exemplary
damages, punitive damages,  interest,  penalties and reasonable attorneys' fees,


                                       3
<PAGE>

expenses and disbursements in connection with an action, suit or proceeding).

     "Delivery  Commitment"  means the  optional or  mandatory  commitment  of a
Selling  Company to sell a  Warehouse  Loan,  Pipeline  Loan or an interest in a
Warehouse Loan or a Pipeline Loan to another Person.

     "Environmental  Laws" means all  domestic,  federal,  state and local laws,
regulations,  rules and  ordinances  relating to pollution or  protection of the
environment,  including,  without  limitation,  laws  relating  to  releases  or
threatened  releases of Hazardous  Substances into the  environment  (including,
without limitation,  ambient air, surface water, ground water, land, surface and
subsurface  strata)  or  otherwise  relating  to  the  manufacture,  processing,
distribution,  use,  treatment,  storage,  release,  transport  or  handling  of
Hazardous Substances.

     "ERISA"  means the Employee  Retirement  Income  Security  Act of 1974,  as
amended.

     "FHA" means Federal Housing Administration or any successor thereto.

     "FHA Loans"  means  residential  mortgage  loans that are  insured,  or are
eligible and intended to be insured, by FHA.

     "FHLMC"  means  Federal Home Loan  Mortgage  Corporation  or any  successor
thereto.

     "FNMA"  means  Federal  National  Mortgage  Association  or  any  successor
thereto.

     "Foreclosure"  means the process culminating in the acquisition of title to
a Mortgaged  Property in a foreclosure  sale or by a deed in lieu of foreclosure
or  pursuant  to  any  other  comparable   procedure  allowed  under  applicable
Regulations.

     "Foreclosure  Buyout  Claims"  means  reimbursement  claims for  principal,
interest  and/or other  amounts paid by a Selling  Company to GNMA in accordance
with applicable  Regulations for the buyout of an FHA Loan or VA Loan subject to
Foreclosure.

     "GAAP" means generally accepted accounting  principles in the United States
which, unless otherwise indicated, are applied on a consistent basis.

     "GNMA" means  Government  National  Mortgage  Association  or any successor
thereto.

     "Governmental  Authority"  means any  Agency or other  domestic  or foreign
court,  administrative agency,  self-regulatory authority or commission or other
body  acting  in an  adjudicative  capacity  or  other  federal,  state or local


                                       4
<PAGE>

governmental or self-regulatory authority or instrumentality.

     "Hazardous  Substances" means all substances  defined as such, or regulated
as such, under any Environmental Law, including,  but not limited to, petroleum,
asbestos or polychlorinated biphenyls.

     "Hedging Assets" means all of the Selling  Companies'  interest rate swaps,
caps, floors, collars, options, futures and forward contracts,  foreign exchange
contracts,  currency swaps,  principal only trades,  treasury  trades,  or other
arrangements, in each case designed to alter the risks arising from fluctuations
in interest rates or currency values.

     "HUD" means United States  Department of Housing and Urban  Development  or
any successor thereto.

     "Insurer"  means (i) a Person who insures or guarantees  all or any portion
of the risk of loss on any  Mortgage  Loan,  including  without  limitation  any
Agency  and  any  provider  of  private  mortgage  insurance,   standard  hazard
insurance, flood insurance, earthquake insurance or title insurance with respect
to any  Mortgage  Loan  or  related  Mortgaged  Property  or (ii) a  Person  who
provides, with respect to a Servicing Agreement or an applicable Regulation, any
fidelity bond,  direct surety bond, letter of credit,  other credit  enhancement
instrument or errors and omissions policy or (iii) is a Certificate Insurer.

     "Intellectual  Property" means each of the following:  (i) patents,  patent
applications,  patent disclosures and inventions  (whether or not patentable and
whether  or  not   reduced  to   practice)   and  any   reissue,   continuation,
continuation-in-part,    revision,    extension   or    reexamination    thereof
(collectively,  "Patents"); (ii) trademarks,  service marks, trade dress, logos,
trade names and Internet  domain  names  together  with all goodwill  associated
therewith,   including,   without  limitation,  the  use  of  all  translations,
adaptations,  derivations  and  combinations  of  the  foregoing  (collectively,
"Marks");   (iii)  copyrights  and   copyrightable   works  (including   without
limitation, web sites) and all registrations,  applications and renewals for any
of the foregoing  (collectively,  "Copyrights");  (iv) information not generally
known to the public or that would  constitute  a trade  secret under the Uniform
Trade Secrets Act, and confidential information (including,  without limitation,
know-how,  research and  development  information,  designs,  plans,  proposals,
technical data,  financial,  business and marketing plans, sales and promotional
literature,   and  customer  and   supplier   lists  and  related   information)
(collectively,  "Trade Secrets");  (v) other intellectual  property rights; (vi)
all copies and  tangible  embodiments  of the  foregoing  (in  whatever  form or
medium), along with all income,  royalties,  damages and payments due or payable
after the Closing including,  without limitation,  damages and payments for past
or future infringements or misappropriations thereof; (vii) the right to sue and
recover for past infringements or misappropriations thereof; (viii) any defenses
related to any of the above; and (ix) any and all corresponding rights that, now
or hereafter, may be secured throughout the world.


                                       5
<PAGE>


     "Interest  Rate" means the prime rate in the United  States as published in
The Wall Street  Journal on the date that the  calculation  of interest is to be
made on the amount specified.  If more than one rate, or a range of rates, is so
published  as the prime  rate,  the prime rate shall be the average of the rates
published.

     "Investment  Commitment"  means the optional or mandatory  commitment  of a
Person to  purchase a  Warehouse  Loan,  a  Pipeline  Loan or an  interest  in a
Warehouse  Loan or a  Pipeline  Loan  owned  or to be  acquired  by the  Selling
Companies.

     "Investor" means FHLMC,  FNMA, GNMA, a State Agency,  the Selling Companies
or an  Affiliate  thereof,  a Private  Investor or any other  Person who owns or
holds Mortgage Loans, serviced or subserviced by the Selling Companies, pursuant
to a  Servicing  Agreement,  as  applicable.  "IRS" means the  Internal  Revenue
Service of the United States of America or any successor agency or authority.

     "Knowledge" means, with respect to each of Sellers and Buyer, the knowledge
of any of the  persons  whose  names  are set  forth  in  Section  1.01 of their
respective Disclosure Schedules.

     "Lease Period" has the meaning set forth in the Employee Lease.

     "Liabilities"  means  any  and all  debts,  losses,  liabilities,  offsets,
claims, damages, fines,  obligations,  payments and accounts payable (including,
without  limitation,  those  arising  out  of  any  award,  demand,  assessment,
settlement,  judgment or  compromise  relating to any Action),  and accruals for
out-of-pocket  costs and expenses  (including,  without  limitation,  reasonable
attorneys' fees and reasonable expenses incurred in investigating,  preparing or
defending any Action).

     "License"  means  any  license,  permit,   franchise,   approval,   orders,
qualifications, waivers or other authorization of any Governmental Authority.

     "Lien" means any lien, pledge, security interest,  mortgage, deed of trust,
claim, encumbrance,  easement, servitude,  encroachment, charge or similar right
of any other Person of any kind or nature whatsoever.

     "Material Adverse Effect" means:

     (a)......With  respect to the Business,  a material adverse change in, or a
material  adverse effect upon, the Purchased Assets or the results of operations
or financial condition of the Business,  taken as a whole,  excluding any effect
or change  attributable  to or resulting  from (1) events,  changes or trends in
economic, business or financial conditions,  including interest rate conditions,
generally or relating to companies engaged in the mortgage banking business, (2)
changes in laws,  regulations,  interpretations of laws or regulations,  GAAP or
regulatory accounting  requirements  applicable to mortgage banking companies or


                                       6
<PAGE>

their holding companies,  (3) actions, or effects of actions,  taken by Sellers,
or any of the Selling  Companies,  either  required by or  contemplated  in this
Agreement  or with the prior  written  consent  of Buyer  and (4) any  change in
national or  international  political or social  conditions  including,  without
limitation,  the engagement by the United States in hostilities,  whether or not
pursuant to the declaration of a national emergency or war, or the occurrence of
any military or terrorist attack upon or within the United States, or any of its
territories,  possessions or diplomatic or consular offices or upon any military
installation,  equipment or personnel of the United States,  provided,  however,
that none of the changes or occurrences  described in this clause (4) results in
the destruction or loss of use of the Purchased Assets; and

     (b) With respect to either of Sellers or Buyer,  a material  impairment  of
such Person's ability to perform its material obligations under this Agreement.

     "Mortgage" means with respect to a Mortgage Loan, a mortgage, deed of trust
or other  security  instrument  creating a Lien upon real property and any other
property  described  therein  which secures a Mortgage  Note,  together with any
assignment, reinstatement, extension, endorsement or modification thereof.

     "Mortgage  Loan" means either a Warehouse Loan or Pipeline Loan or Serviced
Loan.

     "Mortgage Loan Documents"  means the Custodial File and all other documents
relating to Mortgage  Loans  required to document and service the Mortgage Loans
by applicable Regulations, whether on hard copy, microfiche or its equivalent or
in  electronic  format and, to the extent  required by  applicable  Regulations,
credit and closing packages and disclosures.

     "Mortgage  Note" means,  with respect to a Mortgage Loan, a promissory note
or notes, or other evidence of indebtedness,  with respect to such Mortgage Loan
secured by a Mortgage or Mortgages, together with any assignment, reinstatement,
extension, endorsement or modification thereof.

     "Mortgaged Property" means (i) the real property and improvements  thereon,
(ii) the stock in a residential housing corporation and the lease to the related
dwelling unit or (iii) a manufactured home and, as applicable, the real property
upon which the home is situated,  in each case that secures a Mortgage  Note and
that are subject to a Mortgage.

     "Mortgagor" means the obligor(s) on a Mortgage Note.

     "Originator"  means,  with  respect  to any  Mortgage  Loan,  the entity or
entities that (i) took the relevant Mortgagor's loan application, (ii) processed
the relevant  Mortgagor's  loan  application  or (iii) closed and/or funded such
Mortgage Loan.


                                       7
<PAGE>

     "Person" means any individual, bank, corporation, partnership, association,
limited  liability  company,  business  trust,  unincorporated  organization  or
similar   organization,   whether  domestic  or  foreign,  or  any  Governmental
Authority.

     "Previously  Disclosed"  by a party  means  information  set  forth  in the
relevant  corresponding  section  of  its  Disclosure  Schedule;  provided  that
information  which,  on its face, is reasonably  readily  apparent to the reader
that it is related to another  provision of this Agreement  shall also be deemed
to be Previously Disclosed with respect to such other provision.

     "Prior  Servicer" means any party that was a servicer or subservicer of any
Mortgage Loan before a Selling Company or the current  Servicer,  as applicable,
became the servicer or subservicer of the Mortgage Loan.

     "Private Investors" means Investors which are not Agencies.

     "Prospective  Employee" means each of the Selling Companies'  employees who
are employed in the Business at the Closing Date, including any Leave Recipient,
but excluding  those Employees whose names or positions are set forth in Section
2.01(c)(xii) of Sellers'  Disclosure  Schedule and those employees who the Buyer
may designate as Retained  Employees as contemplated in Section  2.01(c)(xii) of
the Sellers' Disclosure Schedule.

     "Purchase"  means the  purchase  by Buyer of the  Purchased  Assets and the
Assumption of the Assumed Liabilities.

     "Rating Agency" means any nationally  recognized  statistical credit agency
that at the time of any determination thereof has outstanding a rating on one or
more classes of  mortgage-backed  securities or  asset-backed  securities at the
request of any issuer of mortgage-backed securities or asset-backed securities.

     "Regulation" means and includes, as of the time of reference,  with respect
to the Mortgage Loans and the Servicing under the Servicing  Agreements,  all of
the  following:  (i) all  contractual  obligations  of a Selling  Company or any
Originator  or Prior  Servicer  with  respect to Servicing  under any  Servicing
Agreement,  Mortgage Note,  Mortgage and other Mortgage Loan Document,  (ii) all
applicable federal, state and local legal and regulatory requirements (including
statutes,  rules,  regulations and ordinances) binding upon a Selling Company or
any Originator or Prior Servicer,  (iii) all other  applicable  requirements and
guidelines of each governmental agency, board,  commission,  instrumentality and
other  governmental or  quasi-governmental  body or office having  jurisdiction,
including without  limitation those of any Investor and any Insurer and (iv) all
other applicable judicial and administrative  judgments,  orders,  stipulations,
awards, writs and injunctions.


                                       8
<PAGE>


     "REO"  means any  residential  real  property  owned by a  Selling  Company
(whether for its own account or on behalf of an Investor,  FHA or VA as a result
of a Foreclosure).

     "Selling Companies Articles" means the Articles of Incorporation of HSL, as
amended, and the Certificate of Incorporation of HSI, as amended.

     "Selling Companies  By-laws" means the By-laws of HSL, as amended,  and the
By-laws of HSI, as amended.

     "Selling  Subsidiaries"  means any  Subsidiary  of HSL or HSI as Previously
Disclosed  on  Disclosure  Schedule  1.01 by  Sellers  to Buyer  other  than the
Acquired  Subsidiary,  HomeSide Global MBS Manager,  Inc. and HomeSide  Mortgage
Securities, Inc.

     "Serviced Loan" means a residential  mortgage loan (i) that is evidenced by
a Mortgage Note and secured by a Mortgage,  (ii) with respect to which a Selling
Company owns the Servicing as of the Closing Date and (iii) which is included in
the Retained Servicing Portfolio.

     "Servicer"  means the  Person  responsible  for  performing  the  Servicing
functions  in  connection  with a Mortgage  Loan in or  related to the  Retained
Servicing Portfolio.

     "Servicing" means mortgage loan servicing,  subservicing  rights and master
servicing rights and obligations including,  without limitation,  one or more of
the  following  functions (or a portion  thereof):  (i) the  administration  and
collection of payments for the reduction of principal  and/or the application of
interest on a mortgage loan; (ii) the collection of payments on account of taxes
and  insurance;  (iii) the  remittance  of  appropriate  portions  of  collected
payments;  (iv) the provision of full escrow administration;  (v) the pursuit of
foreclosure and alternate  remedies against a related Mortgaged  Property;  (vi)
the  administration  and  liquidation of REO, and (vii) the right to receive the
Servicing  Compensation  and any ancillary fees arising from or connected to the
Serviced Loans,  earnings and other benefits of the related  Custodial  Accounts
and any other related accounts  maintained by the Selling Companies  pursuant to
applicable  Regulations and Investor and Insurer requirements and, in each case,
all  rights,  powers  and  privileges  incident  to any of  the  foregoing,  and
expressly  includes the right to enter into arrangements with third parties that
generate ancillary fees and benefits with respect to the Serviced Loans.

     "Servicing  Agreement" means an agreement between an Investor and a Selling
Company  pursuant to which a Selling  Company  owns the  Servicing  and services
Mortgage Loans in the Retained Servicing Portfolio.

     "Servicing  Compensation" means any servicing fees and any excess servicing
compensation  which a Selling  Company is  entitled  to receive  pursuant to any
Servicing Agreement.


                                       9
<PAGE>

     "Software"  means each of the following:  computer  programs,  known by any
name, whether in use or under development,  including all versions thereof,  and
all  related  documentation,  training  manuals  and  materials,  user  manuals,
technical and support documentation, source code and object code, tools, program
files,  data  files,  computer  related  data,  field and data  definitions  and
relationships,  data definition specifications,  data models, program and system
logic, interfaces, program modules, routines, sub-routines,  algorithms, program
architecture,  design concepts,  development tools,  maintenance  tools,  system
designs,  program  structure,  sequence and  organizations,  screen displays and
report layouts, and all other material related to the said computer programs.

     "State  Agency"  means any state agency or other  entity with  authority to
regulate  the  mortgage-related  activities  of  the  Selling  Companies  or  to
determine the investment or servicing  requirements with regard to mortgage loan
origination, purchasing, servicing or master servicing performed by Seller.

     "Subsidiary"  means,  for any Person,  any other  person  which the initial
Person directly or indirectly Controls.

     "Tax" means any federal,  state, local, or foreign income,  gross receipts,
gains, license,  payroll,  employment,  excise,  production,  stamp, occupation,
premium, windfall profits,  environmental (including taxes under Code Sec. 59A),
customs duties, capital stock, franchise, profits, withholding,  social security
(or similar),  unemployment,  disability,  real  property,  occupancy,  personal
property, sales, use transfer,  registration, value added, alternative or add-on
minimum, estimated, or other tax of any kind whatsoever, including any interest,
penalty,  or addition thereto (and any penalty,  fine or similar amounts related
to any information return or reporting obligation notwithstanding that no tax is
otherwise payable or such obligations are properly discharged), whether disputed
or not.

     "Tax  Returns"  means all  returns  and  reports  required to be filed with
respect to Taxes.

     "Third Party Consents" means any consent, authorization,  approval, waiver,
order, license, certificate or permit or act of or from, or notice to any Rating
Agency,  any party to any contract to which any Seller or Seller Subsidiary is a
party or by which any of their assets or  properties  are bound or affected,  or
any other Person.

     "VA"  means the  United  States  Department  of  Veterans  Affairs  and any
successor thereto.

     "VA Loans" means  residential  mortgage loans that are  guaranteed,  or are
eligible and intended to be guaranteed, by VA.

     "Warehouse  Loan" means a mortgage loan that (i) is evidenced by a Mortgage
Note  and  secured  by  a  first  priority  Mortgage  on  a  one-to-four  family
residential  property (or a second  priority  mortgage loan that was  originated
concurrently or in conjunction with a first priority  mortgage loan) and (ii) is


                                       10
<PAGE>

owned by a Selling Company at the time immediately prior to the Closing.

     "WARN Act" means the Worker  Adjustment and Retraining  Notification Act of
1988, as amended.

(b) The  following  terms shall have the  respective  meanings  set forth in the
relevant Section referred to below throughout this Agreement:

         Acquired Accounts Receivable                         2.01(a)
         Acquired Cash and Equivalents                        2.01(a)
         Acquired Hedging Assets                              2.01(a)
         Acquired Intellectual Property                       2.01(a)
         Acquired Intellectual Property Licenses              2.01(a)
         Acquired Mortgage Loan Documents                     2.01(a)
         Acquired Subsidiary                                  2.01(a)
         Acquired Warehouse Loans                             2.01(a)
         Acquisition Proposal                                 5.09
         Agreement                                            Preamble
         Applicable Law                                       4.02(g)
         Assumed Liabilities                                  2.01(b)
         Australia Specific ALSS Components                   2.01(c)
         Buyer                                                Preamble
         Buyer GL Accounts                                    5.12(c)
         Buyer Indemnified Parties                            10.01(a)
         Buyer Financial Statements                           4.03(d)
         Cap                                                  10.05(a)
         Chosen Courts                                        11.07(b)
         Closing                                              3.01
         Closing Date                                         3.01
         Closing Date Value                                   2.02
         Closing Date Value Calculation Schedule              2.04(b)
         Comparable Cash Compensation                         6.01(a)
         Confidentiality Agreement                            5.02(c)
         Correspondent Agreement                              2.01(a)
         Deductible                                           10.05(a)
         Disclosure Schedule                                  4.01
         Effective Time                                       3.01
         Employee Lease                                       Recitals
         Estimated Purchase Price                             2.02
         Excluded Assets                                      2.01(c)
         Excluded Liabilities                                 2.01(b)
         Final Purchase Price                                 2.02
         Fixed and Other Assets                               2.01(a)
         Franchise Premium                                    2.02


                                       11
<PAGE>

         HSI                                                  Preamble
         HSL                                                  Preamble
         HSR Act                                              4.02(c)
         Indemnified Party                                    10.06
         Intellectual Property Rights Agreement               Recitals
         Interim Settlement Amount                            2.08
         Interim Settlement Date                              2.08
         Key Outsourcing Contracts                            2.01(a)
         Lease Time Off Cash                                  6.01(g)
         Leave Recipients                                     6.01(c)
         License Agreement                                    Recitals
         Loan Application                                     2.01(a)
         Other Assumed Liabilities                            2.01(b)
         Parent                                               Preamble
         Permitted Liens                                      4.02(d)
         Pipeline Loans                                       2.01(a)
         Pre-Closing Date Value                               2.02
         Pre-Closing Date Value Calculation Schedule          2.04(a)
         Purchase Price Adjustment                            2.02
         Purchased Assets                                     2.01(a)
         Regulatory Authority                                 4.02(f)
         Representatives                                      2.04(e)
         Restricted Business                                  5.10
         Retail Contracts                                     2.01(a)
         Retained Accounts Receivables                        2.01(c)
         Retained Advances                                    2.01(c)
         Retained Cash and Equivalents                        2.01(c)
         Retained Hedging Assets                              2.01(c)
         Retained IP Assets                                   2.01(c)
         Retained Mortgage Loan Documents                     2.01(c)
         Retained Portfolio Subservicing Agreement            Recitals
         Retained Real Estate                                 2.01(c)
         Retained Servicing Portfolio                         2.01(c)
         Retained Warehouse Loans                             2.01(c)
         Seller GL Accounts                                   5.12(c)
         Seller Indemnified Parties                           10.01(b)
         Sellers                                              Preamble
         Selling Companies                                    Recitals
         Services Agreement                                   Recitals
         Servicing Advances                                   2.01(c)
         Servicing Purchase Agreements                        2.01(a)
         Settlement Date                                      2.05
         Solicitation Rights Agreement                        Recitals
         Specified Contracts                                  4.02(h)
         Template Letters                                     2.01(c)


                                       12
<PAGE>

         Third-Party Claim                                    10.06
         Time Off Cash                                        6.01(g)
         Transfer Taxes                                       9.02
         Transferred Employee                                 6.01(a)
         Transitional Agreement                               Recitals

         1.02  Interpretation.

         (a)   The table of contents  and headings  contained in this  Agreement
               are for  reference  purposes  only and do not limit or  otherwise
               affect any of the provisions of this Agreement.

         (b)   Whenever the words "include",  "includes" or "including" are used
               in this  Agreement,  they will be deemed  to be  followed  by the
               words "without  limitation".  Any singular term in this Agreement
               will be deemed to include  the  plural,  and any plural  term the
               singular.  All pronouns and variations of pronouns will be deemed
               to  refer to the  feminine,  masculine  or  neuter,  singular  or
               plural, as the identity of the person referred to may require.

         (c)   Whenever  the  words  "herein"  or  "hereunder"  are used in this
               Agreement,  they will be deemed to refer to this  Agreement  as a
               whole and not to any specific Section.

         (d)   Whenever a dollar figure ($) is used in this  Agreement,  it will
               mean United States dollars unless otherwise specified.

