TRUST AGREEMENT


                  TRUST AGREEMENT, between MSDW Structured Asset Corp. (the
"Depositor") and LaSalle Bank National Association (the "Trustee"), made as of
the date set forth in Schedule I attached hereto, which Schedule together with
Schedules II and III attached hereto, are made a part hereof and are hereinafter
referred to collectively as the "Terms Schedule". The terms of the Standard
Terms for Trust Agreements, dated July 7, 1999 (the "Standard Terms") are,
except to the extent otherwise expressly stated, hereby incorporated by
reference herein in their entirety with the same force and effect as though set
forth herein. Capitalized terms used herein and not defined shall have the
meanings defined in the Standard Terms. References to "herein", "hereunder",
"this Trust Agreement" and the like shall include the Terms Schedule attached
hereto and the Standard Terms so incorporated by reference.

                  WHEREAS, the Depositor and the Trustee desire to establish the
Trust identified in Schedule I attached hereto (the "Trust") for the primary
purposes of (i) holding the Securities, (ii) entering into any Swap Agreement
with the Swap Counterparty and (iii) issuing the Units;

                  WHEREAS, the Depositor desires that the respective beneficial
interests in the Trust be divided into transferable fractional shares, such
shares to be represented by the Units; and

                  WHEREAS, the Depositor desires to appoint the Trustee as
trustee of the Trust and the Trustee desires to accept such appointment;

                  WHEREAS, the Depositor shall transfer, convey and assign to
the Trust without recourse, and the Trust shall acquire, all of the Depositor's
right, title and interest in and under the Securities and other property
identified in Schedule II to the Trust Agreement (the "Trust Property"); and

                  WHEREAS, the Trust agrees to acquire the Trust Property
specified herein in consideration for Units having an initial Unit Principal
Balance identified in Schedule I attached hereto, subject to the terms and
conditions specified in the Trust Agreement;

                  NOW THEREFORE, the Depositor hereby appoints the Trustee as
trustee hereunder and hereby requests the Trustee to receive the Securities from
the Depositor and to issue in accordance with the instructions of the Depositor
Units having an initial Unit Principal Balance identified in Schedule I attached
hereto, and the Trustee accepts such appointment and, for itself and its
successors and assigns, hereby declares that it shall hold all the estate,
right, title and interest in any property contributed to the trust account
established hereunder (except property to be applied to the payment or
reimbursement of or by the Trustee for any fees or expenses which under the
terms hereof is to be so applied) in trust for the benefit of all present and
future Holders of the fractional shares of beneficial interest issued hereunder,
namely, the Unitholders, and subject to the terms and provisions hereof and of
the Standard Terms.

                  IN WITNESS WHEREOF, each of the undersigned has executed this
instrument as of the date set forth in the Terms Schedule attached hereto.

                                LASALLE BANK NATIONAL ASSOCIATION
                                  as Trustee on behalf of the Trust identified
                                  in Schedule I hereto, and not in its
                                  individual capacity



                                By: /s/ Brian D. Ames
                                    --------------------------
                                    Name: Brian D. Ames
                                    Title: Vice President


                                MSDW STRUCTURED ASSET CORP.



                                By: /s/ John Kehoe
                                    --------------------------
                                    Name: John Kehoe
                                    Title: Vice President



Attachments: Terms Schedule (consisting of Schedules I, II and III)

<PAGE>

                                   Schedule I
                           (Terms of Trust and Units)

Trust:                                SATURNS Trust No. 2001-7

Date of Trust Agreement:              December 12, 2001

Trustee:                              LaSalle Bank National Association.
                                      References to Chase Bank of Texas,
                                      National Association in the Standard Terms
                                      shall be inapplicable.

Initial Unit Principal Balance:       $32,191,325

Issue Price:                          100%

Number of Units:                      1,287,653 (Unit Principal Balance of $25
                                      each)

Minimum Denomination:                 $25 and $25 increments in excess thereof.
                                      The minimum denomination specified in
                                      Section 5.01(a) of the Standard Terms
                                      shall not apply. Each $25 of Unit
                                      Principal Balance is a Unit.

Cut-off Date:                         December 12, 2001

Closing Date:                         December 12, 2001

Specified Currency:                   United States dollars

Business Day:                         New York, New York and Chicago, Illinois

Interest Rate:                        8.25%. During an extension period with
                                      respect to the securities, while interest
                                      will continue to accrue on the Unit
                                      Principal Balance at 8.25% per annum,
                                      interest will accrue on any deferred
                                      interest at a rate equal to the rate at
                                      which interest accrues on deferred
                                      interest with respect to the Securities.

Interest Reset Period:                Not Applicable

Rating:                               Baa2 by Moody's
                                      BBB- by S&P

Rating Agencies:                      Moody's and S&P

Scheduled Final Distribution Date:    July 15, 2037. The Units will have the
                                      same final maturity as the Securities.

Prepayment/Redemption:                The Trust Property is subject to
                                      redemption at any time and is subject to
                                      call in accordance with Schedule III.

                                      If the rights under the Swap Agreement is
                                      partially exercised or if there is a
                                      partial redemption of the Securities, the
                                      Trustee will randomly select Units to be
                                      redeemed in full from the proceeds of such
                                      partial exercise of the Swap Agreement or
                                      partial redemption of the Securities.