                                   ARTICLE II

                       Purchase And Delivery of Purchased
                    Assets; Assumption of Assumed Liabilities

         2.01  Delivery of Purchased Assets; Assumption of Assumed Liabilities.

         (a)   On the terms and  subject to the  conditions  of this  Agreement,
               Sellers shall, at the Effective Time, sell, transfer,  assign and
               deliver,  or  cause  to  be  sold,   transferred,   assigned  and
               delivered, to Buyer, all right, title and interest of the Selling
               Companies in and to all of the Purchased Assets. As used herein:

     "Purchased Assets" means all of the Selling Companies' business, properties
and assets,  and rights of whatever kind and nature,  real or personal,  whether
owned,  leased or licensed,  or in which the Selling Companies otherwise have an
interest (but only to the extent of such  interest) at the  Effective  Time (but
specifically  excluding to the extent set forth therein the Excluded  Assets (as
defined in subsection (c) below)) and shall include:


                                       13
<PAGE>


         (i)    all Acquired Warehouse Loans,  where "Acquired  Warehouse Loans"
                means all Warehouse  Loans owned by the Selling  Companies other
                than Retained Warehouse Loans;

         (ii)   all Pipeline Loans,  where "Pipeline  Loans" means each of those
                pending  mortgage  loans  to  be  secured  by a  first  priority
                mortgage lien on a one- to four-family  residential property or,
                in the case of a subordinate lien mortgage loan, a mortgage loan
                to be entered  into  simultaneously  with a first lien  mortgage
                loan for the purpose of purchasing or  refinancing  the purchase
                of a one- to  four-family  residential  property  (e.g.,  a FNMA
                80-10-10 loan),  (i) with respect to which a Selling Company has
                (a) issued a commitment or otherwise agreed with an applicant to
                fund,  (b)  determined  to fund,  (c)  committed  to a specified
                interest  rate or (d)  issued a  commitment  (including  without
                limitation  bulk  commitments  and  assignments  of  trades)  or
                otherwise agreed with a correspondent originator or purchaser to
                purchase (including those mortgage loans that are pending with a
                correspondent  originator or purchaser and that otherwise meet a
                Selling Company's  acquisition criteria for such mortgage loans)
                and  (ii)  which  has not  closed  (or been  purchased  from the
                correspondent) as of the Effective Time;

         (iii)  all Correspondent  Agreements,  where "Correspondent  Agreement"
                means any agreement between a Selling Company,  on the one hand,
                and  a  broker,   correspondent,   originator  or  purchaser  of
                residential  mortgage loans on the other hand, pursuant to which
                such broker,  correspondent,  originator  or purchaser  may sell
                residential  mortgage  loans to such Selling  Company or provide
                application processing services in respect of Mortgage Loans;

         (iv)   the  Retail  Contracts,   where  "Retail  Contracts"  means  the
                agreements   pursuant  to  which  a  Selling   Company's  direct
                production  business  originates   residential  mortgage  loans,
                including all affinity channel contracts;

         (v)    the Servicing  Purchase  Agreements,  where "Servicing  Purchase
                Agreements" means any agreement between a Selling Company on the
                one hand and any other  Person,  on the other hand,  pursuant to
                which a Selling Company purchases Servicing from such Person and
                includes any bulk purchase  agreements,  quarterly bulk purchase
                agreements,  co-issue agreements, PMSR flow agreements and other
                related agreements;

         (vi)   the  Acquired  Accounts  Receivable,  where  "Acquired  Accounts
                Receivable" means all those accrued interest and other accounts


                                       14
<PAGE>

               receivable  of  the  Selling   Companies  (other  than  Servicing
               Advances)  relating to the Business,  the Purchased Assets or the
               Assumed  Liabilities,  and  all  other  accounts  receivable  not
               otherwise  identified  as  "Excluded"  in Section  2.01(d) of the
               Sellers'  Disclosure  Schedule  as  of  the  Effective  Time  but
               including all other accounts receivable identified as "Purchased"
               by Buyer in Section 2.01(d) of the Seller's  Disclosure  Schedule
               as of the Effective Time.

         (vii)  the Acquired Intellectual Property where "Acquired  Intellectual
                Property" means the  Intellectual  Property owned by the Selling
                Companies  and which is used in the conduct of, or which relates
                to,  the  Business,  including  the ALSS  Platform  Intellectual
                Property  and the  Intellectual  Property  described on Sellers'
                Disclosure Schedule other than the Retained IP Assets;

         (viii) the Acquired Intellectual  Property  Licenses,  where  "Acquired
                Intellectual  Property Licenses" means those agreements granting
                licenses  to  Intellectual  Property  or  Software  to a Selling
                Company  for use as part of the ALSS  Platform or  otherwise  in
                connection with the Business,  including those  agreements which
                are  listed in  Section  2.01(a)(viii)  of  Sellers'  Disclosure
                Schedule; provided, however, that Buyer and Parent shall execute
                the  Intellectual  Property Rights Agreement and the license and
                other documents referred to in Section 5.07;

         (ix)   the  Acquired  Cash   Equivalents,   where  "Acquired  Cash  and
                Equivalents"  means all cash and cash  equivalent  assets of the
                Selling Companies (other than Retained Cash and Equivalents);

         (x)    the Fixed and Other Assets, where "Fixed and Other Assets" means
                those assets constituting the specific contracts and agreements,
                real and tangible personal property (including land,  buildings,
                leasehold  interests,  furniture,  fixtures,  office  equipment,
                telecommunications  equipment and computer  equipment),  prepaid
                expenses,   programs,   applications  and  data  bases  (whether
                capitalized  or  non-capitalized),   prospect  lists,   training
                materials,  procedure manuals, origination and servicing related
                forms and documents and other assets related to the Business;

         (xi)   the  Loan  Applications,   where  "Loan  Application"  means  an
                application  for a mortgage  loan, to be secured by a first-lien
                on a one- to four-family  residential property,  or, in the case
                of a  subordinate  lien  mortgage  loan,  a mortgage  loan to be
                entered into  simultaneously with a first lien mortgage loan for
                the purpose of purchasing or refinancing  the purchase of a one-


                                       15
<PAGE>

                to  four-family  residential  property  (e.g.,  a FNMA  80-10-10
                loan),  that has been taken or is being  processed  by a Selling
                Company as of the Effective Time but that is not a Pipeline Loan
                and has not, as of the  Effective  Time,  resulted in a Mortgage
                Loan;

         (xii)  the Acquired Mortgage Loan Documents,  where "Acquired  Mortgage
                Loan  Documents"  means the Mortgage Loan Documents  relating to
                the Loan  Applications,  the  Acquired  Warehouse  Loans and the
                Pipeline Loans;

         (xiii) the Acquired  Hedging Assets,  where  "Acquired  Hedging Assets"
                means the Hedging  Assets (other than Retained  Hedging  Assets)
                used to  hedge  the  interest  rate  risk  associated  with  the
                Pipeline Loans and Acquired  Warehouse  Loans,  including all of
                the Delivery Commitments and Investment Commitments;

         (xiv)  at the end of the Lease  Period for each  Prospective  Employee,
                any  individual   employment  contracts  with  such  Prospective
                Employees;

         (xv)   the ALSS Platform;

         (xvi)  documentation, manuals, files, contractual rights and warranties
                relating to the Purchased Assets;

         (xvii) all of the stock of the  Acquired  Subsidiary  and all rights to
                the stock of the  Acquired  Subsidiary  (all of such stock being
                non-assessable),  where  "Acquired  Subsidiary"  means  Stockton
                Plaza Incorporated;

         (xviii)the  Key   Outsourcing   Contracts,   where   "Key   Outsourcing
                Contracts"  means  the  contracts  relating  to  performance  of
                Subservicing  (other than the  Retained  Portfolio  Subservicing
                Agreement), including those contracts with LOGS, ZC Sterling and
                Transamerica; and

         (xix)  all goodwill associated with the foregoing.

     The foregoing enumeration of the Purchased Assets shall not be construed to
limit in any way the scope of the assets being purchased by the Buyer.

     (b) On the terms and subject to the  conditions  of this  Agreement,  Buyer
shall, at the Effective Time, assume all the Assumed Liabilities.  Buyer assumes
no Excluded  Liability or any other liability of Selling  Companies or any other
Person  pursuant to this Agreement other than the Assumed  Liabilities.  As used
herein:


                                       16
<PAGE>


     "Assumed  Liabilities"  means only the  commitments  and obligations of the
Selling  Companies to be performed after the Effective Time, and the Liabilities
of the Selling  Companies  accruing  or arising  after the  Effective  Time with
respect to:

         (i)    any  Purchased  Assets  listed  in items (i) to  (xviii)  of the
                definition of "Purchased Assets" in Section 2.01(a) above;

         (ii)   Prospective  Employees (whether or not Transferred Employees but
                other than those  described in clause  (ii)(B) of the definition
                of "Excluded Liabilities"),  including all obligations under the
                individual  employment contracts with such Prospective Employees
                relating  to  employment  on or after the  Effective  Time,  all
                severance   obligations   with   respect  to  such   Prospective
                Employees, and any other liability,  commitment or obligation of
                the Selling  Companies  specifically  agreed to be assumed under
                Article VI hereof; and

         (iii)  the Other Assumed Liabilities, where "Other Assumed Liabilities"
                means  the  liabilities,  commitments  and  obligations  of  the
                Selling Companies  identified as liabilities assumed by Buyer in
                Section 2.01(d) of Sellers' Disclosure Schedule;

but specifically  excluding with respect to (i), (ii) and (iii) any liabilities,
commitments or obligations (a) for recourse,  repurchase,  indemnity or warranty
of the  Selling  Companies  with  respect to periods on or prior to the  Closing
Date, (b) for indebtedness for borrowed money of the Selling Companies,  and (c)
with respect to or giving rise to liens other than Permitted Liens (all of which
set forth in (a), (b) and (c) shall be Excluded Liabilities).

     "Excluded  Liabilities"  means all Liabilities of the Selling Companies and
all other  liabilities  of the  Selling  Companies,  whether  known or  unknown,
absolute  or  contingent,   past,  present,   or  future,   other  than  Assumed
Liabilities, and shall include:

         (i)    the Selling  Companies'  obligations for funded debt or borrowed
                money  including  any  penalties or premiums  paid or payable in
                order to prepay or defease any such debt;

         (ii)   the Selling Companies'  obligations to employees (A) who are not
                Prospective  Employees as set forth on Section 2.01  (c)(xii) of
                Sellers'  Disclosure  Schedule or (B) who are Leave  Recipients,
                but do not  become  eligible  to receive  an offer  pursuant  to
                Section 6.01 (c);

         (iii)  all tax  liabilities  of the  Selling  Companies  (except to the
                extent otherwise provided in Article IX hereof);


                                       17
<PAGE>


         (iv)   all  liabilities  relating  to  Actions  pending  or  threatened
                against  the  Selling  Companies  or their  assets  prior to the
                Effective Time;

         (v)    all environmental liabilities;

         (vi)   all obligations of the Selling  Companies for payment of amounts
                arising under its 2001 Retention Bonus Plan; and

         (vii)  all  obligations of the Selling  Companies  under their existing
                qualified and  non-qualified  health care,  dental,  disability,
                life,  401(k)  and  other  employee  benefit  plans  except  for
                liabilities expressly assumed by Buyer hereunder.

     The  foregoing  enumeration  of  the  Excluded  Liabilities  shall  not  be
construed to limit in any way the scope of the liabilities being retained by the
Selling Companies.

         (c)    Notwithstanding subsections (a) and (b) of this Section 2.01, no
                Excluded  Assets shall be purchased or sold  hereunder.  As used
                herein:

     "Excluded Assets" means only the following:

         (i)    the Retained  Servicing  Portfolio,  where  "Retained  Servicing
                Portfolio"  means  all of the  Servicing  owned  by the  Selling
                Companies;

         (ii)   the Retained Warehouse Loans,  where "Retained  Warehouse Loans"
                means

                (1)    all Warehouse  Loans that are over 30 days delinquent (as
                       defined  in the  Fannie  Mae  Seller's  Guide)  as of the
                       Closing Date;

                (2)    all Warehouse Loans that have been delinquent (as defined
                       in the Fannie Mae  Seller's  Guide) for more than 30 days
                       at any  time in the 12  months  immediately  prior to the
                       Closing Date;

                (3)    all  Warehouse  Loans that were  purchased or  originated
                       more than 60 days prior to the Closing Date;

                (4)    all  Warehouse  Loans that are owned by HomeSide  Funding
                       Corporation  and other  Warehouse  Loans  related  to the
                       Early Buyout Program as of the Closing Date; and

                (5)    any Warehouse Loans that are not eligible for sale to the
                       relevant Investor (the "scratch and dent loans");


                                       18
<PAGE>


                (iii)  the Retained  Mortgage Loan  Documents,  where  "Retained
                       Mortgage   Loan   Documents"   means  the  Mortgage  Loan
                       Documents  relating to the Mortgage Loans in the Retained
                       Servicing Portfolio and the Retained Warehouse Loans;

                (iv)   the Retained  Hedging  Assets,  where  "Retained  Hedging
                       Assets"  means  the  Hedging  Assets  used to  hedge  the
                       interest  rate  and  currency  risk  associated  with the
                       Retained Servicing Portfolio or any other Excluded Assets
                       or any Excluded  Liabilities  (including  the medium term
                       notes of HSL);

                (v)    the  Retained   Accounts   Receivable,   where  "Retained
                       Accounts  Receivables"  means those accrued  interest and
                       other  accounts   receivable  that  are  related  to  the
                       Retained  Servicing   Portfolio,   the  Retained  Hedging
                       Assets, the Retained Warehouse Loans or the Retained Real
                       Estate (including those accounts receivable identified as
                       retained by the Selling  Companies in Section  2.01(d) of
                       Sellers'   Disclosure  Schedule  and  including  accounts
                       receivable   with   respect  to   Servicing   ("Servicing
                       Advances"))  and any accrued  interest and other accounts
                       receivable  that  are  assets  of the  Selling  Companies
                       immediately prior to the Effective Time and that have not
                       been collected as of the 75th day after the Closing Date;

                (vi)   the Retained Cash and  Equivalents,  where "Retained Cash
                       and  Equivalents"  means  the cash  and  cash  equivalent
                       assets of the Selling Companies,  related to the Retained
                       Servicing  Portfolio and the Retained  Hedging  Assets as
                       well  as  excess  cash  above  levels  required  for  the
                       operation of the Business;

                (vii)  the Retained  Advances,  where "Retained  Advances" means
                       those   Advances   related  to  the  Retained   Servicing
                       Portfolio and the Retained Warehouse Loans;

                (viii) the  assets  relating  to the  Compensation  and  Benefit
                       Plans;

                (ix)   the  stock  of  HSL,  Mortgage  Electronic   Registration
                       Systems or any  Subsidiary of HSL except the stock of the
                       Acquired Subsidiary;

                (x)    the Retained Real Estate,  where  "Retained  Real Estate"
                       means:

                       (1)    all  real   property   acquired   by  the  Selling
                              Companies as a result of a Foreclosure; and


                                       19
<PAGE>

                       (2)    the vacant  facilities  (and any tangible  assets,
                              including   leasehold   improvements,    of   such
                              facilities)   located  in  Indianapolis,   IN  and
                              Glastonbury, CT;

                (xi)   any claims or causes of action that any  Selling  Company
                       or Parent may have  against  third  parties  arising with
                       respect to matters  occurring  before the  Closing  Date,
                       except  any such  claims or  causes  of  action  that are
                       included  within the definition of Acquired  Intellectual
                       Property;

                (xii)  the individual  employment and ancillary  agreements with
                       the employees listed in Section  2.01(c)(xii) of Sellers'
                       Disclosure Schedule;

                (xiii) the Retained IP Assets where  "Retained IP Assets"  means
                       all  Intellectual  Property  existing  as of the  Closing
                       Date, if any, owned or held by Parent in (i) the business
                       methods, business processes, business functionality,  and
                       document and data  formatting that are implemented in the
                       Australia Specific ALSS Components and (ii) in and to the
                       Template  Letters.   For  purposes  of  this  definition,
                       "Australia  Specific ALSS Components" means components or
                       other   elements  of  the  ALSS   Platform   implementing
                       functionality for the Australia market that were added to
                       the ALSS  Platform  after  Parent  acquired  the  Selling
                       Companies.  For  purposes of this  definition,  "Template
                       Letters" means those template correspondences,  including
                       letters,   e-mail  communications  and  other  documents,
                       authored  by or on  behalf  of  Parent  used by the  ALSS
                       Platform in combination with specific loan information in
                       the servicing of Australian Loans; and

                (xiv)  the books and records of the Selling Companies.

          (d)   For  illustrative  purposes  and to  evidence  the intent of the
                parties as to the  identity of the  Purchased  Assets,  Excluded
                Assets,  Assumed Liabilities and Excluded Liabilities,  Schedule
                2.01(d)  sets  forth a trial  balance  of the  foregoing  to the
                extent  that  they  are  reflected  on  a  balance  sheet  under
                generally  accepted  accounting  principles  as  applied  by the
                Sellers as of September 30, 2001.

          2.02  Consideration for Purchased Assets.

     In consideration  for the Purchased  Assets,  Buyer will assume the Assumed
Liabilities and will pay an amount (the "Purchase Price") equal to the Estimated
Purchase Price as subsequently adjusted by the Interim Settlement Amount and the
Purchase Price Adjustment. The Final Purchase Price will be paid as follows: (1)
at the Closing,  Buyer will pay to Sellers the Estimated Purchase Price, and (2)
on each of the  Interim  Settlement  Date  and the  Settlement  Date,  Buyer  or
Sellers,  as the case may be, will be entitled to the Interim  Settlement Amount


                                       20
<PAGE>

and the Purchase Price Adjustment, respectively. All payments under this Section
2.02  will be paid by  Sellers  or  Buyer,  as the case may be,  in  immediately
available federal funds to an account designated by the applicable  recipient of
such funds.

     As used herein:

     "Closing  Date Value" and  "Pre-Closing  Date Value" have the  meanings set
forth in Schedule 2.02.

     "Estimated  Purchase Price" means the sum of (1) the Pre-Closing Date Value
and (2) the  Franchise  Premium,  calculated in the manner set forth in Schedule
2.02.

     "Franchise Premium" means $25 million.

     "Purchase Price Adjustment" means (w) the Estimated Purchase Price plus (if
applicable) (x) the Interim  Settlement  Amount, if such amount is to be paid by
Buyer to Sellers,  minus (if applicable) (y) the Interim  Settlement  Amount, if
such  amount  is to be paid by  Sellers  to Buyer  minus  (z) the sum of (1) the
Closing Date Value and (2) the Franchise Premium, together with interest thereon
(after  adjusting  for any  interest  amount  previously  paid)  payable  at the
Interest  Rate  from  and  including  the  Closing  Date  to but  excluding  the
Settlement Date, calculated in the manner set forth in Schedule 2.02.

     2.03 Proration of Expenses.

     Except as  otherwise  specifically  provided in this  Agreement,  it is the
intention of the parties hereto that Sellers shall operate for their own account
the Business, until the Effective Time, and that Buyer shall operate for its own
account the  Business,  after the  Effective  Time.  Thus,  except as  otherwise
specifically  provided in this Agreement,  with respect to the Purchased  Assets
and  Assumed  Liabilities,  items of  expense,  including,  but not  limited to,
non-owner  occupation  fees,  payment of amounts  due under  service  contracts,
payments of rent, taxes,  utilities and other amounts required to be paid by the
tenant under leases,  and all personal property taxes applicable to the personal
property to be  transferred  hereunder,  shall be prorated to the Effective Time
and reflected on the Pre-Closing Date Value Calculation Schedule and the Closing
Date Value Calculation  Schedule.  An estimated settlement or settlements of all
such prorated items shall be made in accordance  with the procedures of Sections
2.02 and 2.04,  which estimated  settlement  shall include  reimbursement to the
Selling  Companies for any security  deposits  theretofore  made pursuant to any
lease which is assigned hereunder,  as well as any security deposits made by the
Selling Companies in respect of Purchased Assets or Assumed Liabilities,  all of
which  security  deposits  shall be held, on and after the Closing Date, for the
benefit of Buyer.  Sellers shall use commercially  reasonable  efforts to obtain
final bills for all items of expense  being  prorated  pursuant to this  Section
2.03 and any  adjustments  will be made in accordance with Schedule 2.02 and the
procedures of Section 2.05.


                                       21
<PAGE>

     2.04 Calculation of Purchase Price.

     (a) No later than ten  Business  Days prior to the  Closing  Date,  Sellers
shall deliver, or cause to be delivered,  to Buyer an unaudited schedule setting
out in reasonable  detail the basis of the calculation of the  Pre-Closing  Date
Value,  which calculation shall be as of the month-end for the month that is two
months prior to the month in which the Effective  Time occurs (the  "Pre-Closing
Date Value Calculation Schedule").

     (b) No later than 120 days after the Closing Date,  Sellers shall  deliver,
or  cause  to be  delivered,  to  Buyer an  unaudited  schedule  setting  out in
reasonable  detail the calculation of the Closing Date Value,  which calculation
shall  be  as of  the  Effective  Time  (the  "Closing  Date  Value  Calculation
Schedule").

     (c)  Unless  Buyer  delivers  written  notice to Sellers on or prior to the
later of (x) the 165th day  following the Closing Date or (y) the 45th day after
Buyer's  receipt of the Closing Date Value  Calculation  Schedule  specifying in
reasonable  detail the amount,  nature and basis of all  disputed  items,  Buyer
shall  be  deemed  to  have  accepted  and  agreed  to the  Closing  Date  Value
Calculation Schedule,  and such Closing Date Value Calculation Schedule shall be
deemed conclusive for purposes of determining the Final Purchase Price.

     (d) In the event that Buyer and Sellers are unable to agree with respect to
any item on the Closing Date Value Calculation Schedule within 45 days of notice
of the dispute and the dispute involves either (i) the mathematical  calculation
of the Closing Date Value or the Final  Purchase  Price or (ii) the  appropriate
accounting  treatment of any asset or  liability,  or item of income or expense,
that affects the  calculation of the Closing Date Value,  then Buyer and Sellers
will mutually agree to an independent  public accounting firm, which will make a
determination  of such  dispute (but not as to any other  matters)  based solely
upon not more than two rounds of presentations by Buyer and Sellers,  and not by
independent  review.  If Buyer and  Sellers are unable to agree on the choice of
the  independent  accounting  firm, the firm will be Ernst & Young LLP unless at
such time either Buyer or Sellers has a primary audit  relationship with Ernst &
Young LLP, in which case a "big-five"  accounting  firm (or  successor  thereof)
selected by lot (after  excluding  any firm with which  either  Buyer or Sellers
have a primary audit  relationship).  The findings of such firm,  which will not
exceed in amount the amount claimed by either party as to any matter in dispute,
shall be  conclusive  and binding  upon Buyer and  Sellers for  purposes of this
Agreement.  The fees and  expenses of such firm will be borne 50% by Sellers and
50% by Buyer.

     The provisions in this Section 2.04(d)  relating to resolutions of disputes
by an  accounting  firm are not  intended  to and  shall not be  interpreted  to
require that the parties  refer to such a firm (i) any dispute  arising out of a
breach by one of the parties of its  obligations  under the Agreement;  (ii) any
dispute the resolution of which requires the construction or  interpretation  of
this Agreement or (iii) any other dispute other than (in the case of this clause
(iii)) a dispute  related to the  mathematical  calculation  of the Closing Date


                                       22
<PAGE>

Value or the Final Purchase  Price or the  accounting  treatment of any asset or
liability,  or item of income or expense,  that affects the  calculation  of the
Closing Date Value.

     (e)  Buyer  and  Sellers  agree  that,  in  addition  to  their  respective
obligations  under Section  5.02(d),  prior to the Settlement Date, each of them
and their attorneys,  accountants, officers and other authorized representatives
(collectively,  "Representatives") shall have any and all reasonable access that
they each  reasonably  believe  is  necessary  to the books and  records  of the
Business,  the Purchased  Assets and the Assumed  Liabilities to the extent they
relate to the calculations  required or any dispute under this Section 2.04 (and
shall permit such  Representatives to examine and copy such books and records to
the extent  requested  by such party  provided  that all such copies are treated
confidentially  by such party and are only used for such  purposes  described in
this Section 2.04), and shall cause their  respective  officers and employees to
furnish all  information  requested by, and otherwise  cooperate with each other
with respect to access to any books,  records,  information  or other  documents
related to the calculations required by, or any dispute under this Section 2.04.

     2.05  Settlement Date Payments.

     On a date (the  "Settlement  Date")  within 5 days after the  acceptance by
Buyer of the Closing Date Value Calculation  Schedule  (whether  expressly or by
operation  of Section  2.04(c)) or the  resolution  of any  dispute  pursuant to
Section  2.04(d),  or such later date as the  parties may agree,  the  following
actions shall be taken:

     (a) If the Purchase Price Adjustment is a positive number, Sellers will pay
Buyer an amount equal to the Purchase  Price  Adjustment.  If the Purchase Price
Adjustment is a negative  number,  Buyer will pay Sellers an amount equal to the
absolute value of the Purchase Price Adjustment.

     (b) Each party shall take such other actions, and shall execute and deliver
such other instruments or documents, as shall be required in connection with the
determination and payment of the Final Purchase Price.

     2.06  Allocation of Purchase Price.

     Sellers and Buyer hereby agree to allocate the Final Purchase Price and the
Assumed  Liabilities  among the Purchased Assets in accordance with Section 1060
of the Code and file or cause to be filed in a timely  fashion  any  information
that may be required pursuant to regulations promulgated under the Code.

     2.07  No Offset.

     Neither Sellers or any of their  Affiliates,  on the one hand, nor Buyer or
any of its  Affiliates,  on the other hand,  shall have any set off or any other
similar  rights  with  respect  to (a) any of the funds  received  by such party
pursuant to this  Agreement or (b) any other  amounts  claimed to be owed to the


                                       23
<PAGE>

other  party  or its  Affiliates  arising  out of this  Agreement  or any  other
agreement.

     2.08  Interim Settlement.

     Within ten (10)  calendar days  following  the Closing  Date,  Sellers will
deliver to Buyer a good-faith  estimate of the Closing Date Value, such estimate
to be calculated in the manner set forth in Schedule  2.02. On the basis of such
good-faith  estimate of the Closing Date Value, and without being subject to any
challenge  or  dispute  on the part of Buyer,  and  without  any loss of Buyer's
rights under Section  2.04(d),  the parties will  determine  whether  Sellers or
Buyer is  required  to make a  payment  to the  other.  The  party  so  required
hereunder  to make a payment to the other shall pay,  within  five (5)  Business
Days following the date on which such payment amount is determined (the "Interim
Settlement  Date"),  one hundred  percent (100%) of such amount to be paid, plus
interest  on the  amount so paid at the  Interest  Rate from and  including  the
Closing  Date to but  excluding  the date of payment  (the  "Interim  Settlement
Amount"). The amounts, if any, required to be paid by either party under Section
2.05, including the interest payments thereunder,  shall be adjusted accordingly
to take into  account the interim  settlement  payment  made under this  Section
2.08.

     2.09  Co-Issue.

     Notwithstanding  anything  in this  Agreement  to the  contrary,  including
Article  II, if by the tenth day prior to the  Closing,  the Seller and Buyer do
not reach an agreement  (which they are not obligated to do) with respect to the
purchase and  assumption  by Buyer of the co-issue  arrangements  with Bank One,
Pulte and First Union  (Wachovia),  then each such  co-issue  arrangement  as to
which such an agreement  has not been reached  shall not be part of the Purchase
in any way and the Seller shall retain all interests in, and liabilities related
to, any such co-issue arrangement, and Buyer shall administer each relevant loan
relating  thereto for a $60 per loan set up fee and each  relevant loan relating
thereto shall be subserviced by Buyer in accordance with the Retained  Portfolio
Subservicing Agreement.

                                  ARTICLE III

                      Closing, Transfers and Related Items

     3.01  Closing and Closing Date.

     Unless  this  Agreement  shall have been  terminated  and the  transactions
herein abandoned  pursuant to Section 8.01, subject to the provisions of Article
VII, the closing (the  "Closing") of the purchase and sale of Purchased  Assets,
the  assumption  of the  Assumed  Liabilities  and the  payment  of the  amounts
required to be paid  pursuant to Section 2.02 shall take place in  Jacksonville,
Florida on (1) the first business day of the month  following the month in which
the last of the conditions set forth in Article VII has been satisfied or waived


                                       24
<PAGE>

in accordance with the terms of this Agreement  (other than those  conditions to
be satisfied or waived on the Closing Date,  unless the last of such  conditions
is satisfied or waived less than ten business  days prior to the end of a month,
in which event the Closing  Date shall  occur on the first  business  day of the
second succeeding  month), or (2) such other date to which the parties may agree
in writing.  The date on which the Closing  occurs is herein called the "Closing
Date".  The parties hereby agree that the effective time (the "Effective  Time")
of Closing for all purposes shall be at the opening of business in New York City
on the Closing Date or such other time as shall be agreed to by the parties.

     3.02  Assignment and Assumption Documents.

     (a) On the Closing Date, (i) the Selling  Companies and Buyer shall deliver
and  Parent  shall  cause the  Selling  Companies  to deliver a bill of sale and
instrument  of  assumption  of  liabilities  substantially  in the form attached
hereto as Exhibit F, (ii) the Selling  Companies  shall deliver and Parent shall
cause the Selling  Companies to deliver to Buyer such other instruments of sale,
assignment,  transfer and  conveyance  (including,  if necessary,  duly executed
powers of  attorney  to  transfer  all of the  shares  of stock of the  Acquired
Subsidiary),  and do such other acts as are  reasonably  necessary to effectuate
the sale,  transfer,  assignment  and delivery to Buyer of the right,  title and
interest of the Selling  Companies  in and to the  Purchased  Assets to be sold,
transferred,  assigned and  delivered to Buyer on such date  pursuant to Section
2.01(a)  free and clear of any Liens  other than  Permitted  Liens  except  that
clause (a) of such definition shall not apply immediately prior to the Effective
Time  and  (iii)  Buyer  shall  deliver  to the  Selling  Companies  such  other
instruments  of  assumption,  and do or cause to be done by third  parties  such
other acts as are reasonably  necessary to effectuate the assumption by Buyer of
the Assumed  Liabilities to be assumed by Buyer on such date pursuant to Section
2.01(b).

     (b) Without limiting the foregoing,  on or before the Closing Date, Sellers
shall,  at their expense,  promptly take each such action as may be necessary to
transfer all of the Selling  Companies' right,  title and interest in and to the
Acquired Warehouse Loans,  including (i) endorsing or causing to be endorsed the
related Mortgage Notes to Buyer without  recourse,  (ii) preparing or causing to
be prepared Assignments of Mortgage Instruments, assigning the related Mortgages
from the Selling  Companies to Buyer and preparing or causing to be prepared all
prior intervening  Assignments of Mortgage Instruments as reasonably required by
Buyer and (iii)  assigning  nominal  title to the other  related  Mortgage  Loan
Documents  to Buyer.  To the extent  required  by  applicable  Regulations  with
respect to Mortgage Loans,  Sellers will, at their expense,  record or cause the
recordation  of  the  Assignments  of  Mortgage  Instruments  from  the  Selling
Companies to Buyer.  In addition,  Sellers will, at their  expense,  prepare and
record,  or cause the preparation  and  recordation of,  Assignments of Mortgage
Instruments  from Buyer to the  applicable  Investor  to the extent  required by
applicable Regulations. Sellers shall provide to Buyer such recorded Assignments
of Mortgage Instruments as soon as practicable.


                                       25
<PAGE>


     3.03 Further Assistance and Assurances.

     Sellers  shall,  at any  time and from  time to  time,  promptly,  upon the
reasonable request of Buyer, execute, acknowledge,  deliver or perform, all such
further acts, deeds, assignments,  transfers, conveyances, and assurances as may
be required for the better  vesting and  conferring  to Buyer of title in and to
the  Purchased  Assets  and to  effect  the  transactions  contemplated  by this
Agreement.  Buyer shall, at any time and from time to time,  promptly,  upon the
reasonable request of Sellers,  execute,  acknowledge,  deliver or perform,  all
such further acts, deeds, assumption agreements, transfers and assurances as may
be  required  for the full  assumption  and  transfer  to  Buyer of the  Assumed
Liabilities and to effect the transactions  contemplated by this Agreement. Each
party agrees that if it receives any payment or amount after the Closing Date to
which another  party is entitled,  the recipient  shall  promptly  transfer such
payment or amount to the party so entitled.  At the Effective  Time, the Sellers
shall,  and Parent shall cause the Selling  Companies  to,  transfer and deliver
possession  and control of the ALSS  Platform to Buyer,  including all copies of
source code and documentation and physical and electronic access to all systems.

     3.04 Other Consents.

     Sellers shall take all commercially reasonable action, at no cost to Buyer,
to obtain such other Third Party  Consents as are  necessary to permit the sale,
transfer, assignment and conveyance to Buyer of the Purchased Assets. Nothing in
this  Agreement  shall be  construed  as an attempt or  agreement  to assign any
Purchased  Asset or Assumed  Liability  which is not  capable  of being  validly
assigned,  conveyed or transferred  without the consent of a third party, unless
such consent shall have been obtained and remain in full force and effect at the
Closing. If such consent in respect of a Purchased Asset or an Assumed Liability
is not obtained prior to the Closing or does not remain in full force and effect
at the Closing,  Buyer and Sellers will use  reasonable  efforts,  at no cost to
Buyer, to enter into a mutually  agreeable,  reasonable and lawful  arrangement,
including,  subcontracting,  sublicensing or subleasing, under which Buyer would
obtain the benefit and assume the  obligations in respect thereto from and after
the Closing Date in accordance with this Agreement,  and under which the Selling
Companies  would  enforce  for the  benefit of Buyer any and all rights of Buyer
against a third party thereto,  with Buyer assuming the  obligations to the same
extent as if they would have constituted an Assumed Liability.

                                   ARTICLE IV

                         Representations and Warranties

     4.01 Disclosure Schedules.

     On or prior to the execution and delivery hereof, Sellers have delivered to
Buyer a schedule and Buyer has  delivered  to Sellers a schedule  (respectively,
its  "Disclosure  Schedule")  setting  forth,  among  other  things,  items  the


                                       26
<PAGE>

disclosure of which is necessary or appropriate either in response to an express
disclosure requirement contained in a provision hereof or as an exception to one
or more  representations or warranties contained in Section 4.02 or Section 4.03
or to one or more of the covenants  contained in Article V;  provided,  however,
that the  inclusion  of an item in a  Disclosure  Schedule as an  exception to a
representation,  warranty or covenant will not be deemed an admission by a party
that such item represents a material exception or fact, event or circumstance or
that such item has had or is reasonably  likely to result in a Material  Adverse
Effect with respect to the disclosing party.

     4.02 Representations and Warranties of Sellers.

     Subject  to  Section  4.01 and  except as  Previously  Disclosed,  Sellers,
jointly and severally, represent and warrant to Buyer as follows:

     (a) Organization, Standing and Authority.

         (1)  Parent  has  been  duly  organized  and  is  an  existing  banking
     corporation in good standing under the laws of Australia.

         (2)  HSL  and  HSI  have  been  duly   incorporated  and  are  existing
     corporations  in good standing  under the laws of the States of Florida and
     Delaware,  respectively.  Each of the  Selling  Subsidiaries  has been duly
     incorporated  or organized and is an existing  corporation in good standing
     under the laws of its respective jurisdiction of organization.

         (3) Each of the Selling Companies has the requisite power and authority
     to own its current assets and carry on its business as currently conducted,
     and is duly  qualified  to do  business  in  each  jurisdiction  where  the
     ownership  or  operation  of its  property and assets or the conduct of its
     business requires such qualification  except in those  jurisdictions  where
     the failure to so qualify would not have a Material Adverse Effect.

         (4) Parent owns  beneficially all of the capital stock of HSI, free and
     clear of all Liens.  HSI owns of record and beneficially all of the capital
     stock  of  HSL,  free  and  clear  of all  Liens.  HSI or  another  Selling
     Subsidiary owns of record and beneficially all of the capital stock of each
     Selling   Subsidiary,   free  and  clear  of  all   Liens.   There  are  no
     subscriptions,  options, warrants, calls, commitments, preemptive rights or
     other  rights  of any  kind  outstanding  for  the  purchase  of,  nor  any
     securities  convertible or exchangeable  for, any equity  interests of HSI,
     HSL or any Selling Subsidiary. There are no restrictions upon the voting of
     the capital  stock of HSI, HSL or any Selling  Subsidiary.  Other than HSL,
     the Selling  Subsidiaries,  the Acquired  Subsidiary,  Homeside  Global MBS
     Manager,  Inc., Homeside Mortgage Securities,  Inc. and Mortgage Electronic
     Registration  Systems there are no Persons in which HSI, HSL or any Selling


                                       27
<PAGE>

     Subsidiary owns, of record or  beneficially,  any direct or indirect equity
     interest or other interest or right.

         (5) HSL owns of record  and  beneficially  all of the Shares of Capital
     Stock of the  Acquired  Subsidiary  and all such  Shares have been duly and
     validly authorized and issued and are fully paid and non-assessable.

     (b) Corporate Authority.  This Agreement and the transactions  contemplated
hereby  have been duly  authorized  by all  necessary  corporate  action of each
Seller and this  Agreement has been duly  authorized,  executed and delivered by
each Seller.  This Agreement is a valid and legally  binding  obligation of each
Seller,  enforceable in accordance with its terms (except as enforceability  may
be limited by applicable  bankruptcy,  insolvency,  reorganization,  moratorium,
fraudulent  transfer  and similar laws of general  applicability  relating to or
affecting  creditors' rights or by general equity  principles).  Each Seller has
the  corporate  power  and  authority  to  execute,   deliver  and  perform  its
obligations under this Agreement and to consummate the transactions contemplated
hereby.

     (c) Regulatory Approvals; No Conflicts.

         (1) No consents or approvals of, or filings or registrations  with, any
     Governmental  Authority  or any third party are  required to be obtained or
     made by Sellers or any of the Selling  Subsidiaries  in connection with the
     execution,  delivery  or  performance  by Sellers of this  Agreement  or to
     consummate  the  transaction  contemplated  hereby,  except  for  consents,
     approvals,  filings,  applications,   notices  or  registrations,  and  the
     termination   of  any   applicable   waiting   periods,   (A)   under   the
     Hart-Scott-Rodino  Antitrust  Improvements  Act of 1976 ("HSR Act"), (B) to
     relevant state mortgage banking licensing or supervisory  authorities,  (C)
     to the VA, FHA, FNMA, FHLMC, GNMA and HUD, (D) under any applicable foreign
     laws or regulations or to any foreign  Governmental  Authority,  (E) to the
     Board of Governors of the Federal  Reserve  System or any other  federal or
     state bank  regulatory  agency,  (F) as Previously  Disclosed on Disclosure
     Schedule  4.02(c)(1)  and (G) Third  Party  Consents  where the  failure to
     obtain  such  consents  or  approvals  would  not  individually  or in  the
     aggregate have a Material Adverse Effect on the Business or on Sellers.  As
     of the  date  hereof,  Sellers  have no  Knowledge  of any  reason  why the
     approvals  or  consents  set forth as  conditions  to closing  in  Sections
     7.01(a) will not be received in a timely manner.

         (2) Subject to receipt of the regulatory  approvals  referred to in the
     preceding  paragraph,  and expiration of related waiting periods,  required
     filings  under  federal  and  state  securities  laws and the  third  party
     consents  or  approvals  referred  to  in  the  preceding  paragraph,   the
     execution,  delivery and performance of this Agreement and the consummation
     of the transactions  contemplated hereby do not and will not (A) constitute
     a breach or violation of, or a default under, or give rise to any Lien, any


                                       28
<PAGE>

     acceleration of remedies or any right of termination  under,  any law, rule
     or  regulation  or any  judgment,  decree,  order,  License,  or  contract,
     agreement,  mortgage,  indenture  or  instrument  of any of  Sellers or any
     Selling Subsidiary,  or to which any of them or their properties is subject
     or bound,  (B) constitute a breach or violation of, or a default under, the
     Selling  Companies  Articles  or  the  Selling  Companies  By-Laws  or  the
     corresponding  governing  documents  of any of Sellers,  or (C) require any
     consent or approval under any such law, rule, regulation, judgment, decree,
     order, License, contract, agreement, indenture or instrument.

     (d) Title to and Sufficiency of Purchased Assets.

         (1) Subject to the receipt of any Third  Party  Consents in  connection
     therewith,  the sale and delivery to Buyer of the Purchased Assets pursuant
     to the  provisions  of this  Agreement  will  transfer  to  Buyer  good and
     marketable title to the respective assets (or, as to any leased property, a
     valid  leasehold  interest),  free and clear of any Liens  (other  than (A)
     Liens that were Previously Disclosed; (B) mechanics', carriers', workmen's,
     repairmen's or other like Liens arising or incurred in the ordinary  course
     of  business  and Liens for Taxes that are not due and  payable or that may
     thereafter  be  paid  without  penalty;  and (C)  Liens  created  by  Buyer
     (collectively, "Permitted Liens"). Other than persons having an interest in
     Permitted Liens that have been Previously  Disclosed,  no person other than
     Sellers and the  Selling  Subsidiaries  has any  interest in (i) any of the
     Purchased  Assets  transferred  to  Buyer  hereunder  (provided  that  this
     representation  and  warranty  does  not  apply  to  Acquired  Intellectual
     Property,  Acquired  Intellectual  Property  Licenses and leases of real or
     personal  property) or (ii)  Sellers'  leasehold  interest in any leases of
     real or personal property  included in the Purchased Assets  transferred to
     Buyer hereunder.

         (2) Subject to the receipt of any required  Third Party  Consents,  the
     Purchased   Assets   together  with  Buyer's   rights  under  the  Acquired
     Intellectual Property Licenses,  and Ancillary Agreements are sufficient to
     operate the Business as it is conducted as of the date hereof and to permit
     Buyer to perform in the ordinary course of business its  obligations  under
     the Ancillary Agreements consistent with the standards set forth therein.

     (e) Litigation. Sellers have Previously Disclosed a true and complete list,
as of the date hereof,  of all  litigation,  claims,  actions,  arbitrations  or
investigations  or other proceedings  before any Governmental  Authority pending
(or, to Sellers' Knowledge, threatened in writing) against the Selling Companies
with respect to the Business or relating to or  involving  any of the  Purchased
Assets or Assumed  Liabilities of the Selling Companies (except for prosecutions
of applications for  registrations of intellectual  property or similar rights).
To Sellers'  Knowledge there does not exist any fact or circumstance  that would
be reasonably  expected to give rise to any such  litigation,  claims,  actions,
arbitrations or  investigations  or other  proceedings.  Except for matters that


                                       29
<PAGE>

would not  reasonably  be  expected  to have a  Material  Adverse  Effect on the
Business  or  Sellers,  no  other  litigation,   claim,   action,   arbitration,
investigation or other proceeding before any Governmental  Authority (except for
prosecutions  of applications  for  registrations  of  intellectual  property or
similar  rights) is pending  against the Selling  Companies  with respect to the
Business,  or relating to or involving  any of the  Purchased  Assets or Assumed
Liabilities of the Selling Companies and, to Sellers'  Knowledge,  no other such
litigation,  claim, action,  arbitration,  investigation or other proceeding has
been threatened in writing nor, to Sellers' Knowledge, does there exist any fact
or  circumstance  that  would be  reasonably  expected  to give rise to any such
litigation,   claims,   actions,   arbitrations  or   investigations   or  other
proceedings.  In addition,  except as Previously Disclosed, no other litigation,
claim,  action,  arbitration,  investigation  or  other  proceeding  before  any
Governmental   Authority   (except  for   prosecutions   of   applications   for
registrations of intellectual property or similar rights) is pending against the
Acquired  Subsidiary,  or  relating  to  or  involving  any  of  its  assets  or
liabilities and, to Sellers' Knowledge, no other such litigation, claim, action,
arbitration,  investigation  or other  proceeding has been threatened in writing
nor, to Sellers' Knowledge, does there exist any fact or circumstance that would
be reasonably  expected to give rise to any such  litigation,  claims,  actions,
arbitrations or investigations or other proceedings.

     (f) Regulatory Matters. None of Sellers or the Selling Companies is a party
to or is subject to any  outstanding  order,  decree,  agreement,  memorandum of
understanding or similar supervisory arrangement with, or a commitment letter or
similar submission to, or extraordinary  supervisory letter from, any federal or
state  governmental   agency  or  authority  charged  with  the  supervision  or
regulation of banks and their holding companies, or mortgage banking (including,
without  limitation,  the Federal Reserve Board, the VA, FHA, FNMA,  FHLMC, GNMA
and HUD) or the  supervision  or regulation of the Selling  Companies  (each,  a
"Regulatory Authority") except any such regulatory action that would not have in
the aggregate a Material Adverse Effect on the Business or on Sellers.

     (g) Compliance with Laws.

         (1) The Business is being  conducted in compliance  with all applicable
     federal, state, local and foreign statutes, laws, regulations,  ordinances,
     rules,  judgments,  orders or decrees applicable thereto ("Applicable Law")
     except  where any failure to comply with  Applicable  Law would not have in
     the aggregate a Material Adverse Effect on the Business or on Sellers; and

         (2) The Selling Companies hold all permits,  licenses,  authorizations,
     orders  and  approvals  of,  and have made all  filings,  applications  and
     registrations with, all Governmental Authorities that are required in order
     to own or lease the  Purchased  Assets and to conduct  the  Business in all
     material  respects as  presently  conducted;  all such  permits,  licenses,
     certificates  of  authority,  orders  and  approvals  are in full force and
     effect and, to Sellers' Knowledge,  no suspension or cancellation of any of
     them has been threatened in writing.


                                       30
<PAGE>


     (h) Specified Contracts; Defaults.