Additional Distribution:              If any of the Securities are redeemed by
                                      the Security Issuer prior to July 15,
                                      2006, each of the Units which are redeemed
                                      in connection with such redemption of
                                      Securities will receive a pro rata
                                      distribution from the proceeds of the
                                      redemption of the Securities remaining
                                      after payment of principal and interest on
                                      such Units up to a maximum of $2.50 per
                                      Unit.

Corporate Trust Office:               The definition of "Corporate Trust Office"
                                      in the Standard Terms shall not apply.

                                      The Corporate Trust Office shall be the
                                      Trustee's Asset-Backed Securities Trust
                                      Services Group having an office at 135 S.
                                      LaSalle Street, Suite 1625, Chicago,
                                      Illinois 60603 or such other addresses as
                                      the Trustee may designate from time to
                                      time by notice to the Unitholders, the
                                      Depositor, the Swap Counterparty and the
                                      Guarantor.

Swap Agreement:                       The ISDA Agreement referred to in Schedule
                                      III. In addition, in connection with an
                                      additional issuance of Units, any
                                      additional Swap Agreement entered into in
                                      connection therewith.

Swap Counterparty:                    Party A to the Swap Agreement referred to
                                      in Schedule III or any assignee thereof.
                                      In addition, in connection with an
                                      additional issuance of Units, Party A to
                                      any additional Swap Agreement or any
                                      assignee thereof.

                                      In the event that there is more than one
                                      Swap Counterparty at any time when a
                                      partial termination or a deemed exercise
                                      is to occur under only part of the options
                                      outstanding under all Swap Agreements, the
                                      Trustee shall randomly select which
                                      options under the Swap Agreements shall be
                                      selected for such partial termination or
                                      deemed exercise.

Guaranty:                             Morgan Stanley Dean Witter & Co. (the
                                      "Guarantor") shall guarantee the
                                      obligations of Morgan Stanley & Co.
                                      International Limited ("MSIL") for so long
                                      as MSIL is Party A to any Swap Agreement
                                      with the Trust.

Swap Notional Amount:                 The Notional Amount specified in Schedule
                                      III.

Swap Payment Date:                    Any date upon which the rights under the
                                      Swap Agreement may be exercised.

Swap Rate:                            Not Applicable

Additional Swap Agreements:           In connection with an additional issuance
                                      of Units, the Depositor may arrange for
                                      the Trust to enter into an additional Swap
                                      Agreement with identical terms as the Swap
                                      Agreement entered into as of the Closing
                                      Date with an additional Swap Counterparty,
                                      except that such Swap Agreement may have a
                                      different Swap Counterparty and premium
                                      amount than the Swap Agreement entered
                                      into on the Closing Date. The Rating
                                      Agency Condition must be satisfied in
                                      connection with respect to the Swap
                                      Counterparty.

Distribution Date:                    Each January 15 and July 15, commencing
                                      January 15, 2002.

                                      If any payment with respect to the
                                      Securities held by the Trust is not
                                      received by the Trustee by 12 noon (New
                                      York City time) on a Distribution Date,
                                      the corresponding distribution on the
                                      Units will not occur until the next
                                      Business Day that the Trust is in receipt
                                      of proceeds of such payment prior to 12
                                      noon, with no adjustment to the amount
                                      distributed.

Record Date:                          Each January 1 and July 1, regardless of
                                      whether such day is a Business Day.

Form:                                 Global

Depositary:                           DTC

Trustee Fees and Expenses:            As compensation for and in payment of
                                      trust expenses related to its services
                                      hereunder other than Extraordinary Trust
                                      Expenses, the Trustee will receive Trustee
                                      Fees on each Distribution Date in the
                                      amount equal to $3,750. The Trustee Fee
                                      shall cease to accrue after termination of
                                      the Trust. The "Trigger Amount" with
                                      respect to Extraordinary Trust Expenses
                                      for the Trust is $25,000 and the Maximum
                                      Reimbursable Amount is $100,000. The
                                      Trustee Fee will be paid by the Expense
                                      Administrator. Expenses will be reimbursed
                                      by the Expense Administrator in accordance
                                      with the Expense Administration Agreement.

Expense Administrator:                The Depositor will act as Expense
                                      Administrator on behalf of the Trust
                                      pursuant to an Expense Administration
                                      Agreement, dated as of December 12, 2001
                                      (the "Expense Administration Agreement"),
                                      between the Depositor as Expense
                                      Administrator (the "Expense
                                      Administrator") and the Trust.

                                      The Expense Administrator will receive a
                                      fee equal to 0.025% per annum of the
                                      principal amount of the Securities held by
                                      the Trust as its fee, payable on the basis
                                      of a 360 day year consisting of twelve 30
                                      day months. The Expense Administrator will
                                      be entitled to interest on any deferred
                                      fee amounts that would have been payable
                                      but for deferral of interest on the
                                      Securities at the rate interest accrues on
                                      any deferred interest with respect to the
                                      Securities. The Expense Administrator's
                                      fee is payable only from available
                                      interest receipts received with respect to
                                      the Securities after application of such
                                      receipts to payment of accrued interest on
                                      the Units and any Swap Termination
                                      Payments currently owing.