         (1)  Sellers  have  Previously  Disclosed  (in the  case  of  contracts
     described  in  (i)-(iv)  below)  and  have  made  available  or  Previously
     Disclosed  (in the  case of  contracts  described  in  (v)-(x)  below)  the
     following  written contracts related to the Business in existence as of the
     date hereof to which one or more of the Selling  Companies  is a party (the
     "Specified Contracts"):

         (i)    any  agreement,  if (x)  the  performance  remaining  thereunder
                involves  aggregate  consideration to or by a Selling Company in
                excess  of  $100,000  per annum  and (y) such  agreement  is not
                cancelable,  without material penalty,  by the Selling Companies
                on 180 days' or less notice;

         (ii)   any agreement  which  restricts or contains  limitations  on the
                ability  of any  Selling  Company  to  compete  in any  line  of
                business,  to the  extent  that  any  such  provisions  would be
                binding upon, or enforceable against,  Buyer in its operation of
                the Business or the use of the Purchased Assets after Closing;

         (iii)  any  agreement  with any of Sellers or their  Affiliates  (other
                than the Selling Companies), on the one hand, and any of Sellers
                and any of their  Affiliates,  on the other  hand,  relating  to
                services  provided with respect to the Business or the Purchased
                Assets other than in the ordinary course of their business;

         (iv)   any  individual  employment  contracts  binding  on the  Selling
                Companies for aggregate payments to any Prospective  Employee in
                any calendar year in excess of $150,000;

         (v)    any mortgage, pledge, indenture or security agreement or similar
                arrangement constituting a Lien upon the Purchased Assets;

         (vi)   any  agreement  for the sale or purchase  of  personal  property
                having  a value  individually,  with  respect  to all  sales  or
                purchases thereunder, in excess of $25,000;

         (vii)  any  agreement  for the sale or purchase of fixed assets or real
                estate having a value individually, with respect to all sales or
                purchases thereunder, in excess of $100,000;

         (viii) any  agreement  involving  Acquired   Intellectual  Property  or
                relating  to  the   provision   of  data   processing,   network
                communication  or other technical  services to or by the Selling
                Companies;

         (ix)   all material Acquired Intellectual Property Licenses; and


                                       31
<PAGE>


         (x)    other agreements.

         (2)    (i) Each  Specified  Contract  is in full force and effect  with
                respect  to the  Selling  Companies,  as  applicable,  (ii)  the
                Selling  Companies  are  not  in  default  under  any  Specified
                Contract  in any  material  respect  and  (iii)  there  has  not
                occurred any event that, with the lapse of time or the giving of
                notice or both, would constitute such a default except where any
                failure  to comply  would not have in the  aggregate  a Material
                Adverse Effect on the Business or on Sellers.

     (i) No Brokers. No action has been taken by any Seller that would give rise
to any valid claim against any party hereto for a brokerage commission, finder's
fee or other like payment with respect to the transactions  contemplated by this
Agreement,  other than a fee to be paid to Cohane Rafferty Securities,  Inc. and
Merrill Lynch & Co. by Sellers.

     (j) Liens for Taxes. There are no Liens for Taxes upon any of the Purchased
Assets nor, to Sellers'  Knowledge,  is any taxing  authority  in the process of
imposing any Lien for Taxes upon any of the Purchased  Assets,  except for Liens
for Taxes not yet due and payable.

     (k) Real Property.

           (1) Sellers have Previously Disclosed all real property and leasehold
     estates  owned by the Selling  Companies and used in the Business as of the
     date hereof. The Selling Companies have a valid, subsisting and enforceable
     leasehold interest in all leasehold estates, and valid rights as lessees or
     owners to all property of any kind or nature used by the Selling  Companies
     in the Business,  in each case free and clear of all Liens,  other than (A)
     Permitted Liens, (B) subleases and similar agreements Previously Disclosed,
     (C) easements,  covenants,  rights-of-way and other similar restrictions of
     record which do not materially  interfere with the Selling Company's use of
     such property in the Business,  (D) any  conditions  that may be shown by a
     current,  accurate survey or physical  inspection of any real property made
     prior to the Closing Date and (E) (i) zoning,  building  and other  similar
     restrictions,  (ii) Liens that have been placed by any developer,  landlord
     or other  third party on property  over which the  Selling  Companies  have
     easement  rights or on any leased  property  and  subordination  or similar
     agreements  relating  thereto and (iii)  unrecorded  easements,  covenants,
     rights-of-way  and other  similar  restrictions.  Each  Selling  Company as
     lessee has the right under valid leases to occupy, use, possess and control
     all  property  leased  by  such  Selling  Company  as now  occupied,  used,
     possessed and controlled by such Selling Company.

           (2) Each lease or agreement under which a Selling Company is a lessee
     or  lessor  of any  property,  real or  personal,  is a valid  and  binding
     agreement  of such  Selling  Company,  and no  event  has  occurred  and is
     continuing which, with or without notice or lapse of time, would constitute
     a material  default or event of default by such Selling  Company  under any


                                       32
<PAGE>

     such lease or  agreement  or, to  Sellers'  Knowledge,  by any other  party
     thereto.

     (l) Insurance.  Sellers have Previously Disclosed all policies of insurance
relating to the Purchased  Assets and the Business  (other than title  insurance
policies or insurance policies relating  exclusively to mortgages or other loans
originated or serviced by the Selling  Companies)  that name any Selling Company
as an  insured  party  thereunder.  Except  as  Previously  Disclosed,  all such
policies are with reputable  insurers  against such risks and in such amounts as
the management of the Selling Companies  reasonably has determined to be prudent
in accordance with industry  practices.  All such insurance policies are in full
force and effect, the Selling Companies are not in material default  thereunder,
and all claims thereunder have been filed in due and timely fashion.

     (m) ALSS Platform.

         (1)  Disclosure.   All  material  Software  systems  and  modules,  and
     telecommunications and computer equipment comprising the ALSS Platform, and
     all Acquired  Intellectual  Property Licenses and service contracts related
     thereto,  have been  Previously  Disclosed  in  Section  4.02(m)(1)  of the
     Disclosure Schedule (except for generally available "shrinkwrap",  over-the
     counter,  "clickwrap"  and other similar  licenses that are not  enterprise
     licenses).

         (2) Rights to Use. The Selling  Companies have sufficient  Intellectual
     Property  rights to use all Third Party  Software that is being used by the
     Selling Companies related to the ALSS Platform as currently used by them in
     connection  with the  Business by means of Acquired  Intellectual  Property
     Licenses.

         (3) Title.  The Selling  Companies have exclusive  ownership and use of
     the ALSS  Platform in its  entirety  (i.e.  , taken as a whole as currently
     used by them in connection  with the Business)  which ownership and use are
     free  of  all  liens,   encumbrances   and  claims   including  claims  for
     infringement except as Previously  Disclosed concerning those ALSS Platform
     components  licensed to the Selling  Companies by third Persons pursuant to
     Acquired Intellectual Property Licenses.

         (4) Noninfringement. The ALSS Platform as currently used by the Selling
     Companies  does not  violate  or  infringe  the  Intellectual  Property  or
     proprietary rights of any other Person except as Previously  Disclosed.  In
     the three (3) years preceding this Agreement,  there has not been any suit,
     action or other proceeding,  and to Sellers' Knowledge,  no suit, action or
     other  proceeding is pending or  threatened,  against them  concerning  any
     claim  that  the ALSS  Platform  infringes  or  violates  the  Intellectual
     Property rights of any other Person,  or that any of the Selling  Companies
     has breached any Acquired  Intellectual Property License. No claim has been
     asserted  in writing  against any of the  Selling  Companies  that the ALSS
     Platform  infringes or violates  the  Intellectual  Property  rights of any
     other  Person,  or that  any of the  Selling  Companies  has  breached  any
     Acquired Intellectual Property License. There exists no event, condition or


                                       33
<PAGE>

     occurrence  which,  with the  giving of  notice or lapse of time,  or both,
     would constitute a material breach by any of the Selling  Companies,  or to
     Sellers'  Knowledge,   another  Person,  under  any  Acquired  Intellectual
     Property License.  No party to any Acquired  Intellectual  Property License
     has given any of the Selling  Companies  notice of its intention to cancel,
     terminate or fail to renew any such Acquired Intellectual Property License.
     To Sellers'  Knowledge,  no Person is  infringing  or violating  any of the
     Acquired Intellectual Property in the ALSS Platform.

         (5)  Trademarks.  The ALSS  Platform does not consist of or include any
     Marks.

         (6)  Patents.  Sellers do not own any right,  title or  interest in any
     Patents covering any component of the ALSS Platform.

         (7)  Copyrights.  Section  4.02(m)(7) of Sellers'  Disclosure  Schedule
     contains  a complete  and  accurate  list and  summary  description  of all
     registered  Copyrights owned by the Selling  Companies that are part of the
     ALSS Platform,  which  registrations  are currently in compliance  with all
     formal  legal  requirements,  and to  Sellers'  Knowledge,  are  valid  and
     enforceable, and are not subject to any maintenance fees or actions falling
     due within ninety days after the date of Closing.

         (8)  Trade Secrets. The following  representations  are solely made for
     Trade Secrets that are part of the ALSS Platform.

         (i)    The  documentation  relating  to the ALSS  Platform  is current,
                accurate  and  sufficient  in detail and content to identify and
                explain it and to allow its full and proper use.

         (ii)   Sellers have taken commercially reasonable precautions necessary
                to  protect  the  secrecy,  confidentiality  and  value  of  the
                Software in the ALSS Platform as a trade secret.

         (iii)  To  Sellers'  Knowledge,  the Trade  Secrets are not part of the
                public  knowledge or literature  and have not been  disclosed to
                any Person (other than Parent,  the Selling  Companies and their
                employees,  counsel and other agents,  and other Persons who are
                bound by written confidentiality  obligations to Sellers or have
                otherwise been advised of their  confidentiality  obligations to
                Sellers).

         (iv)   Since  1993,  all  employees  hired and  consultants  engaged by
                Sellers,  and, to Sellers'  Knowledge,  all employees  hired and
                consultants   engaged  by  the   predecessors   of  the  Selling
                Companies,  who had access to the Software in the ALSS  Platform
                have  signed  a   confidentiality   agreement   in  the  Selling
                Companies' standard form (for employees hired by and consultants


                                       34
<PAGE>

                engaged by the Selling  Companies),  as certified by the Selling
                Companies  and  delivered  to Buyer,  and except as disclosed in
                Section  4.02(m)(8)(iv) of the Disclosure Schedule,  the Selling
                Companies  are  not  aware  of  any  breaches  of  any  of  such
                agreements. To Sellers' Knowledge, the employment by the Selling
                Companies  of any of  such  employees  and  engagement  of  such
                consultants,  and their duties for the Selling Companies, do not
                violate any non-disclosure or non-competition  agreement between
                an employee and a third party.

         (9)  Software.  The  following  representations  are  solely  made  for
Software that is part of the ALSS Platform.

         (i)    Section  4.02(m)(9)(i) of Sellers' Disclosure Schedule lists all
                third party Software ("Third Party Programs")  currently used by
                the  Selling  Companies  as part of the ALSS  Platform,  and all
                copies of such Third Party  Programs are licensed to the Selling
                Companies under valid written license agreements;

         (ii)   Copies  of  all  the  license,   distribution   and  maintenance
                agreements  for the Third Party  Programs  have been provided by
                Sellers to Buyer, except in respect of Third Party Programs that
                are covered by shrinkwrapped, clickwrapped or similar agreements
                for Third  Party  Programs  software  that  have been  purchased
                off-the-shelf  by the Selling  Companies  in order to be used by
                the  Selling  Companies,   and  such  license  and  distribution
                agreements  give  the  Selling  Companies  the  right  to  grant
                unlimited  run-time  licenses  of  the  respective  Third  Party
                Program;

         (iii)  Recipients  of services  utilizing the ALSS Platform do not have
                access to or the  right or  ability  to  possess  any  object or
                source  code  of the  ALSS  Platform,  and no  Person  has  been
                provided  with a copy of the  object  code of the ALSS  Platform
                Software (except as Section 4.02(m)(8)(iv) contemplates);

         (iv)   Except  as  disclosed  in  Section  4.02(m)(9)(iv)  of  Sellers'
                Disclosure Schedule,  all copies in all media of the source code
                are currently  stored only in Sellers'  premises in San Antonio,
                Texas and all files containing  source code have been identified
                to Buyer. To Sellers' Knowledge, the transaction contemplated by
                this Agreement will not itself entitle any Person except for the
                rights  of  Parent  under  the   Intellectual   Property  Rights
                Agreement to obtain a copy of the source code for the Software;


                                       35
<PAGE>


         (v)    Except as listed in Section 4.02(m)(9)(v) of Sellers' Disclosure
                Schedule,  there are no problems or defects in the ALSS Platform
                Software--including  bugs,  logic errors or failures of the ALSS
                Platform  Software  to  operate  as  described  in  the  related
                documentation or  specifications,  or as otherwise  warranted to
                any third party, in each case that are specifically known by the
                Selling  Companies,  and, except for such disclosed  problems or
                defects,   the  Software   operates  in   accordance   with  its
                specifications;

         (vi)   Section   4.02(m)(9)(vi)   of   Sellers'   Disclosure   Schedule
                accurately  describes the current material development plans and
                schedule  for the  ALSS  Platform  Software  and  discloses  and
                describes all material internal plans and external  commitments,
                and  commitments  to Parent,  to  enhance  or  improve  the ALSS
                Platform  Software,  and all related budgets and schedules,  and
                except  as  disclosed  in  Section  4.02(m)(9)(vi)  of  Sellers'
                Disclosure  Schedule,  all  projects  there  described  are  not
                materially over budget or behind schedule;

         (vii)  There are not now nor have  there  ever  been any  distributors,
                sales agents,  representatives  or any other persons,  including
                VARs, OEMs or resellers, who have rights from Sellers under oral
                or written  agreements  to market or license  the ALSS  Platform
                Intellectual Property, or the Software in the ALSS Platform; and

         (viii) Sellers  have  disclosed  to Buyer  all  reports,  analyses  and
                investigations  performed by Sellers or consultants  retained by
                Sellers  concerning  the  capacity  of the ALSS  Platform  to be
                extended to service  additional  mortgage loans and Sellers have
                no reason to  believe  that the  conclusions  reflected  in such
                reports,  analyses  and  investigations  are  inaccurate  in any
                material respect.

     (n) Employee Benefit Plans.

         (1)    All Compensation and Benefit Plans,  other than Compensation and
                Benefit  Plans  that  are not  material,  have  been  Previously
                Disclosed in Section  4.02(n) of Sellers'  Disclosure  Schedule.
                True and complete  copies of all such  Compensation  and Benefit
                Plans have been made available to Buyer.

         (2)    Neither the execution of this Agreement nor the  consummation of
                the Purchase will entitle any Prospective Employees to severance
                pay or any increase in  severance  pay upon any  termination  of
                employment  after the date  hereof,  other  than as set forth in
                Section 4.02(n) of Sellers' Disclosure Schedule.

         (3)    None of the  Compensation  and Benefit Plans are  "multiemployer
                plans" within the meaning of section 3(37) of ERISA.


                                       36
<PAGE>


         (o) Labor  Matters.  None of the Selling  Companies is a party to or is
bound by any collective  bargaining  agreement,  contract or other  agreement or
understanding  with a labor  union or  labor  organization,  nor is any  Selling
Company the subject of a proceeding  asserting  that it has  committed an unfair
labor  practice  (within the meaning of the  National  Labor  Relations  Act) or
seeking  to  compel  any of the  Selling  Companies  to  bargain  with any labor
organization as to wages or conditions of employment, nor is there any strike or
other  labor  dispute  involving  any of the  Selling  Companies  pending or, to
Sellers' Knowledge, threatened in writing, nor do the Sellers have any Knowledge
of any activity involving  employees of the Selling Companies seeking to certify
a collective bargaining unit or engaging in other organizational  activity.  The
Selling Companies are in material compliance with all applicable laws respecting
employment practices, terms and conditions of employment and wages and hours and
have not engaged in any unfair labor practices.

         (p) Environmental Matters.

             (1) To the  Knowledge  of  Sellers,  the Selling  Companies  are in
         compliance in all material  respects with all applicable  Environmental
         Laws.

             (2) To the Knowledge of Sellers,  the Selling Companies possess all
         permits,    licenses,     registrations,     identification    numbers,
         authorizations  and approvals  required under applicable  Environmental
         Laws for the operation of the Business as presently conducted.

             (3) The Selling  Companies  have not  received  any written  claim,
         notice of violation  or citation  concerning  any  violation or alleged
         violation of any applicable  Environmental Law or any alleged liability
         involving  the  presence  of any  hazardous  substance  pursuant to any
         Environmental  Law during the past seven years. To Sellers'  Knowledge,
         there  have  been no  releases,  spills  and  discharges  of  Hazardous
         Substances  that  could   reasonably  be  expected  to  require  either
         reporting or  remediation,  or to result in  liability  pursuant to any
         Environmental  Law on or underneath  any Purchased  Asset which is real
         property owned or leased by any of the Selling Companies.

             (4) There are no writs,  injunctions,  decrees, orders or judgments
         outstanding,  or any  actions,  suits,  proceedings  or  investigations
         pending  or,  to the  Knowledge  of  Sellers,  threatened  in  writing,
         relating to compliance by the Selling  Companies with any Environmental
         Law.

             (5) Notwithstanding  any other  representation and warranty in this
         Section 4.02,  the  representations  and  warranties  contained in this
         Section 4.02(p) constitute the sole  representations  and warranties of
         Sellers with respect to any Environmental Law.


                                       37
<PAGE>


         (q) Mortgage Banking Representation.

             (1)  Advances  and  Accounts  Receivable.  Each  Acquired  Accounts
     Receivable is a valid and subsisting amount owing to the Selling Companies,
     is carried on the books of the Selling  Companies at values  determined  in
     accordance  with GAAP and is not subject to any set-off or claim that could
     be asserted against Buyer, and the Selling  Companies have not received any
     notice from an Investor,  Insurer or other  appropriate  party in which the
     Investor,  Insurer or other party disputes or denies a claim by the Selling
     Companies  for  reimbursement  in  connection  with  an  Acquired  Accounts
     Receivable.

             (2) Compliance. Each Acquired Warehouse Loan that is allocated to a
     particular  Investor  in  accordance  with the  standard  secondary  market
     practices of the Selling Companies is eligible for sale under an Investment
     Commitment   or  otherwise  in  the  ordinary   course  of  business.   The
     origination,  sale, and servicing of the Acquired Warehouse Loans comply in
     all material  respects with Applicable Law and Regulations and Investor and
     Insurer requirements.

             (3) Mortgage Banking  Qualification.  HSL (together with each other
     Selling  Company that  services or  originates  Mortgage  Loans) (a) to the
     extent required for the conduct of the Business,  is approved (i) by HUD as
     an approved mortgagee and servicer for FHA Loans, (ii) by VA as an approved
     lender and  servicer  for VA Loans,  (iii) by FNMA and FHLMC as an approved
     seller/servicer of first lien residential  mortgages and (iv) by GNMA as an
     authorized issuer and approved servicer of GNMA-guaranteed  mortgage-backed
     securities,  (b) has all  other  material  certifications,  authorizations,
     licenses,  permits and other approvals,  including without limitation those
     required by State Agencies, that are necessary to conduct the Business (or,
     where  legally  permissible,  any  waiver of or  exemption  from any of the
     foregoing by such Agency or State Agency) and (c) is in good standing under
     all applicable federal,  state and local laws and regulations thereunder as
     a lender and servicer.  None of Sellers or any Selling Company has received
     any notice or information from any  Governmental  Authority that it intends
     to terminate or restrict HSL's status (or that of any other Selling Company
     that services or originates  Mortgage Loans) as an approved  participant in
     its programs for which HSL or such Selling Company is as of the date hereof
     registered, approved or authorized.

             (4) No Recourse.  Except with respect to the Warehouse Loans listed
     in Schedule  4.02(q)(4),  none of the Warehouse Loans provides for recourse
     to the Selling Companies.

     (r) Corporate Documents. The Selling Companies have made available to Buyer
true and complete copies of their amended charters and amended by-laws.

     (s) Risk Management  Instruments.  All Acquired Hedging Assets were entered
into in accordance with all applicable laws,  rules,  regulations and regulatory


                                       38
<PAGE>

policies;  and each of them constitutes the valid and legally binding obligation
of the Selling  Companies,  enforceable in accordance  with its terms (except as
enforceability   may  be   limited   by   applicable   bankruptcy,   insolvency,
reorganization,  moratorium,  fraudulent  transfer  and similar  laws of general
applicability  relating to or affecting  creditors'  rights or by general equity
principles),  and each is in full  force  and  effect.  Neither  of the  Selling
Companies,  nor to Sellers'  Knowledge any other party thereto,  is in breach of
any of its obligations under any of the Acquired Hedging Assets.

     (t) Warehouse Loans.

         (1) Ownership.  The Selling  Companies are the only owners of, and have
     valid title to, each Acquired  Warehouse Loan, free and clear of all Liens,
     except Permitted Liens.

         (2)  Collateral.  Each Acquired  Warehouse Loan is a first  residential
     mortgage loan,  subject only to (i) the Lien of current real property taxes
     and assessments,  (ii) covenants,  conditions and  restrictions,  rights of
     way,  easements  and  other  matters  of  public  record  as of the date of
     recording of the mortgage,  (iii) such exceptions appearing of record which
     are  acceptable  to mortgage  lending  institutions  generally  in the area
     wherein the  property  subject to the  mortgage is located or  specifically
     reflected  in  the  appraisal  to  be  obtained  in  connection   with  the
     origination of the related  Acquired  Warehouse Loan and (iv) other matters
     to which like  properties  are  commonly  subject  which do not  materially
     interfere with the benefits of the security intended to be provided by such
     mortgage.

         (3) Payments/Defaults.  There is no default, breach, violation or event
     permitting acceleration existing under any Acquired Warehouse Loan. Selling
     Companies  have not waived any such  default,  breach,  violation  or event
     permitting acceleration of any Acquired Warehouse Loan.

         (4) No Waiver.  No provision of any  Acquired  Warehouse  Loan has been
     waived,  altered or  modified  in any  respect,  except by  instruments  or
     documents identified in the file relating to such Acquired Warehouse Loan.

         (5) No Defenses.  To Sellers' Knowledge,  no Acquired Warehouse Loan is
     subject  to any  right of  rescission,  setoff,  counterclaim  or  defense,
     including the defense of usury and, to Sellers' Knowledge,  the exercise of
     any right under any Acquired  Warehouse  Loan will not render such Acquired
     Warehouse Loan unenforceable in whole or in part or subject to any right of
     rescission  (other  than  the  statutory  right  of  rescission),   setoff,
     counterclaim or defense, including the defense of usury.

         (6)  Warehouse  Loans in Force.  No  Acquired  Warehouse  Loan has been
     satisfied  or  subordinated  in whole or in part or  rescinded  (other than
     pursuant to a statutory right of rescission) and no collateral  securing an
     Acquired  Warehouse  Loan has been  released  from the Lien of the  related


                                       39
<PAGE>

     mortgage in whole or in part.

          (u)  Origination  of  Second  Mortgage  Loans.  None  of  the  Selling
     Companies  originates any second  mortgage loans except  concurrently or in
     conjunction with first priority mortgage loans.

          (v) Financial Reports; No Material Adverse Effect.

              (1) Sellers have  Previously  Disclosed  the audited  consolidated
     financial  statements for HSL for the fiscal year ended  September 30, 2001
     (the "HSL Financial  Statements").  Each of the balance sheets contained in
     the HSL  Financial  Statements  (including  the related notes and schedules
     thereto)  fairly  presents  in  all  material   respects  the  consolidated
     financial  position of HSL as of its date,  and each of the  statements  of
     income and  changes in  shareholder's  equity and cash flows or  equivalent
     statements contained in the HSL Financial Statements (including any related
     notes and schedules  thereto) fairly presents in all material  respects the
     consolidated  results of operations,  consolidated changes in shareholder's
     equity and  consolidated  changes in cash flows, as the case may be, of HSL
     for the periods to which they relate,  in each case in accordance with GAAP
     consistently applied during the periods involved.

              (2) Since  September  30,  2001,  (A) the Selling  Companies  have
     conducted  their  respective  businesses  in the  ordinary  course of their
     business  (excluding the  incurrence of expenses  related to this Agreement
     and the transactions  contemplated  hereby), (B) the Selling Companies have
     not incurred any material  liability  other than in the ordinary  course of
     their business and (C) no event has occurred or  circumstance  arisen that,
     individually  or taken  together  with all other facts,  circumstances  and
     events,  is  reasonably  likely to have a  Material  Adverse  Effect on the
     Business or on the Sellers.

              (3) The Sellers are not aware of any fact or circumstance relevant
     to them or any of the  Selling  Subsidiaries  that  would  have a  material
     adverse  effect on  Buyer's  ability  to  timely  perform  in all  material
     respects its material obligations under the Retained Portfolio Subservicing
     Agreement and the Services  Agreement other than the failure to receive any
     relevant  Third  Party  Consents  in  connection   with  the   transactions
     contemplated hereby.

     (w) Non-ALSS Platform Intellectual Property. The following  representations
are made solely with respect to the Software, Acquired Intellectual Property and
Acquired  Intellectual  Property Licenses that are not part of the ALSS Platform
(the "Non-ALSS IP Assets").

           (1) All Software and Acquired  Intellectual Property that is material
     and/or that is the subject of a subsisting registration or issued
     Patent or pending  application  for  registration or issued Patent has been
     Previously Disclosed. All Acquired Intellectual Property Licenses have been


                                       40
<PAGE>

     Previously   Disclosed  (except  for  generally   available   "shrinkwrap",
     over-the-counter,  "clickwrap"  and  other  similar  licenses  that are not
     enterprise licenses).

           (2) The Selling Companies have sufficient rights to use all Software,
     Acquired  Intellectual  Property  and  Intellectual  Property  and Software
     licensed  under the  Acquired  Intellectual  Property  Licenses  ("Licensed
     Intellectual  Property") as currently  used by them in connection  with the
     Business.

           (3)  The  Software  and the  Acquired  Intellectual  Property  in the
     Non-ALSS  IP  Assets,  and  the  Selling  Companies'  use of the  Software,
     Acquired  Intellectual  Property  and  Licensed  Intellectual  Property  as
     currently used by them in connection with the Business, does not violate or
     infringe  the  Intellectual  Property  or  proprietary  rights of any other
     Person except as Previously  Disclosed.  Except as Previously  Disclosed in
     Section  4.02(w) of Sellers'  Disclosure  Schedule,  in the three (3) years
     preceding  this  Agreement,  there has not been any  suit,  action or other
     proceeding,  and to Sellers' Knowledge, no suit, action or other proceeding
     is  pending  against  them  concerning  any claim  that any of the  Selling
     Companies' use of the Software,  Acquired Intellectual Property or Licensed
     Intellectual  Property as  currently  used by them in  connection  with the
     Business  infringes or violates  the  Intellectual  Property  rights of any
     other  Person,  or that  any of the  Selling  Companies  has  breached  any
     Acquired  Intellectual  Property  License.  No claim has been  asserted  in
     writing against any of the Selling  Companies that its use of the Software,
     Acquired   Intellectual  Property  or  Licensed  Intellectual  Property  as
     currently  used  by them in  connection  with  the  Business  infringes  or
     violates the Intellectual  Property rights of any other Person, or that any
     of the Selling  Companies has breached any Acquired  Intellectual  Property
     License.

           (4) There exists no event,  condition or occurrence  which,  with the
     giving of notice or lapse of time,  or both,  would  constitute  a material
     breach by any of the Selling  Companies,  or to Sellers'  Knowledge another
     Person, under any Acquired  Intellectual  Property License. No party to any
     Acquired  Intellectual  Property  License  has  given  any of  the  Selling
     Companies notice of its intention to cancel, terminate or fail to renew any
     such Acquired Intellectual Property License.

           (5) To Sellers'  Knowledge,  no Person is infringing or violating any
     of the Selling Companies'  intellectual  property rights in the Software or
     Acquired Intellectual Property in the Non-ALSS IP Assets.

           (6) Trademarks.

           (i)  Section 4.03(w)(6)(i) of Sellers' Disclosure Schedule contains a
                complete  and  accurate  list  and  summary  description  of all
                federally  registered Marks,  pending applications for Marks and


                                       41
<PAGE>

                material unregistered Marks.

           (ii) Except as set forth in Section 4.03(w)(6) of Sellers' Disclosure
                Schedule,  all Marks that have been  registered  with the United
                States Patent and  Trademark  Office are currently in compliance
                with all legal  requirements  relating  thereto  (including  the
                timely  post-registrations  filing  of  affidavits  of  use  and
                incontestability and renewal applications),  and to the Sellers'
                Knowledge are valid and  enforceable  and are not subject to any
                maintenance  fees or actions falling due within ninety (90) days
                after the Closing Date.

           (iii)All Internet  domain  names are subject to  currently  effective
                Internet domain name registrations.

           (iv) No  Mark  has  been  or is now  involved  in any  opposition  or
                cancellation  or any other type of  proceeding  challenging  the
                Selling   Companies'  rights  therein,   and,  to  the  Sellers'
                Knowledge,  no such action is threatened with the respect to any
                of the Marks which  action or  proceeding  would have a Material
                Adverse Effect.

           (7)  Sellers  have  taken  all  commercially  reasonable  precautions
     necessary to protect the secrecy, confidentiality and value of the Non-ALSS
     IP Assets as a trade secret.

           (8) All copies of Third Party Programs in the Non-ALSS IP Assets used
     in the Business are licensed to the Selling  Companies  under valid written
     license agreements.

           (9) E-business.

           (i)  The Selling  Companies' web sites are in  substantial compliance
                with all applicable regulations.

           (ii) The  Selling   Companies   have  operated  their  web  sites  in
                substantial conformance with their privacy policies.

     (x) Top-Ten Investors. Section 4.02(x) of Seller's Disclosure Schedule sets
forth the ten largest  Investors in terms of volume of Servicing on the basis of
unpaid principal  balance and the percentage of the total volume of Servicing of
such Investors.

     4.03 Representations and Warranties of Buyer.

     Subject  to  Section  4.01  and  except  as  Previously  Disclosed,   Buyer
represents and warrants to Sellers as follows:


                                       42
<PAGE>

     (a) Organization, Standing and Authority. Buyer has been duly organized and
is existing in good  standing as a federal  savings  association.  Buyer has the
requisite  power  and  authority  to own its  current  assets  and  carry on its
business as currently  conducted,  and is duly  qualified to do business in each
jurisdiction  where the ownership or operation of its property and assets or the
conduct of its business requires such qualification.

     (b) Corporate  Authority.  Buyer has full corporate  power and authority to
execute  and  deliver  the  Agreement  and  to   consummate   the   transactions
contemplated  hereby and thereby and to perform its  obligations  hereunder  and
thereunder.  This Agreement and the transactions  contemplated  hereby have been
duly  authorized by all necessary  corporate  action of Buyer and do not require
the approval of any shareholder or shareholders and this Agreement has been duly
authorized,  executed  and  delivered  by Buyer.  This  Agreement is a valid and
legally  binding  agreement of Buyer,  enforceable in accordance  with its terms
(except as enforceability may be limited by applicable  bankruptcy,  insolvency,
receivership,  reorganization,  moratorium, fraudulent transfer and similar laws
of  general  applicability  relating  to or  affecting  creditors'  rights or by
general  equity  principles).  Buyer has the  corporate  power and  authority to
execute,  deliver  and  perform  its  obligations  under this  Agreement  and to
consummate the transactions contemplated hereby.

     (c) Regulatory Approvals; No Conflicts.

           (1) No consents or approvals  of, or filings with,  any  Governmental
     Authority  or any Third Party  Consents are required to be obtained or made
     by  Buyer  or any of its  Affiliates  in  connection  with  the  execution,
     delivery or  performance  by Buyer of this  Agreement or to consummate  the
     Purchase, except for consents, approvals, filings, applications, notices or
     registrations,  and the termination of any applicable waiting periods,  (A)
     under the HSR Act, (B) the VA, FHA, FNMA,  FHLMC,  GNMA and HUD, (C) to the
     Office of Thrift Supervision,  the Federal Deposit Insurance Corporation or
     any other  federal or state bank  regulatory  agency and (D) as  Previously
     Disclosed on Disclosure Schedule  4.03(c)(1).  As of the date hereof, Buyer
     or its  Affiliates  have no  Knowledge  of any reason why the  approvals or
     consents set forth as conditions to closing in Section  7.01(a) will not be
     received in a timely manner.

           (2) Subject to receipt of the regulatory approvals referred to in the
     preceding paragraph and the expiration of the related waiting periods,  and
     the  Third  Party  Consents  or  approvals  referred  to in  the  preceding
     paragraph,  the execution,  delivery and  performance of this Agreement and
     the  consummation of the transactions  contemplated  hereby do not and will
     not (A)  constitute a breach or violation of, or a default  under,  or give
     rise to any Lien, any  acceleration of remedies or any right of termination
     under,  any  law,  rule  or  regulation  or any  judgment,  decree,  order,
     ordinance, statute, governmental permit or license, or contract, agreement,
     indenture or instrument  of either of Buyer or of any of its  Affiliates or


                                       43
<PAGE>

     to which either of Buyer or any of its  Affiliates  or their  properties is
     subject or bound,  (B)  constitute a breach or  violation  of, or a default
     under, its charter or by-laws, or (C) require any consent or approval under
     any  such  law,  rule,  regulation,  judgment,  decree,  order,  ordinance,
     statute, governmental permit or license, contract, agreement,  indenture or
     instrument.

     (d) Financial Reports;  No Material Adverse Effect.  Buyer has delivered to
Sellers  Buyer's  annual  report on Form 10-K for the fiscal year ended 2000 and
its quarterly  report on Form 10-Q for the period ended  September 30, 2001 (the
financial statements contained therein, the "Buyer Financial Statements").  Each
of the balance sheets  contained in Buyer  Financial  Statements  (including the
related notes and schedules  thereto) fairly  presents in all material  respects
the  consolidated  financial  position of Buyer as of its date,  and each of the
statements  of income  and  changes  in  shareholders'  equity and cash flows or
equivalent  statements  contained in Buyer Financial  Statements  (including any
related notes and schedules  thereto) fairly  presents in all material  respects
the consolidated  results of operations,  consolidated  changes in shareholders'
equity and consolidated  changes in cash flows, as the case may be, of Buyer for
the  periods  to  which  they  relate,  in each  case in  accordance  with  GAAP
consistently  applied  during  the  periods  involved  and,  in the  case of the
unaudited interim statements, subject to normal year-end audit adjustments.

     (e) No Material Adverse Effect.  Since September 30, 2001, through the date
hereof no event has occurred or fact or circumstance  arisen that,  individually
or taken together with all other events, facts, or circumstances,  is reasonably
likely to have a Material Adverse Effect with respect to Buyer.

     (f)  Litigation;   Regulatory   Action.  No  litigation,   claim,   action,
arbitration, investigation or other proceeding before any Governmental Authority
is pending  against Buyer or any of its  Affiliates  and, to the best of Buyer's
Knowledge,  no such litigation,  claim,  action,  arbitration,  investigation or
other  proceeding has been  threatened in writing except where such  litigation,
claim, action, arbitration,  investigation, or other proceeding would not have a
Material Adverse Effect on Buyer.

     (g)  Regulatory  Action.  Neither  of Buyer  nor any of its  Affiliates  or
properties  is a  party  to or is  subject  to  any  order,  decree,  agreement,
memorandum  of  understanding  or similar  supervisory  arrangement  with,  or a
commitment letter or similar submission to, or extraordinary  supervisory letter
from a Regulatory  Authority,  nor has either of Buyer or any of its  Affiliates
been advised by a Regulatory Authority that such agency is contemplating issuing
or requesting (or is considering the  appropriateness  of issuing or requesting)
any such order,  decree,  agreement,  memorandum  of  understanding,  commitment
letter,  supervisory  letter or similar  submission  except where any failure to
comply would not have in the aggregate a Material Adverse Effect on Buyer.

     (h) Compliance  with Laws.  Buyer and its Affiliates are in compliance with
all applicable federal,  state, local and foreign statutes,  laws,  regulations,
ordinances,  rules,  judgments,  orders or decrees  applicable to them or to the


                                       44
<PAGE>

employees  conducting such  businesses,  including the Equal Credit  Opportunity
Act, the Fair Housing Act, the  Community  Reinvestment  Act, the Home  Mortgage
Disclosure  Act and all  other  applicable  fair  lending  laws and  other  laws
relating  to  discriminatory  business  practices,  except  where any failure to
comply would not have in the aggregate a Material Adverse Effect on Buyer.

     (i)  No Brokers.  No action has been taken by Buyer that would give rise to
any valid claim  against any party hereto for a brokerage  commission,  finder's
fee or other like payment with respect to the transactions  contemplated by this
Agreement, other than a fee to be paid to Morgan Stanley Dean Witter by Buyer.

     (j) Banking  Regulation.  Buyer is an "insured  depository  institution" as
defined  in  the  Federal  Deposit  Insurance  Act  and  applicable  regulations
thereunder.  Buyer and each of its Affiliates  that is a depository  institution
has a rating of "Satisfactory" or better under the Community Reinvestment Act as
of the date hereof.

     (k)  Financing.  Buyer has,  or will have on the Closing  Date,  sufficient
cash, available lines of credit or other sources of immediately  available funds
to enable it to pay the Purchase Price hereunder and to pay any other amounts to
be paid by it under this Agreement.

     4.04 No Other Representations or Warranties.

     Except for the representations  and warranties  expressly contained in this
Article IV, none of Sellers, the Selling Subsidiaries, Buyer or any other Person
has made or makes any other  express  or  implied  representation  or  warranty,
either written or oral, on behalf of any Seller, Selling Subsidiary or Buyer.

                                   ARTICLE V

                                    Covenants

     5.01 Conduct of Business.

     From the date hereof until the Closing Date,  except (i) as contemplated by
this Agreement, (ii) as Previously Disclosed,  (iii) as required by law, (iv) in
the ordinary  course of the Business,  or (v) to the extent that Buyer  provides
prior  written  consent to do otherwise,  which consent may not be  unreasonably
withheld:

     (a) Sellers shall use commercially  reasonable  efforts to (i) maintain the
Selling  Companies'  corporate  existence in good  standing,  (ii)  maintain the
general  character of the  Business  and conduct the Business in a  commercially
reasonable  manner,  (iii)  maintain  proper  business  and  accounting  records
relative to the Business,  (iv) use commercially  reasonable efforts to preserve
relationships with customers, suppliers, Investors and Insurers of the Business,


                                       45
<PAGE>

(v) maintain the Purchased  Assets in good  condition and repair,  ordinary wear
and tear  excepted,  (vi)  maintain  procedures  for  protection of the Acquired
Intellectual Property, and (vii) maintain presently existing insurance coverages
with respect to the Purchased Assets and the Business;

         (b)   Sellers shall not permit any Selling Company to:

               (i)   enter into any Specified Contract, relating to the Business
                     (other than those contemplated by this Agreement or related
                     to Excluded Assets or Excluded Liabilities) or terminate or
                     amend or modify in any material  respect any such  existing
                     Specified Contracts;

               (ii)  enter into  or  amend  or renew  any  individual employment
                     agreements with any Prospective Employee;

               (iii) grant any salary or wage  increase or increase any employee
                     benefit for any Prospective  Employee (including  incentive
                     or bonus payments) other than regularly scheduled salary or
                     wage  increases of up to 4% in aggregate  amount from those
                     existing on the date  hereof,  except in either case (A) to
                     satisfy  Previously   Disclosed   contractual   obligations
                     existing  as  of  the  date  hereof,  (B)  for  agreements,
                     arrangements,  grants or awards  to newly  hired  employees
                     consistent  with  past  practice,  (C) as a  result  of any
                     change or  modification  of any benefit  plan of Parent not
                     related  solely  to  the  Selling  Companies,  or  (D)  for
                     incentive   bonus  awards  payable  in  December  2001  for
                     performance associated with the fiscal year 2001;

               (iv)  sell, transfer,  assign or otherwise dispose of or encumber
                     any of the Purchased  Assets in one transaction or a series
                     of  related  transactions  having  a  value  in  excess  of
                     $100,000;

               (v)   cancel any debt or waive or  compromise  any claim or right
                     relating to the Business in one  transaction or a series of
                     related transactions having a value in excess of $250,000;

               (vi)  make any capital  expenditure or commitment relating to the
                     Business in excess of (A)  $100,000  per project or related
                     projects  or (B)  $1,000,000  in the  aggregate  other than
                     expenditures  necessary to maintain in good repair existing
                     assets;

               (vii) except  with   respect  to   endorsements   of   negotiable
                     instruments  in  the  ordinary  course  of  their  business
                     consistent  with past  practice  or, with  respect to their
                     mortgage banking business,  the ordinary course of business
                     in  accordance  with  past  practice,   incur,   assume  or
                     guarantee  or   otherwise   become   responsible   for  any
                     indebtedness  for borrowed  money which will  constitute an


                                       46
<PAGE>

                     Assumed Liability as of the Closing Date;

              (viii) issue,  sell or agree to  issue or sell (a) any  shares  of
                     the capital  stock of the  Acquired  Subsidiary  or (b) any
                     securities convertible into, or options with respect to, or
                     warrants to purchase or rights to subscribe for, any Shares
                     of the capital stock of the Acquired Subsidiary;

               (ix)  enter into any joint venture,  partnership or other similar
                     arrangement,  form any other new material  arrangement  for
                     the conduct of its business or purchase any material assets
                     or securities of any Person;

               (x)   purchase new  mortgage  servicing  rights or sell  mortgage
                     servicing   rights  except  (a)  pursuant  to   contractual
                     commitments in place on the date hereof (including co-issue
                     commitments/agreements),  (b) other purchases not to exceed
                     in the  aggregate  more than $2.5  billion  in  outstanding
                     principal  amount of loans over any  calendar  month or (c)
                     sales of  servicing  provided  that the  Selling  Companies
                     comply with the  procedures  in Section 8.4 of the Retained
                     Portfolio  Subservicing Agreement as if such provision were
                     operative and in effect;

               (xi)  terminate,  cancel or amend any material insurance coverage
                     maintained by Sellers or Selling  Subsidiaries with respect
                     to the assets or  activities  of the Business  which is not
                     replaced by an  adequate  amount of  insurance  coverage at
                     reasonable cost;

               (xii) merge or  consolidate  with or into  any  other  Person  or
                     permit  any other  Person to merge or  consolidate  with or
                     into it;

              (xiii) transfer,  mortgage,  encumber or otherwise  dispose of any
                     of the Pipeline Loans or Warehouse  Loans other than in the
                     ordinary course of business;

               (xiv) except for  residential  mortgage loans or commitments  for
                     residential   mortgage  loans  that  have  been  previously
                     approved by Sellers prior to the date of this Agreement (a)
                     make or acquire any  residential  mortgage  loan or issue a
                     commitment for any residential  loan except for residential
                     mortgage loans and commitments that are made or acquired in
                     the  ordinary  course  of  business  consistent  with  past
                     practice  and  with  an  individual  principal  balance  of
                     $3,000,000  or  less;  or (b) take any  action  that  would
                     result  in any  discretionary  releases  of  collateral  or


                                       47
<PAGE>

                     guarantees or otherwise  restructure any loan or commitment
                     for  any  loan  with  a  principal  balance  in  excess  of
                     $3,000,000;

               (xv)  except as necessary in order to comply with  Regulations or
                     the  requirements  of  this  Agreement  or in  response  to
                     competitive  or market  conditions in order to preserve the
                     value of its  franchise,  make any material  changes in its
                     policies and  practices  with respect to (a)  underwriting,
                     pricing,  originating,  acquiring,  servicing, or buying or
                     selling   rights  to  service  loans  or  (b)  hedging  the
                     Warehouse Loans or Pipeline Loans;

               (xvi) make any changes to its  accounting  methods,  practices or
                     policies,  except  as  may be  required  under  law,  rule,
                     regulation  or  GAAP,  in  each  case  as  concurred  in by
                     Seller's independent public accountant;

              (xvii) settle any action  filed or  otherwise  instituted  against
                     it, the Purchased Assets or the Business if such settlement
                     would contain any relief  against the  Purchased  Assets or
                     the Business other than monetary damages; or

             (xviii) agree to do any of the foregoing.

     (c) Notwithstanding  the preceding  provisions of this Section 5.01, during
the period  from the date hereof to the  Closing  Date,  Sellers and the Selling
Subsidiaries may sell or transfer,  or enter into one or more agreements to sell
or  transfer,  any asset of the  Selling  Companies,  except  for the  Purchased
Assets;  provided,  however,  that any sale of  mortgage  servicing  rights must
comply with the procedures in Section 8.4 of the Retained Portfolio Subservicing
Agreement  as if such  provision  were  operative  and in effect.  From the date
hereof to the Closing Date, the officers of the Selling  Companies  shall confer
on a regular basis with Buyer as to the Business, and report periodically on the
general status of the ongoing operations thereof.

     5.02 Access; Confidentiality.

     (a) Sellers agree to permit Buyer and its  Representatives  to have, during
the period from the date hereof to the Closing  Date,  reasonable  access to the
premises,  books  and  records  relating  to the  Business  and to  records  and
documentation  of the ALSS Platform and other  systems,  during normal  business
hours.  Sellers agree to make available to Buyer upon reasonable  advance notice
and during  normal  business  hours,  the  employees  of the  Selling  Companies
involved in the conduct of the Business and the  operation of the ALSS  Platform
and  other  systems,  as  Buyer  may  reasonably  request,  provided  that  such
availability shall not unreasonably  interfere with the normal operations of the
Selling  Companies.   Sellers  shall  furnish  Buyer  with  such  financial  and
operational data and other  information  relating to the Business as Buyer shall
from time to time reasonably  request and shall reasonably  cooperate with Buyer
with respect to Buyer's need to plan for and coordinate  the  integration of the


                                       48
<PAGE>

Purchased Assets and to prepare to undertake its obligations under the Ancillary
Agreements.

     (b) Buyer agrees that it will not, and will cause its  Representatives  not
to, use any information  obtained  pursuant to this Section 5.02 (as well as any
other  information  obtained  prior to the date  hereof in  connection  with the
entering into of this Agreement) for any purpose  unrelated to the  consummation
of the transactions contemplated by this Agreement.  Subject to the requirements
of  applicable  law,  and  other  exceptions  set  forth in the  Confidentiality
Agreement,  Buyer will keep confidential,  and will cause its Representatives to
keep  confidential,  all  information  and documents  obtained  pursuant to this
Section 5.02 (as well as any other information obtained prior to the date hereof
in connection with the entering into of this Agreement)  unless such information
(1) was already  known to such party,  (2) becomes  available to such party from
other  sources not known by Buyer to be bound by a  confidentiality  obligation,
(3) is disclosed with the prior written approval of Sellers or (4) is or becomes
readily  ascertainable from published information or trade sources. In the event
that this  Agreement is  terminated  or the  transactions  contemplated  by this
Agreement will otherwise fail to be  consummated,  Buyer will promptly cause all
copies of documents or extracts  thereof  containing  information and data as to
Sellers,  any Selling  Subsidiary  or the Acquired  Subsidiary to be returned to
Sellers  at  Buyer's  expense,  or (at  Sellers'  option)  confirm in writing to
Sellers  that  they  have  completely  destroyed  all  such  copies,  documents,
extracts, information and data.