                                      In addition the Expense Administrator
                                      shall own that portion of the Securities
                                      which represent the interest of a
                                      fractional Unitholder that would remain
                                      after a partial exercise or deemed
                                      exercise of the Swap Agreement had the
                                      Swap Counterparty not been obligated to
                                      pay the Fractional Unit Make Whole Amount
                                      (pursuant to and as defined in the Swap
                                      Agreement). The Expense Administrator
                                      shall receive all interest and principal
                                      with respect to such portion of the
                                      Securities.

                                      The Expense Administrator will be
                                      responsible for paying the Trustee Fee and
                                      reimbursing certain other expenses of the
                                      Trust in accordance with the Expense
                                      Administration Agreement.

Listing:                              The Depositor has applied to list the
                                      Units on the New York Stock Exchange

ERISA Restrictions:                   None of the restrictions in the Standard
                                      Terms relating to the Employee Retirement
                                      Income Security Act of 1974, as amended,
                                      and related matters shall apply.

Deemed Representations:               Not Applicable

QIB Restriction:                      Not Applicable

Trust Wind-Up Event:                  The Trust Wind-Up Events specified in
                                      Sections 9.01(a), 9.01(c), 9.01(d),
                                      9.01(f) and 9.01(h) shall not apply. The
                                      Trust Wind Events specified in Sections
                                      9.01(b) (Security Default), 9.01(e) (Early
                                      Termination Date designated due to
                                      "illegality" or "tax event" under the Swap
                                      Agreement), 9.01(g) (Disqualified
                                      Securities), 9.01(i) (Excess Expense
                                      Event) shall apply. Pursuant to Section
                                      9.01(j), the following events also shall
                                      constitute Trust Wind-Up Events: (i)
                                      redemption (or completion of a
                                      self-tender) by the Security Issuer of all
                                      Securities held by the Trust and (ii)
                                      exercise of the right to purchase
                                      Securities under the Swap Agreement as to
                                      all Securities held by the Trust.

Termination:                          If a Trust Wind-Up Event occurs (other
                                      than due to exercise of the right to
                                      purchase Securities under the Swap
                                      Agreement as to all Securities held by the
                                      Trust), any Securities held by the Trust
                                      will be liquidated (in the case of a Trust
                                      Wind-Up Event resulting from a self-tender
                                      offer, by tender to the Security Issuer)
                                      and the proceeds will be applied first to
                                      redeem the Units at 100% of their
                                      principal balance plus accrued interest
                                      and then to apply any remaining amounts to
                                      the payment of any amounts owed to the
                                      Swap Counterparty as a Swap Termination
                                      Payment under the Swap Agreement.

                                      In the event the Security Issuer makes a
                                      self-tender offer for the Securities, 100%
                                      of the Unitholders may direct the Trustee
                                      to tender all of the Securities held by
                                      the Trust. The Trustee will only accept an
                                      instruction to tender the Securities if
                                      all of the Securities held by the Trust
                                      are to be tendered. The Units will receive
                                      the proceeds after payment of a Swap
                                      Termination Payment determined on the
                                      basis of "Market Quotation" under the Swap
                                      Agreement (with the Trust as sole Affected
                                      Party) as advised by the Swap
                                      Counterparty.

Terms of Retained Interest:           The Depositor retains the right to receive
                                      any and all interest that accrues on the
                                      Securities prior to the Closing Date. The
                                      Depositor will receive such accrued
                                      interest on the first Distribution Date
                                      for the Units and such amount shall be
                                      paid from the interest payment made with
                                      respect to the Securities on January 15,
                                      2002.

                                      The amount of the Retained Interest is
                                      $1,084,445.

                                      If a Security Default occurs on or prior
                                      to January 15, 2002 and the Depositor does
                                      not receive such Retained Interest amount
                                      in connection with such Distribution Date,
                                      the Depositor will have a claim for such
                                      Retained Interest, and will share pro rata
                                      with holders of the Units to the extent of
                                      such claim in the proceeds from the
                                      recovery on the Securities.

Call Option Terms:                    Not applicable.

Security Default:                     The definition of Security Default in the
                                      Standard Terms shall not apply. A
                                      "Security Default" shall mean one of the
                                      following events: (i) the acceleration of
                                      the outstanding Securities under the terms
                                      of the Securities and/or the applicable
                                      Security Agreement and failure to pay the
                                      accelerated amount on the acceleration
                                      date, (ii) the failure of the Security
                                      Issuer to pay an installment of principal
                                      of, or any amount of interest due on, the
                                      Securities after the due date thereof and
                                      after the expiration of any applicable
                                      grace period; or (iii) the occurrence of
                                      certain events of default under such
                                      Securities and/or Security Agreement
                                      relating to the insolvency or bankruptcy
                                      of the Security Issuer.

Sale of Securities:                   If the Trust must sell the Securities it
                                      holds, the Trust will sell the Securities
                                      through the Selling Agent in accordance
                                      with Section 9.03(b) and the following
                                      terms. The Selling Agent will solicit bids
                                      for all of the Securities held by the
                                      Trust from at least three registered
                                      broker-dealers of national reputation. The
                                      Selling Agent will, on behalf of the
                                      Trust, sell the Securities at the highest
                                      bid price received.