     (c) In  addition to the  confidentiality  arrangements  contained  in  this
Agreement,   all  information  provided  or  obtained  in  connection  with  the
transactions  contemplated by this Agreement  (including  pursuant to clause (a)
above) will be held by Buyer in accordance  with and subject to the terms of the
Confidentiality  Agreement, dated October 2, 2001, between Buyer and Parent (the
"Confidentiality  Agreement").  In the  event  of a  conflict  or  inconsistency
between the terms of this Agreement and the Confidentiality Agreement, the terms
of this Agreement will govern.

     (d) Buyer  agrees  that  following  the  Closing  Date,  Sellers  and their
Representatives  shall have reasonable access,  during normal business hours, to
the documentation,  manuals, files and other information or data of the Business
to the extent they relate to the Purchased Assets or Assumed  Liabilities during
the  period  prior to the  Closing  Date  (but  subject  to the  provisions  and
limitations of the Intellectual  Property Rights  Agreement  regarding access to
the ALSS  Platform)  (and shall  permit  such  Persons to examine  and copy such
documentation,  manuals,  files  and  other  information  or data to the  extent
reasonably  requested by such party), and shall cause the officers and employees
of the  Business  to  furnish  (to  Sellers or any of their  Affiliates,  or any
regulator  of Sellers or any of their  Affiliates)  all  information  reasonably
requested by, and  otherwise  cooperate  with  (including,  without  limitation,
causing employees to assist Sellers or any of their Affiliates by requiring such
employees  to avail  themselves  for trial,  depositions,  interviews  and other
Action-related  litigation  endeavors)  Sellers or any of their  Affiliates with
respect to the Business,  Purchased Assets or Assumed Liabilities, in connection


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<PAGE>

with  regulatory  compliance,  indemnification  claim  verification,  pending or
threatened litigation,  financial reporting and tax matters (including financial
and tax audits and tax contests) and other similar business purposes. During the
period required under the longer of Buyer's record  retention policy or Seller's
record  retention  policy,  Buyer  shall not destroy or dispose of or permit the
destruction or disposition of any such documentation,  manuals,  files and other
information  or data  except as it relates to the ALSS  Platform  without  first
offering,  in  writing,  at least sixty (60) days prior to such  destruction  or
disposition to surrender them to Seller.  Anything foregoing to the contrary not
withstanding,  Buyer shall not be required to disclose or deliver  trade secrets
or other  confidential  information  regarding  the ALSS  Platform  Software  or
Acquired  Intellectual  Property  unless required by the  Intellectual  Property
Rights  Agreement  or the  Services  Agreement  or  required  by  law  or  legal
proceedings  and under the type of  protection  provisions  in the  Intellectual
Property Rights Agreement.

     (e)  Sellers  agree  that  following  the  Closing  Date,   Buyer  and  its
Representatives  shall have reasonable access,  during normal business hours, to
the books, records, documentation,  manuals, files and other information or data
of the Selling  Companies to the extent they relate to the Business or Purchased
Assets or Assumed  Liabilities  during the period prior to the Closing Date (and
shall   permit  such   Persons  to  examine   and  copy  such  books,   records,
documentation,  manuals,  files and  other  information  or data of the  Selling
Companies to the extent reasonably requested by such party), and shall cause the
officers and  employees of the Selling  Companies to furnish (to Buyer or any of
its  Affiliates,  or any  regulator  of  Buyer  or any  of its  Affiliates)  all
information  reasonably  requested by, and otherwise  cooperate with (including,
without  limitation,  causing employees to assist Buyer or any of its Affiliates
by  requiring  such  employees  to  avail  themselves  for  trial,  depositions,
interviews and other Action-related  litigation endeavors) Buyer with respect to
the  Business,  Purchased  Assets or Assumed  Liabilities,  in  connection  with
regulatory compliance, indemnification claim verification, pending or threatened
litigation,  financial  reporting and tax matters  (including  financial and tax
audits and tax contests) and other similar business purposes.  During the period
required under the longer of Buyer's record  retention policy or Seller's record
retention  policy,  Sellers  shall not  destroy  or  dispose  of or  permit  the
destruction or disposition of any such books, records,  documentation,  manuals,
files and other information or data without first offering, in writing, at least
sixty (60) days prior to such  destruction  or  disposition to surrender them to
Buyer.

     5.03 Taking of Necessary Action.

     (a)  Both  Sellers  and  Buyer  will  cooperate  and use  their  respective
commercially  reasonable  efforts to prepare  all  documentation,  to effect all
filings and to obtain all permits, consents, approvals and authorizations of all
third  parties  and  Governmental   Authorities   necessary  to  consummate  the
transactions contemplated by this Agreement. Each of Sellers and Buyer will have
the right to review in advance,  and to the extent practicable each will consult
with the other with respect to, all material  written  information  submitted to
any  third  party  or  any   Governmental   Authority  in  connection  with  the


                                       50
<PAGE>

transactions  contemplated by this Agreement, in each case subject to applicable
laws relating to the exchange of information. In exercising the foregoing right,
each  of the  parties  hereto  agrees  to act  reasonably  and  as  promptly  as
practicable.   Each  of  Buyer  and  Sellers  commits  to  submit  all  required
applications or notices to the appropriate  Governmental  Authorities  within 15
Business  Days of the date of this  Agreement.  Each party hereto agrees that it
will consult  with the other party  hereto with respect to the  obtaining of all
material permits,  consents,  approvals and  authorizations of all third parties
and   Governmental   Authorities   necessary  or  advisable  to  consummate  the
transactions  contemplated  by this Agreement and each party will keep the other
party appraised of the status of material  matters relating to completion of the
transactions  contemplated  hereby. To the extent  necessary,  Buyer and Sellers
shall  cause  their  respective  Affiliates  to take  any  action  necessary  in
connection with the foregoing.

     (b) Each party agrees,  upon  request,  to furnish the other party with all
information  concerning  itself,  its  Subsidiaries,   directors,  officers  and
stockholders and such other matters as may be reasonably  necessary or advisable
in connection  with any filing,  notice or  application  made by or on behalf of
such other party or any of its  Subsidiaries  to any third party or Governmental
Authority.

     (c)  Each  party  shall   designate  a  person  to  act  as  that   party's
representative  for purposes of coordinating  with the other party in connection
with  activities  and conduct  necessary or appropriate to effect the closing of
the transaction contemplated by this Agreement, the transition the Business from
the Selling  Companies to Buyer, to prepare for the performance of the Ancillary
Agreements and to communicate  concerning  Buyer's rights under the Solicitation
Rights  Agreement.   The  Sellers   initially   designate  Simon  Moore  as  the
representative of each of them. Buyer initially  designates Melba Bartels as its
representative.  The  representatives  shall meet or otherwise  communicate with
each other on a regular basis.

     5.04 Disclosure.

     Except as  contemplated  by the terms of this Agreement or as may otherwise
be  required by law,  neither  Sellers  nor Buyer,  nor any of their  respective
Affiliates,  will  disclose  to  any  Person  not a  party  hereto  (other  than
Affiliates and Representatives,  who shall be bound by this provision) the terms
of this  Agreement.  Sellers and Buyer agree to consult with each other prior to
issuing any press  release  relating to the  transactions  contemplated  by this
Agreement.  Sellers  will not make or deliver  any  written  communication  with
borrowers  or other  customers  of the  Selling  Companies  or with  Prospective
Employees or Leave Recipients  related to the transactions  contemplated  hereby
without  the prior  consent of Buyer  which  consent  shall not be  unreasonably
withheld.

     5.05 Missing Mortgage Loan Documents.

     Sellers agree, at their own expense, to use commercially reasonable efforts
before the Closing Date to obtain any Mortgage  Loan  Documents for any Acquired
Warehouse  Loan that is missing and must be  obtained  by the Selling  Companies


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<PAGE>

pursuant to the applicable Regulations.  To the extent any such missing document
is not obtained by the Selling  Companies by the Closing Date, Buyer agrees,  at
its own expense, to use commercially  reasonable efforts to obtain such document
from and after the Closing Date.

     5.06 Post-Closing Collection of Certain Receivables.

     (a) Buyer shall use  commercially  reasonable  efforts in  accordance  with
applicable  Regulations  and with at least the same level of  diligence as Buyer
would exercise for its own account to collect the Retained  Accounts  Receivable
on behalf of Sellers and the Selling Companies.  Such collection effort shall be
made by Buyer without cost to Sellers or any of their  Affiliates.  To aid Buyer
in its collections efforts, Sellers shall compile and deliver to Buyer a list of
all relevant  Retained  Accounts  Receivable  as soon as  practicable  after the
Closing Date.

     (b) Buyer shall remit to Sellers or the  Selling  Subsidiaries  all amounts
received with respect to Retained Accounts Receivable during a month by no later
than the 10th  day of the  following  month,  in one or more  remittances.  Upon
receipt of any such amounts by Buyer and prior to the remittance of such amounts
to Sellers,  Buyer shall place such amounts in an interest bearing account,  and
any interest earned thereon shall be for the benefit of Sellers.  With each such
remittance  Buyer  shall  deliver a report  with  respect  to the  status of the
Retained Accounts Receivable in form reasonably satisfactory to Sellers. Sellers
and their  accountants  and other  advisors  shall be given  full  access at all
reasonable  times  to all  books  and  records  necessary  to  perform  an audit
regarding Buyer's collections with respect to the Retained Accounts Receivable.

     5.07 Granted Licenses.

     (a)  Effective  upon Closing,  ___ Buyer grants  Parent and its  Affiliates
(including the Selling  Companies) a  royalty-free  right and license to use the
Marks identified in Schedule 4.02(w)  nonexclusively in North America solely for
the purpose of the Selling Companies' servicing the Retained Servicing Portfolio
and in connection with HomeSide Mortgage  Securities Trust 2001-1 and its issued
securities.  Such  license  will be  coterminous  with  the  Retained  Portfolio
Subservicing  Agreement and the term of the issued  securities,  as the case may
be. Buyer and Parent shall enter into a Trademark License Agreement effective on
the Closing Date on such terms as well as other terms mutually agreeable between
them.

     5.08 Insurance Matters.

     Buyer  acknowledges and agrees that no policy of insurance  relating to the
Purchased  Assets or the Business will be  transferred  or assigned  pursuant to
this  Agreement  (other  than title  insurance  policies  or  policies  relating
exclusively to individual  Acquired  Warehouse  Loans that may be transferred or
assigned  pursuant to Section 3.02), and that from and after the Closing,  Buyer


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<PAGE>

bears the  entire,  subject  to  Article X hereof,  risk of loss  related to the
Purchased Assets and the Business.

     5.09 No Solicitation.

     Prior to the Closing  only,  each of Sellers  and the Selling  Subsidiaries
shall immediately  cease and cause to be terminated any activities,  discussions
or  negotiations  commenced prior to the date of this Agreement with any parties
other than Buyer with respect to the sale of the Business as a whole. Nothing in
this  provision  shall  prohibit  the sale of the Retained  Servicing  Portfolio
provided that the Selling Companies comply with the procedures of Section 8.4 of
the  Retained  Portfolio  Subservicing  Agreement  as if  such  provisions  were
operative and in effect.

     5.10 Non-Competition Agreement.

     (a) For a period of three (3) years  following  the Closing  Date,  Sellers
shall not, and shall not permit any of their  Affiliates to, in any state in the
United States (i) directly or indirectly, either as a principal, partner, agent,
manager,  stockholder,  director, officer or in any other capacity, enter into a
business  that competes in the mortgage  software  business in the United States
(the  "Restricted  Business")  on a  de  novo  basis;  provided,  however,  that
ownership of less than 5% of the voting stock of any corporation  engaged in the
Restricted  Business shall not constitute a violation  hereof or (ii) acquire or
enter into an agreement to acquire or merge or consolidate  with any corporation
or other business  entity whose primary  business on a consolidated  or combined
basis with all its Affiliates is the Restricted Business.

     (b) For a period of three (3) years following the Closing Date, Buyer shall
not, and shall not permit any of its  Affiliates  to, offer services by means of
the ALSS Platform or any modification thereof in Australia or New Zealand.

     5.11 Non-Solicitation of Employees.

     (a) For the period from the Closing Date until the third anniversary of the
end of the Lease  Period,  neither  Sellers nor any of their  Affiliates  shall,
directly  or  indirectly  solicit  for  employment,  retain  as  an  independent
contractor or consultant, induce to terminate employment with Buyer or otherwise
interfere with Buyer's  employment  relationship  with any Prospective  Employee
located  in San  Antonio,  Texas  as of the  date of this  Agreement;  provided,
however,  that this  Section  5.11 shall not apply (a) if any such  employee has
been  terminated  by Buyer or any of its  Affiliates  for any reason,  or by the
Selling  Companies  during the Lease  Period at  Buyer's  request or (b) if such
employee is hired by a Seller or any of its  Affiliates as a result of a general
solicitation for employment in newspaper  advertisements or other periodicals of
general  solicitation not specifically  targeted to employees of Buyer or (c) if
Buyer  indicates by written  consent that this Section 5.11 shall not apply to a
specific employee.


                                       53
<PAGE>


     (b) In the event that this  Agreement  is  terminated  pursuant  to Article
VIII, Buyer and its Affiliates will not, without Sellers' prior written consent:
(a) for a period of three years from the date of  termination  of this Agreement
(other than pursuant to any general  solicitations  for  employment in newspaper
advertisements   or  other   periodicals  of  general   circulation  or  through
recruitment firms not specifically targeted to employees of any Selling Company;
provided,  however,  that  Buyer  will  not  instruct  any  recruiting  firm  to
specifically  recruit employees of any Selling Company),  directly or indirectly
solicit for  employment  any person who is then employed by any Selling  Company
holding  the  title  of vice  president  or  higher  or (b)  use  any  material,
information  or document  obtained in connection  with the entering into of this
Agreement  directly or  indirectly  to solicit  any  customer or supplier of any
Selling Company.  The preceding sentence shall not prohibit Buyer from employing
any such person to whom an offer of  employment  may have been extended by Buyer
prior to the date hereof.  Notwithstanding the foregoing, in the event that this
Agreement is terminated pursuant to Article VIII as a result of a willful breach
by Sellers,  the  restrictions  set forth in clause (a) of the first sentence of
this Section 5.11(b) shall terminate on January 2, 2003.

     5.12 Transitional Matters.

     (a) Each of the parties  acknowledges and agrees that the transition of the
Business  from  the  Selling  Companies  to  Buyer  will  require  that  certain
transactions and  relationships  will need to be entered into,  restructured and
reorganized  in connection  with the transition of the Business from the Selling
Companies  to Buyer.  The  parties  agree that prior to the  Closing  Date,  the
parties shall  cooperate with each other to identify all such  transactions  and
relationships  and  negotiate in good faith to enter into a mutually  acceptable
Transitional  Agreement  effective as of the Closing Date, which agreement shall
provide for all such transactions and relationships as are reasonably  necessary
to provide,

         (i)   for (A) the  operation of the  Business and use of the  Purchased
               Assets by Buyer, (B) the operation and use of the Excluded Assets
               by Sellers and the Selling Subsidiaries and (C) the separation of
               the Business,  the Purchased  Assets and the Assumed  Liabilities
               from Parent and its Affiliates (including the Selling Companies),
               in each  case  during  the  period  commencing  on and  after the
               Closing Date and ending no later than the one year anniversary of
               the Closing Date or such longer  period as the parties may agree,
               including the following:

         (1) the  transitioning  of the  financial  systems,  assets and hedging
     valuation systems, asset management systems,  payroll and employee benefits
     systems and any other applicable business operating systems;

         (2) the provision of rights of access (provided that access to the ALSS
     Platform shall be governed and limited by the Intellectual  Property Rights


                                       54
<PAGE>

     Agreement and the Services  Agreement) to the Parent and its  Affiliates to
     Intellectual   Property  currently  owned  (or  licensed)  by  the  Selling
     Companies (and included in the Purchased  Assets) and used by Parent or the
     Selling Companies in the ordinary course of their business,  or required by
     the Selling  Companies for the operation and use of the Excluded  Assets or
     Excluded Liabilities;  provided, that access to the ALSS Platform and other
     Software  shall be  governed  solely by the  Intellectual  Property  Rights
     Agreement  and the  Services  Agreement  and,  provided  further,  anything
     foregoing to the contrary  notwithstanding,  Buyer shall not be required to
     disclose or deliver trade secret or confidential  information regarding the
     ALSS Platform,  Software or Acquired  Intellectual Property unless required
     by the Intellectual  Property Rights Agreement,  the Services  Agreement or
     required  by law or legal  proceedings  and  under  the type of  protective
     provisions in the Intellectual Property Rights Agreement.

          (3) the  provision  of rights of access (to the extent not  covered by
     the  Intellectual  Property  Rights  Agreement)  to Buyer  to  Intellectual
     Property currently owned (or licensed) by Parent (or the Selling Companies)
     and used by the Selling  Companies in connection with the Purchased  Assets
     or Assumed Liabilities;

          (4) moving corporate records related to the Selling Companies; and

          (5) the  provision of office  space,  computer  equipment and supplies
     sufficient  to enable the  Selling  Companies  to complete  any  transition
     services; and

         (ii) for  such  services   and   facilities   as  Sellers  and  Selling
              Subsidiaries   may  require  to  monitor   compliance   with,  and
              implementation  of the  Subservicing  Agreement,  during its term,
              including the provision of office  space,  computer  equipment and
              supplies  sufficient to enable Sellers to monitor  compliance with
              the Retained Portfolio Subservicing Agreement throughout its term.

          (b) In addition to the matters to be identified  pursuant to paragraph
     (a) of this Section  5.12,  the  Transition  Agreement  shall  specifically
     provide  for the  transactions  and  matters  outlined  in Section  5.12 of
     Sellers' Disclosure Schedule.

          (c) For the purpose of  facilitating  the  transition of the financial
     system,  on or prior to the 15th day prior to the Closing Date, the Selling
     Companies shall create on their general ledger,  a separate  general ledger
     company ("GL Company"),  as well as accounts for such GL Company ("Buyer GL
     Accounts"),  which accounts shall be duplicative of the Selling  Companies'
     own  accounts  ("Seller GL  Accounts")  and are  intended to be used by the
     Buyer in the  operation  of the  Business,  the  Purchased  Assets  and the
     Assumed  Liabilities  from and after the Closing  Date.  From and after the
     creation of the Buyer GL Accounts,  until  Closing,  the Selling  Companies
     shall  maintain  such  accounts (as  duplicate  entries on the books of the
     Selling  Companies in the name of the GL Company).  From and after  Closing


                                       55
<PAGE>

     until the  completion  of the  transition  of the  financial  system of the
     Selling  Companies,  the Buyer  shall  operate the  Business  by  recording
     entries  using the Buyer GL Accounts,  and shall  maintain on behalf of the
     Selling Companies, the Seller GL Accounts on its general ledger.

          (d) The party receiving service under the Transitional Agreement shall
     pay to the party  providing  service the costs  incurred by such  providing
     party.  Services  provided  under  the  Transitional   Agreement  shall  be
     performed at the same standard as the providing party performs such service
     for its own account.

          5.13 MSR  Purchases  by Buyer.  From and after  January 1, 2002 to the
     Closing Date,  any purchases by Buyer of mortgage  servicing  rights or the
     purchase of any  business  principally  engaged in the  Servicing  of FNMA,
     FHLMC or GNMA residential  mortgage loan servicing rights shall comply with
     the  procedures  in  Section  8.4 of the  Retained  Portfolio  Subservicing
     Agreement as if such provision were operative and in effect.

          5.14 Damage or Deterioration of 7301 Baymeadows Way.

          Prior to the Closing, Sellers and the Selling Companies shall maintain
     all existing  insurance  policies in respect of 7301 Baymeadows Way. In the
     event of any damage to 7301 Baymeadows Way that results in a recovery under
     such  insurance  policies  prior to the  Closing,  Sellers  and the Selling
     Companies shall transfer the proceeds thereof to Buyer and, for purposes of
     Article II, the Closing Date Value of 7301 Baymeadows Way shall not reflect
     any  changes  arising  out of, or in  connection  with,  such damage to the
     extent covered by insurance or condemnation proceeds.

                                   ARTICLE VI

                                Employee Matters

          6.01 Employees and Service Crediting.

          (a) Offer of Employment  with Buyer.  Within 90 days after the Closing
     Date, but in no event later than the date that is 20 days before the end of
     the Lease  Period,  Buyer shall make a written  offer of employment to each
     Prospective  Employee and,  subject to subsection (c) below,  to each Leave
     Recipient,  which offer shall  include  (i) total cash  compensation  until
     December 31, 2002 that is Comparable Cash  Compensation,  where "Comparable
     Cash  Compensation"  means  cash  compensation  that  in the  aggregate  is
     comparable to the total cash compensation  (including,  but not limited to,
     short-term  and long-term  bonus  opportunities  and  commission/incentives
     opportunities)  provided by the Selling  Companies to the relevant employee
     as of the Closing,  and (ii) the covenant of Buyer set forth in subsections
     6.01(d)(ii),  6.01(e),  6.01(f) and 6.01(g)  below.  The Selling  Companies
     shall  cooperate  with and use  reasonable  efforts to assist  Buyer in its
     efforts to secure reasonably  satisfactory employment arrangements with the


                                       56
<PAGE>

     Prospective  Employees.  Each  Prospective  Employee who does not reject an
     offer of  employment  with Buyer  shall  become an employee of Buyer on the
     last day of the  employee  leasing  period,  if any,  with  respect to such
     Prospective Employee, in the Employee Lease (the "Lease Period"), and shall
     be referred to herein as a "Transferred Employee".

          (b)  Adjustment  of  Prospective   Employees  for  Subsequently  Hired
     Employees.  Prior to the Closing Date, the Selling  Companies shall furnish
     to Buyer an updated list of all Prospective  Employees as of a date that is
     approximately 30 days prior to the Closing,  which list shall indicate each
     Prospective Employee's prior service, projected to the Closing Date.

          (c) Special Provisions for Leave Recipients.

              (1) With respect to any  Prospective  Employee who is not actively
          at work on the  Closing  Date as a  result  of  short-term  disability
          leave,   or  other  approved   personal  leave   (including,   without
          limitation,  military leave with reemployment rights under federal law
          and leave under the Family  Medical Leave Act of 1993)  (collectively,
          the "Leave Recipients") Buyer will explain to Leave Recipients Buyer's
          intention  to make an offer of  employment  in the manner  required by
          Section 6.01(a)  contingent on such Prospective  Employee's  return to
          active status at the  termination of such disability or approved leave
          of absence,  respectively,  provided  that he or she returns to active
          service before the later of (A) the end of the Lease Period or (B) the
          date such employee's  reemployment rights expire under applicable laws
          or under the Compensation and Benefit Plans.

              (2) When the Leave Recipient  returns to active status pursuant to
          the  terms  of  clause  (1)  above,  such  Leave  Recipient  shall  be
          considered a Transferred Employee (as defined above) and the following
          provisions  shall apply: (A) the Leave Recipient shall become eligible
          for coverage and benefits under all employee benefit plans or programs
          maintained by Buyer under the same terms and conditions  that apply to
          other Transferred  Employees;  and (B) the Leave Recipient's period of
          leave  shall be  treated  as a period of  service  under the  employee
          benefit plans and programs of Buyer to the same extent as if the Leave
          Recipient had received benefits under a similar plan or was subject to
          a similar  policy of  Selling  Companies  except  to the  extent  such
          service  credit  will result in  duplication  of benefits to the Leave
          Recipient.

          (d) Buyer Benefit Obligation.

              (i)  Buyer shall  establish and maintain,  until at least December
                   31, 2002,  employee  benefit  plans,  programs,  policies and
                   arrangements for Transferred Employees which provide benefits
                   to the  Transferred  Employees  that are no less favorable in
                   the aggregate to those  provided to them under the applicable
                   Compensation and Benefit Plans in effect on the Closing Date.


                                       57
<PAGE>


              (ii) Notwithstanding the above aggregation, (A) Buyer shall accept
                   assignment, and assume, from Sellers, all agreements to which
                   any  Prospective  Employee  is a party  and (B)  Buyer  shall
                   provide  severance pay and benefits pursuant to the severance
                   terms set forth in  Section  6.01(d) of  Sellers'  Disclosure
                   Schedule,  to Prospective  Employees whose employment becomes
                   terminated  under  circumstances  set forth  therein from the
                   Closing Date until July 1, 2003.

          (e)  Recognition  of Service.  For purposes of  eligibility,  vesting,
     vacation  entitlement  and severance  benefits and benefit accrual for sick
     leave under all  employee  compensation  and benefit  plans of Buyer,  each
     Transferred  Employee  shall  receive  full credit from Buyer for all prior
     service  properly  credited  under  the  Compensation  and  Benefit  Plans;
     provided,  however, that for purposes of Buyer's cash balance pension plan,
     each Transferred  Employee shall receive such prior service credit only for
     the period  between the Closing Date and the end of the Lease  Period.  The
     schedule  of  service  provided  by  Sellers  prior to the end of the Lease
     Period may be  conclusively  relied upon by Buyer in  crediting  service in
     accordance with this Section 6.01(b).

          (f) Welfare Plans and Other Unfunded Plans. Buyer shall offer coverage
     under  employer-sponsored  medical and dental plans and agree to cause each
     of such medical and dental plans that  provides  coverage to a  Transferred
     Employee  to (A) waive any  pre-existing  conditions,  waiting  periods and
     actively at work requirements under such plans, and (B) cause such plans to
     honor any expenses  (including any expenses paid for purposes of satisfying
     applicable  deductibles,  co-insurance  and maximum  out-of-pocket  limits)
     incurred by the Transferred Employees and their beneficiaries under similar
     plans of the  Selling  Companies  during the portion of the  calendar  year
     prior to the Closing Date for purposes of satisfying  applicable deductible
     and maximum out-of-pocket expenses under Buyer's plans.

          (g) Time Off. On the Closing Date, the Selling Companies shall pay out
     to each  Prospective  Employee  an  amount  in cash  equal  to the time off
     benefits  earned but not yet used by such  employee as of the Closing Date,
     if  any.  In  addition,  the  Selling  Companies  shall  pay  out  to  each
     Prospective Employee an amount in cash equal to the time off benefit earned
     but not used during the Lease  Period,  if any (the "Lease Time Off Cash").
     Buyer shall reimburse the Selling Companies  pursuant to the Employee Lease
     for the Lease Time Off Cash as part of the Base Fee (as  defined in Section
     3.1(a) of the Employee Lease).  Buyer shall waive any service  requirements
     or other applicable internal guidelines,  to allow Transferred Employees to
     take unpaid time off from Buyer up to the number of days represented by the
     Lease  Time Off  Cash,  beginning  immediately  after  the end of the Lease
     Period,  subject  to a  department  manager's  request  to meet  reasonable
     business needs.

          (h) WARN Act and Health Care Continuance Requirements.  Buyer shall be
     responsible  for  providing  or  discharging  any  and  all  notifications,
     benefits,   and  liabilities  to  Transferred  Employees  and  Governmental


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     Authorities  required  by  the  WARN  Act or by any  other  applicable  law
     relating to plant  closings or employee  separations  or severance pay that
     are first  required to be provided  or  discharged  on or after the Closing
     Date, including pre-closing notice or liabilities if actions by Buyer on or
     after the Closing Date result in a notice  requirement  or liability  under
     such laws. Upon Buyer's reasonable request, during the Lease Period Selling
     Companies  shall provide any  notification  described under the WARN Act to
     any  Prospective  Employees  identified  by Buyer,  in order to  attempt to
     minimize Buyer's liability under the first sentence of this subsection. All
     employees  involuntarily  separated  from  employment by any of the Selling
     Companies within 90 days of the Closing Date, the involuntary separation of
     whom could result in a notice requirement covered by this Section, shall be
     identified  on a schedule  to be  prepared  by the  Selling  Companies  and
     submitted  to Buyer on the Closing  Date.  Buyer and the Selling  Companies
     shall cooperate with each other to provide timely notice,  if required,  to
     any  Governmental  Entity of the  consummation  of this  Agreement  and the
     related  transfer of  employees.  The Selling  Companies  shall  retain the
     obligations with respect to COBRA continuation coverage for all Prospective
     Employees who are not Transferred Employees.

                                   ARTICLE VII

                            Conditions To The Closing

          7.01 Conditions to Each Party's Obligation to Effect the Purchase.

          The respective  obligations of each of Sellers and Buyer to consummate
     the Purchase are subject to the fulfillment or written waiver,  at or prior
     to the Closing Date, of each of the following conditions:

          (a) Regulatory   Approvals.   All  Governmental   Authority  approvals
     required to consummate the transactions  contemplated hereby will have been
     obtained and will remain in full force and effect and all statutory waiting
     periods in respect thereof will have expired,  unless the failure to obtain
     any such  approval  is not  reasonably  likely to have a  Material  Adverse
     Effect on the Business.

          (b) No Injunction. No Governmental Authority of competent jurisdiction
     will have enacted,  issued,  promulgated,  enforced or entered any statute,
     rule,  regulation,  judgment,  decree,  injunction or other order  (whether
     temporary,  preliminary  or  permanent)  which is in effect  and  prohibits
     consummation of the transactions contemplated by this Agreement as a whole.

          (c)  Certain  Representations.  The  representation  and  warranty  of
     Sellers set forth in Section 4.03(v)(3) shall be true and correct as of the
     Closing Date.


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<PAGE>


          7.02 Conditions to Obligation of Buyer.

          The  obligations  of Buyer to consummate the Purchase are also subject
     to the fulfillment or written  waiver,  at or prior to the Closing Date, of
     each of the following conditions:

          (a) Representations and Warranties. The representations and warranties
     of Sellers set forth in this  Agreement  will be true and correct as of the
     date of this  Agreement and as of the Closing Date as though made on and as
     of the Closing Date (except that  representations  and  warranties  that by
     their terms speak as of the date of this  Agreement or some other date will
     be true and  correct  as of such date  only) and Buyer  will have  received
     certificates,  dated the Closing Date,  signed on behalf of each of Sellers
     to such effect;  provided,  however,  that for purposes of determining  the
     satisfaction of this  condition,  no effect shall be given to any exception
     or  qualification  in  such  representations  and  warranties  relating  to
     materiality or a Material  Adverse Effect;  and provided  further that, for
     purposes of this condition, such representations and warranties (other than
     the representations and warranties in Section 4.02(b),  which shall be true
     in all  respects)  shall be deemed to be true and  correct in all  respects
     unless the failure of such representations and warranties to be so true and
     correct,  individually or in the aggregate,  results or would reasonably be
     expected  to result in a  Material  Adverse  Effect  on  Sellers  or on the
     Business.

          (b) Performance of Obligations of Sellers. Sellers will have performed
     in all material  respects all obligations  required to be performed by them
     under this  Agreement  at or prior to the Closing  Date and Buyer will have
     received certificates,  dated the Closing Date, signed on behalf of each of
     Sellers to such effect.

          (c) Third Party  Consents.  All  consents or approvals of all Persons,
     other than Governmental Authorities, required for or in connection with the
     execution,   delivery  and   performance  of  this   Agreement   (including
     consummation  of the Purchase)  will have been obtained and will be in full
     force and effect, unless the failure to obtain any such consent or approval
     is not reasonably likely to have a Material Adverse Effect on the Business;
     provided,  however,  that all  consents  and  approvals  listed on  Exhibit
     7.02(c) and all consents and approvals with respect to agreements listed on
     Exhibit 7.02(c) must be obtained and in full force and effect.

          7.03 Conditions to Obligations of Sellers.

          The obligations of Sellers to consummate the Purchase are also subject
     to the fulfillment or written  waiver,  at or prior to the Closing Date, of
     each of the following conditions:

          (a) Representations and Warranties. The representations and warranties
     of Buyer set forth in this  Agreement  will be true and  correct  as of the
     date of this  Agreement and as of the Closing Date as though made on and as
     of the Closing Date (except that  representations  and  warranties  that by
     their terms speak as of the date of this  Agreement or some other date will


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<PAGE>

     be true and correct as of such date only) and Sellers will have  received a
     certificate,  dated  the  Closing  Date,  signed on behalf of Buyer to such
     effect;   provided,   however,   that  for  purposes  of  determining   the
     satisfaction of this  condition,  no effect shall be given to any exception
     or  qualification  in  such  representations  and  warranties  relating  to
     materiality or a Material  Adverse Effect;  and provided  further that, for
     purposes of this condition, such representations and warranties (other than
     the representations and warranties in Section 4.03(b),  which shall be true
     in all  respects)  shall be deemed to be true and  correct in all  respects
     unless the failure of such representations and warranties to be so true and
     correct,  individually or in the aggregate,  results or would reasonably be
     expected to result in a Material Adverse Effect on Buyer.

          (b) Performance of Obligations of Buyer.  Buyer will have performed in
     all material respects all obligations  required to be performed by it under
     this  Agreement  at or prior to the  Closing  Date and  Sellers  will  have
     received a certificate,  dated the Closing Date,  signed on behalf of Buyer
     to such effect.

          (c) Third Party  Consents.  All  consents or approvals of all Persons,
     other than Governmental Authorities, required for or in connection with the
     execution,   delivery  and   performance  of  this   Agreement   (including
     consummation  of the Purchase)  will have been obtained and will be in full
     force and effect, unless the failure to obtain any such consent or approval
     is not reasonably likely to have a Material Adverse Effect on the Business;
     provided,  however,  that all  consents  and  approvals  listed on  Exhibit
     7.02(c) and all consents and approvals with respect to agreements listed on
     Exhibit 7.02(c) must be obtained and in full force and effect.

                                  ARTICLE VIII

                                   Termination

          8.01 Termination.

          This  Agreement may be terminated  and the  transactions  contemplated
     hereby may be abandoned at any time prior to the Closing Date:

          (a) Mutual  Consent.  By the  mutual  written  consent of Sellers  and
     Buyer.

          (b) Breach.  By Sellers or Buyer, by written  notice,  in the event of
     either:  (1) a breach by the other party of any  representation or warranty
     contained herein,  which breach cannot be cured or which has not been cured
     within 30 days after the giving of written notice to the breaching party of
     such breach,  or (2) a breach by the other party of any of the covenants or
     agreements  contained herein, which breach cannot be cured or which has not
     been  cured  within 30 days  after  the  giving  of  written  notice to the
     breaching  party of such breach,  provided that such breach  (whether under
     (1) or (2)) would be reasonably  likely,  individually  or in the aggregate
     with other breaches, to result in a Material Adverse Effect.


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<PAGE>


          (c) Delay. By Sellers or Buyer,  by written notice,  in the event that
     the  Purchase  is not  consummated  by the first day of the month after the
     month in which the  six-month  anniversary  of execution of this  Agreement
     occurs,  except to the extent that the failure of the  Purchase  then to be
     consummated  arises out of or results  from the action or  inaction  of the
     party seeking to terminate pursuant to this Section 8.01(c).

          (d) No Approval.  By Sellers or Buyer, by written notice, in the event
     the approval of any Governmental Authority required for consummation of the
     transactions   contemplated   hereby   will  have  been   denied  by  final
     nonappealable action of such Governmental Authority or if such Governmental
     Authority  will have  issued an order,  decree or ruling or taken any other
     action  in  effect   permanently   restraining,   enjoining   or  otherwise
     prohibiting   consummation  of  the   transactions   contemplated  by  this
     Agreement,  and such order, decree, ruling or other action will have become
     final and nonappealable,  unless the failure to obtain any such approval is
     not reasonably likely to have a Material Adverse Effect on the Business.

          8.02 Effect of Termination and Abandonment.

          In the event of termination  of this Agreement and the  abandonment of
     the Purchase pursuant to this Article VIII, no party to this Agreement will
     have  any  liability  or  further  obligation  to any  other  party to this
     Agreement,  except (a) for  obligations  arising  under  Sections  5.02(b),
     5.02(c),  5.04 and  5.11(b),  this Section 8.02 and Article XI and (b) that
     termination  will not  relieve a  breaching  party from  liability  for any
     willful breach of this Agreement giving rise to such termination.

                                   ARTICLE IX

                                   Tax Matters

          9.01 Cooperation.

          Buyer shall provide  Sellers and their  designees with such assistance
     as may  reasonably  be  requested  by  Sellers  or  any  such  designee  in
     connection  with the  preparation  of any Tax Return,  audit or judicial or
     administrative  proceeding or determination  relating to Taxes with respect
     to the Purchased  Assets for periods prior to Closing,  including,  without
     limitation,  access to the books and records  that relate to the  Purchased
     Assets, and the assistance of the officers and employees of Buyer and their
     respective Affiliates.

          9.02 Transfer Taxes.

          All stamp, transfer, excise, documentary, sales, use, registration and
     other such taxes and fees  (including any penalties and interest)  incurred
     in connection with this Agreement and the transactions  contemplated hereby
     (collectively,  the "Transfer  Taxes") shall be split evenly  between Buyer
     and Seller.  Buyer shall  properly file on a timely basis all necessary tax


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<PAGE>

     returns  and other  documentation  with  respect to, any  Transfer  Tax and
     provide to Sellers evidence of filing and payment of all Transfer Taxes.

                                    ARTICLE X

                                 Indemnification

          10.01 Indemnification Not Subject to Limitations.

          Without regard to the DeMinimis Liability  Restriction (as hereinafter
     defined),  the Deductible (as hereinafter defined), the Cap (as hereinafter
     defined) or the periods of survival set forth in and  applicable to certain
     of the other provisions of this Article X, from and after the Closing Date:

          (a) Sellers shall  jointly and  severally  indemnify and hold harmless
     Buyer and its Affiliates,  each of their  respective  directors,  officers,
     employees  and  agents,  and  each  of  the  respective  heirs,  executors,
     successors  and assigns of any of the foregoing  (collectively,  the "Buyer
     Indemnified  Parties") from and against any and all Liabilities incurred by
     or asserted against any of Buyer Indemnified  Parties in connection with or
     arising from:

              (i)  any breach of any representation,  warranty or agreement made
                   by,  or  on   behalf   of,   Sellers   under   Section   2.02
                   (Consideration for Purchased Assets), Section 2.03 (Proration
                   of Expenses),  Section 2.04  (Calculation of Purchase Price),
                   Section  2.05   (Settlement   Date  Payment),   Section  2.06
                   (Allocation  of Purchase  Price),  Section  2.07 (No Offset),
                   Section 2.08 (Interim  Settlement),  Section 2.09 (Co-Issue),
                   Section  4.02(d)  (Title  to  and  Sufficiency  of  Purchased
                   Assets)  (but in the  case of  Section  4.02(d)(2),  only for
                   breaches  arising  within  one  year  of the  Closing  Date),
                   Section 4.02(m) (ALSS  Platform),  Section 4.02(j) (Liens for
                   Taxes),   Section  4.02(t)(1)  (Warehouse  Loans  Ownership),
                   Section 4.02(v)(3)  (Financial  Reports;  No Material Adverse
                   Effect)  (but in the  case of  Section  4.02(v)(3),  only for
                   breaches  arising  within  one  year  of the  Closing  Date),
                   Article VI (Employee Matters) and Article IX (Tax Matters) of
                   this Agreement;

              (ii) any Tax or Lien for Taxes  imposed  upon any of the  Excluded
                   Assets, any of the Excluded Liabilities or the Business,  the
                   Purchased Assets or the Assumed Liabilities for any period on
                   or prior to the  Closing  Date and any audit or  judicial  or
                   administrative proceedings or determinations relating to such
                   Taxes or such Liens;


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<PAGE>


          (iii) any litigation,  claims, actions, arbitrations or investigations
     or  other  proceedings   before  any  Governmental   Authority  pending  or
     threatened as of the Closing Date against the Selling Companies,  Purchased
     Assets or Assumed Liabilities;

          (iv) any Excluded Liabilities; or

          (v) any Excluded Assets;

     provided,  however,  there  shall  be  excluded  from  the  indemnification
     obligation  any  Liabilities  resulting from a fact or  circumstance  which
     constitutes a breach by Buyers of any representation, warranty or agreement
     set forth in this Agreement.

          (b) Buyer shall  indemnify  and hold  harmless  Sellers  and  Sellers'
     Affiliates,  each of their respective  directors,  officers,  employees and
     agents, and each of the respective heirs, executors, successors and assigns
     of any of the foregoing  (collectively,  the "Seller Indemnified  Parties")
     from and against any and all  Liabilities  incurred by or asserted  against
     any of Seller Indemnified Parties in connection with or arising from:

              (i)  any breach of any representation,  warranty or agreement made
                   by, or on behalf of, Buyer under Section 2.02  (Consideration
                   for Purchased Assets),  Section 2.03 (Proration of Expenses),
                   Section 2.04  (Calculation of Purchase  Price),  Section 2.05
                   (Settlement  Date  Payment),   Section  2.06  (Allocation  of
                   Purchase  Price),  Section  2.07 (No  Offset),  Section  2.08
                   (Interim  Settlement),  Section 2.09  (Co-Issue),  Article VI
                   (Employees) and Article IX (Tax Matters) of this Agreement;

              (ii) any Tax or Lien for Taxes  imposed upon any of the  Purchased
                   Assets,  any of the Assumed  Liabilities  or the Business for
                   any period  after the Closing  Date and any audit or judicial
                   or administrative  proceedings or determinations  relating to
                   such Taxes or such Liens;

             (iii) any Assumed Liabilities;

              (iv) any Purchased Assets; or

              (v)  the  operation of the Business or the  Purchased  Assets from
                   and after the Closing Date.

     provided,  however,  there  shall  be  excluded  from  the  indemnification
     obligation  any  Liabilities  resulting from a fact or  circumstance  which
     constitutes  a  breach  by  Sellers  of  any  representation,  warranty  or
     agreement set forth in this Agreement.



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<PAGE>


          10.02 Indemnification Subject to Limitations.

          Subject  to the  De  Minimis  Liability  Restriction  (as  hereinafter
     defined),  the Deductible (as hereinafter defined), the Cap (as hereinafter
     defined) and the periods of survival set forth below and  applicable to the
     indemnification  obligations of Sellers and Buyer under this Section 10.02,
     from and after the Closing Date:

          (a) Sellers shall  jointly and  severally  indemnify and hold harmless
     Buyer Indemnified Parties from and against any and all Liabilities incurred
     by or asserted against any of Buyer Indemnified  Parties in connection with
     or arising from:

              (i)  any breach of any representation,  warranty or agreement made
                   by, or on behalf of, Sellers under this Agreement  other than
                   those specifically referred to in Section 10.01(a)(i); or

              (ii) the  operation or ownership of the Business or the  Purchased
                   Assets on or prior to the Closing Date.

          (b) Buyer shall indemnify and hold harmless Seller Indemnified Parties
     from and against any and all  Liabilities  incurred by or asserted  against
     any of Seller  Indemnified  Parties in connection  with or arising from any
     breach of any  representation,  warranty or agreement made by, or on behalf
     of, Buyer under this Agreement other than those specifically referred to in
     Section 10.01(b)(i).

          10.03 Survival Periods.

          The  obligations  to indemnify and hold harmless any party pursuant to
     Section  10.02(a)  or  10.02(b)  shall  terminate  on June  30,  2003.  The
     obligations  to indemnify and hold  harmless any party  pursuant to Section
     10.01(a) and 10.01(b) shall survive indefinitely.

          10.04 Miscellaneous.

          (a) After the Closing,  and except for any claims made under  Sections
     5.02(b),  (c), (d), (e), 5.04, 5.05, 5.06, 5.07, 5.08, 5.10, 5.11, 5.12 and
     5.13 and  Article IX, and the  Ancillary  Agreements,  the  indemnification
     expressly provided in this Article X shall be the sole and exclusive remedy
     for  any  matter  arising  out of or  relating  to  this  Agreement  or the
     transactions  contemplated  hereby  by  any  party.  Nothing  herein  shall
     preclude a party hereto from  applying to a court for  equitable  relief to
     enforce its rights under this Agreement.

          (b) Each  indemnitee  under  this  Article X shall use its  reasonable
     efforts  to  mitigate   Liabilities   for  which  it  seeks  or  reasonably
     anticipates seeking indemnification hereunder.


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<PAGE>


          (c) For purposes of determining  whether a breach of a  representation
     or warranty in this  Agreement  has occurred for purposes of this Article X
     no effect  shall be given to any  exception  or  qualification  relating to
     materiality or Material Adverse Effect.

          (d) In  calculating  any amount of  Liabilities  payable to Sellers or
     Buyer under this Article X, the indemnifying party shall receive credit for
     (1) any  reduction in tax  liability of the  Indemnified  Party (as defined
     herein)  as  a  result  of  the  facts   giving   rise  to  the  claim  for
     indemnification, (2) any insurance recoveries offsetting the amount of loss
     and (3) any recoveries from third parties  pursuant to  indemnification  or
     otherwise with respect thereto.  Any party receiving indemnity shall assign
     to the  indemnifying  party all of its claims for  recovery  against  third
     parties as to such Liabilities whether by insurance coverage,  contribution
     claims, subrogation or otherwise.

          10.05 De Minimis Liability, Deductible and Cap.

          (a) Sellers  shall not have any  Liability  whatsoever  under  Section
     10.02(a) for any  individual  Liability  that is less than $25,000 (the "De
     Minimis  Liability  Restriction").  Sellers  shall  not have any  liability
     whatsoever  under Section 10.02(a) for any Liability until the aggregate of
     all  Liabilities  for which Sellers would be liable under Section  10.02(a)
     exceeds  on  a  cumulative   basis  an  amount  equal  to  $3,500,000  (the
     "Deductible"),  and then only to the extent of any such excess. The maximum
     liability of Sellers  (collectively)  under Section 10.02(a) shall be equal
     to $125,000,000 (the "Cap").

          (b)  Buyer  shall  not have any  Liability  whatsoever  under  Section
     10.02(b) for any  individual  Liability  that is less than  $25,000.  Buyer
     shall not have any  liability  whatsoever  under  Section  10.02(b) for any
     Liability  until the aggregate of all  Liabilities for which Buyer would be
     liable under Section 10.02(b) exceeds on a cumulative basis an amount equal
     to the  Deductible,  and then only to the  extent of any such  excess.  The
     maximum  liability of Buyer under  Section  10.02(b)  shall be equal to the
     Cap.