Additional Issuance of Units:         Upon no less than 5 days' notice to the
                                      Trustee, the Depositor may deposit
                                      additional Securities at any time in
                                      exchange for additional Units in a minimum
                                      aggregate amount of $250,000 and, if in
                                      excess of such amount, in a $25 integral
                                      multiple in excess thereof. The principal
                                      amount of Securities deposited must be in
                                      the same ratio to the Unit Principal
                                      Balance of the Units received as the ratio
                                      of the aggregate Unit Principal Balance on
                                      the Closing Date to the aggregate
                                      principal balance of the Securities on the
                                      Closing Date. The Depositor must either
                                      arrange for the Swap Counterparty and the
                                      Trust to increase proportionally the
                                      notional amount under the Swap Agreement
                                      or arrange for an additional Swap
                                      Agreement to be entered into between the
                                      Trust and an additional Swap Counterparty.
                                      The Rating Agency Condition must be
                                      satisfied in connection with any such
                                      additional issuance.

Selling Agent:                        Morgan Stanley & Co. Incorporated.
                                      Notwithstanding any provision of the
                                      Standard Terms to the contrary, any sale
                                      of the Securities shall be conducted by
                                      and through the Selling Agent and not the
                                      Trustee.

Rating Agency Condition:              The definition of Rating Agencies
                                      Condition in the Standard Terms shall not
                                      apply.

                                      "Rating Agency Condition": With respect to
                                      any specified action or determination,
                                      means receipt of (i) oral or written
                                      confirmation by Moody's (for so long as
                                      the Units are outstanding and rated by
                                      Moody's) and (ii) written confirmation by
                                      S&P (for so long as the Units are
                                      outstanding and rated by S&P), that such
                                      specified action or determination will not
                                      result in the reduction or withdrawal of
                                      their then-current ratings on the Units;
                                      provided, however, that if the Rating
                                      Agency Condition specified herein is to be
                                      satisfied only with respect to Moody's or
                                      S&P, only clause (i) or clause (ii) shall
                                      be applicable. Such satisfaction may
                                      relate either to a specified transaction
                                      or may be a confirmation with respect to
                                      any future transactions which comply with
                                      generally applicable conditions published
                                      by the applicable rating agency.

Eligible Account:                     The definition of "Eligible Account" in
                                      the Standard Terms shall not apply.

                                      "Eligible Account": A non-interest bearing
                                      account, held in the United States, in the
                                      name of the Trustee for the benefit of the
                                      Trust that is either (i) a segregated
                                      account or segregated accounts maintained
                                      with a Federal or State chartered
                                      depository institution or trust company
                                      the short-term and long-term unsecured
                                      debt obligations of which (or, in the case
                                      of a depository institution or trust
                                      company that is the principal subsidiary
                                      of a holding company, the short-term and
                                      long-term unsecured debt obligations of
                                      such holding company) are rated P-1 and
                                      Aa2 by Moody's, A-1+ and AA by S&P, and,
                                      if rated by Fitch, F1 and AA by Fitch at
                                      the time any amounts are held on deposit
                                      therein including when such amounts are
                                      initially deposited and all times
                                      subsequent or (ii) a segregated trust
                                      account or segregated accounts maintained
                                      as a segregated account or as segregated
                                      accounts and held by the Trustee in its
                                      Corporate Trust Office in trust for the
                                      benefit of the Unitholders.

Permitted Investments:                The following shall be a Permitted
                                      Investment in addition to the investments
                                      specified in the Standard Terms:

                                      Units of the Dreyfus Cash Management Fund
                                      Investor Shares or any other money market
                                      funds which are rated in the highest
                                      applicable rating category by each Rating
                                      Agency (or such lower rating if the Rating
                                      Agency Condition is satisfied).

Non-U.S. Persons:                     Notwithstanding anything to the contrary
                                      herein or in the Standard Terms, any
                                      beneficial owner of any Units which is a
                                      non-U.S. person shall not be entitled to
                                      exercise any rights of the Unitholders to
                                      instruct or direct Trustee.

Other Terms:                          The Trust shall not merge or consolidate
                                      with any other trust, entity or person and
                                      the Trust shall not acquire the assets of,
                                      or an interest in, any other trust, entity
                                      or person except as specifically
                                      contemplated herein.

                                      The Trustee shall provide to the
                                      Unitholders copies of any notices it
                                      receives with respect to a redemption of
                                      the Securities or a call of the Securities
                                      under the Swap Agreement and any other
                                      notices with respect to the Securities.

                                      The reference to "B2" in the definition of
                                      Certificate in the Standard Terms shall be
                                      replaced with "Exhibit B2".

                                      The reference to "Section 10.02(ix)" in
                                      the definition of Available Funds in the
                                      Standard Terms shall be replaced with
                                      "Section 10.02(a)(ix)".

                                      The reference to "Section 3.04" in the
                                      definition of Unit Account in the Standard
                                      Terms shall be replaced with "Section
                                      3.05".

                                      The transfer by the Depositor to the
                                      Trustee specified in Section 2.01(a) of
                                      the Standard Terms shall be in trust.

                                      Section 2.06 of the Standard Terms shall
                                      be incorporated herein by inserting "cash
                                      in an amount equal to the premium under
                                      the Swap Agreement and" after the phrase
                                      "constituting the Trust Property,"
                                      therein.

                                      The reference to "calendar day" in the
                                      last sentence of Section 3.06 of the
                                      Standard Terms shall be replaced with
                                      "Business Day".

                                      Section 4.02(d) of the Standard Terms
                                      shall be incorporated herein by striking
                                      "and the Trustee on behalf of the
                                      Unitholders" from the first sentence of
                                      the second paragraph thereof.

                                      Section 5.03(c) of the Standard Terms
                                      shall be incorporated herein by striking
                                      "(if so required by the Trustee or the
                                      Unit Registrar)" from the first sentence
                                      thereof.

                                      Section 7.01(c)(i) of the Standard Terms
                                      shall be incorporated herein by replacing
                                      the first word thereof ("after") with
                                      "alter".

                                      Section 7.02 of the Standard Terms shall
                                      be incorporated herein by striking "(i)
                                      the Trustee determines that such amendment
                                      will not adversely affect the interests of
                                      the Unitholders and (ii)" from the first
                                      sentence thereof, inserting "on which it
                                      may conclusively rely" after "Opinion of
                                      Counsel" in such sentence, and striking
                                      "clause (ii)" from the second sentence of
                                      such Section.

                                      Section 9.03(a) of the Standard Terms
                                      shall be incorporated herein by striking
                                      "or oral" after the "at any time by" in
                                      the third sentence thereof.

                                      Clause (ix) of Section 10.02(a) shall not
                                      apply.

                                      Section 10.02(a)(x) of the Standard Terms
                                      shall be replaced with the following:

                                      (x) the Trustee shall have the power to
                                      sell the Securities and other Trust
                                      Property, in accordance with Article IX
                                      and XI, through the Selling Agent or, if
                                      the Selling Agent shall have resigned or
                                      declined to sell some or all of the
                                      Securities, any broker selected by the
                                      Trustee (at the direction of the
                                      Depositor) with reasonable care, in an
                                      amount sufficient to pay any amount due to
                                      the Swap Counterparty under the Swap
                                      Agreement (including Termination Payments)
                                      or reimbursable to itself in respect of
                                      unpaid Extraordinary Trust Expenses and to
                                      use the proceeds thereof to make such
                                      payments after the distribution of funds
                                      or Trust Property to Unitholders. Any such
                                      broker shall be instructed by the Trustee
                                      to sell such Trust Property in a
                                      reasonable manner designed to maximize the
                                      sale proceeds.

                                      Section 10.05(b) of the Standard Terms
                                      shall be incorporated herein by replacing
                                      ", pursuant to the first sentence of this
                                      paragraph" with "the Trustee shall be
                                      indemnified by the Trust, however," in the
                                      last sentence thereof.

                                      Section 10.06(a) of the Standard Terms
                                      shall be incorporated herein by inserting
                                      "or association" after the word
                                      "corporation" in the second sentence
                                      thereof.

                                      Section 10.07(a) of the Standard Terms
                                      shall be incorporated herein by replacing
                                      "notice or resignation" with "notice of
                                      resignation" in the second sentence
                                      thereof and striking the last two
                                      sentences thereof.

                                      Section 10.10(b) of the Standard Terms
                                      shall be incorporated herein by inserting
                                      "The Trustee shall not be liable for the
                                      acts or omissions of any co-trustee."
                                      after the last sentence thereof.

                                      Section 10.14 of the Standard Terms shall
                                      be replaced with the following:

                                      SECTION 10.14. Non-Petition. Prior to the
                                      date that is one year and one day after
                                      all distributions in respect of the Units
                                      have been made, none of the Trustee, the
                                      Trust or the Depositor shall take any
                                      action, institute any proceeding, join in
                                      any action or proceeding or otherwise
                                      cause any action or proceeding against any
                                      of the others under the United States
                                      Bankruptcy Code or any other liquidation,
                                      insolvency, bankruptcy, moratorium,
                                      reorganization or similar law ("Insolvency
                                      Law") applicable to any of them, now or
                                      hereafter in effect, or which would be
                                      reasonably likely to cause any of the
                                      others to be subject to, or seek the
                                      protection of, any such Insolvency Law.

                                      Section 12.01(a) of the Standard Terms
                                      shall be incorporated herein by replacing
                                      "(v)" with "(vi)" in the last proviso
                                      thereof.

                                      Section 12.01(c) of the Standard Terms
                                      shall be incorporated herein by inserting
                                      ",provided at the expense of the party
                                      requesting such amendment," after "Opinion
                                      of Counsel".

                                      Section 12.05 of the Standard Terms shall
                                      be incorporated herein by striking "the
                                      Trustee and" in the last sentence of the
                                      second paragraph thereof.

                                      The reference to "its President, its
                                      Treasurer, or one of its Vice Presidents,
                                      Assistant Vice Presidents or Trust
                                      Officers" in the first sentence of Section
                                      5.02(a) of the Standard Terms shall be
                                      replaced with "a Responsible Officer".

                                      The reference to "the proper officers" in
                                      the second sentence of Section 5.02(a) of
                                      the Standard Terms shall be replaced with
                                      "a Responsible Officer".

                                      The reference to "one of its authorized
                                      signatories" in the first sentence of
                                      Section 5.02(d) of the Standard Terms
                                      shall be replaced with "a Responsible
                                      Officer".

                                      The reference to the "Trust" in the first
                                      sentence of Section 5.08(b) of the
                                      Standard Terms shall be replaced with the
                                      "Trustee".

                                      References to D&P in the Standard Terms
                                      shall be incorporated as references to
                                      Fitch Inc. ("Fitch").

<PAGE>

                                   Schedule II

                            (Terms of Trust Property)


Securities:                           SAFECO Capital Trust I 8.072% trust
                                      preferred capital securities due July 15,
                                      2037

Security Issuer:                      SAFECO Capital Trust I

Security Guarantor:                   SAFECO Corporation

                                      The Security Guarantor will be considered
                                      the "Security Issuer" for purposes of
                                      determining whether the Security Issuer is
                                      an Eligible Issuer and whether the
                                      Securities are Disqualified Securities.

Guarantor Debentures:                 The Guarantor's 8.072% junior subordinated
                                      debentures due 2037. Such debentures are
                                      the only assets of the Security Issuer.

                                      In the event that the Guarantor Debentures
                                      are exchanged for the Securities or
                                      distributed in liquidation of the Security
                                      Issuer, the Guarantor Debentures shall be
                                      treated as the Securities. Such exchange
                                      or liquidation shall not be considered a
                                      redemption.

Principal Amount:                     $33,070,000

Security Rate:                        8.072%

Credit Ratings:                       Baa2 by Moody's
                                      BBB- by S&P

Listing:                              Not applicable

Security Agreement:                   As to the Securities, the amended and
                                      restated declaration of trust dated as of
                                      July 15, 1997 relating to the Security
                                      Issuer. As to the Guarantor Debentures,
                                      the indenture, dated as of July 15, 1997,
                                      between the Guarantor and The Chase
                                      Manhattan Bank.

Form:                                 Global

Currency of                           United States dollars
Denomination:

Acquisition Price                     94.5267%
by Trust:

Security Payment Date:                Each January 15 and July 15, commencing
                                      January 15, 1998.

Original Issue Date:                  The Securities were issued July 15, 1997.

Maturity Date:                        July 15, 2037.

Sinking Fund Terms:                   Not Applicable

Redemption Terms:                     The Guarantor Debentures and the
                                      Securities may be redeemed upon a "tax
                                      event" (as defined in the underlying
                                      indenture and declaration of trust). The
                                      Guarantor Debentures may also be
                                      distributed in exchange for the Securities
                                      or in liquidation of the Issuer. In such
                                      event the Guarantor Debentures would
                                      become the Securities under the Trust
                                      Agreement.

CUSIP No.:/ISIN No.                   786427 AC8

Security Trustee:                     The Chase Manhattan Bank

Guarantor Debenture Trustee:          The Chase Manhattan Bank

Available Information                 The Security Guarantor is subject to the
Regarding the Security Issuer         informational requirements of the
(if other than U.S.                   Securities Exchange Act of 1934, as
Treasury obligations):                amended, and in accordance therewith files
                                      reports and other information with the
                                      Securities and Exchange Commission (the
                                      "Commission"). Such reports and other
                                      information can be inspected and copied at
                                      the public reference facilities maintained
                                      by the Commission at 450 Fifth Street,
                                      N.W., Washington, D.C. 20549 and at the
                                      following Regional Offices of the
                                      Commission: Woolworth Building, 233
                                      Broadway, New York, NY 10279, and
                                      Northwest Atrium Center, 500 West Madison
                                      Street, Chicago, Illinois 60661. Copies of
                                      such materials can be obtained from the
                                      Public Reference Section of the Commission
                                      at 450 Fifth Street, N.W., Washington,
                                      D.C. 20549 at prescribed rates.

<PAGE>

                                  Schedule III

                              (Call Option Confirm)

                                                                  MORGAN STANLEY

<TABLE>
--------------------------------------------------------------------------------------------------
Date:   December 12, 2001

<S>     <C>  <C>                            <C>        <C>
To:     SATURNS Trust No. 2001-7            From:      Morgan Stanley & Co. International Limited

Attn:   Asset-Backed Securities Group       Contact:   Chris Boas
        SATURNS Trust No. 2001-7

Fax:    312-904-2084                        Fax:       212-761-0406

Tel:    312-904-7807                        Tel:       212-761-1395
------- ----------------------------------- ---------- ----------------------------------------------
</TABLE>

Re: Bond Option Transaction. MS Reference Number S7503

         The purpose of this letter agreement is to confirm the terms and
conditions of the Transaction entered into between you and Morgan Stanley & Co.
International Limited ("MSIL"), with Morgan Stanley & Co. Incorporated
("MS&Co."), as agent, on the Trade Date specified below (the "Transaction").
This letter agreement constitutes a "Confirmation" as referred to in the
Agreement below.

         The definitions and provisions contained in (i) the 1991 ISDA
Definitions and the 1997 ISDA Government Bond Option Definitions (the "Bond
Option Definitions") (each as published by the International Swaps and
Derivatives Association, Inc. ("ISDA")) and (ii) to the extent of terms not
defined herein or in the Bond Option Definitions the 1996 ISDA Equity
Derivatives Definitions (as published by ISDA) (the "Equity Definitions"), are
incorporated into this Confirmation. In the event of any inconsistency between
those definitions and this Confirmation, this Confirmation will govern.

         1. This Confirmation supplements, forms a part of, and is subject to,
the ISDA Master Agreement dated as of December 12, 2001, as amended and
supplemented from time to time (the "Agreement"), between you and us. All
provisions contained in the Agreement govern this Confirmation except as
expressly modified below.

         2. The terms of the particular Transaction to which this Confirmation
relates are as follows:

I. General Terms

Trade Date:                           December 4, 2001

Commencement Date:                    December 12, 2001

Option Style:                         American

Option Type:                          Call

Buyer:                                MSIL ("Party A")

Seller:                               SATURNS Trust No. 2001-7 ("Party B")

<TABLE>
<S>                                   <C>                        <C>
Bonds:                                The obligation identified as follows:
                                      Bond Issuer:               SAFECO Capital Trust I
                                      Issue:                     8.072% Debentures due 2037
                                      CUSIP:                     786427 AC8
                                      Coupon:                    8.072%
                                      Maturity Date:             July 15, 2037
                                      Face Amount Purchased:     USD 33,070,000
</TABLE>

Premium:                              USD 82,675

Number of Options:                    33,070

Option Entitlement:                   USD 1,000 of face amount of the Bonds per
                                      Option.

Strike Price:                         (i) For any Exercise Date on or prior to
                                      July 15, 2007, the redemption price of the
                                      Bonds including any make-whole amount
                                      (expressed as a percentage) subject to a
                                      maximum of 110% of the aggregate Unit
                                      Principal Balance, or (ii) for any
                                      Exercise Date after July 15, 2007, 97.343%
                                      of the face amount of the Bonds.

Calculation Agent:                    Party A

II. Exercise Terms

Automatic Exercise:                   Inapplicable

Exercise Period:                      Any Business Day from, and including, 9:00
                                      a.m. (New York time) on the Commencement
                                      Date to, and including, the Expiration
                                      Time on the Expiration Date; if on or
                                      prior to such day with respect to any such
                                      Bonds notice of redemption has been
                                      delivered by the Issuer (including if
                                      necessary, additional Bonds to allow for
                                      the exercise of whole Options).

Exercise Date:                        For each Option exercised or deemed
                                      exercised, the day during the Exercise
                                      Period on which that Option is or is
                                      deemed to be exercised, subject to the
                                      Deemed Exercise and Alternative Settlement
                                      provision set forth below.

Multiple Exercise:                    Applicable

Minimum Number of Options:            1

Maximum Number of Options:            33,070

Integral Multiple:                    1

Written Confirmation of Exercise:     Applicable. Buyer shall give irrevocable
                                      exercise notice which may be given orally
                                      (including by telephone) during the
                                      Exercise Period but no later than the
                                      Notification Date. Buyer will execute and
                                      deliver a written exercise notice
                                      confirming the substance of such oral
                                      notice, however, failure to provide such
                                      written notice will not affect the
                                      validity of the oral notice.

Notification Date:                    Any date at least 20 calendar days but not
                                      more than 60 calendar days prior to the
                                      Exercise Date, provided that any date
                                      which is 30 calendar days after the Bond
                                      Issuer provides notice of redemption is
                                      also a Notification Date.

Limited Right to Confirm Exercise:    Inapplicable

Expiration Date:                      July 15, 2034

Expiration Time:                      4:00 p.m. New York time

Business Days:                        New York and Chicago

III. Settlements:

Settlement:                           Physical Settlement (subject to the Deemed
                                      Exercise and Alternative Settlement
                                      provision below). Party A will notify
                                      Party B separately regarding the clearance
                                      system details.

Bond Payment:                         An amount equal to the sum of:

                                      (i) The product of the Strike Price and
                                      the Exercised Call Notional Amount,

                                      (ii) The accrued interest, if applicable,
                                      and

                                      (iii) Any Fractional Unit Make Whole
                                      Amount.

                                      In addition, in connection with any
                                      partial exercise, Party A shall pay to the
                                      Expense Administrator an amount equal to
                                      the present value of the Trustee Fee (as
                                      defined in the Trust Agreement) that will
                                      accrue from the date of such exercise
                                      until the Scheduled Final Distribution
                                      Date (as defined in the Trust Agreement),
                                      assuming for this purpose that the Trust
                                      (as defined in the Trust Agreement) is not
                                      terminated prior to the Scheduled Final
                                      Distribution Date, multiplied by the
                                      Exercised Call Notional Amount and divided
                                      by $33,070,000.

Exercised Call Notional Amount:       The product of the Option Entitlement and
                                      the number of Options exercised on the
                                      relevant Exercise Date.

Settlement Date:                      Exercise Date

Deposit of Bond Payment:              Except in the event of a deemed exercise,
                                      Party A must deposit the Bond Payment with
                                      the Trustee on the Business Day prior to
                                      the Exercise Date. The Bonds are to be
                                      delivered "free" to Party A.

Deemed Exercise and Alternative       In the event that any of the Bonds held by
Settlement:                           Party B are redeemed by the Bond Issuer
                                      and paid in full in accordance with their
                                      terms, an equivalent number of Options
                                      with respect to any remaining Bonds held
                                      by Party B shall be deemed to have been
                                      exercised (and the requirements of notice
                                      of exercise and written confirmation of
                                      exercise deemed satisfied), in the same
                                      proportion as the portion of the Bonds
                                      held by Party B that are redeemed. The
                                      effective date of deemed exercise shall be
                                      20 calendar days prior to the date on
                                      which Party B receives the cash proceeds
                                      delivered in connection with the
                                      redemption. As a result of such deemed
                                      exercise, (i) Party B shall pay to Party
                                      A, against the payment by Party A set
                                      forth in clause (ii), the cash proceeds
                                      delivered in connection with such
                                      redemption (including any cash paid or
                                      delivered in respect of accrued interest
                                      on the Bonds) and (ii) Party A shall pay
                                      to Party B, against the payment and/or
                                      delivery set forth in clause (i), the Bond
                                      Payment.


         3. Additional Definitions.

         "Expense Administration Agreement" means the expense administration
agreement dated as of December 12, 2001 between Party B and the Expense
Administrator.

         "Expense Administrator" means MSDW Structured Asset Corp. acting
pursuant to the Expense Administration Agreement.

         "Fractional Unit Make Whole Amount" means the amount specified in
paragraph 9.

         "Trust Agreement" means the trust agreement dated as of December 12,
2001, between the MSDW Structured Asset Corp. and LaSalle Bank National
Association.

         4. Representations. Morgan Stanley & Co. Incorporated is acting as
agent for both parties but does not guarantee the performance of Party A.

         5. Additional Termination Event. As set forth in the Agreement, a Trust
Wind-Up Event will result in an Additional Termination Event under the Agreement
with respect to which Party B shall be the Affected Party and this Transaction
shall be an Affected Transaction.

         6. Swap Termination Payments. In the event an Early Termination Date is
designated with respect to which this Transaction is an Affected Transaction
(other than as a result of a self-tender), there shall be payable to Party A as
a termination payment in lieu of the termination payment determined in
accordance with Section 6(e) of the Agreement an amount equal to the excess (if
any) of the sale proceeds in excess of the principal of and interest on the
Units. If an early termination occurs due to a tender of the Bonds to the Bond
Issuer, the Swap Termination Payment shall be determined under Section 6(e)
determined on the basis of "Market Quotation" under the Swap Agreement (with
Party B as sole Affected Party). If an early termination occurs due to a tender
of the Bonds to the Bond Issuer, the Swap Termination Payment shall be paid
prior to any payment on the Units.

         7. Assignment. The rights under this Confirmation and the Agreement may
be assigned at any time and from time to time in whole or in part; provided that
any such assignment shall be an assignment of whole Options and provided further
that Rating Agency Condition is satisfied (as provided in the Trust Agreement)
with respect to such assignment and any transfer.

         8. Account Details.

Payments to Party A:                  Citibank, New York
                                      ABA No. 021 000 089
                                      For:  Morgan Stanley & Co. International
                                            Limited
                                      Account No. 4072 4601

Operations Contact:                   Barbara Kent
                                      Tel:  212-761-4662
                                      Fax:  212-761-0581

Payments to Party B:                  LaSalle Bank, Chicago, Illinois
                                      ABA No. 071 000 505
                                      Reference:  SATURNS 2001-7
                                      Unit Account / AC-2090067/
                                      Account No.: 67-8912-70-0

Operations Contact:                   Brian Ames
                                      Tel: 312-904-7807
                                      Fax: 312-904-2084


         9. Fractional Unit Make-Whole Amount. In the event any exercise or
deemed exercise hereunder would result in a fractional Unit (as defined in the
Trust Agreement) remaining after such exercise, Party A shall, in addition to
amounts payable hereunder, pay to Party B the remaining fractional Unit
Principal Balance (as defined in the Trust Agreement) together with accrued
interest on such Unit and, if applicable, any Additional Distribution (as
defined in the Trust Agreement). Party A shall be entitled to reimbursement from
the Expense Administrator to the extent provided in the Expense Administration
Agreement.

         10. Representations. Morgan Stanley & Co. Incorporated is acting as
agent for both parties but does not guarantee the performance of Party A. Party
B represents and warrants to Party A, which representation and warranty will be
deemed to be repeated by Party B on each date on which a Transaction is entered
into, that it owns or controls (or, in the case of an investment advisor
(whether or not registered under the United States Investment Advisors Act of
1940), has under management) in excess of USD 33 million in Aggregate Financial
Assets (as defined below).

         For purposes hereof, Aggregate Financial Assets of an entity means the
total, on a gross basis, without deduction for liabilities of the entity, of all
cash, money-market instruments, securities of unaffiliated issuers, futures and
options.

<PAGE>

         Please confirm that the foregoing correctly sets forth the terms of our
agreement MS Reference Number S7503 by executing this Confirmation and returning
it to us.

Best Regards,

MORGAN STANLEY & CO. INTERNATIONAL LIMITED


BY: /s/ John Kehoe
    ------------------------------
    Name: John Kehoe
    Title: Vice President

Acknowledged and agreed as of the date first written above:

SATURNS TRUST NO. 2001-7
BY: LaSalle Bank National Association,
    solely as Trustee and not in its individual capacity.


BY: /s/ Brian D. Ames
    ------------------------------
    Name: Brian D. Ames
    Title: Vice President


MORGAN STANLEY & CO. INCORPORATED hereby agrees to and
acknowledges its role as agent for both parties in accordance with
the Schedule to the Agreement.


BY: /s/ Susan Portelli
    ------------------------------
    Name: Susan Portelli
    Title: Attorney in fact