          10.06 Third-Party Claims.

          If a claim by a third party (a "Third-Party  Claim") is made against a
     Seller  Indemnified  Party or Buyer  Indemnified  Party  (collectively,  an
     "Indemnified  Party"),  and if  such  Indemnified  Party  intends  to  seek
     indemnity with respect thereto under this Article X, such Indemnified Party
     shall  promptly  notify in writing the  indemnifying  party of such claims;
     provided, that, that failure to promptly notify the indemnifying party will
     not  relieve the  indemnifying  party of any  liability  it may have to the
     indemnified  party,  except  to the  extent  that  the  indemnifying  party
     demonstrates  that the defense of such  Third-Party  Claim is prejudiced by
     the indemnified party's failure to give notice within such time period. The
     indemnifying  party  shall  have 30 days after  receipt  of such  notice to
     undertake,  conduct and control, through counsel of its own choosing and at
     its own expense,  the settlement or defense  thereof,  and the  Indemnified
     Party shall  cooperate with it in connection  therewith;  provided that the
     indemnifying  party shall permit the  Indemnified  Party to  participate in
     such  settlement  or defense  through  counsel  chosen by such  Indemnified
     Party,  provided  that the fees and expenses of such counsel shall be borne


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<PAGE>

     by such Indemnified  Party. If the indemnifying  party so chooses to assume
     the  defense  it  shall  do so  promptly  and  diligently.  So  long as the
     indemnifying  party is reasonably  contesting any such claim in good faith,
     the   Indemnified   Party   shall  not  pay  or  settle  any  such   claim.
     Notwithstanding  the foregoing,  the Indemnified Party shall have the right
     to pay or settle any such claim,  provided  that,  in such event,  it shall
     waive any right to indemnity  therefor by the  indemnifying  party.  If the
     indemnifying  party does not notify the Indemnified Party in writing within
     30 days after the receipt of the  Indemnified  Party's  written notice of a
     claim of  indemnity  hereunder  that it elects  to  undertake  the  defense
     thereof,  the Indemnified Party shall have the right to contest,  settle or
     compromise  the claim but shall not  thereby  waive any right to  indemnity
     therefor  pursuant to this  Agreement.  The  indemnifying  party shall not,
     except with the written  consent of the Indemnified  Party,  enter into any
     settlement  unless (A) there is no finding or admission of any violation of
     Applicable Law, (B) the sole relief  provided is monetary  damages that are
     paid in full by the indemnifying  party,  (C) the indemnified  party or its
     Affiliates  shall  have no  liability  with  respect to any  compromise  or
     settlement of such Third-Party  Claim, and (D) the compromise or settlement
     provides  to all  indemnified  parties and their  Affiliates  and agents an
     unconditional  release from all liability with respect to such  Third-Party
     Claim or the facts underlying such Third-Party  Claim.  With respect to any
     Third-Party Claim subject to indemnification under this Article X, (i) both
     the Indemnified Party and the indemnifying party, as the case may be, shall
     keep the other party reasonably  informed of the status of such Third-Party
     Claim and any related  proceedings at all stages thereof,  (ii) the parties
     agree to  render  to each  other  such  assistance  as they may  reasonably
     require  of each  other and to  cooperate  in good faith with each other in
     order to ensure the proper and adequate  defense of any  Third-Party  Claim
     and (iii) with respect to any Third-Party Claim subject to  indemnification
     under this Article X, the parties agree to cooperate in such a manner as to
     preserve  in full  (to the  extent  possible)  the  confidentiality  of all
     confidential   information  and  the   attorney-client   and   work-product
     privileges.

                                   ARTICLE XI

                               General Provisions

          11.01 .Notices.

          All notices and other communications required or permitted to be given
     hereunder  shall be in  writing  and  shall be  deemed  given if  delivered
     personally, transmitted by facsimile (and telephonically confirmed), mailed
     by registered  or certified  mail with postage  prepaid and return  receipt
     requested,  or sent by commercial overnight courier,  courier fees prepaid,
     to the parties at the following addresses:

          (a) if to Buyer, to it at:

                     Washington Mutual Bank, FA
                     1501 4th Avenue, 6th Floor


                                       67
<PAGE>

                     Seattle, WA 98101
                     Attention:  Melba Bartels
                                  Senior Vice President
                     Facsimile:  (206) 554-2887

                     with copies to:

                     Washington Mutual Bank, FA
                     1201 Third Avenue, 17th Floor
                     Seattle, WA 98101
                     Attention:  Carey M. Brennan
                                  Senior Vice President and
                                  Associate General Counsel
                     Facsimile:  (206) 377-6244

                     Heller Ehrman White & McAuliffe LLP
                     701 Fifth Avenue, Suite 6100
                     Seattle, WA 98104
                     Attention:  Bernard L. Russell
                     Facsimile:  (206) 389-6217

          (b) if to Sellers, to them at:

                     HomeSide Lending, Inc.
                     Office of the CEO
                     200 Park Avenue
                     New York, NY 10166
                     Attention: Joseph J. Whiteside
                     Facsimile:  (212) 983-1969


                     with copies to:

                     National Australia Bank Limited
                     Legal Department, Level 24
                     500 Bourke Street
                     Melbourne, Victoria 3000
                     Attention:  David Krasnostein, Esq.
                                  Group General Counsel
                     Facsimile:  61-3-8641-4902/4906




                                       68
<PAGE>



                     and

                     Sullivan & Cromwell
                     125 Broad Street
                     New York, NY  10004-2498
                     Attention:  Mark J. Menting
                     Facsimile:  212-558-3588

     or to such other Person or address as either party shall  specify by notice
     in writing to the other party in accordance  with this Section  11.01.  All
     such notices or other  communications shall be deemed to have been received
     on the  date of the  personal  delivery  or  facsimile  transmission  (with
     telephone  confirmation)  or on the third Business Day after the mailing or
     dispatch  thereof;  provided  that  notice of change  of  address  shall be
     effective only upon receipt.

          11.02 Amendment and Modification; Waiver.

          (a)  This  Agreement and the  Disclosure  Schedules  hereto may not be
     amended  except by an  instrument  or  instruments  in  writing  signed and
     delivered on behalf of each of the parties hereto.

          (b) At any time prior to the Closing  Date,  any party hereto which is
     entitled  to the  benefits  hereof may, by an  instrument  in writing,  (i)
     extend the time for the performance of any of the obligations or other acts
     of the other party,  (ii) waive any inaccuracy in the  representations  and
     warranties of the other party contained herein or in any schedule hereto or
     in any document  delivered  pursuant hereto and (iii) waive compliance with
     any of the  agreements of the other party or conditions  contained  herein.
     Any agreement on the part of a party hereto to any such extension or waiver
     shall  be valid  if set  forth  in an  instrument  in  writing  signed  and
     delivered on behalf of such party.

          11.03 Entire Agreement.

          This Agreement  (including the Disclosure  Schedules and Exhibits (but
     excluding the Ancillary  Agreements))  constitute the entire  agreement and
     supersede all other prior agreements and  understandings,  both written and
     oral, between the parties with respect to the subject matter hereof.

          11.04 Fees and Expenses.

          Except  as  otherwise  expressly  provided  herein,  Sellers  shall be
     responsible  for all transfer  and  recording  fees,  costs with respect to
     delivery  of the  custodial  and other  loan files and  mortgage  servicing
     records relating to the Acquired Warehouse Loans and the Pipeline Loans and
     other  related  costs  incurred  by Sellers in their  performance  of their
     obligations  under this Agreement,  together with fees of Sellers' document
     custodian,  attorneys and accountants.  Buyer shall pay all data processing
     costs  incurred  by Buyer in  connection  with  this  Agreement,  and other
     related costs of Buyer in its  performance  of its  obligations  under this


                                       69
<PAGE>

     Agreement, together with fees of Buyer's attorneys and accountants.

          11.05 Third Party Beneficiaries.

          Nothing in this Agreement,  express or implied,  is intended to confer
     upon any Person  (including,  without  limitation,  employees of Sellers or
     Investors) other than the parties hereto or their respective successors and
     assigns any rights, remedies, obligations or liabilities under or by reason
     of this Agreement.

          11.06 Assignment; Binding Effect.

          This  Agreement  shall not be  assigned  by any of  Sellers  or (until
     payment of the Final Purchase Price) Buyer hereto without the prior written
     consent of the other parties; provided,  however, that this Agreement shall
     inure to the benefit of and be binding  upon the  parties  hereto and their
     respective  successors  and permitted  assigns,  and provided  further that
     Buyer  shall  have the right to assign to a  Subsidiary  of Buyer,  Buyer's
     right  hereunder  to  purchase  any  Purchased  Assets so long as (a) Buyer
     irrevocably and  unconditionally  guarantees all of the obligations of such
     Subsidiary  hereunder  and (b) such  assignment  shall not  affect  Buyer's
     obligations hereunder,  delay the Closing, adversely affect Buyer's ability
     to consummate the transaction  contemplated  hereby or otherwise  adversely
     affect any interest (economic,  tax, regulatory or otherwise) of Sellers in
     this Agreement.

          11.07 Governing Law.

          (a) This  Agreement  shall be governed by and  construed in accordance
     with the laws of the State of New York applicable to agreements made and to
     be performed  entirely within the State of New York,  without regard to the
     conflicts of law principles of the State of New York.

          (b) Each  party  hereto  agrees  that it will   bring  any  action  or
     proceeding  in  respect  of any claim  arising  out of or  related  to this
     Agreement or the transactions contemplated hereby or thereby exclusively in
     the United States  District Court for the Southern  District of New York or
     the Supreme Court of the State of New York for New York County (the "Chosen
     Courts") and solely in connection  with claims arising under this Agreement
     or the  transactions  contained in or  contemplated  by this  Agreement (1)
     irrevocably submits to the exclusive jurisdiction of the Chosen Courts, (2)
     waives any  objection to laying venue in any such action or  proceeding  in
     the Chosen Courts,  (3) to the fullest extent  permitted by law, waives any
     objection that the Chosen Courts are an  inconvenient  forum or do not have
     jurisdiction  over any party  hereto and (4) agrees that service of process
     upon such  party in any such  action or  proceeding  will be  effective  if
     notice is given in accordance with Section 11.01.


                                       70
<PAGE>


          11.08 Waiver of Jury Trial.

          Each party hereto  acknowledges and agrees that any controversy  which
     may  arise  under  this  Agreement  is likely to  involve  complicated  and
     difficult  issues,  and therefore  each such party hereby  irrevocably  and
     unconditionally  waives any right such party may have to a trial by jury in
     respect of any litigation directly or indirectly arising out of or relating
     to this Agreement, or the transactions contemplated by this Agreement. Each
     party  certifies  and  acknowledges  that (a) no  representative,  agent or
     attorney of any other party has represented,  expressly or otherwise,  that
     such other party would not, in the event of litigation, seek to enforce the
     foregoing  waiver,  (b)  each  party  understands  and has  considered  the
     implications of this waiver, (c) each party makes this waiver  voluntarily,
     and (d) each party has been induced to enter into this  Agreement by, among
     other things,  the mutual waivers and certifications in this Section 11.08.

          11.09 Counterparts.

          This  Agreement may be executed in two or more  counterparts,  each of
     which  shall  be  deemed  an  original,  and all of  which  together  shall
     constitute one and the same instrument.

          11.10 Severability.

          The  provisions  of this  Agreement  will be deemed  severable and the
     invalidity  or  unenforceability  of any  provision  will  not  affect  the
     validity or enforceability of the other provisions hereof. If any provision
     of this Agreement,  or the  application  thereof to any person or entity or
     any circumstance,  is found by a court or other  Governmental  Authority of
     competent  jurisdiction to be invalid or unenforceable,  (a) a suitable and
     equitable provision will be substituted  therefor in order to carry out, so
     far as may be valid and enforceable, the intent and purpose of such invalid
     or unenforceable  provision and (b) the remainder of this Agreement and the
     application of such provision to other persons,  entities or  circumstances
     will not be affected by such invalidity or unenforceability,  nor will such
     invalidity or  unenforceability  affect the validity or  enforceability  of
     such provision, or the application thereof, in any other jurisdiction.

          11.11 Affiliates of Buyer.

          To the extent that this  Agreement  obligates  any  Affiliate of Buyer
     either to take or to refrain from taking certain actions, Buyer shall cause
     such Affiliate to comply with such covenant.

                     *                *                   *

                      [The next page is a signature page.]


                                       71
<PAGE>


          IN WITNESS  WHEREOF,  the parties hereto have caused this Agreement to
     be executed on their  behalf by their  respective  officers  hereunto  duly
     authorized.

                               Sellers:
                               NATIONAL AUSTRALIA BANK LIMITED


                               By:    /s/ SIMON MOORE
                                      ------------------------------------------
                                      Name:  Simon Moore
                                      Title: Head of Investments and
                                             Advisory


                               HOMESIDE INTERNATIONAL, INC.


                               By:    /s/  JOSEPH J. WHITESIDE
                                      ------------------------------------------
                                      Name:  Joseph J. Whiteside
                                      Title: Chief Executive Officer


                               HOMESIDE LENDING, INC.


                               By:    /s/  JOSEPH J. WHITESIDE
                                        ----------------------------------------
                                      Name:  Joseph J. Whiteside
                                      Title: Chairman and Chief Executive
                                             Officer


                               Buyer:
                               WASHINGTON MUTUAL BANK, FA


                               By:    /s/  CRAIG E. TALL
                                      ------------------------------------------
                                      Name:  Craig E. Tall
                                      Title:  Vice Chair


                                       72
<PAGE>


            BILL OF SALE AND INSTRUMENT OF ASSUMPTION OF LIABILITIES
            --------------------------------------------------------

          This BILL OF SALE AND  INSTRUMENT OF ASSUMPTION OF  LIABILITIES  (this
     "Agreement"),  made and entered  into as of  __________  __,  2002,  by and
     between  HomeSide  International,  Inc.,  a Delaware  corporation  ("HSI"),
     HomeSide  Lending,  Inc., a Florida  corporation  ("HSL"),  [other  Selling
     Subsidiaries] (the "Selling  Subsidiaries",  and together with HSI and HSL,
     the  "Assignors")  and  Washington  Mutual  Bank,  FA,  a  federal  savings
     association ("Buyer" or "Assignee").

                              W I T N E S S E T H:

          WHEREAS, pursuant to that certain Asset Purchase/Liability  Assumption
     Agreement, dated as of December 10, 2001 (the "Purchase Agreement"), by and
     among  Buyer,  Assignee and  Assignors,  among other  things,  Assignee has
     agreed to  purchase  from  Assignors  and  Assignors  have  agreed to sell,
     transfer,  assign,  convey,  and deliver to  Assignee,  all of their right,
     title and interest in certain of their assets,  properties and business and
     Assignee has agreed to assume  certain of Assignors'  liabilities  upon the
     terms and conditions set forth in the Purchase Agreement;

          NOW, THEREFORE,  pursuant to the Purchase Agreement and the assignment
     described above and in  consideration of the premises set forth therein and
     for other good and  valuable  consideration,  the receipt  and  adequacy of
     which are hereby acknowledged, Assignors and Buyer hereby agree as follows:

          Section  1.  Conveyance  and  Assignment  of  the  Purchased   Assets.
                       --------------------------------------------------------

          (a) In  accordance  with all the terms and  conditions of the Purchase
     Agreement,  and for other good and valuable consideration,  the receipt and
     sufficiency of which are hereby  acknowledged,  Assignors by this Agreement
     hereby sell, convey, assign, transfer and deliver to, and vest in Assignee,
     its  successors and assigns,  to have and to hold forever,  effective as of
     the date hereof, all of the right, title and interest, legal and equitable,
     of Assignors in and to the Purchased Assets.

          (b) Assignors  hereby  authorize  Assignee to take any  appropriate or
     reasonable action to protect the right,  title and interest hereby conveyed
     in connection with the Purchased Assets hereby sold, assigned, transferred,
     conveyed and  delivered to Assignee in the name of Assignors or Assignee or
     any other name (but for the  benefit of  Assignee  and its  successors  and
     assigns)  against each and every person or persons  whomsoever  claiming or
     asserting any claim against any or all of the same.

          Section 2. Assumption of Liabilities.
                     -------------------------

          (a) In  partial  consideration  for the  foregoing  sale,  conveyance,
     assignment,  transfer  and  delivery  of the  Purchased  Assets on the date
     hereof,  and for other good and  valuable  consideration,  the  receipt and

                                      F-1
<PAGE>

     sufficiency of which are hereby acknowledged,  Assignee, by this Agreement,
     hereby  assumes,  becomes  responsible  for  and  agrees  to pay  and  hold
     Assignors harmless from and against the Assumed Liabilities.

          (b) The assumption by Assignee of the Assumed Liabilities shall not be
     construed to defeat,  impair or limit in any way any rights and remedies of
     Assignee to contest or dispute the validity or amount thereof.

          Section 3. Power of Attorney.  Each Assignor  hereby  constitutes  and
                     -----------------   appoints Assignee, its  successors  and
     assigns,  the  true and  lawful  attorney  of  Assignor  with full power of
     substitution in the name and stead of such Assignor,  but on behalf and for
     the benefit and at the expense of Assignee,  its successors and assigns, to
     demand and receive  any and all of the  Purchased  Assets  assigned by such
     Assignor of Assignee  pursuant to this  Agreement  and to give receipts and
     releases for and in respect of the same or any part thereof, to endorse any
     claim or right of any kind in respect thereof and to do all acts and things
     in relation to the  above-mentioned  Purchased  Assets which Assignee,  its
     successors or assigns,  may deem desirable,  such Assignor hereby declaring
     that  the  foregoing  powers  are  coupled  with  an  interest  and are not
     revocable  and  shall  not be  revoked  by such  Assignor  for  any  reason
     whatsoever.

          Section 4. Further  Assurances.  Assignors shall, at any time and from
                     -------------------   time to  time,   promptly,  upon  the
     reasonable request of Assignee, execute,  acknowledge,  deliver or perform,
     all such further acts,  deeds,  assignments,  transfers,  conveyances,  and
     assurances  as may be required  for the better  vesting and  conferring  to
     Assignee  of  title  in  and  to  the  Purchased   Assets,  to  effect  the
     transactions  contemplated by this  Agreement.  Assignee shall, at any time
     and  from  time to  time,  promptly,  upon the  reasonable  request  of the
     Assignors, execute, acknowledge, deliver or perform, all such further acts,
     deeds, assumption agreements,  transfers, and assurances as may be required
     for the  full  assumption  and  transfer  to the  Assignee  of the  Assumed
     Liabilities, to effect the transactions contemplated by this Agreement.

          Section 5. Notices. All notices and other  communications  required or
                     -------  permitted  to  be  given  hereunder  shall  be  in
     writing and shall be deemed given if delivered  personally,  transmitted by
     facsimile (and telephonically confirmed), mailed by registered or certified
     mail  with  postage  prepaid  and  return  receipt  requested,  or  sent by
     commercial  overnight courier,  courier fees prepaid, to the parties at the
     following addresses:

          (a) if to Assignee, to them at:

                   Washington Mutual Bank, FA
                   1501 4th Avenue, 6th Floor
                   Seattle, WA 98101
                   Attention:  Melba Bartels
                                     Senior Vice President
                   Facsimile:  (206) 554-2887

                                      F-2

<PAGE>

                   with copies to:

                   Washington Mutual Bank, FA
                   1201 Third Avenue, 17th Floor
                   Seattle, WA 98101
                   Attention:  Carey M. Brennan
                               Senior Vice President and
                               Associate General Counsel
                   Facsimile:  (206)377-6244

                   Heller Ehrman White & McAuliffe LLP
                   701 Fifth Avenue, Suite 6100
                   Seattle, WA 98104
                   Attention:  Bernard L. Russell
                   Facsimile:  (206) 389-6217

          (b) if to Assignors, to them at:

                   HomeSide Lending, Inc.
                   Office of the CEO
                   200 Park Avenue
                   New York, NY 10166
                   Attention:   Joseph J. Whiteside
                   Facsimile:  (212) 983-1969

                   with copies to:

                   National Australia Bank Limited
                   Legal Department, Level 24
                   500 Bourke Street
                   Melbourne, Victoria 3000
                   Attention:  David Krasnostein, Esq.
                                Group General Counsel
                   Facsimile:  61-3-8641-4902/4906




                                      F-3

<PAGE>


                   and

                   Sullivan & Cromwell
                   125 Broad Street
                   New York, NY  10004-2498
                   Attention:  Mark J. Menting
                   Facsimile:  212-558-3588

     or to such other Person or address as either party shall  specify by notice
     in writing to the other party in  accordance  with this Section 5. All such
     notices or other  communications  shall be deemed to have been  received on
     the date of the personal delivery or facsimile transmission (with telephone
     confirmation)  or on the third  Business  Day after the mailing or dispatch
     thereof;  provided that notice of change of address shall be effective only
     upon receipt.

          Section 6.  Governing  Law. This  Agreement  shall be  governed by and
                      --------------  construed  in accordance  with the laws of
     the State of New York  applicable  to  agreements  made and to be performed
     entirely  within the State of New York,  without regard to the conflicts of
     law principles of the State of New York.

          Section 7. Succession and Assignment. This Agreement shall be  binding
                     -------------------------  upon  and  inure to the  benefit
     of the parties named herein and their  respective  successors and permitted
     assigns.  No party may assign  either this  Agreement or any of its rights,
     interests,  or obligations  hereunder without the prior written approval of
     the other party, provided, however, that Buyer may assign this Agreement or
     any of its rights,  interests  or  obligations  hereunder  to an  Affiliate
     without the prior  written  approval of the  Assignors,  provided that with
     respect to this  Agreement  Sellers shall only be obligated to the original
     Buyer and Assignee and  Assignors  continue to interact for all purposes of
     this Agreement solely with the original Assignee.

          Section 8. Counterparts. This Agreement may be executed in two or more
                     ------------  counterparts,   all   of   which   shall   be
     considered one and the same agreement,  and shall become effective when one
     or more such  counterparts  have been  signed  by each of the  parties  and
     delivered to the other party.

          Section 9. Conflicts.  In  the event that the terms of this  Agreement
                     ---------
     and the terms of the  Purchase  Agreement  are  inconsistent  or  otherwise
     conflict,  the  terms  of the  Purchase  Agreement  shall be  deemed  to be
     controlling.

          Section 10. Definitions.  Capitalized   terms  used,  but  not defined
                      -----------
     herein  shall  have  those  meanings  assigned  to  them  in  the  Purchase
     Agreement.

                                      F-4


<PAGE>

          IN WITNESS  WHEREOF,  the parties  hereto have duly executed or caused
     this Agreement to be duly executed on the date first above written.

                                       HOMESIDE INTERNATIONAL, INC.


                                       By:  ____________________________________
                                            Name:
                                            Title:



                                       HOMESIDE LENDING, INC.


                                       By:  ____________________________________
                                            Name:
                                            Title:



                                       WASHINGTON MUTUAL BANK, FA


                                       By:  ____________________________________
                                            Name:
                                            Title: