Document:

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                                                                  EXECUTION COPY

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                BEAR STEARNS COMMERCIAL MORTGAGE SECURITIES INC.
                                  as Depositor,

                     WELLS FARGO BANK, NATIONAL ASSOCIATION,
                               as Master Servicer,

                             ARCAP SERVICING, INC.,
                              as Special Servicer,

                       LASALLE BANK NATIONAL ASSOCIATION,
                                   as Trustee,

                WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION,
                   as Paying Agent and Certificate Registrar,

                                       and

                               ABN AMRO BANK N.V.,
                                 as Fiscal Agent

                         POOLING AND SERVICING AGREEMENT

                           Dated as of October 1, 2003

                  COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
                                SERIES 2003-TOP12

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                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

                                    ARTICLE I

                                   DEFINITIONS

SECTION 1.1    DEFINITIONS....................................................10
SECTION 1.2    CALCULATIONS RESPECTING MORTGAGE LOANS.........................85
SECTION 1.3    CALCULATIONS RESPECTING ACCRUED INTEREST.......................86
SECTION 1.4    INTERPRETATION.................................................86
SECTION 1.5    ARD LOANS......................................................86
SECTION 1.6    CERTAIN MATTERS WITH RESPECT TO LOAN PAIRS AND A/B
               MORTGAGE LOANS.................................................87

                                   ARTICLE II

                              DECLARATION OF TRUST;
                            ISSUANCES OF CERTIFICATES

SECTION 2.1    CONVEYANCE OF MORTGAGE LOANS...................................89
SECTION 2.2    ACCEPTANCE BY TRUSTEE..........................................92
SECTION 2.3    SELLERS' REPURCHASE OF MORTGAGE LOANS FOR MATERIAL
               DOCUMENT DEFECTS AND MATERIAL BREACHES OF REPRESENTATIONS
               AND WARRANTIES.................................................94
SECTION 2.4    REPRESENTATIONS AND WARRANTIES................................101
SECTION 2.5    CONVEYANCE OF INTERESTS.......................................102

                                   ARTICLE III

                                THE CERTIFICATES

SECTION 3.1    THE CERTIFICATES..............................................102
SECTION 3.2    REGISTRATION..................................................103
SECTION 3.3    TRANSFER AND EXCHANGE OF CERTIFICATES.........................104
SECTION 3.4    MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.............110
SECTION 3.5    PERSONS DEEMED OWNERS.........................................110
SECTION 3.6    ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND ADDRESSES.....110
SECTION 3.7    BOOK-ENTRY CERTIFICATES.......................................111
SECTION 3.8    NOTICES TO CLEARING AGENCY....................................114
SECTION 3.9    DEFINITIVE CERTIFICATES.......................................114

                                   ARTICLE IV

                                    ADVANCES

SECTION 4.1    P&I ADVANCES BY MASTER SERVICER...............................115

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SECTION 4.1A   P&I ADVANCES WITH RESPECT TO THE BERKELEY & BROWN PARI
               PASSU LOAN, THE RSA PARI PASSU LOAN AND THE WESTSHORE
               PLAZA PARI PASSU LOAN.........................................116
SECTION 4.2    SERVICING ADVANCES............................................117
SECTION 4.3    ADVANCES BY THE TRUSTEE AND THE FISCAL AGENT..................117
SECTION 4.4    EVIDENCE OF NONRECOVERABILITY.................................118
SECTION 4.5    INTEREST ON ADVANCES; CALCULATION OF OUTSTANDING
               ADVANCES WITH RESPECT TO A MORTGAGE LOAN......................119
SECTION 4.6    REIMBURSEMENT OF ADVANCES AND ADVANCE INTEREST................120
SECTION 4.7    FISCAL AGENT TERMINATION EVENT................................122
SECTION 4.8    PROCEDURE UPON TERMINATION EVENT..............................122
SECTION 4.9    MERGER OR CONSOLIDATION OF FISCAL AGENT.......................123
SECTION 4.10   LIMITATION ON LIABILITY OF THE FISCAL AGENT AND OTHERS........123
SECTION 4.11   INDEMNIFICATION OF FISCAL AGENT...............................123

                                    ARTICLE V

                           ADMINISTRATION OF THE TRUST

SECTION 5.1    COLLECTIONS...................................................124
SECTION 5.2    APPLICATION OF FUNDS IN THE CERTIFICATE ACCOUNT AND
               INTEREST RESERVE ACCOUNT......................................128
SECTION 5.3    DISTRIBUTION ACCOUNT AND RESERVE ACCOUNT......................138
SECTION 5.4    PAYING AGENT REPORTS..........................................139
SECTION 5.5    PAYING AGENT TAX REPORTS......................................141

                                   ARTICLE VI

                                  DISTRIBUTIONS

SECTION 6.1    DISTRIBUTIONS GENERALLY.......................................142
SECTION 6.2    KIMBALL LANE LOAN REMIC.......................................143
SECTION 6.3    REMIC I.......................................................143
SECTION 6.4    REMIC II......................................................144
SECTION 6.5    REMIC III.....................................................151
SECTION 6.5A   GRANTOR TRUST.................................................156
SECTION 6.6    ALLOCATION OF REALIZED LOSSES, EXPENSE LOSSES AND
               SHORTFALLS DUE TO NONRECOVERABILITY...........................156
SECTION 6.7    NET AGGREGATE PREPAYMENT INTEREST SHORTFALLS..................158
SECTION 6.8    ADJUSTMENT OF SERVICING FEES..................................159
SECTION 6.9    APPRAISAL REDUCTIONS..........................................159
SECTION 6.10   COMPLIANCE WITH WITHHOLDING REQUIREMENTS......................159
SECTION 6.11   PREPAYMENT PREMIUMS...........................................160

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                              ARTICLE VII

       CONCERNING THE TRUSTEE, THE FISCAL AGENT, THE PAYING AGENT AND THE
                             LUXEMBOURG PAYING AGENT

SECTION 7.1    DUTIES OF THE TRUSTEE, THE FISCAL AGENT AND THE PAYING AGENT..161
SECTION 7.2    CERTAIN MATTERS AFFECTING THE TRUSTEE, THE FISCAL AGENT AND
               THE PAYING AGENT..............................................162
SECTION 7.3    THE TRUSTEE, THE FISCAL AGENT AND THE PAYING AGENT NOT
               LIABLE FOR CERTIFICATES OR INTERESTS OR MORTGAGE LOANS........164
SECTION 7.4    THE TRUSTEE, THE FISCAL AGENT AND THE PAYING AGENT MAY
               OWN CERTIFICATES..............................................166
SECTION 7.5    ELIGIBILITY REQUIREMENTS FOR THE TRUSTEE, THE FISCAL AGENT
               AND THE PAYING AGENT..........................................166
SECTION 7.6    RESIGNATION AND REMOVAL OF THE TRUSTEE, THE FISCAL AGENT
               OR THE PAYING AGENT...........................................166
SECTION 7.7    SUCCESSOR TRUSTEE, FISCAL AGENT OR PAYING AGENT...............168
SECTION 7.8    MERGER OR CONSOLIDATION OF TRUSTEE, FISCAL AGENT OR
               PAYING AGENT..................................................169
SECTION 7.9    APPOINTMENT OF CO-TRUSTEE, SEPARATE TRUSTEE, AGENTS
               OR CUSTODIAN..................................................170
SECTION 7.10   AUTHENTICATING AGENTS.........................................172
SECTION 7.11   INDEMNIFICATION OF TRUSTEE, THE FISCAL AGENT AND THE
               PAYING AGENT..................................................172
SECTION 7.12   FEES AND EXPENSES OF TRUSTEE, THE FISCAL AGENT AND THE
               PAYING AGENT..................................................174
SECTION 7.13   COLLECTION OF MONEYS..........................................175
SECTION 7.14   TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR......................175
SECTION 7.15   NOTIFICATION TO HOLDERS.......................................177
SECTION 7.16   REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE, THE FISCAL
               AGENT AND THE PAYING AGENT....................................177
SECTION 7.17   FIDELITY BOND AND ERRORS AND OMISSIONS INSURANCE POLICY
               MAINTAINED BY THE TRUSTEE, THE FISCAL AGENT AND THE
               PAYING AGENT..................................................180
SECTION 7.18   APPOINTMENT OF LUXEMBOURG PAYING AGENT; NOTIFICATION TO
               CERTIFICATEHOLDERS............................................180

                                  ARTICLE VIII

                 ADMINISTRATION AND SERVICING OF MORTGAGE LOANS

SECTION 8.1    SERVICING STANDARD; SERVICING DUTIES..........................182
SECTION 8.2    FIDELITY BOND AND ERRORS AND OMISSIONS INSURANCE POLICY
               MAINTAINED BY THE MASTER SERVICER.............................183
SECTION 8.3    MASTER SERVICER'S GENERAL POWER AND DUTIES....................183
SECTION 8.4    PRIMARY SERVICING AND SUB-SERVICING...........................190
SECTION 8.5    SERVICERS MAY OWN CERTIFICATES................................192

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SECTION 8.6    MAINTENANCE OF HAZARD INSURANCE, OTHER INSURANCE, TAXES
               AND OTHER.....................................................192
SECTION 8.7    ENFORCEMENT OF DUE-ON-SALE CLAUSES; ASSUMPTION AGREEMENTS;
               DUE-ON-ENCUMBRANCE CLAUSE.....................................195
SECTION 8.8    TRUSTEE TO COOPERATE; RELEASE OF TRUSTEE MORTGAGE FILES.......199
SECTION 8.9    DOCUMENTS, RECORDS AND FUNDS IN POSSESSION OF MASTER SERVICER
               TO BE HELD FOR THE TRUSTEE FOR THE BENEFIT OF THE
               CERTIFICATEHOLDERS............................................200
SECTION 8.10   SERVICING COMPENSATION........................................200
SECTION 8.11   MASTER SERVICER REPORTS; ACCOUNT STATEMENTS...................202
SECTION 8.12   ANNUAL STATEMENT AS TO COMPLIANCE.............................204
SECTION 8.13   ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING REPORT.......204
SECTION 8.14   CMSA OPERATING STATEMENT ANALYSIS REPORTS REGARDING THE
               MORTGAGED PROPERTIES..........................................205
SECTION 8.15   OTHER AVAILABLE INFORMATION AND CERTAIN RIGHTS OF THE MASTER
               SERVICER......................................................206
SECTION 8.16   RULE 144A INFORMATION.........................................208
SECTION 8.17   INSPECTIONS...................................................208
SECTION 8.18   MODIFICATIONS, WAIVERS, AMENDMENTS, EXTENSIONS AND CONSENTS...209
SECTION 8.19   SPECIALLY SERVICED MORTGAGE LOANS.............................212
SECTION 8.20   REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE MASTER
               SERVICER......................................................213
SECTION 8.21   MERGER OR CONSOLIDATION.......................................214
SECTION 8.22   RESIGNATION OF MASTER SERVICER................................214
SECTION 8.23   ASSIGNMENT OR DELEGATION OF DUTIES BY MASTER SERVICER.........215
SECTION 8.24   LIMITATION ON LIABILITY OF THE MASTER SERVICER AND OTHERS.....215
SECTION 8.25   INDEMNIFICATION; THIRD-PARTY CLAIMS...........................218
SECTION 8.26   EXCHANGE ACT REPORTING........................................221
SECTION 8.27   COMPLIANCE WITH REMIC PROVISIONS..............................222
SECTION 8.28   TERMINATION...................................................223
SECTION 8.29   PROCEDURE UPON TERMINATION....................................225
SECTION 8.30   OPERATING ADVISER CONTACT WITH MASTER SERVICER AND SPECIAL
               SERVICER......................................................227

                                   ARTICLE IX

        ADMINISTRATION AND SERVICING OF SPECIALLY SERVICED MORTGAGE LOANS
                               BY SPECIAL SERVICER

SECTION 9.1    DUTIES OF SPECIAL SERVICER....................................227
SECTION 9.2    FIDELITY BOND AND ERRORS AND OMISSIONS INSURANCE POLICY OF
               SPECIAL SERVICER..............................................229
SECTION 9.3    SUB-SERVICERS.................................................229
SECTION 9.4    SPECIAL SERVICER GENERAL POWERS AND DUTIES....................229

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SECTION 9.5    "DUE-ON-SALE" CLAUSES; ASSIGNMENT AND ASSUMPTION
               AGREEMENTS; MODIFICATIONS OF SPECIALLY SERVICED MORTGAGE
               LOANS; DUE-ON-ENCUMBRANCE CLAUSES.............................232
SECTION 9.6    RELEASE OF MORTGAGE FILES.....................................236
SECTION 9.7    DOCUMENTS, RECORDS AND FUNDS IN POSSESSION OF SPECIAL
               SERVICER TO BE HELD FOR THE TRUSTEE...........................237
SECTION 9.8    REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE
               SPECIAL SERVICER..............................................238
SECTION 9.9    STANDARD HAZARD, FLOOD AND COMPREHENSIVE GENERAL
               LIABILITY INSURANCE POLICIES..................................239
SECTION 9.10   PRESENTMENT OF CLAIMS AND COLLECTION OF PROCEEDS..............241
SECTION 9.11   COMPENSATION TO THE SPECIAL SERVICER..........................241
SECTION 9.12   REALIZATION UPON DEFAULTED MORTGAGE LOANS.....................243
SECTION 9.13   FORECLOSURE...................................................245
SECTION 9.14   OPERATION OF REO PROPERTY.....................................245
SECTION 9.15   SALE OF REO PROPERTY..........................................248
SECTION 9.16   REALIZATION ON COLLATERAL SECURITY............................249
SECTION 9.17   RESERVED......................................................250
SECTION 9.18   ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE.................250
SECTION 9.19   ANNUAL INDEPENDENT ACCOUNTANTS' SERVICING REPORT..............250
SECTION 9.20   MERGER OR CONSOLIDATION.......................................251
SECTION 9.21   RESIGNATION OF SPECIAL SERVICER...............................251
SECTION 9.22   ASSIGNMENT OR DELEGATION OF DUTIES BY SPECIAL SERVICER........252
SECTION 9.23   LIMITATION ON LIABILITY OF THE SPECIAL SERVICER AND OTHERS....252
SECTION 9.24   INDEMNIFICATION; THIRD-PARTY CLAIMS...........................254
SECTION 9.25   RESERVED......................................................256
SECTION 9.26   SPECIAL SERVICER MAY OWN CERTIFICATES.........................256
SECTION 9.27   TAX REPORTING.................................................256
SECTION 9.28   APPLICATION OF FUNDS RECEIVED.................................256
SECTION 9.29   COMPLIANCE WITH REMIC PROVISIONS..............................257
SECTION 9.30   TERMINATION...................................................257
SECTION 9.31   PROCEDURE UPON TERMINATION....................................259
SECTION 9.32   CERTAIN SPECIAL SERVICER REPORTS..............................261
SECTION 9.33   SPECIAL SERVICER TO COOPERATE WITH THE MASTER SERVICER
               AND PAYING AGENT..............................................262
SECTION 9.34   RESERVED......................................................263
SECTION 9.35   RESERVED......................................................264
SECTION 9.36   SALE OF DEFAULTED MORTGAGE LOANS..............................264
SECTION 9.37   OPERATING ADVISER; ELECTIONS..................................266
SECTION 9.38   LIMITATION ON LIABILITY OF OPERATING ADVISER..................267
SECTION 9.39   DUTIES OF OPERATING ADVISER...................................268
SECTION 9.40   RIGHTS OF THE HOLDER OF A B NOTE..............................269

                                      -v-
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                                    ARTICLE X

                      PURCHASE AND TERMINATION OF THE TRUST

SECTION 10.1   TERMINATION OF TRUST UPON REPURCHASE OR LIQUIDATION OF
               ALL MORTGAGE LOANS............................................270
SECTION 10.2   PROCEDURE UPON TERMINATION OF TRUST...........................272
SECTION 10.3   ADDITIONAL TRUST TERMINATION REQUIREMENTS.....................273

                                   ARTICLE XI

                          RIGHTS OF CERTIFICATEHOLDERS

SECTION 11.1   LIMITATION ON RIGHTS OF HOLDERS...............................274
SECTION 11.2   ACCESS TO LIST OF HOLDERS.....................................275
SECTION 11.3   ACTS OF HOLDERS OF CERTIFICATES...............................275

                                   ARTICLE XII

                     REMIC AND GRANTOR TRUST ADMINISTRATION

SECTION 12.1   REMIC ADMINISTRATION..........................................276
SECTION 12.2   PROHIBITED TRANSACTIONS AND ACTIVITIES........................282
SECTION 12.3   MODIFICATIONS OF MORTGAGE LOANS...............................282
SECTION 12.4   LIABILITY WITH RESPECT TO CERTAIN TAXES AND LOSS OF
               REMIC STATUS..................................................282
SECTION 12.5   THE GRANTOR TRUST.............................................283

                                  ARTICLE XIII

                            MISCELLANEOUS PROVISIONS

SECTION 13.1   BINDING NATURE OF AGREEMENT...................................284
SECTION 13.2   ENTIRE AGREEMENT..............................................284
SECTION 13.3   AMENDMENT.....................................................284
SECTION 13.4   GOVERNING LAW.................................................286
SECTION 13.5   NOTICES.......................................................286
SECTION 13.6   SEVERABILITY OF PROVISIONS....................................287
SECTION 13.7   INDULGENCES; NO WAIVERS.......................................287
SECTION 13.8   HEADINGS NOT TO AFFECT INTERPRETATION.........................287
SECTION 13.9   BENEFITS OF AGREEMENT.........................................287
SECTION 13.10  SPECIAL NOTICES TO THE RATING AGENCIES........................288
SECTION 13.11  COUNTERPARTS..................................................289
SECTION 13.12  INTENTION OF PARTIES..........................................289
SECTION 13.13  RECORDATION OF AGREEMENT......................................291
SECTION 13.14  RATING AGENCY MONITORING FEES.................................291
SECTION 13.15  ACKNOWLEDGEMENT BY PRIMARY SERVICERS..........................291

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                             EXHIBITS AND SCHEDULES
                             ----------------------

EXHIBIT A-1      Form of Class A-1 Certificate
EXHIBIT A-2      Form of Class A-2 Certificate
EXHIBIT A-3      Form of Class A-3 Certificate
EXHIBIT A-4      Form of Class A-4 Certificate
EXHIBIT A-5      Form of Class B Certificate
EXHIBIT A-6      Form of Class C Certificate
EXHIBIT A-7      Form of Class D Certificate
EXHIBIT A-8      Form of Class E Certificate
EXHIBIT A-9      Form of Class F Certificate
EXHIBIT A-10     Form of Class G Certificate
EXHIBIT A-11     Form of Class H Certificate
EXHIBIT A-12     Form of Class J Certificate
EXHIBIT A-13     Form of Class K Certificate
EXHIBIT A-14     Form of Class L Certificate
EXHIBIT A-15     Form of Class M Certificate
EXHIBIT A-16     Form of Class N Certificate
EXHIBIT A-17     Form of Class O Certificate
EXHIBIT A-18     Form of Class R-I Certificate
EXHIBIT A-19     Form of Class R-II Certificate
EXHIBIT A-20     Form of Class R-III Certificate
EXHIBIT A-21     Form of Class R-K Certificate
EXHIBIT A-22     Form of Class X-1 Certificate
EXHIBIT A-23     Form of Class X-2 Certificate
EXHIBIT B-1      Form of Initial Certification of Trustee (Section 2.2)
EXHIBIT B-2      Form of Final Certification of Trustee (Section 2.2)
EXHIBIT C        Form of Request for Release
EXHIBIT D-1      Form of Transferor Certificate for Transfers to Definitive
                    Privately Offered Certificates (Section 3.3(c))
EXHIBIT D-2A     Form I of Transferee Certificate for Transfers of
                    Definitive Privately Offered Certificates (Section 3.3(c))
EXHIBIT D-2B     Form II of Transferee Certificate for Transfers of Definitive
                    Privately Offered Certificates (Section 3.3(c))
EXHIBIT D-3A     Form I of Transferee Certificate for Transfers of Interests in
                    Book-Entry Privately Offered Certificates (Section 3.3(c))
EXHIBIT D-3B     Form II of Transferee Certificate for Transfers of Interests in
                    Book-Entry Privately Offered Certificates (Section 3.3(c))
EXHIBIT E-1      Form of Transfer Affidavit and Agreement (Section 3.3(e))
EXHIBIT E-2      Form of Transfer Affidavit and Agreement (Section 3.3(e))
EXHIBIT F        Form of Regulation S Certificate
EXHIBIT G-1      Form of Principal Primary Servicing Agreement
EXHIBIT G-2      Form of JHREF Primary Servicing Agreement
EXHIBIT H        Form of Exchange Certification
EXHIBIT I        Form of Euroclear Bank or Clearstream Bank Certificate
                    (Section 3.7(d)

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EXHIBIT J        List of Loans as to Which Excess Servicing Fees Are Paid
                    ("Excess Servicing Fee")
EXHIBIT K-1      Form of Mortgage Loan Purchase Agreement I (BSCMI)
EXHIBIT K-2      Form of Mortgage Loan Purchase Agreement II (Wells Fargo)
EXHIBIT K-3      Form of Mortgage Loan Purchase Agreement III (Principal)
EXHIBIT K-4      Form of Mortgage Loan Purchase Agreement IV (MSMC)
EXHIBIT K-5      Form of Mortgage Loan Purchase Agreement V (JHREF)
EXHIBIT L        Form of Inspection Report
EXHIBIT M        Form of Monthly Certificateholders Reports (Section 5.4(a))
EXHIBIT N        Form of CMSA Operating Statement Analysis Report
EXHIBIT O        Reserved
EXHIBIT P        Reserved
EXHIBIT Q        Reserved
EXHIBIT R        Reserved
EXHIBIT S-1      Form of Power of Attorney to Master Servicer (Section 8.3(c))
EXHIBIT S-2      Form of Power of Attorney to Special Servicer (Section 9.4(a)
EXHIBIT T        Form of Debt Service Coverage Ratio Procedures
EXHIBIT U        Form of Assignment and Assumption Submission to Special
                    Servicer (Section 8.7(a))
EXHIBIT V        Form of Additional Lien, Monetary Encumbrance and Mezzanine
                    Financing Submission Package to the Special Servicer
                    (Section 8.7(e))
EXHIBIT W        Restricted Servicer Reports
EXHIBIT X        Unrestricted Servicer Reports
EXHIBIT Y        Investor Certificate (Section 5.4(a))
EXHIBIT Z        Form of Notice and Certification Regarding Defeasance of
                    Mortgage Loans
EXHIBIT AA       Form of Wells Fargo primary servicing agreement
                    (Section 8.29(b))
EXHIBIT BB       Controlling Class Certificateholder's Reports Checklist
EXHIBIT CC       Form of Performance Certification (Section 8.26 (b))

SCHEDULE I       BSCMI Loan Schedule
SCHEDULE II      Wells Fargo Loan Schedule
SCHEDULE III     Principal Loan Schedule
SCHEDULE IV      MSMC Loan Schedule
SCHEDULE V       JHREF Loan Schedule
SCHEDULE VI      List of Escrow Accounts Not Currently Eligible Accounts
                    (Section 8.3(e))
SCHEDULE VII     Certain Escrow Accounts for Which a Report Under
                    Section 5.1(g) is Required
SCHEDULE VIII    List of Mortgagors that are Third-Party Beneficiaries Under
                    Section 2.3(a)
SCHEDULE IX -
SCHEDULE XVI     Rates Used in Determination of Class X Pass-Through Rates
                    ("Class X-1 Strip Rate" and "Class X-2 Strip Rate")
SCHEDULE XVII    Mortgage Loans Secured by Mortgaged  Properties  Covered by an
                    Environmental  Insurance Policy
SCHEDULE XVIII   List of Mortgage Loans that have Scheduled Payments after the
                    end of a Collection Period

                                     -viii-
<PAGE>

     THIS POOLING AND SERVICING AGREEMENT is dated as of October 1, 2003 (this
"Agreement") between BEAR STEARNS COMMERCIAL MORTGAGE SECURITIES INC., a
Delaware corporation, as depositor (the "Depositor"), WELLS FARGO BANK, NATIONAL
ASSOCIATION, as master servicer (the "Master Servicer"), ARCAP SERVICING, INC.,
as special servicer (the "Special Servicer"), LASALLE BANK NATIONAL ASSOCIATION,
as trustee of the Trust (the "Trustee"), ABN AMRO BANK N.V., only in its
capacity as a fiscal agent pursuant to Article IV hereof (the "Fiscal Agent")
and WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, only in its capacity as
paying agent (the "Paying Agent") and certificate registrar.

                              PRELIMINARY STATEMENT

     On the Closing Date, the Depositor will acquire the Mortgage Loans from
Principal Commercial Funding, LLC, as seller ("Principal"), Wells Fargo Bank,
National Association, as seller ("Wells Fargo"), Bear Stearns Commercial
Mortgage, Inc., as seller ("BSCMI"), John Hancock Real Estate Finance, Inc., as
seller ("JHREF") and Morgan Stanley Mortgage Capital Inc., as seller ("MSMC"),
and will be the owner of the Mortgage Loans and the other property being
conveyed by it to the Trustee for inclusion in the Trust which is hereby
created. On the Closing Date, the Depositor will acquire (i) the Kimball Lane
Loan REMIC Regular Interest and the Kimball Lane Loan REMIC Residual Interest as
consideration for its transfer to the Trust of the Kimball Lane Loan; (ii) the
REMIC I Regular Interests and the REMIC I Residual Interest as consideration for
its transfer to the Trust of the Majority Mortgage Loans and the Kimball Lane
Loan REMIC Regular Interest; (iii) the REMIC II Regular Interests and the Class
R-II Certificates as consideration for its transfer of the REMIC I Regular
Interests to the Trust; and (iv) the REMIC III Certificates (other than the
portion of the Class O Certificates representing Excess Interest and the portion
of the Class A-1 and Class X Certificates representing Kimball Lane Yield
Maintenance Amounts) as consideration for its transfer of the REMIC II Regular
Interests to the Trust and the portion of the Class O Certificates representing
Excess Interest and the portion of the Class A-1 and Class X Certificates
representing Kimball Lane Yield Maintenance Amounts as consideration for its
transfer to the Trust of the Excess Interest and the Kimball Lane Yield
Maintenance Amounts, respectively. The Depositor has duly authorized the
execution and delivery of this Agreement to provide for the foregoing and the
issuance of (A) the Kimball Lane Loan Regular Interest and the Kimball Lane Loan
REMIC Residual Interest representing in the aggregate the entire beneficial
ownership of Kimball Lane Loan REMIC, (B) the REMIC I Regular Interests and the
REMIC I Residual Interest representing in the aggregate the entire beneficial
ownership of REMIC I, (C) the REMIC II Regular Interests and the Class R-II
Certificates representing in the aggregate the entire beneficial ownership of
REMIC II and (D) the REMIC III Certificates representing in the aggregate the
entire beneficial ownership of REMIC III and, in the case of the Class O
Certificates, the Class A-1 Certificates and the Class X Certificates, the
Grantor Trust. All covenants and agreements made by the Depositor and the
Trustee herein with respect to the Mortgage Loans and the other property
constituting the Trust are for the benefit of the Holders of the Kimball Lane
Loan REMIC Regular Interest, the REMIC I Regular Interests, the REMIC II Regular
Interests, the Residual Certificates, the REMIC Regular Certificates and the
Class O Certificates to the extent of their interest in the Excess Interest. The
Class R-I Certificates shall represent ownership of the REMIC I Residual
Interest. The Class R-K Certificates shall represent ownership of the Kimball
Lane Loan REMIC Residual Interest. The parties hereto are

<PAGE>

entering into this Agreement, and the Trustee is accepting the trusts created
hereby, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged.

     The Class A, Class B, Class C and Class D Certificates will be offered for
sale pursuant to the prospectus (the "Prospectus") dated August 13, 2003, as
supplemented by the preliminary prospectus supplement dated September 19, 2003
(together with the Prospectus, the "Preliminary Prospectus Supplement"), and as
further supplemented by the final prospectus supplement dated October 1, 2003
(together with the Prospectus, the "Final Prospectus Supplement"), and the Class
X-1, Class X-2, Class E, Class F, Class G, Class H, Class J, Class K, Class L,
Class M, Class N and Class O Certificates will be offered for sale pursuant to a
Private Placement Memorandum dated October 1, 2003.

     The following sets forth the Class designation, Pass-Through Rate, initial
Aggregate Certificate Balance (or initial Notional Amount) and Final Scheduled
Distribution Date for the Kimball Lane Loan REMIC Regular Interest and the
Kimball Lane Loan REMIC Residual Interest comprising interests in the Kimball
Lane Loan REMIC, each Class of REMIC I Regular Interests and the REMIC I
Residual Interest comprising the interests in REMIC I, each Class of REMIC II
Regular Interests and the Class R-II Certificates comprising the interests in
REMIC II and each Class of REMIC III Certificates comprising the interests in
REMIC III created hereunder:

                             KIMBALL LANE LOAN REMIC

     The Kimball Lane Loan REMIC Regular Interest will relate to the Kimball
Lane Loan. The Kimball Lane Loan REMIC Regular Interest will have a pass-through
rate equal to the Kimball Lane Loan REMIC Net Mortgage Rate, an initial
principal amount (the initial "Certificate Balance") equal to the Scheduled
Principal Balance as of the Cut-Off Date (as herein defined) of the Kimball Lane
Loan, and a "latest possible maturity date" set to the Rated Final Distribution
Date of the Kimball Lane Loan. The Kimball Lane Loan REMIC Residual Interest
will be represented by the Class R-K Certificate, will be designated as the sole
Class of residual interests in the Kimball Lane Loan REMIC and will have no
Certificate Balance and no Pass-Through Rate, but will be entitled to receive
the proceeds of any assets remaining in the Kimball Lane Loan REMIC after the
Kimball Lane Loan REMIC Regular Interest has been paid in full.

                                     REMIC I

     Each REMIC I Regular Interest (a "Corresponding REMIC I Regular Interest")
will relate to a specific Mortgage Loan. Each Corresponding REMIC I Regular
Interest will have a pass-through rate equal to the REMIC I Net Mortgage Rate of
the related Mortgage Loan an initial principal amount (the initial "Certificate
Balance") equal to the Scheduled Principal Balance as of the Cut-Off Date (as
herein defined) of the Mortgage Loan to which the Corresponding REMIC I Regular
Interest relates, and a "latest possible maturity date" set to the Maturity Date
(as defined herein) of the Mortgage Loan to which the Corresponding REMIC I
Regular Interest relates; provided that in the case of the Kimball Lane Loan,
the Corresponding REMIC I Regular Interest will have a pass-through rate equal
to the REMIC I Net Mortgage Rate of the Kimball Lane Loan REMIC Regular
Interest, an initial principal amount (the initial "Certificate Balance") equal
to the initial Certificate Balance of the Kimball Lane Loan REMIC Regular
Interest, and a "latest possible maturity date" set to the "latest possible
maturity date" of

                                      -2-
<PAGE>

the Kimball Lane Loan REMIC Regular Interest. The REMIC I Residual Interest will
be represented by the Class R-I Certificate, will be designated as the sole
Class of residual interests in REMIC I and will have no Certificate Balance and
no Pass-Through Rate, but will be entitled to receive the proceeds of any assets
remaining in REMIC I after all Classes of REMIC I Regular Interests have been
paid in full.

                                    REMIC II

     The REMIC II Regular Interests have the pass-through rates and Certificate
Balances set forth in the definition thereof. The Class R-II Certificates will
be designated as the sole Class of residual interests in REMIC II and will have
no Certificate Balance and no Pass-Through Rate, but will be entitled to receive
the proceeds of any assets remaining in REMIC II after all Classes of REMIC II
Regular Interests have been paid in full.

                                      -3-
<PAGE>

                                    REMIC III

<TABLE>
<CAPTION>
                                                      Initial Aggregate
        REMIC III                                        Certificate
         Regular              Initial Pass-           Principal Balance
        Interest                 Through                 or Notional          Final Scheduled
       Designation               Rate(a)                   Amount           Distribution Date(b)
       -----------               -------                   ------           --------------------
     <S>                      <C>                    <C>                   <C>
        Class A-1(c)               2.96%                $198,000,000        August 13, 2008
        Class A-2                  3.88%                $150,600,000        April 13, 2010
        Class A-3                  4.24%                $185,900,000        April 13, 2012
        Class A-4                  4.68%                $487,288,000        September 13, 2013
        Class X-1(d)               0.12%              $1,161,122,793        September 13, 2023
        Class X-2(e)               0.93%              $1,097,720,000        October 13, 2011
        Class B                    4.81%                 $30,479,000        September 13, 2013
        Class C                    4.93%                 $31,931,000        September 13, 2014
        Class D                    5.20%                 $13,063,000        August 13, 2015
        Class E                    5.24%                 $14,514,000        June 13, 2016
        Class F                    5.24%                  $7,257,000        December 13, 2016
        Class G                    5.24%                  $7,257,000        October 13, 2017
        Class H                   4.941%                  $5,805,000        July 13, 2018
        Class J                   4.941%                  $5,806,000        August 13, 2018
        Class K                   4.941%                  $2,903,000        August 13, 2018
        Class L                   4.941%                  $2,902,000        August 13, 2018
        Class M                   4.941%                  $2,903,000        August 13, 2018
        Class N                   4.941%                  $2,903,000        August 13, 2018
        Class O (f)               4.941%                 $11,611,793        September 13, 2023
        Class R-III(g)             N/A                  N/A                        N/A
</TABLE>

(a)  On each Distribution Date after the initial Distribution Date, the
     Pass-Through Rate for each Class of Certificates will be determined as
     described herein under the definition of "Pass-Through Rate." The initial
     Pass-Through Rates shown above are approximate for the Class B, C, D, E, F,
     G, X-1 and X-2 Certificates.

(b)  The Final Scheduled Distribution Date for each Class of Certificates
     assigned a rating is the Distribution Date on which such Class is expected
     to be paid in full, assuming that timely payments (and no prepayments) will
     be made on the Mortgage Loans in accordance with their terms (except that
     each ARD Loan will be prepaid in full on its Anticipated Repayment Date).

(c)  Each Class A-1 Certificate represents ownership of one REMIC III Regular
     Interest (entitled to the principal and interest set forth above). In
     addition, each Class A-1 Certificate will be entitled to Kimball Lane Yield
     Maintenance Amounts, as set forth in Section 6.11 (which will not be a part
     of any REMIC Pool). The parties intend that (i) the portion of the Trust
     representing the right to receive Kimball Lane Yield Maintenance Amounts
     and the Kimball Lane Sub-account shall be treated as a grantor trust under
     subpart E of Part 1 of subchapter J of Chapter 1 of Subtitle A of the Code
     (the "Grantor Trust") and (ii) the Class A-1 Certificates (other than the
     portion thereof consisting of a REMIC III Regular Interest) shall represent
     undivided beneficial interests in the portion of the Grantor Trust
     consisting of its entitlement to receive Kimball Lane Yield Maintenance
     Amounts.

(d)  Each Class X-1 Certificate represents ownership of multiple "regular
     interests" in REMIC III. In addition, each Class X-1 Certificate will be
     entitled to the Kimball Lane Yield Maintenance Amounts, as set forth in
     Section 6.11 from the Grantor Trust (which will not be a part of any REMIC
     Pool) and the Class X-1 Certificates (other than the portion thereof
     consisting of the related REMIC III Regular Interests) shall represent
     undivided beneficial interests in the portion of the Grantor Trust
     consisting of its entitlement to receive Kimball Lane Yield Maintenance
     Amounts. The Class X-1 Certificates are comprised of the following regular
     interests:

          (1) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-1A Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the Pass-Through Rate
          of the Class A-1 Certificates;

                                      -4-
<PAGE>

          (2) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-1B Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule IX for such Distribution Date and (ii) the
          Pass-Through Rate of the Class A-1 Certificates;

          (3) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-1C Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule X for such Distribution Date and (ii) the
          Pass-Through Rate of the Class A-1 Certificates;

          (4) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-1D Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XI for such Distribution Date and (ii) the
          Pass-Through Rate of the Class A-1 Certificates;

          (5) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-2A Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XI for such Distribution Date and (ii) the
          Pass-Through Rate of the Class A-2 Certificates;

          (6) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-2B Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XII for such Distribution Date and (ii) the
          Pass-Through Rate of the Class A-2 Certificates;

          (7) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-3A Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XII for such Distribution Date and (ii) the
          Pass-Through Rate of the Class A-3 Certificates;

          (8) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-3B Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XIII for such Distribution Date and (ii)
          the Pass-Through Rate of the Class A-3 Certificates;

          (9) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-3C Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XIV for such Distribution Date and (ii) the
          Pass-Through Rate of the Class A-3 Certificates;

          (10) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-4A Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XIV for such Distribution Date and (ii) the
          Pass-Through Rate of the Class A-4 Certificates;

          (11) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-4B Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XV for such Distribution Date and (ii) the
          Pass-Through Rate of the Class A-4 Certificates;

          (12) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-4C Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XVI for such Distribution Date and (ii) the
          Pass-Through Rate of the Class A-4 Certificates;

          (13) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class B-3 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XVI for such Distribution Date and (ii) the
          Pass-Through Rate of the Class B Certificates;

          (14) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class B-2 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XV for such Distribution Date and (ii) the
          Pass-Through Rate of the Class B Certificates;

          (15) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class B-1 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XIV for such Distribution Date and (ii) the
          Pass-Through Rate of the Class B Certificates;

          (16) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class C-3 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XIV for such Distribution Date and (ii) the
          Pass-Through Rate of the Class C Certificates;

          (17) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class C-2 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XIII for such Distribution Date and (ii)
          the Pass-Through Rate of the Class C Certificates;

                                      -5-
<PAGE>

          (18) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class C-1 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XII for such Distribution Date and (ii) the
          Pass-Through Rate of the Class C Certificates;

          (19) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class D-2 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XII for such Distribution Date and (ii) the
          Pass-Through Rate of the Class D Certificates;

          (20) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class D-1 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XI for such Distribution Date and (ii) the
          Pass-Through Rate of the Class D Certificates;

          (21) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class E-2 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule XI for such Distribution Date and (ii) the
          Pass-Through Rate of the Class E Certificates;

          (22) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class E-1 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule X for such Distribution Date and (ii) the
          Pass-Through Rate of the Class E Certificates;

          (23) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class F Certificate and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule X for such Distribution Date and (ii) the
          Pass-Through Rate of the Class F Certificates;

          (24) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class G Certificate and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule X for such Distribution Date and (ii) the
          Pass-Through Rate of the Class G Certificates;

          (25) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class H-2 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule X for such Distribution Date and (ii) the
          Pass-Through Rate of the Class H Certificates;

          (26) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class H-1 Component and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule IX for such Distribution Date and (ii) the
          Pass-Through Rate of the Class H Certificates;

          (27) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class J Certificate and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule IX for such Distribution Date and (ii) the
          Pass-Through Rate of the Class J Certificates;

          (28) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class K Certificate and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the greater of (i)
          the rate shown on Schedule IX for such Distribution Date and (ii) the
          Pass-Through Rate of the Class K Certificates;

          (29) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class L Certificates and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the Pass-Through Rate
          of the Class L Certificates;

          (30) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class M Certificates and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the Pass-Through Rate
          of the Class M Certificates;

          (31) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class N Certificates and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the Pass-Through Rate
          of the Class N Certificates; and

          (32) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class O Certificates and (B) one
          twelfth of the excess (if any) of (x) the Weighted Average REMIC I Net
          Mortgage Rate on such Distribution Date over (y) the Pass-Through Rate
          of the Class O Certificates.

(e)  Each Class X-2 Certificate represents ownership of multiple "regular
     interests" in REMIC III. In addition, each Class X-2 Certificate will be
     entitled to the Kimball Lane Yield Maintenance Amounts, as set forth in
     Section 6.11 from the Grantor Trust (which will not be a part of any REMIC
     Pool) and the Class X-2 Certificates (other than the portion thereof
     consisting of the related REMIC III Regular Interests) shall represent
     undivided beneficial interests in the portion of the Grantor Trust
     consisting of its entitlement to receive Kimball Lane Yield Maintenance
     Amounts. The Class X-2 Certificates are comprised of the following regular
     interests:

          (1) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-1B Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule IX for such

                                      -6-
<PAGE>

          Distribution Date and (y) the Weighted Average REMIC I Net Mortgage
          Rate on such Distribution Date, over (ii) the Pass-Through Rate of the
          Class A-1 Certificates;

          (2) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-1C Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule X for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class A-1 Certificates;

          (3) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-1D Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XI for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class A-1 Certificates;

          (4) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-2A Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XI for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class A-2 Certificates;

          (5) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-2B Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XII for such Distribution Date and (y) the Weighted
          Average REMIC I Net Mortgage Rate on such Distribution Date, over (ii)
          the Pass-Through Rate of the Class A-2 Certificates;

          (6) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-3A Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XII for such Distribution Date and (y) the Weighted
          Average REMIC I Net Mortgage Rate on such Distribution Date, over (ii)
          the Pass-Through Rate of the Class A-3 Certificates;

          (7) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-3B Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XIII for such Distribution Date and (y) the Weighted
          Average REMIC I Net Mortgage Rate on such Distribution Date, over (ii)
          the Pass-Through Rate of the Class A-3 Certificates;

          (8) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-3C Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XIV for such Distribution Date and (y) the Weighted
          Average REMIC I Net Mortgage Rate on such Distribution Date, over (ii)
          the Pass-Through Rate of the Class A-3 Certificates;

          (9) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-4A Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XIV for such Distribution Date and (y) the Weighted
          Average REMIC I Net Mortgage Rate on such Distribution Date, over (ii)
          the Pass-Through Rate of the Class A-4 Certificates;

          (10) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-4B Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XV for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class A-4 Certificates;

          (11) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class A-4C Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XVI for such Distribution Date and (y) the Weighted
          Average REMIC I Net Mortgage Rate on such Distribution Date, over (ii)
          the Pass-Through Rate of the Class A-4 Certificates;

          (12) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class B-3 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XVI for such Distribution Date and (y) the Weighted
          Average REMIC I Net Mortgage Rate on such Distribution Date, over (ii)
          the Pass-Through Rate of the Class B Certificates;

          (13) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class B-2 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XV for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class B Certificates;

          (14) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class B-1 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XIV for such Distribution Date and (y) the Weighted
          Average REMIC I Net Mortgage Rate on such Distribution Date, over (ii)
          the Pass-Through Rate of the Class B Certificates;

          (15) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class C-3 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XIV for such Distribution Date and (y) the Weighted
          Average REMIC I Net Mortgage Rate on such Distribution Date, over (ii)
          the Pass-Through Rate of the Class C Certificates;

          (16) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class C-2 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XIII for such Distribution Date and (y) the Weighted
          Average REMIC I Net Mortgage Rate on such Distribution Date, over (ii)
          the Pass-Through Rate of the Class C Certificates;

          (17) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class C-1 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XII for such

                                      -7-
<PAGE>

          Distribution Date and (y) the Weighted Average REMIC I Net Mortgage
          Rate on such Distribution Date, over (ii) the Pass-Through Rate of the
          Class C Certificates;

          (18) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class D-2 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XII for such Distribution Date and (y) the Weighted
          Average REMIC I Net Mortgage Rate on such Distribution Date, over (ii)
          the Pass-Through Rate of the Class D Certificates;

          (19) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class D-1 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XI for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class D Certificates;

          (20) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class E-2 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule XI for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class E Certificates;

          (21) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class E-1 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule X for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class E Certificates;

          (22) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class F Certificates and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule X for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class F Certificates;

          (23) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class G Certificates and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule X for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class G Certificates;

          (24) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class H-2 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule X for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class H Certificates;

          (25) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class H-1 Component and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule IX for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class H Certificates;

          (26) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class J Certificates and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule IX for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class J Certificates; and

          (27) the right to receive, on each Distribution Date, the product of
          (A) the Certificate Balance of the Class K Certificates and (B) one
          twelfth of the excess (if any) of (i) the lesser of (x) the rate shown
          on Schedule IX for such Distribution Date and (y) the Weighted Average
          REMIC I Net Mortgage Rate on such Distribution Date, over (ii) the
          Pass-Through Rate of the Class K Certificates;

     After the Distribution Date in April 2005, payments made in respect of the
     Class A-1B Component, Class H-1 Component, Class J Certificates and Class K
     Certificates shall not be included in the calculation of the amount paid in
     respect of the Class X-2 Certificates. After the Distribution Date in April
     2006, payments made in respect of the Class A-1C Component, Class E-1
     Component, Class F Certificates, Class G Certificates and Class H-2
     Component shall not be included in the calculation of the amount paid in
     respect of the Class X-2 Certificates. After the Distribution Date in April
     2007, payments made in respect of the Class A-1D Component, Class A-2A
     Component, Class D-1 Component and Class E-2 Component shall not be
     included in the calculation of the amount paid in respect of the Class X-2
     Certificates. After the Distribution Date in April 2008, payments made in
     respect of the Class A-2B Component, Class A-3A Component, Class C-1
     Component and Class D-2 Component shall not be included in the calculation
     of the amount paid in respect of the Class X-2 Certificates. After the
     Distribution Date in April 2009, payments made in respect of the Class A-3B
     Component and Class C-2 Component shall not be included in the calculation
     of the amount paid in respect of the Class X-2 Certificates. After the
     Distribution Date in April 2010, payments made in respect of the Class A-3C
     Component, Class A-4A Component, Class B-1 Component and Class C-3
     Component shall not be included in the calculation of the amount paid in
     respect of the Class X-2 Certificates. After the Distribution Date in April
     2011, payments made in respect of the Class A-4B Component and Class B-2
     Component shall not be included in the calculation of the amount paid in
     respect of the Class X-2 Certificates.

(f)  Each Class O Certificate represents ownership of one REMIC III Regular
     Interest (entitled to the principal and interest set forth above). In
     addition, each Class O Certificate will be entitled to Excess Interest from
     the Grantor Trust (which will not be a part of any REMIC Pool) and the
     Class O Certificates (other than the portion thereof consisting of a REMIC
     III Regular Interest) shall represent undivided beneficial interests in the
     portion of the Grantor Trust consisting of the entitlement to receive
     Excess Interest.

                                      -8-
<PAGE>

(g)  The Class R-III Certificates will be entitled to receive the proceeds of
     any remaining assets in REMIC III after the principal amounts of all
     Classes of Certificates have been reduced to zero and any Realized Losses
     previously allocated thereto (and any interest thereon) have been
     reimbursed.

     As of the Cut-Off Date, the Mortgage Loans had an Aggregate Principal
Balance of $1,161,122,793.

     As provided herein, with respect to the Trust, the Paying Agent on behalf
of the Trustee will make an election for the segregated pool of assets
consisting of the Kimball Lane Loan to be treated for federal income tax
purposes as a real estate mortgage investment conduit (the "Kimball Lane Loan
REMIC"). The Kimball Lane Loan REMIC Regular Interest will be held as an asset
of REMIC I, and the Kimball Lane Loan REMIC Residual Interest will represent the
sole class of "residual interests" in the Kimball Lane Loan REMIC and will be
represented by the Class R-K Certificates.

     As provided herein, with respect to the Trust, the Paying Agent on behalf
of the Trustee will make an election for the segregated pool of assets described
in the first paragraph of Section 12.1(a) hereof (including the Majority
Mortgage Loans and the Kimball Lane Loan REMIC Regular Interest) to be treated
for federal income tax purposes as a real estate mortgage investment conduit
("REMIC I"). The REMIC I Regular Interests will be designated as the "regular
interests" in REMIC I and the REMIC I Residual Interest will be designated as
the sole Class of "residual interests" in REMIC I and will be represented by the
Class R-I Certificates.

     As provided herein, with respect to the Trust, the Paying Agent on behalf
of the Trustee will make an election for the segregated pool of assets described
in the second paragraph of Section 12.1(a) hereof consisting of the REMIC I
Regular Interests to be treated for federal income tax purposes as a real estate
mortgage investment conduit ("REMIC II"). The REMIC II Regular Interests will be
designated as the "regular interests" in REMIC II and the Class R-II
Certificates will be designated as the sole Class of "residual interests" in
REMIC II for purposes of the REMIC Provisions.

     As provided herein, with respect to the Trust, the Paying Agent on behalf
of the Trustee will make an election for the segregated pool of assets described
in the third paragraph of Section 12.1(a) hereof consisting of the REMIC II
Regular Interests to be treated for federal income tax purposes as a real estate
mortgage investment conduit ("REMIC III"). The REMIC III Regular Interests (and,
in the case of the Class O, Class A-1, Class X-1 and Class X-2 Certificates, the
Class O REMIC Interest represented by the Class O Certificates, the Class A-1
REMIC Interest represented by the Class A-1 Certificates, the Class X-1 REMIC
Interest represented by the Class X-1 Certificates and the Class X-2 REMIC
Interest represented by the Class X-2 Certificates, respectively) will be
designated as the "regular interests" in REMIC III and the Class R-III
Certificates (together with the REMIC Regular Certificates, the "REMIC III
Certificates") will be designated as the sole Class of "residual interests" in
REMIC III for purposes of the REMIC Provisions.

                                      -9-
<PAGE>

                                   ARTICLE I

                                   DEFINITIONS

     SECTION 1.1 Definitions. Whenever used in this Agreement, the following
words and phrases, unless the context otherwise requires, shall have the
following meanings:

     "A NOTE" means, with respect to any A/B Mortgage Loan, the mortgage note
that is senior in right of payment to the related B Note to the extent set forth
in the related Intercreditor Agreement.

     "A-1 NOTE" means, with respect to any A/B Mortgage Loan or the Loan Pair,
as applicable, the Mortgage Note included in the Trust, which, in the case of an
A/B Mortgage Loan, is senior in right of payment to the related B Note to the
extent set forth in the related Intercreditor Agreement, and which, in the case
of the Loan Pair, is pari passu in right of payment to the related A-2 Note to
the extent set forth in the Loan Pair Intercreditor Agreement.

     "A-2 NOTE" means, with respect to any A/B Mortgage Loan or the Loan Pair,
as applicable, the A-2 component of such Mortgage Loan, if any, which is not
included in the Trust and which, in the case of an A/B Mortgage Loan, is senior
in right of payment to the related B Note to the extent set forth in the related
Intercreditor Agreement, and which, in the case of the Loan Pair, is pari passu
in right of payment to the related A-1 Note to the extent set forth in the Loan
Pair Intercreditor Agreement.

     "A/B LOAN CUSTODIAL ACCOUNT" means each of the custodial sub-account(s) of
the Certificate Account (but which are not included in the Trust) created and
maintained by the Master Servicer pursuant to Section 5.1(c) on behalf of the
holder of a related B Note. Any such sub-account(s) shall be maintained as a
sub-account of an Eligible Account.

     "A/B MORTGAGE LOAN" means any mortgage loan that is divided into a senior
mortgage note and a subordinated mortgage note, which senior mortgage note is
included in the Trust. Mortgage Loan Nos. 50 and 54 are each designated as A/B
Mortgage Loans on the Mortgage Loan Schedule, and any additional A/B Mortgage
Loan that is substituted for the Kimball Lane Loan in accordance with the
provisions of this Agreement. References herein to an A/B Mortgage Loan shall be
construed to refer to the aggregate indebtedness under the related A Note and
the related B Note.

     "ACCOUNTANT" means a person engaged in the practice of accounting who is
Independent.

     "ACCRUED CERTIFICATE INTEREST" means with respect to each Distribution Date
and any Class of Interests or Principal Balance Certificates, other than the
Class X Certificates, the Class R-I Certificates, the Class R-II Certificates,
the Class R-III Certificates and the Class R-K Certificates, interest accrued
during the Interest Accrual Period relating to such Distribution Date on the
Aggregate Certificate Balance of such Class or Interest as of the close of
business on the immediately preceding Distribution Date at the respective rates
per annum set forth in the definition of the applicable Pass-Through Rate for
each such Class. Accrued Certificate Interest on the Class X-1 Certificates for
each Distribution Date will equal the Class X-1 Interest

                                      -10-
<PAGE>

Amount. Accrued Certificate Interest on the Class X-2 Certificates for each
Distribution Date will equal the Class X-2 Interest Amount.

     "ACQUISITION DATE" means the date upon which, under the Code (and in
particular the REMIC Provisions and Section 856(e) of the Code), the Trust or a
REMIC Pool is deemed to have acquired a Mortgaged Property (or an interest
therein, in the case of the Mortgaged Properties securing any A/B Mortgage Loan,
any Berkeley & Brown Companion Loan, the Berkeley & Brown Pari Passu Loan, the
RSA Companion Loan, the RSA Pari Passu Loan and the Loan Pair).

     "ADDITIONAL REVIEW PERIOD" has the meaning set forth in Section 9.4(d).

     "ADDITIONAL TRUST EXPENSE" means any of the following items: (i) Special
Servicing Fees, Work-Out Fees and Liquidation Fees (to the extent not collected
from the related Mortgagor), (ii) Advance Interest that cannot be paid in
accordance with Section 4.6(c); (iii) amounts paid to indemnify the Master
Servicer, the Special Servicer, the applicable Non-Serviced Mortgage Loan Master
Servicer, the applicable Non-Serviced Mortgage Loan Special Servicer, any
Primary Servicer, the Trustee, the Paying Agent, the Fiscal Agent (or any other
Person) pursuant to the terms of this Agreement; (iv) to the extent not
otherwise paid, any federal, state, or local taxes imposed on the Trust or its
assets and paid from amounts on deposit in the Certificate Account or
Distribution Account and (v) to the extent not otherwise included in the
calculation of a Realized Loss and not covered by indemnification by one of the
parties hereto or otherwise, any other unanticipated cost, liability, or expense
(or portion thereof) of the Trust (including costs of collecting such amounts or
other Additional Trust Expenses) that the Trust has not recovered, and in the
judgment of the Master Servicer (or Special Servicer) will not, recover from the
related Mortgagor or Mortgaged Property or otherwise, including a Modification
Loss described in clause (ii) of the definition thereof; provided, however,
that, in the case of an A/B Mortgage Loan, "Additional Trust Expense" shall not
include any of the foregoing amounts that have been recovered from the related
Mortgagor or Mortgaged Property as a result of the subordination of the related
B Note. Notwithstanding anything to the contrary, "Additional Trust Expenses"
shall not include allocable overhead of the Master Servicer, the Special
Servicer, any Non-Serviced Mortgage Loan Master Servicer, any Non-Serviced
Mortgage Loan Special Servicer, the Trustee, the Paying Agent, the Certificate
Registrar or the Fiscal Agent, such as costs for office space, office equipment,
supplies and related expenses, employee salaries and related expenses, and
similar internal costs and expenses.

     "ADMINISTRATIVE COST RATE" means the sum of the Master Servicing Fee Rate,
the Primary Servicing Fee Rate, the Excess Servicing Fee Rate, the Trustee Fee
Rate and in the case of any Non-Serviced Mortgage Loan, the related Pari Passu
Loan Servicing Fee Rate.

     "ADVANCE" means either a P&I Advance or a Servicing Advance.

     "ADVANCE INTEREST" means interest payable to the Master Servicer, the
Special Servicer, the Trustee or the Fiscal Agent on outstanding Advances (other
than Unliquidated Advances) pursuant to Section 4.5 of this Agreement and any
interest payable to any Non-Serviced Mortgage Loan Master Servicer, any
Non-Serviced Mortgage Loan Trustee or any Non-Serviced Mortgage Loan Fiscal
Agent with respect to Pari Passu Loan Nonrecoverable Advances pursuant to
Section 4.4(b) hereof.

                                      -11-
<PAGE>

     "ADVANCE RATE" means a per annum rate equal to the Prime Rate as published
in the "Money Rates" section of The Wall Street Journal from time to time or
such other publication as determined by the Trustee in its reasonable
discretion.

     "ADVANCE REPORT DATE" means the second Business Day prior to each
Distribution Date.

     "ADVERSE REMIC EVENT" means any action that, under the REMIC Provisions, if
taken or not taken, as the case may be, would either (i) endanger the status of
any REMIC Pool as a REMIC or (ii) subject to Section 9.14(e), result in the
imposition of a tax upon the income of any REMIC Pool or any of their respective
assets or transactions, including (without limitation) the tax on prohibited
transactions as defined in Section 860F(a)(2) of the Code and the tax on
prohibited contributions set forth in Section 860G(d) of the Code.

     "AFFILIATE" means, with respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" 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; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.

     "AGGREGATE CERTIFICATE BALANCE" means the aggregate of the Certificate
Balances of the Principal Balance Certificates, the Kimball Lane Loan REMIC
Regular Interest, the REMIC I Regular Interests or the REMIC II Regular
Interests, as the case may be, at any date of determination. With respect to a
Class of Principal Balance Certificates, the Kimball Lane Loan REMIC Regular
Interest, REMIC I Regular Interests or REMIC II Regular Interests, Aggregate
Certificate Balance shall mean the aggregate of the Certificate Balances of all
Certificates or Interests, as the case may be, of that Class at any date of
determination.

     "AGGREGATE PRINCIPAL BALANCE" means, at the time of any determination and
as the context may require, the aggregate of the Scheduled Principal Balances
for all Mortgage Loans.

     "AGREEMENT" means this Pooling and Servicing Agreement and all amendments
and supplements hereto.

     "ANTICIPATED REPAYMENT DATE" means, with respect to the ARD Loans, the
anticipated maturity date set forth in the related Mortgage Note.

     "APPRAISAL" means an appraisal by an Independent licensed MAI appraiser
having at least five years experience in appraising property of the same type
as, and in the same geographic area as, the Mortgaged Property being appraised,
which appraisal complies with the Uniform Standards of Professional Appraisal
Practices and states the "market value" of the subject property as defined in 12
C.F.R. (Section) 225.62.

     "APPRAISAL EVENT" means, with respect to any Mortgage Loan or the Loan
Pair, not later than the earliest of (i) the date 120 days after the occurrence
of any delinquency in payment with respect to such Mortgage Loan or Loan Pair if
such delinquency remains uncured, (ii) the date 30 days after receipt of notice
that the related Mortgagor has filed a bankruptcy

                                      -12-
<PAGE>

petition or the related Mortgagor has become the subject of involuntary
bankruptcy proceedings or the related Mortgagor has consented to the filing of a
bankruptcy proceeding against it or a receiver is appointed in respect of the
related Mortgaged Property, provided such petition or appointment is still in
effect, (iii) the date that is 30 days following the date the related Mortgaged
Property becomes an REO Property and (iv) the effective date of any modification
to a Money Term of a Mortgage Loan or the Loan Pair, other than an extension of
the date that a Balloon Payment is due for a period of less than six months from
the original due date of such Balloon Payment.

     "APPRAISAL REDUCTION" means, with respect to any Required Appraisal Loan
with respect to which an Appraisal or internal valuation is performed pursuant
to Section 6.9, an amount equal to the excess of (A) the sum of (i) the
Scheduled Principal Balance of such Mortgage Loan or Loan Pair (or, in the case
of an REO Property, the related REO Mortgage Loan) less the principal amount of
any guaranty or surety bond with a rating of at least "BBB-" (or its equivalent)
by a nationally recognized statistical rating organization and the undrawn
principal amount of any letter of credit or debt service reserve, if applicable,
that is then securing such Mortgage Loan or Loan Pair, (ii) to the extent not
previously advanced by the Master Servicer, the Trustee or the Fiscal Agent, all
accrued and unpaid interest on such Mortgage Loan or Loan Pair at a per annum
rate equal to the Mortgage Rate, (iii) all unreimbursed Advances (including
Unliquidated Advances) and interest on Advances (other than Unliquidated
Advances) at the Advance Rate with respect to such Mortgage Loan or Loan Pair,
and (iv) to the extent funds on deposit in any applicable Escrow Accounts are
not sufficient therefor, and to the extent not previously advanced by the Master
Servicer, the Special Servicer, the Trustee or the Fiscal Agent, all currently
due and unpaid real estate taxes and assessments, insurance premiums and, if
applicable, ground rents and other amounts which were required to be deposited
in any Escrow Account (but were not deposited) in respect of such Mortgaged
Property or REO Property, as the case may be, over (B) 90% of the Appraised
Value (net of any prior mortgage liens) of such Mortgaged Property or REO
Property as determined by such Appraisal or internal valuation, as the case may
be, plus the full amount of any escrows held by or on behalf of the Trustee as
security for the Mortgage Loan or the Loan Pair (less the estimated amount of
the obligations anticipated to be payable in the next twelve months to which
such escrows relate). Each Appraisal or internal valuation for a Required
Appraisal Loan shall be updated annually for so long as an Appraisal Reduction
exists. The Appraisal Reduction for each Required Appraisal Loan will be
recalculated based on subsequent Appraisals, internal valuations or updates. Any
Appraisal Reduction for any Mortgage Loan shall be reduced to reflect any
Realized Principal Losses on the Required Appraisal Loan. Each Appraisal
Reduction will be reduced to zero as of the date the related Mortgage Loan or
the Loan Pair is brought current under the then current terms of the Mortgage
Loan or the Loan Pair for at least three consecutive months, and no Appraisal
Reduction will exist as to any Mortgage Loan or the Loan Pair after it has been
paid in full, liquidated, repurchased or otherwise disposed of. Any Appraisal
Reduction in respect of any Non-Serviced Mortgage Loan shall be calculated in
accordance with the related Non-Serviced Mortgage Loan Pooling and Servicing
Agreement based upon the applicable allocation of the items set forth in clauses
(A) and (B) above between the Non-Serviced Mortgage Loans and the related
Non-Serviced Mortgage Loan Companion Loans and all other related pari passu
loans. Any Appraisal Reduction in respect of the Loan Pair shall be allocated,
as between the WestShore Plaza Pari Passu Loan Pari Passu Loan and the WestShore
Plaza Companion Loan, pro rata according to their respective Principal Balances.
Any Appraisal Reduction in respect of the Kimball Lane Loan shall be calculated
in respect of the entire aggregate Principal Balance of

                                      -13-
<PAGE>

the Kimball Lane Loan and the related B Note, and any Appraisal Reduction shall
be allocated first to the related B Note, and then to the related A Note.

     "APPRAISED VALUE" means, (i) with respect to any Mortgaged Property (other
than the Mortgaged Property relating to a Non-Serviced Mortgage Loan), the
appraised value thereof determined by an Appraisal of the Mortgaged Property
securing such Mortgage Loan made by an Independent appraiser selected by the
Master Servicer or the Special Servicer, as applicable or, in the case of an
internal valuation performed by the Special Servicer pursuant to Section 6.9,
the value of the Mortgaged Property determined by such internal valuation and
(ii) with respect to the Mortgaged Property relating to a Non-Serviced Mortgage
Loan, the portion of the appraised value allocable thereto.

     "ARD LOAN" means any Mortgage Loan designated as such on the Mortgage Loan
Schedule.

     "ASSIGNMENT OF LEASES" means, with respect to any Mortgage Loan, any
assignment of leases, rents and profits or equivalent instrument, whether
contained in the related Mortgage or executed separately, assigning to the
holder or holders of such Mortgage all of the related Mortgagor's interest in
the leases, rents and profits derived from the ownership, operation, leasing or
disposition of all or a portion of the related Mortgaged Property as security
for repayment of such Mortgage Loan.

     "ASSIGNMENT OF MORTGAGE" means an assignment of the Mortgage, notice of
transfer or equivalent instrument, in recordable form, sufficient under the laws
of the jurisdiction wherein the related Mortgaged Property is located to reflect
the transfer of the Mortgage to the Trustee, which assignment, notice of
transfer or equivalent instrument may be in the form of one or more blanket
assignments covering the Mortgage Loans secured by Mortgaged Properties located
in the same jurisdiction, if permitted by law.

     "ASSUMED SCHEDULED PAYMENT" means: (i) with respect to any Balloon Mortgage
Loan or any B Note as to which advancing is required hereunder for its Maturity
Date (provided that such Mortgage Loan or B Note has not been paid in full, and
no Final Recovery Determination or other sale or liquidation has occurred in
respect thereof, on or before the end of the Collection Period in which such
Maturity Date occurs) and for any subsequent Due Date therefor as of which such
Mortgage Loan or such B Note remains outstanding and part of the Trust, if no
Scheduled Payment (other than the related delinquent Balloon Payment) is due for
such Due Date, the scheduled monthly payment of principal and/or interest deemed
to be due in respect thereof on such Due Date equal to the Scheduled Payment
that would have been due in respect of such Mortgage Loan or such B Note on such
Due Date, if it had been required to continue to accrue interest in accordance
with its terms, and to pay principal in accordance with the amortization
schedule in effect immediately prior to, and without regard to the occurrence
of, its most recent Maturity Date (as such may have been extended in connection
with a bankruptcy or similar proceeding involving the related Mortgagor or a
modification, waiver or amendment of such Mortgage Loan or such B Note granted
or agreed to by the Master Servicer or the Special Servicer pursuant to the
terms hereof), and (ii) with respect to any REO Mortgage Loan for any Due Date
therefor as of which the related REO Property remains part of the Trust, the
scheduled monthly payment of principal and interest deemed to be due in respect
thereof on such Due Date equal to the Scheduled Payment (or, in the case of a
Balloon Mortgage Loan or B Note described

                                      -14-
<PAGE>

in the preceding clause of this definition, the Assumed Scheduled Payment) that
was due in respect of the related Mortgage Loan or the related B Note on the
last Due Date prior to its becoming an REO Mortgage Loan. The amount of the
Assumed Scheduled Payment for any A Note or B Note shall be calculated solely by
reference to the terms of such A Note or B Note, as applicable (as modified in
connection with any bankruptcy or similar proceeding involving the related
Mortgagor or pursuant to a modification, waiver or amendment of such Mortgage
Loan granted or agreed to by the Master Servicer or the Special Servicer
pursuant to the terms hereof) and without regard to the remittance provisions of
the related Intercreditor Agreement. The Assumed Scheduled Payment calculated in
respect of the Kimball Lane Loan shall not include any portion thereof defined
as the "Fixed Retained Yield" in the related Intercreditor Agreement.

     "AUTHENTICATING AGENT" means any authenticating agent serving in such
capacity pursuant to Section 7.10.

     "AUTHORIZED OFFICER" means any Person that may execute an Officer's
Certificate on behalf of the Depositor.

     "AVAILABLE ADVANCE REIMBURSEMENT AMOUNT" has the meaning set forth in
Section 4.6(a).

     "AVAILABLE DISTRIBUTION AMOUNT" means, with respect to any Distribution
Date, an amount equal to the aggregate of (a) all amounts on deposit in the
Distribution Account as of the commencement of business on such Distribution
Date that represent payments and other collections on or in respect of the
Mortgage Loans and any REO Properties that were received by the Master Servicer
or the Special Servicer through the end of the related Collection Period
exclusive of (i) any such amounts that were deposited in the Distribution
Account in error, (ii) amounts that are payable or reimbursable to any Person
other than the Certificateholders (including amounts payable to the Master
Servicer in respect of unpaid Master Servicing Fees, any Primary Servicer in
respect of unpaid Primary Servicing Fees, the Special Servicer in respect of
unpaid Special Servicer Compensation, the Trustee in respect of unpaid Trustee
Fees, the Paying Agent in respect of unpaid Paying Agent Fees or to the parties
entitled thereto in respect of the unpaid Excess Servicing Fees), (iii) amounts
that constitute Prepayment Premiums and any Kimball Lane Yield Maintenance
Amounts, (iv) if such Distribution Date occurs during January, other than in a
leap year, or February of any year, the Interest Reserve Amounts with respect to
Interest Reserve Loans deposited in the Interest Reserve Account, (v) in the
case of each REO Property related to an A/B Mortgage Loan or the Loan Pair, all
amounts received with respect to such A/B Mortgage Loan or Loan Pair that are
required to be paid to the holder of the related B Note or the WestShore Plaza
Companion Loan, as applicable, pursuant to the terms of the related B Note or
the WestShore Plaza Companion Loan, as applicable, and the related Intercreditor
Agreement or Loan Pair Intercreditor Agreement (which amounts will be deposited
into the related A/B Loan Custodial Account or WestShore Plaza Companion Loan
Custodial Account, as applicable, pursuant to Section 5.1(c) and withdrawn from
such accounts pursuant to Section 5.2(a)) and (vi) Scheduled Payments collected
but due on a Due Date subsequent to the related Collection Period and (b) if and
to the extent not already among the amounts described in clause (a), (i) the
aggregate amount of any P&I Advances made by the Master Servicer, the Trustee or
the Fiscal Agent for such Distribution Date pursuant to Section 4.1 and/or
Section 4.3, (ii) the aggregate amount of any Compensating Interest payments
made by the Master Servicer for such Distribution Date pursuant to the terms
hereof, and (iii) if such Distribution Date occurs

                                      -15-
<PAGE>

in March of any year, commencing March 2004, the aggregate of the Interest
Reserve Amounts then held on deposit in the Interest Reserve Account in respect
of each Interest Reserve Loan.

     "B NOTE" means, with respect to any A/B Mortgage Loan, the related
subordinated Mortgage Note not included in the Trust, which is subordinated in
right of payment to the related A Note to the extent set forth in the related
Intercreditor Agreement.

     "BALLOON MORTGAGE LOAN" means a Mortgage Loan that provides for Scheduled
Payments based on an amortization schedule that is significantly longer than its
term to maturity and that is expected to have a remaining principal balance
equal to or greater than 5% of its original principal balance as of its stated
maturity date, unless prepaid prior thereto.

     "BALLOON PAYMENT" means, with respect to any Balloon Mortgage Loan, B Note
or the WestShore Plaza Companion Loan, the Scheduled Payment payable on the
Maturity Date of such Mortgage Loan or B Note.

     "BANKRUPTCY LOSS" means a loss arising from a proceeding under the United
States Bankruptcy Code or any other similar state law or other proceeding with
respect to the Mortgagor of, or Mortgaged Property under, a Mortgage Loan,
including, without limitation, any Deficient Valuation Amount or losses, if any,
resulting from any Debt Service Reduction Amount for the month in which the
related Remittance Date occurs.

     "BASE INTEREST FRACTION" means, with respect to any Principal Prepayment
(or repurchase of the Kimball Lane Loan by the related Seller in connection with
an early defeasance of such Mortgage Loan) of any Mortgage Loan that provides
for payment of a Prepayment Premium (including any Kimball Lane Yield
Maintenance Amounts), and with respect to any Class of Certificates, a fraction
(A) whose numerator is the greater of (x) zero and (y) the difference between
(i) the Pass-Through Rate on that Class of Certificates and (ii) the Discount
Rate used in calculating the Prepayment Premium with respect to the Principal
Prepayment (or the current Discount Rate if not used in such calculation) and
(B) whose denominator is the difference between (i) the Mortgage Rate on the
related Mortgage Loan and (ii) the Discount Rate used in calculating the
Prepayment Premium with respect to that Principal Prepayment (or the current
Discount Rate if not used in such calculation), provided, however, that under no
circumstances will the Base Interest Fraction be greater than one. If the
Discount Rate referred to above is greater than the Mortgage Rate on the related
Mortgage Loan, then the Base Interest Fraction will equal zero.

     "BENEFIT PLAN OPINION" means an Opinion of Counsel satisfactory to the
Paying Agent and the Master Servicer to the effect that any proposed transfer
will not (i) cause the assets of the Trust to be regarded as plan assets for
purposes of the Plan Asset Regulations or (ii) give rise to any fiduciary duty
on the part of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent, the Certificate Registrar or the Fiscal Agent.

     "BERKELEY & BROWN COMPANION LOANS" means the two notes secured by the
Berkeley & Brown Pari Passu Mortgage on a pari passu basis with the Berkeley &
Brown Pari Passu Loan and which are not included in the Trust. Neither of the
Berkeley & Brown Companion Loans is a "Mortgage Loan." As of the date hereof,
one of the Berkeley & Brown Companion Loans is included in a trust fund created
in connection with the issuance of the

                                      -16-
<PAGE>

Morgan Stanley Capital I Trust 2003-IQ5, Commercial Mortgage Pass-Through
Certificates, Series 2003-IQ5 and the other Berkeley & Brown Companion Loan is
included in a trust fund created in connection with the issuance of the LB-UBS
Commercial Mortgage Trust 2003-C7, Commercial Mortgage Pass-Through
Certificates, Series 2003-C7.

     "BERKELEY & BROWN PARI PASSU LOAN" means the Mortgage Loan designated as
Mortgage Loan No. 3 on the Mortgage Loan Schedule and which is secured on a pari
passu basis with the Berkeley & Brown Companion Loans and with any other note
secured by the related Mortgaged Property pursuant to the Berkeley & Brown Pari
Passu Mortgage. The Berkeley & Brown Pari Passu Loan is a "Mortgage Loan."

     "BERKELEY & BROWN PARI PASSU MORTGAGE" means the Mortgage securing the
Berkeley & Brown Companion Loans and the Berkeley & Brown Pari Passu Loan and
any other note secured by the related Mortgaged Property.

     "BOOK-ENTRY CERTIFICATES" means certificates evidencing a beneficial
interest in a Class of Certificates, ownership and transfer of which shall be
made through book entries as described in Section 3.7; provided, that after the
occurrence of a condition whereupon book-entry registration and transfer are no
longer authorized and Definitive Certificates are to be issued to the
Certificate Owners, such certificates shall no longer be "Book-Entry
Certificates."

     "BSCMI" has the meaning set forth in the Preliminary Statement hereto.

     "BSCMI LOANS" means, collectively, those Mortgage Loans sold to the
Depositor pursuant to the Mortgage Loan Purchase Agreement I and shown on
Schedule I hereto.

     "BUSINESS DAY" means any day other than (i) a Saturday or a Sunday, (ii) a
legal holiday in New York, New York, Boston, Massachusetts (but only with
respect to matters related to the performance of obligations delegated to JHREF
as Primary Servicer under the related Primary Servicing Agreement), Chicago,
Illinois, Des Moines, Iowa (but only with respect to matters related to the
performance of obligations of Principal Global Investors, LLC as Primary
Servicer under the related Primary Servicing Agreement), San Francisco,
California or the principal cities in which the Special Servicer, the Trustee,
the Paying Agent or the Master Servicer conducts servicing or trust operations,
or (iii) a day on which banking institutions or savings associations in
Minneapolis, Minnesota, Columbia, Maryland, New York, New York, Chicago,
Illinois or San Francisco, California are authorized or obligated by law or
executive order to be closed.

     "CASH LIQUIDATION" means, as to any Defaulted Mortgage Loan other than a
Mortgage Loan with respect to which the related Mortgaged Property became REO
Property, the sale of such Defaulted Mortgage Loan. The Master Servicer shall
maintain records in accordance with the Servicing Standard (and, in the case of
Specially Serviced Mortgage Loans, based on the written reports with respect to
such Cash Liquidation delivered by the Special Servicer to the Master Servicer),
of each Cash Liquidation.

     "CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended (42 U.S.C. (Section) 9601, et seq.).

                                      -17-
<PAGE>

     "CERTIFICATE ACCOUNT" means one or more separate accounts established and
maintained by the Master Servicer (or any Sub-Servicer or Primary Servicer on
behalf of the Master Servicer) pursuant to Section 5.1(a), each of which shall
be an Eligible Account.

     "CERTIFICATE BALANCE" means, with respect to any Certificate or Interest
(other than the Class X Certificates and the Residual Certificates) as of any
Distribution Date, the maximum specified dollar amount of principal to which the
Holder thereof is then entitled hereunder, such amount being equal to the
initial principal amount set forth on the face of such Certificate (in the case
of a Certificate), or as ascribed thereto herein (in the case of an Interest),
minus (A)(i) the amount of all principal distributions previously made with
respect to such Certificate pursuant to Section 6.5(a) or deemed to have been
made with respect to such Interest pursuant to Section 6.2(a) or Section 6.3(a),
as the case may be, (ii) all Realized Losses allocated or deemed to have been
allocated to such Interest or Certificate in reduction of Certificate Balance
pursuant to Section 6.6, and plus (B) an amount equal to the amounts identified
in clause (I)(C) of the definition of Principal Distribution Amount, such
increases to be allocated to the Principal Balance Certificates or Interests in
sequential order (i.e. to the most senior Class first), in each case up to the
amount of Realized Losses previously allocated thereto and not otherwise
reimbursed hereunder. The Certificate Balance of the Class A-1A Component, the
Class A-1B Component, the Class A-1C Component and the Class A-1D Component
shall equal the Certificate Balance of the REMIC II Regular Interest A-1A, the
REMIC II Regular Interest A-1B, the REMIC II Regular Interest A-1C and the REMIC
II Regular Interest A-1D, respectively. The Certificate Balance of the Class
A-2A Component and the Class A-2B Component shall equal the Certificate Balance
of the REMIC II Regular Interest A-2A and the REMIC II Regular Interest A-2B,
respectively. The Certificate Balance of the Class A-3A Component, the Class
A-3B Component and the Class A-3C Component shall equal the Certificate Balance
of the REMIC II Regular Interest A-3A, the REMIC II Regular Interest A-3B and
the REMIC II Regular Interest A-3C, respectively. The Certificate Balance of the
Class A-4A Component, the Class A-4B Component and the Class A-4C Component
shall equal the Certificate Balance of the REMIC II Regular Interest A-4A, the
REMIC II Regular Interest A-4B and the REMIC II Regular Interest A-4C,
respectively. The Certificate Balance of the Class B-1 Component, the Class B-2
Component and the Class B-3 Component shall equal the Certificate Balance of the
REMIC II Regular Interest B-1, the REMIC II Regular Interest B-2 and the REMIC
II Regular Interest B-3, respectively. The Certificate Balance of the Class C-1
Component, the Class C-2 Component and the Class C-3 Component shall equal the
Certificate Balance of the REMIC II Regular Interest C-1, the REMIC II Regular
Interest C-2 and the REMIC II Regular Interest C-3, respectively. The
Certificate Balance of the Class D-1 Component and the Class D-2 Component shall
equal the Certificate Balance of the REMIC II Regular Interest D-1 and the REMIC
II Regular Interest D-2, respectively. The Certificate Balance of the Class E-1
Component and the Class E-2 Component shall equal the Certificate Balance of the
REMIC II Regular Interest E-1 and the REMIC II Regular Interest E-2,
respectively. The Certificate Balance of the Class H-1 Component and the Class
H-2 Component shall equal the Certificate Balance of the REMIC II Regular
Interest H-1 and the REMIC II Regular Interest H-2, respectively.

     "CERTIFICATE OWNER" means, with respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate, as may be
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing

                                      -18-
<PAGE>

Agency (directly or as an indirect participant, in accordance with the rules of
such Clearing Agency).

     "CERTIFICATE REGISTER" has the meaning set forth in Section 3.2.

     "CERTIFICATE REGISTRAR" means the registrar appointed pursuant to Section
3.2 and initially shall be the Paying Agent.

     "CERTIFICATEHOLDERS" has the meaning set forth in the definition of
"Holder."

     "CERTIFICATES" means, collectively, the REMIC III Certificates, the Class
R-I Certificates, the Class R-II Certificates and the Class R-K Certificates.

     "CERTIFICATION PARTIES" has the meaning set forth in Section 8.26(b).

     "CERTIFYING PERSON" has the meaning set forth in Section 8.26(b).

     "CLASS" means, with respect to the Kimball Lane Loan REMIC Regular
Interest, the REMIC I Interests, REMIC II Interests or REMIC III Certificates,
any Class of such Certificates or Interests.

     "CLASS A-1 CERTIFICATES," "CLASS A-2 CERTIFICATES," "CLASS A-3
CERTIFICATES," "CLASS A-4 CERTIFICATES," "CLASS X-1 CERTIFICATES," "CLASS X-2
CERTIFICATES," "CLASS B CERTIFICATES," "CLASS C CERTIFICATES," "CLASS D
CERTIFICATES," "CLASS E CERTIFICATES," "CLASS F CERTIFICATES," "CLASS G
CERTIFICATES," "CLASS H CERTIFICATES," "CLASS J CERTIFICATES," "CLASS K
CERTIFICATES," "CLASS L CERTIFICATES," "CLASS M CERTIFICATES," "CLASS N
CERTIFICATES," "CLASS O CERTIFICATES," "CLASS R-I CERTIFICATES," "CLASS R-II
CERTIFICATES," "CLASS R-III CERTIFICATES" or "CLASS R-K CERTIFICATES," mean the
Certificates designated as "Class A-1," "Class A-2," "Class A-3," "Class A-4,"
"Class X-1," "Class X-2," "Class B," "Class C," "Class D," "Class E," "Class F,"
"Class G," "Class H," "Class J," "Class K," "Class L," "Class M," "Class N,"
"Class O," "Class R-I," "Class R-II", "Class R-III" and "Class R-K"
respectively, on the face thereof, in substantially the form attached hereto as
Exhibits.

     "CLASS A CERTIFICATES" means the Class A-1 Certificates, the Class A-2
Certificates, the Class A-3 Certificates and the Class A-4 Certificates,
collectively.

     "CLASS A-1 GRANTOR TRUST INTEREST" means that portion of the rights
represented by the Class A-1 Certificates that evidences beneficial ownership of
the Kimball Lane Yield Maintenance Amounts and the Kimball Lane Sub-account, as
described in Section 12.1(b) hereof.

     "CLASS A-1 REMIC INTEREST" means that portion of the rights represented by
the Class A-1 Certificates that evidences a regular interest in REMIC III, which
rights consist of the rights to the distributions described in Section 6.5
hereof and all other rights of the Holders of the Class A-1 Certificates other
than those comprising the Grantor Trust.

     "CLASS A-1A COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-1 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-1A.

                                      -19-
<PAGE>

     "CLASS A-1B COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-1 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-1B.

     "CLASS A-1C COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-1 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-1C.

     "CLASS A-1D COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-1 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-1D.

     "CLASS A-2A COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-2 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-2A.

     "CLASS A-2B COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-2 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-2B.

     "CLASS A-3A COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-3 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-3A.

     "CLASS A-3B COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-3 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-3B.

     "CLASS A-3C COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-3 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-3C.

     "CLASS A-4A COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-4 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-4A.

     "CLASS A-4B COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-4 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-4B.

     "CLASS A-4C COMPONENT" means a component of the beneficial interest in
REMIC III evidenced by the Class A-4 Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest A-4C.

     "CLASS B-1 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class B Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest B-1.

                                      -20-
<PAGE>

     "CLASS B-2 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class B Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest B-2.

     "CLASS B-3 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class B Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest B-3.

     "CLASS C-1 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class C Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest C-1.

     "CLASS C-2 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class C Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest C-2.

     "CLASS C-3 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class C Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest C-3.

     "CLASS D-1 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class D Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest D-1.

     "CLASS D-2 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class D Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest D-2.

     "CLASS E-1 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class E Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest E-1.

     "CLASS E-2 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class E Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest E-2.

     "CLASS H-1 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class H Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest H-1.

     "CLASS H-2 COMPONENT" means a component of the beneficial interest in REMIC
III evidenced by the Class H Certificates, which component represents a
Certificate Balance equal to the Certificate Balance of the REMIC II Regular
Interest H-2.

     "CLASS O GRANTOR TRUST INTEREST" means that portion of the rights
represented by the Class O Certificates that evidences beneficial ownership of
the Excess Interest and the Excess Interest Sub-account, as described in Section
12.1(b) hereof.

                                      -21-
<PAGE>

     "CLASS O REMIC INTEREST" means that portion of the rights represented by
the Class O Certificates that evidences a regular interest in REMIC III, which
rights consist of the rights to the distributions described in Section 6.5
hereof and all other rights of the Holders of the Class O Certificates other
than those comprising the Grantor Trust.

     "CLASS X CERTIFICATES" means the Class X-1 Certificates and the Class X-2
Certificates.

     "CLASS X-1 GRANTOR TRUST INTEREST" means that portion of the rights
represented by the Class X-1 Certificates that evidences beneficial ownership of
the Kimball Lane Yield Maintenance Amounts and the Kimball Lane Sub-account, as
described in Section 12.1(b) hereof.

     "CLASS X-1 INTEREST AMOUNT" means, with respect to any Distribution Date
and the related Interest Accrual Period, interest equal to the product of (i)
one-twelfth of a per annum rate equal to the weighted average of the Class X-1
Strip Rates for the Class A-1A Component, Class A-1B Component, Class A-1C
Component, Class A-1D Component, Class A-2A Component, Class A-2B Component,
Class A-3A Component, Class A-3B Component, Class A-3C Component, Class A-4A
Component, Class A-4B Component, Class A-4C Component, Class B-1 Component,
Class B-2 Component, Class B-3 Component, Class C-1 Component, Class C-2
Component, Class C-3 Component, Class D-1 Component, Class D-2 Component, Class
E-1 Component, Class E-2 Component Class F Certificates, Class G Certificates,
Class H-1 Component, Class H-2 Component, Class J Certificates, Class K
Certificates, Class L Certificates, Class M Certificates, Class N Certificates
and Class O Certificates, weighted on the basis of the respective Certificate
Balances of such Classes of Certificates or such Components immediately prior to
such Distribution Date and (ii) the Class X-1 Notional Amount for such
Distribution Date.

     "CLASS X-1 NOTIONAL AMOUNT" means, with respect to any Distribution Date,
the aggregate of the Certificate Balances of the Principal Balance Certificates
as of the close of business on the preceding Distribution Date.

     "CLASS X-1 REMIC INTEREST" means that portion of the rights represented by
the Class X-1 Certificates that evidences a regular interest in REMIC III, which
rights consist of the rights to the distributions described in Section 6.5
hereof and all other rights of the Holders of the Class X-1 Certificates other
than those comprising the Grantor Trust.

     "CLASS X-1 STRIP RATE" means, with respect to any Class of Certificates
(other than the Class A-1, Class A-2, Class A-3, Class A-4, Class B, Class C,
Class D, Class E, Class H, Class X and the Residual Certificates), the Class
A-1A Component, the Class A-1B Component, the Class A-1C Component, the Class
A-1D Component, the Class A-2A Component, the Class A-2B Component, the Class
A-3A Component, the Class A-3B Component, the Class A-3C Component, the Class
A-4A Component, Class A-4B Component, the Class A-4C Component, the Class B-1
Component, the Class B-2 Component, the Class B-3 Component, the Class C-1
Component, the Class C-2 Component, the Class C-3 Component, the Class D-1
Component, the Class D-2 Component, the Class E-1 Component, the Class E-2
Component, the Class H-1 Component and the Class H-2 Component:

                                      -22-
<PAGE>

     (A) for any Distribution Date occurring on or before April 2005, the
excess, if any, of (i) the Weighted Average REMIC I Net Mortgage Rate for such
Distribution Date over (ii) (x) in the case of the Class A-1A Component, Class L
Certificates, Class M Certificates, Class N Certificates and Class O
Certificates, the Pass-Through Rate for such Class of Certificates or such
Component and (y) in the case of the Class A-1B Component, Class A-1C Component,
Class A-1D Component, Class A-2A Component, Class A-2B Component, Class A-3A
Component, Class A-3B Component, Class A-3C Component, Class A-4A Component,
Class A-4B Component, Class A-4C Component, Class B-1 Component, Class B-2
Component, Class B-3 Component, Class C-1 Component, Class C-2 Component, Class
C-3 Component, Class D-1 Component, Class D-2 Component, Class E-1 Component,
Class E-2 Component, Class F Certificates, Class G Certificates, Class H-1
Component, Class H-2 Component, Class J Certificates and Class K Certificates,
the greater of (1) the rate per annum corresponding to such Distribution Date as
set forth in Schedule IX attached hereto and (2) the Pass-Through Rate for such
Class of Certificates or Components;

     (B) for any Distribution Date occurring after April 2005 and on or before
April 2006, the excess, if any, of (i) the Weighted Average REMIC I Net Mortgage
Rate for such Distribution Date over (ii) (x) in the case of the Class A-1A
Component, Class A-1B Component, Class H-1 Component, Class J Certificates,
Class K Certificates, Class L Certificates, Class M Certificates, Class N
Certificates and Class O Certificates, the Pass-Through Rate for such Class of
Certificates or such Component and (y) in the case of the Class A-1C Component,
Class A-1D Component, Class A-2A Component, Class A-2B Component, Class A-3A
Component, Class A-3B Component, Class A-3C Component, Class A-4A Component,
Class A-4B Component, Class A-4C Component, Class B-1 Component, Class B-2
Component, Class B-3 Component, Class C-1 Component, Class C-2 Component, Class
C-3 Component, Class D-1 Component, Class D-2 Component, Class E-1 Component,
Class E-2 Component, Class F Certificates, Class G Certificates and Class H-2
Component, the greater of (1) the rate per annum corresponding to such
Distribution Date as set forth in Schedule X attached hereto and (2) the
Pass-Through Rate for such Class of Certificates or Components;

     (C) for any Distribution Date occurring after April 2006 and on or before
April 2007, the excess, if any, of (i) the Weighted Average REMIC I Net Mortgage
Rate for such Distribution Date over (ii) (x) in the case of the Class A-1A
Component, Class A-1B Component, Class A-1C Component, Class E-1 Component,
Class F Certificates, Class G Certificates, Class H-1 Component, Class H-2
Component, Class J Certificates, Class K Certificates, Class L Certificates,
Class M Certificates, Class N Certificates and Class O Certificates, the
Pass-Through Rate for such Class of Certificates or such Component and (y) in
the case of the Class A-1D Component, Class A-2A Component, Class A-2B
Component, Class A-3A Component, Class A-3B Component, Class A-3C Component,
Class A-4A Component, Class A-4B Component, Class A-4C Component, Class B-1
Component, Class B-2 Component, Class B-3 Component, Class C-1 Component, Class
C-2 Component, Class C-3 Component, Class D-1 Component, Class D-2 Component and
Class E-2 Component, the greater of (1) the rate per annum corresponding to such
Distribution Date as set forth in Schedule XI attached hereto and (2) the
Pass-Through Rate for such Class of Certificates or Components;

     (D) for any Distribution Date occurring after April 2007 and on or before
April 2008, the excess, if any, of (i) the Weighted Average REMIC I Net Mortgage
Rate for such Distribution Date over (ii) (x) in the case of the Class A-1A
Component, Class A-1B Component, Class A-1C Component, Class A-1D Component,
Class A-2A Component, Class D-

                                      -23-
<PAGE>

1 Component, Class E-1 Component, Class E-2 Component, Class F Certificates,
Class G Certificates, Class H-1 Component, Class H-2 Component, Class J
Certificates, Class K Certificates, Class L Certificates, Class M Certificates,
Class N Certificates and Class O Certificates, the Pass-Through Rate for such
Class of Certificates or such Component and (y) in the case of the Class A-2B
Component, Class A-3A Component, Class A-3B Component, Class A-3C Component,
Class A-4A Component, Class A-4B Component, Class A-4C Component, Class B-1
Component, Class B-2 Component, Class B-3 Component, Class C-1 Component, Class
C-2 Component, Class C-3 Component and Class D-2 Component, the greater of (1)
the rate per annum corresponding to such Distribution Date as set forth in
Schedule XII attached hereto and (2) the Pass-Through Rate for such Class of
Certificates or Components;

     (E) for any Distribution Date occurring after April 2008 and on or before
April 2009, the excess, if any, of (i) the Weighted Average REMIC I Net Mortgage
Rate for such Distribution Date over (ii) (x) in the case of the Class A-1A
Component, Class A-1B Component, Class A-1C Component, Class A-1D Component,
Class A-2A Component, Class A-2B Component, Class A-3A Component, Class C-1
Component, Class D-1 Component, Class D-2 Component, Class E-1 Component, Class
E-2 Component, Class F Certificates, Class G Certificates, Class H-1 Component,
Class H-2 Component, Class J Certificates, Class K Certificates, Class L
Certificates, Class M Certificates, Class N Certificates and Class O
Certificates, the Pass-Through Rate for such Class of Certificates or such
Component and (y) in the case of the Class A-3B Component, Class A-3C Component,
Class A-4A Component, Class A-4B Component, Class A-4C Component, Class B-1
Component, Class B-2 Component, Class B-3 Component, Class C-2 Component and
Class C-3 Component, the greater of (1) the rate per annum corresponding to such
Distribution Date as set forth on Schedule XIII attached hereto and (2) the
Pass-Through Rate for such Class of Certificates or Components;

     (F) for any Distribution Date occurring after April 2009 and on or before
April 2010, the excess, if any, of (i) the Weighted Average REMIC I Net Mortgage
Rate for such Distribution Date over (ii) (x) in the case of the Class A-1A
Component, Class A-1B Component, Class A-1C Component, Class A-1D Component,
Class A-2A Component, Class A-2B Component, Class A-3A Component, Class A-3B
Component, Class C-1 Component, Class C-2 Component, Class D-1 Component, Class
D-2 Component, Class E-1 Component, Class E-2 Component, Class F Certificates,
Class G Certificates, Class H-1 Component, Class H-2 Component, Class J
Certificates, Class K Certificates, Class L Certificates, Class M Certificates,
Class N Certificates and Class O Certificates, the Pass-Through Rate for such
Class of Certificates or such Component and (y) in the case of the Class A-3C
Component, Class A-4A Component, Class A-4B Component, Class A-4C Component,
Class B-1 Component, Class B-2 Component, Class B-3 Component and Class C-3
Component, the greater of (1) the rate per annum corresponding to such
Distribution Date as set forth on Schedule XIV attached hereto and (2) the
Pass-Through Rate for such Class of Certificates or Components;

     (G) for any Distribution Date occurring after April 2010 and on or before
April 2011, the excess, if any, of (i) the Weighted Average REMIC I Net Mortgage
Rate for such Distribution Date over (ii) (x) in the case of the Class A-1A
Component, Class A-1B Component, Class A-1C Component, Class A-1D Component,
Class A-2A Component, Class A-2B Component, Class A-3A Component, Class A-3B
Component, Class A-3C Component, Class A-4A Component, Class B-1 Component,
Class C-1 Component, Class C-2 Component, Class C-3 Component, Class D-1
Component, Class D-2 Component, Class E-1 Component, Class E-2 Component, Class
F Certificates, Class G Certificates, Class H-1 Component, Class H-2

                                      -24-
<PAGE>

Component, Class J Certificates, Class K Certificates, Class L Certificates,
Class M Certificates, Class N Certificates and Class O Certificates, the
Pass-Through Rate for such Class of Certificates or such Component and (y) in
the case of the Class A-4B Component, Class A-4C Component, Class B-2 Component
and Class B-3 Component, the greater of (1) the rate per annum corresponding to
such Distribution Date as set forth on Schedule XV attached hereto and (2) the
Pass-Through Rate for such Class of Certificates or Components;

     (H) for any Distribution Date occurring after April 2011 and on or before
October 2011, the excess, if any, of (i) the Weighted Average REMIC I Net
Mortgage Rate for such Distribution Date over (ii) (x) in the case of the Class
A-1A Component, Class A-1B Component, Class A-1C Component, Class A-1D
Component, Class A-2A Component, Class A-2B Component, Class A-3A Component,
Class A-3B Component, Class A-3C Component, Class A-4A Component, Class A-4B
Component, Class B-1 Component, Class B-2 Component, Class C-1 Component, Class
C-2 Component, Class C-3 Component, Class D-1 Component, Class D-2 Component,
Class E-1 Component, Class E-2 Component, Class F Certificates, Class G
Certificates, Class H-1 Component, Class H-2 Component, Class J Certificates,
Class K Certificates, Class L Certificates, Class M Certificates, Class N
Certificates and Class O Certificates, the Pass-Through Rate for such Class of
Certificates or such Component and (y) in the case of the Class A-4C Component
and Class B-3 Component, the greater of (1) the rate per annum corresponding to
such Distribution Date as set forth on Schedule XVI attached hereto and (2) the
Pass-Through Rate for such Class of Certificates or Components; and

     (I) for any Distribution Date occurring after October 2011, and for any
Class of Certificates or Components, the excess of (i) the Weighted Average
REMIC I Net Mortgage Rate for such Distribution Date over (ii) the Pass-Through
Rate for each such Class of Certificates or Component. In no event will any
Class X-1 Strip Rate be less than zero.

     "CLASS X-2 GRANTOR TRUST INTEREST" means that portion of the rights
represented by the Class X-2 Certificates that evidences beneficial ownership of
the Kimball Lane Yield Maintenance Amounts and the Kimball Lane Sub-account, as
described in Section 12.1(b) hereof.

     "CLASS X-2 INTEREST AMOUNT" means,

     (A) with respect to any Distribution Date occurring on or before April 2005
and the related Interest Accrual Period, interest equal to the product of (i)
one-twelfth of a per annum rate equal to the weighted average of the Class X-2
Strip Rates for the Class A-1B Component, Class A-1C Component, Class A-1D
Component, Class A-2A Component, Class A-2B Component, Class A-3A Component,
Class A-3B Component, Class A-3C Component, Class A-4A Component, Class A-4B
Component, Class A-4C Component, Class B-1 Component, Class B-2 Component, Class
B-3 Component, Class C-1 Component, Class C-2 Component, Class C-3 Component,
Class D-1 Component, Class D-2 Component, Class E-1 Component, Class E-2
Component, Class F Certificates, Class G Certificates, Class H-1 Component,
Class H-2 Component, Class J Certificates and Class K Certificates, weighted on
the basis of the respective Certificate Balances of such Classes of Certificates
or such Components immediately prior to such Distribution Date and (ii) the
Class X-2 Notional Amount for such Distribution Date;

     (B) with respect to any Distribution Date occurring after April 2005 and on
or before the Distribution Date in April 2006 and the related Interest Accrual
Period, interest equal to the product of (i) one-twelfth of a per annum rate
equal to the weighted average of the Class

                                      -25-
<PAGE>

X-2 Strip Rates for the Class A-1C Component, Class A-1D Component, Class A-2A
Component, Class A-2B Component, Class A-3A Component, Class A-3B Component,
Class A-3C Component, Class A-4A Component, Class A-4B Component, Class A-4C
Component, Class B-1 Component, Class B-2 Component, Class B-3 Component, Class
C-1 Component, Class C-2 Component, Class C-3 Component, Class D-1 Component,
Class D-2 Component, Class E-1 Component, Class E-2 Component, Class F
Certificates, Class G Certificates and Class H-2 Component, weighted on the
basis of the respective Certificate Balances of such Classes of Certificates or
such Component immediately prior to such Distribution Date and (ii) the Class
X-2 Notional Amount for such Distribution Date;

     (C) with respect to any Distribution Date occurring after April 2006 and on
or before the Distribution Date in April 2007 and the related Interest Accrual
Period, interest equal to the product of (i) one-twelfth of a per annum rate
equal to the weighted average of the Class A-1D Component, Class A-2A Component,
Class A-2B Component, Class A-3A Component, Class A-3B Component, Class A-3C
Component, Class A-4A Component, Class A-4B Component, Class A-4C Component,
Class B-1 Component, Class B-2 Component, Class B-3 Component, Class C-1
Component, Class C-2 Component, Class C-3 Component, Class D-1 Component, Class
D-2 Component and Class E-2 Component, weighted on the basis of the respective
Certificate Balances of such Classes of Certificates or such Component
immediately prior to such Distribution Date and (ii) the Class X-2 Notional
Amount for such Distribution Date;

     (D) with respect to any Distribution Date occurring after April 2007 and on
or before the Distribution Date in April 2008 and the related Interest Accrual
Period, interest equal to the product of (i) one-twelfth of a per annum rate
equal to the weighted average of the Class A-2B Component, Class A-3A Component,
Class A-3B Component, Class A-3C Component, Class A-4A Component, Class A-4B
Component, Class A-4C Component, Class B-1 Component, Class B-2 Component, Class
B-3 Component, Class C-1 Component, Class C-2 Component, Class C-3 Component and
Class D-2 Component, weighted on the basis of the respective Certificate
Balances of such Classes of Certificates or such Component immediately prior to
such Distribution Date and (ii) the Class X-2 Notional Amount for such
Distribution Date;

     (E) with respect to any Distribution Date occurring after April 2008 and on
or before the Distribution Date in April 2009 and the related Interest Accrual
Period, interest equal to the product of (i) one-twelfth of a per annum rate
equal to the weighted average of the Class A-3B Component, Class A-3C Component,
Class A-4A Component, Class A-4B Component, Class A-4C Component, Class B-1
Component, Class B-2 Component, Class B-3 Component, Class C-2 Component and
Class C-3 Component, weighted on the basis of the respective Certificate
Balances of such Classes of Certificates or such Component immediately prior to
such Distribution Date and (ii) the Class X-2 Notional Amount for such
Distribution Date;

     (F) with respect to any Distribution Date occurring after April 2009 and on
or before the Distribution Date in April 2010 and the related Interest Accrual
Period, interest equal to the product of (i) one-twelfth of a per annum rate
equal to the weighted average of the Class A-3C Component, Class A-4A Component,
Class A-4B Component, Class A-4C Component, Class B-1 Component, Class B-2
Component, Class B-3 Component and Class C-3 Component, weighted on the basis of
the respective Certificate Balances of such Classes of Certificates or

                                      -26-
<PAGE>

such Component immediately prior to such Distribution Date and (ii) the Class
X-2 Notional Amount for such Distribution Date;

     (G) with respect to any Distribution Date occurring after April 2010 and on
or before the Distribution Date in April 2011 and the related Interest Accrual
Period, interest equal to the product of (i) one-twelfth of a per annum rate
equal to the weighted average of the Class A-4B Component, Class A-4C Component,
Class B-2 Component and Class B-3 Component, weighted on the basis of the
respective Certificate Balances of such Classes of Certificates or such
Component immediately prior to such Distribution Date and (ii) the Class X-2
Notional Amount for such Distribution Date;

     (H) with respect to any Distribution Date occurring after April 2011 and on
or before the Distribution Date in October 2011 and the related Interest Accrual
Period, interest equal to the product of (i) one-twelfth of a per annum rate
equal to the weighted average of the Class A-4C Component and Class B-3
Component, weighted on the basis of the respective Certificate Balances of such
Classes of Certificates or such Component immediately prior to such Distribution
Date and (ii) the Class X-2 Notional Amount for such Distribution Date.

     "CLASS X-2 NOTIONAL AMOUNT" means,

     (A) with respect to any Distribution Date occurring on or before the
Distribution Date in April 2005, the aggregate of the Certificate Balances of
the Class A-1B Component, Class A-1C Component, Class A-1D Component, Class A-2A
Component, Class A-2B Component, Class A-3A Component, Class A-3B Component,
Class A-3C Component, Class A-4A Component, Class A-4B Component, Class A-4C
Component, Class B-1 Component, Class B-2 Component, Class B-3 Component, Class
C-1 Component, Class C-2 Component, Class C-3 Component, Class D-1 Component,
Class D-2 Component, Class E-1 Component, Class E-2 Component, Class F
Certificates, Class G Certificates, Class H-1 Component, Class H-2 Component,
Class J Certificates and Class K Certificates as of the close of business on the
preceding Distribution Date,

     (B) with respect to any Distribution Date after the Distribution Date in
April 2005 and on or before the Distribution Date in April 2006, the aggregate
of the Certificate Balances of the Class A-1C Component, Class A-1D Component,
Class A-2A Component, Class A-2B Component, Class A-3A Component, Class A-3B
Component, Class A-3C Component, Class A-4A Component, Class A-4B Component,
Class A-4C Component, Class B-1 Component, Class B-2 Component, Class B-3
Component, Class C-1 Component, Class C-2 Component, Class C-3 Component, Class
D-1 Component, Class D-2 Component, Class E-1 Component, Class E-2 Component,
Class F Certificates, Class G Certificates and Class H-2 Component as of the
close of business on the preceding Distribution Date,

     (C) with respect to any Distribution Date after the Distribution Date in
April 2006 and on or before the Distribution Date in April 2007, the aggregate
of the Certificate Balances of the Class A-1D Component, Class A-2A Component,
Class A-2B Component, Class A-3A Component, Class A-3B Component, Class A-3C
Component, Class A-4A Component, Class A-4B Component, Class A-4C Component,
Class B-1 Component, Class B-2 Component, Class B-3 Component, Class C-1
Component, Class C-2 Component, Class C-3 Component, Class D-1

                                      -27-
<PAGE>

Component, Class D-2 Component and Class E-2 Component as of the close of
business on the preceding Distribution Date,

     (D) with respect to any Distribution Date after the Distribution Date in
April 2007 and on or before the Distribution Date in April 2008, the aggregate
of the Certificate Balances of the Class A-2B Component, Class A-3A Component,
Class A-3B Component, Class A-3C Component, Class A-4A Component, Class A-4B
Component, Class A-4C Component, Class B-1 Component, Class B-2 Component, Class
B-3 Component, Class C-1 Component, Class C-2 Component, Class C-3 Component and
Class D-2 Component as of the close of business on the preceding Distribution
Date,

     (E) with respect to any Distribution Date after the Distribution Date in
April 2008 and on or before the Distribution Date in April 2009, the aggregate
of the Certificate Balances of the Class A-3B Component, Class A-3C Component,
Class A-4A Component, Class A-4B Component, Class A-4C Component, Class B-1
Component, Class B-2 Component, Class B-3 Component, Class C-2 Component and
Class C-3 Component as of the close of business on the preceding Distribution
Date,

     (F) with respect to any Distribution Date after the Distribution Date in
April 2009 and on or before the Distribution Date in April 2010, the aggregate
of the Certificate Balances of the Class A-3C Component, Class A-4A Component,
Class A-4B Component, Class A-4C Component, Class B-1 Component, Class B-2
Component, Class B-3 Component and Class C-3 Component as of the close of
business on the preceding Distribution Date,

     (G) with respect to any Distribution Date after the Distribution Date in
April 2010 and on or before the Distribution Date in April 2011, the aggregate
of the Certificate Balances of the Class A-4B Component, Class A-4C Component,
Class B-2 Component and Class B-3 Component as of the close of business on the
preceding Distribution Date,

     (H) with respect to any Distribution Date after the Distribution Date in
April 2011 and on or before the Distribution Date in October 2011, the aggregate
of the Certificate Balances of the Class A-4C Component and Class B-3 Component
as of the close of business on the preceding Distribution Date, and

     (I) with respect to any Distribution Date occurring after the Distribution
Date in October 2011, zero.

     "CLASS X-2 REMIC INTEREST" means that portion of the rights represented by
the Class X-2 Certificates that evidences a regular interest in REMIC III, which
rights consist of the rights to the distributions described in Section 6.5
hereof and all other rights of the Holders of the Class X-2 Certificates other
than those comprising the Grantor Trust.

     "CLASS X-2 STRIP RATE" means,

     (A) for any Distribution Date occurring on or before April 2005, with
respect to those components of the Class X-2 Notional Amount outstanding
immediately prior to the related Distribution Date, the excess, if any, of (x)
the lesser of (i) the rate per annum corresponding to such Distribution Date as
set forth in Schedule IX attached hereto and (ii) the

                                      -28-
<PAGE>

Weighted Average REMIC I Net Mortgage Rate for such Distribution Date over (y)
the Pass-Through Rate for such Class of Certificates or Component;

     (B) for any Distribution Date occurring after April 2005 and on or before
April 2006, with respect to those components of the Class X-2 Notional Amount
outstanding immediately prior to the related Distribution Date, the excess, if
any, of (x) the lesser of (i) the rate per annum corresponding to such
Distribution Date as set forth in Schedule X attached hereto and (ii) the
Weighted Average REMIC I Net Mortgage Rate for such Distribution Date over (y)
the Pass-Through Rate for such Class of Certificates or Component;

     (C) for any Distribution Date occurring after April 2006 and on or before
April 2007, with respect to those components of the Class X-2 Notional Amount
outstanding immediately prior to the related Distribution Date, the excess, if
any, of (x) the lesser of (i) the rate per annum corresponding to such
Distribution Date as set forth in Schedule XI attached hereto and (ii) the
Weighted Average REMIC I Net Mortgage Rate for such Distribution Date over (y)
the Pass-Through Rate for such Class of Certificates or Component;

     (D) for any Distribution Date occurring after April 2007 and on or before
April 2008, with respect to those components of the Class X-2 Notional Amount
outstanding immediately prior to the related Distribution Date, the excess, if
any, of (x) the lesser of (i) the rate per annum corresponding to such
Distribution Date as set forth in Schedule XII attached hereto and (ii) the
Weighted Average REMIC I Net Mortgage Rate for such Distribution Date over (y)
the Pass-Through Rate for such Class of Certificates or Component;

     (E) for any Distribution Date occurring after April 2008 and on or before
April 2009, with respect to those components of the Class X-2 Notional Amount
outstanding immediately prior to the related Distribution Date, the excess, if
any, of (x) the lesser of (i) the rate per annum corresponding to such
Distribution Date as set forth in Schedule XIII attached hereto and (ii) the
Weighted Average REMIC I Net Mortgage Rate for such Distribution Date over (y)
the Pass-Through Rate for such Class of Certificates or Component;

     (F) for any Distribution Date occurring after April 2009 and on or before
April 2010, with respect to those components of the Class X-2 Notional Amount
outstanding immediately prior to the related Distribution Date, the excess, if
any, of (x) the lesser of (i) the rate per annum corresponding to such
Distribution Date as set forth in Schedule XIV attached hereto and (ii) the
Weighted Average REMIC I Net Mortgage Rate for such Distribution Date over (y)
the Pass-Through Rate for such Class of Certificates or Component;

     (G) for any Distribution Date occurring after April 2010 and on or before
April 2011, with respect to those components of the Class X-2 Notional Amount
outstanding immediately prior to the related Distribution Date, the excess, if
any, of (x) the lesser of (i) the rate per annum corresponding to such
Distribution Date as set forth in Schedule XV attached hereto and (ii) the
Weighted Average REMIC I Net Mortgage Rate for such Distribution Date over (y)
the Pass-Through Rate for such Class of Certificates or Component;

     (H) for any Distribution Date occurring after April 2011 and on or before
October 2011, with respect to those components of the Class X-2 Notional Amount
outstanding immediately prior to the related Distribution Date, the excess, if
any, of (x) the lesser of (i) the

                                      -29-
<PAGE>

rate per annum corresponding to such Distribution Date as set forth in Schedule
XVI attached hereto and (ii) the Weighted Average REMIC I Net Mortgage Rate for
such Distribution Date over (y) the Pass-Through Rate for such Class of
Certificates or Component; and

     (I) for any Distribution Date occurring after October 2011, the Class X-2
Strip Rate for any Certificate or Component will be equal to zero.

     "CLEARING AGENCY" means an organization registered as a "clearing agency"
pursuant to Section 17A of the 1934 Act, which initially shall be the
Depository.

     "CLEARSTREAM BANK" means Clearstream Bank, societe anonyme.

     "CLOSING DATE" means October 14, 2003.

     "CMSA" means the Commercial Mortgage Securities Association.

     "CMSA OPERATING STATEMENT ANALYSIS REPORT" means a report which is one
element of the CMSA Methodology for Analyzing and Reporting Property Income
Statements and which is substantially in the form of Exhibit N.

     "CMSA REPORTS" means the Restricted Servicer Reports and the Unrestricted
Servicer Reports, collectively.

     "CODE" means the Internal Revenue Code of 1986, as amended, any successor
statutes thereto, and applicable U.S. Department of Treasury regulations issued
pursuant thereto in temporary or final form and proposed regulations thereunder,
to the extent that, by reason of their proposed effective date, such proposed
regulations would apply to the Trust.

     "COLLECTION PERIOD" means, with respect to any Distribution Date, the
period beginning on the day after the Determination Date in the month preceding
the month of such Distribution Date (or in the case of the first Distribution
Date, the Cut-Off Date) and ending on the Determination Date in the month in
which the Distribution Date occurs.

     "COMMISSION" has the meaning set forth in Section 8.26(a).

     "COMPENSATING INTEREST" means with respect to any Distribution Date, an
amount equal to the lesser of (A) the excess of (i) Prepayment Interest
Shortfalls incurred in respect of the Mortgage Loans other than the Specially
Serviced Mortgage Loans resulting from (x) voluntary Principal Prepayments on
such Mortgage Loans (but not including any B Note, Non-Serviced Mortgage Loan
Companion Loan or the WestShore Plaza Companion Loan) or (y) to the extent that
the Master Servicer did not apply the proceeds thereof in accordance with the
terms of the related Mortgage Loan documents, involuntary Principal Prepayments
during the related Collection Period over (ii) the aggregate of Prepayment
Interest Excesses resulting from Principal Prepayments on the Mortgage Loans
(but not including any B Note, Non-Serviced Mortgage Loan Companion Loan or the
WestShore Plaza Companion Loan) during the same Collection Period and (B) the
aggregate of the portion of the aggregate Master Servicing Fee accrued at a rate
per annum equal to 2 basis points for the related Collection Period calculated
in respect of all the Mortgage Loans (including REO Mortgage Loans but not
including any B

                                      -30-
<PAGE>

Note, Non-Serviced Mortgage Loan Companion Loan or the WestShore Plaza Companion
Loan), plus any investment income earned on the amount prepaid prior to such
Distribution Date.

     "COMPONENT" means any of the Class A-1A Component, the Class A-1B
Component, the Class A-1C Component, the Class A-1D Component, the Class A-2A
Component, the Class A-2B Component, the Class A-3A Component, the Class A-3B
Component, the Class A-3C Component, the Class A-4A Component, the Class A-4B
Component, the Class A-4C Component, the Class B-1 Component, the Class B-2
Component, the Class B-3 Component, the Class C-1 Component, the Class C-2
Component, the Class C-3 Component, the Class D-1 Component, the Class D-2
Component, the Class E-1 Component, the Class E-2 Component, the Class H-1
Component and the Class H-2 Component.

     "CONDEMNATION PROCEEDS" means any awards resulting from the full or partial
condemnation or any eminent domain proceeding or any conveyance in lieu or in
anticipation thereof with respect to a Mortgaged Property by or to any
governmental, quasi-governmental authority or private entity with condemnation
powers other than amounts to be applied to the restoration, preservation or
repair of such Mortgaged Property or released to the related Mortgagor in
accordance with the terms of the Mortgage Loan and (if applicable) its related B
Note or the WestShore Plaza Companion Loan, and with respect to the Mortgaged
Property securing the Non-Serviced Mortgage Loans and the Non-Serviced Mortgage
Loan Companion Loans, any portion of such amounts payable to the holders of the
related Non-Serviced Mortgage Loans.

     "CONTROLLING CLASS" means the most subordinate Class of REMIC Regular
Certificates outstanding at any time of determination; provided, that, if the
aggregate Certificate Balance of such Class is less than 25% of the initial
Certificate Balance of such Class as of the Closing Date, the Controlling Class
shall be the next most subordinate Class of REMIC Regular Certificates
outstanding. As of the Closing Date, the Controlling Class will be the Class O
Certificates.

     "CONTROLLING PERSON" means, with respect to any Person, any other Person
who "controls" such Person within the meaning of the 1933 Act.

     "CORPORATE TRUST OFFICE" means, with respect to the presentment and
surrender of Certificates for the final distribution thereon or the presentment
and surrender of Certificates for any other purpose, the principal corporate
trust office of the Certificate Registrar. The principal corporate trust office
of the Trustee is presently located at 135 South LaSalle Street, Suite 1625,
Chicago, IL 60603, Attention: Asset-Backed Securities Trust Services Group--
Bear Stearns Commercial Mortgage Securities Inc. Series 2003-TOP12 and the
office of the Certificate Registrar is presently located for certificate
transfer purposes at Wells Fargo Center, Sixth and Marquette Avenue, MAC
#N9303-121, Minneapolis, Minnesota 55479-0113, Attention: Corporate Trust
Services (CMBS)-- Bear Stearns Commercial Mortgage Securities Inc. Series
2003-TOP12, and for all other purposes at 9062 Old Annapolis Road, Columbia,
Maryland 21045, Attention: Corporate Trust Services (CMBS)-- Bear Stearns
Commercial Mortgage Securities Inc. Series 2003-TOP12, or at such other address
as the Trustee or Certificate Registrar may designate from time to time by
notice to the Certificateholders, the Depositor, the Master Servicer, the Paying
Agent and the Special Servicer.

                                      -31-
<PAGE>

     "CORRESPONDING REMIC I REGULAR INTEREST" means with respect to each
Majority Mortgage Loan and the Kimball Lane Loan REMIC Regular Interest, the
REMIC I Regular Interest having an initial Certificate Balance equal to the
Principal Balance of such Mortgage Loan outstanding as of the Cut-Off Date,
after taking into account all principal and interest payments made or due prior
to the Cut-Off Date (or in the case of the Kimball Lane Loan REMIC Regular
Interest, an initial principal amount (the initial "Certificate Balance") equal
to the initial Certificate Balance of the Kimball Lane Loan REMIC Regular
Interest).

     "CORRESPONDING REMIC II REGULAR INTEREST" means (i) with respect to each
Class of Certificates other than the Class A-1 Certificates, Class A-2
Certificates, Class A-3 Certificates, Class A-4 Certificates, Class B
Certificates, Class C Certificates, Class D Certificates, Class E Certificates
and Class H Certificates, the REMIC II Regular Interest having the same letter
designation, (ii) with respect to the Class A-1 Certificates, the REMIC II
Regular Interest A-1A, REMIC II Regular Interest A-1B, REMIC II Regular Interest
A-1C and REMIC II Regular Interest A-1D, (iii) with respect to the Class A-2
Certificates, the REMIC II Regular Interest A-2A and the REMIC II Regular
Interest A-2B, (iv) with respect to the Class A-3 Certificates, the REMIC II
Regular Interest A-3A, REMIC II Regular Interest A-3B and REMIC II Regular
Interest A-3C, (v) with respect to the Class A-4 Certificates, the REMIC II
Regular Interest A-4A, the REMIC II Regular Interest A-4B and REMIC II Regular
Interest A-4C, (vi) with respect to the Class B Certificates, the REMIC II
Regular Interest B-1, the REMIC II Regular Interest B-2 and the REMIC II Regular
Interest B-3, (vii) with respect to the Class C Certificates, the REMIC II
Regular Interest C-1, the REMIC II Regular Interest C-2 and the REMIC II Regular
Interest C-3, (viii) with respect to the Class D Certificates, the REMIC II
Regular Interest D-1 and the REMIC II Regular Interest D-2, (ix) with respect to
the Class E Certificates, the REMIC II Regular Interest E-1 and the REMIC II
Regular Interest E-2 and (x) with respect to the Class H Certificates, the REMIC
II Regular Interest H-1 and the REMIC II Regular Interest H-2.

     "CROSSED MORTGAGE LOAN" has the meaning set forth in Section 2.3(a).

     "CUSTODIAN" means the Trustee or any Person who is appointed by the Trustee
at any time as custodian pursuant to Section 7.9 and who is unaffiliated with
the Depositor and each Seller and satisfies the eligibility requirements of the
Trustee as set forth in Section 7.5.

     "CUSTOMER" means a broker, dealer, bank, other financial institution or
other Person for whom the Clearing Agency effects book-entry transfers and
pledges of securities deposited with the Clearing Agency.

     "CUT-OFF DATE" means the end of business on October 1, 2003. The Cut-Off
Date for any Mortgage Loan that has a Due Date on a date other than the first
day of each month shall be the end of business on October 1, 2003, and Scheduled
Payments due in October 2003 with respect to Mortgage Loans not having Due Dates
on the first of each month have been deemed received on October 1, 2003, not the
actual day on which such Scheduled Payments were due.

     "DEBT SERVICE COVERAGE RATIO" means, with respect to any Mortgage Loan, as
of any date of determination and for any period, the amount calculated for such
date of determination in accordance with the procedures set forth in Exhibit T.

                                      -32-
<PAGE>

     "DEBT SERVICE REDUCTION AMOUNT" means, with respect to a Due Date and the
related Determination Date, the amount of the reduction of the Scheduled Payment
which a Mortgagor is obligated to pay on such Due Date with respect to a
Mortgage Loan, the WestShore Plaza Companion Loan or a B Note as a result of any
proceeding under bankruptcy law or any similar proceeding (other than a
Deficient Valuation Amount); provided, however, that in the case of an amount
that is deferred, but not forgiven, such reduction shall include only the net
present value (calculated at the related Mortgage Rate) of the reduction.

     "DEFAULTED MORTGAGE LOAN" means a Mortgage Loan or the WestShore Plaza
Companion Loan that is in default under the terms of the applicable Mortgage
Loan documentation and for which any applicable grace period has expired.

     "DEFEASANCE COLLATERAL" means, with respect to any Defeasance Loan, the
United States Treasury obligations required to be pledged in lieu of prepayment
pursuant to the terms thereof.

     "DEFEASANCE LOAN" means any Mortgage Loan, the WestShore Plaza Companion
Loan or any B Note which requires or permits the related Mortgagor (or permits
the holder of such Mortgage Loan, the WestShore Plaza Companion Loan or B Note
to require the related Mortgagor) to pledge Defeasance Collateral to such holder
in lieu of prepayment.

     "DEFECTIVE MORTGAGE LOAN" has the meaning set forth in Section 2.3(a).

     "DEFICIENT VALUATION" means, with respect to any Mortgage Loan (other than
an A Note and the WestShore Plaza Pari Passu Loan), any A/B Mortgage Loan and
the Loan Pair, a valuation by a court of competent jurisdiction of the Mortgaged
Property (or, with respect to the Berkeley & Brown Pari Passu Loan, the RSA Pari
Passu Loan or the WestShore Plaza Pari Passu Loan, the pro rata portion of the
valuation allocable to the Berkeley & Brown Pari Passu Loan, the RSA Pari Passu
Loan or the WestShore Plaza Pari Passu Loan, as applicable) relating to such
Mortgage Loan, A/B Mortgage Loan or Loan Pair in an amount less than the then
outstanding indebtedness under such Mortgage Loan, A/B Mortgage Loan or Loan
Pair, which valuation results from a proceeding initiated under the United
States Bankruptcy Code, as amended from time to time, and that reduces the
amount the Mortgagor is required to pay under such Mortgage Loan, A/B Mortgage
Loan or Loan Pair.

     "DEFICIENT VALUATION AMOUNT" means (i) with respect to each Mortgage Loan
(other than an A Note and the WestShore Plaza Pari Passu Loan), any A/B Mortgage
Loan and the Loan Pair, the amount by which the total amount due with respect to
such Mortgage Loan, A/B Mortgage Loan or Loan Pair (excluding interest not yet
accrued), including the Principal Balance of such Mortgage Loan, A/B Mortgage
Loan or Loan Pair plus any accrued and unpaid interest thereon and any other
amounts recoverable from the Mortgagor with respect thereto pursuant to the
terms thereof, is reduced in connection with a Deficient Valuation and (ii) with
respect to any A Note or the WestShore Plaza Pari Passu Loan, the portion of any
Deficient Valuation Amount for the related A/B Mortgage Loan or Loan Pair, as
applicable, that is borne by the holder of the A Note or the WestShore Plaza
Pari Passu Loan, as applicable, under the related Intercreditor Agreement or
Loan Pair Intercreditor Agreement, as applicable.

                                      -33-
<PAGE>

     "DEFINITIVE CERTIFICATES" means Certificates of any Class issued in
definitive, fully registered, certificated form without interest coupons.

     "DELETED MORTGAGE LOAN" means a Mortgage Loan which is repurchased from the
Trust pursuant to the terms hereof or as to which one or more Qualifying
Substitute Mortgage Loans are substituted.

     "DEPOSITOR" means Bear Stearns Commercial Mortgage Securities Inc., a
Delaware corporation, and its successors in interest.

     "DEPOSITORY" has the meaning set forth in Section 3.7(a).

     "DEPOSITORY AGREEMENT" means the Letter of Representations dated the
Closing Date and by and among the Depositor, the Paying Agent and the
Depository.

     "DETERMINATION DATE" means, with respect to any Distribution Date, the
earlier of (i) the 8th day of the month in which such Distribution Date occurs
or, if such day is not a Business Day, the immediately preceding Business Day,
and (ii) the 5th Business Day prior to the related Distribution Date, commencing
November 5, 2003.

     "DIRECTLY OPERATE" means, with respect to any REO Property, the furnishing
or rendering of services to the tenants thereof, the management of such REO
Property, the holding of such REO Property primarily for sale to customers
(other than a sale of an REO Property pursuant to and in accordance with Section
9.15) or the performance of any construction work thereon, in each case other
than through an Independent Contractor; provided, however, that the Trustee (or
the Special Servicer on behalf of the Trustee) shall not be considered to
Directly Operate an REO Property solely because the Trustee (or the Special
Servicer on behalf of the Trustee) establishes rental terms, chooses tenants,
enters into or renews leases, deals with taxes and insurance, or makes decisions
as to repairs, tenant improvements or capital expenditures with respect to such
REO Property (including, without limitation, construction activity to effect
repairs or in connection with leasing activity) or undertakes any ministerial
action incidental thereto.

     "DISCOUNT RATE" means the rate which, when compounded monthly, is
equivalent to the Treasury Rate when compounded semi-annually. The "Treasury
Rate," unless otherwise set forth in the Mortgage Loan documents, is the yield
calculated by the linear interpolation of the yields, as reported in Federal
Reserve Statistical Release H.15--Selected Interest Rates under the heading
"U.S. government securities/Treasury constant maturities" for the week ending
prior to the date of the relevant principal prepayment, of U.S. Treasury
constant maturities with a maturity date (one longer and one shorter) most
nearly approximating the maturity date (or the Anticipated Repayment Date, if
applicable) of the Mortgage Loan prepaid. If Release H.15 is no longer
published, the Master Servicer will select a comparable publication to determine
the Treasury Rate.

     "DISQUALIFIED ORGANIZATION" means any of (i) the United States, any State
or any political subdivision thereof, or any agency or instrumentality of any of
the foregoing (other than an instrumentality which is a corporation if all of
its activities are subject to tax and, except for FHLMC, a majority of its board
of directors is not selected by any such governmental unit), (ii) a foreign
government, international organization or any agency or instrumentality of
either of the

                                      -34-
<PAGE>

foregoing, (iii) an organization (except certain farmers' cooperatives described
in Section 521 of the Code) which is exempt from tax imposed by Chapter 1 of the
Code (unless such organization is subject to the tax imposed by Section 511 of
the Code on unrelated business taxable income), (iv) rural electric and
telephone cooperatives described in Section 1381 of the Code, and (v) any other
Person so designated by the Master Servicer based upon an Opinion of Counsel
that the holding of an ownership interest in a Residual Certificate by such
Person may cause any of the REMICs, or any Person having an Ownership Interest
in any Class of Certificates, other than such Person, to incur a liability for
any federal tax imposed under the Code that would not otherwise be imposed but
for the transfer of an ownership interest in a Residual Certificate to such
Person. The terms "United States," "State" and "international organization"
shall have the meanings set forth in Section 7701 of the Code or successor
provisions.

     "DISTRIBUTABLE CERTIFICATE INTEREST" means, with respect to any
Distribution Date and any Class of Certificates (other than the Residual
Certificates) or Interests, the sum of (A) Accrued Certificate Interest in
respect of such Class or Interest, reduced (to not less than zero) by (i) any
Net Aggregate Prepayment Interest Shortfalls for such Class of Certificates or
Interests, allocated on such Distribution Date to such Class or Interest
pursuant to Section 6.7, and (ii) Realized Losses allocated on such Distribution
Date to reduce the Distributable Certificate Interest payable to such Class or
Interest pursuant to Section 6.6, plus (B) the Unpaid Interest, plus (C) if the
Aggregate Certificate Balance is reduced because of a diversion of principal in
accordance with Section 5.2(a)(II)(iv), and there is a subsequent recovery of
amounts as described in Section 6.6(c)(i), then interest at the applicable
Pass-Through Rate that would have accrued and been distributable with respect to
the amount that the Aggregate Certificate Balance was so reduced, which interest
shall accrue from the date that the related Realized Loss is allocated through
the end of the Interest Accrual Period related to the Distribution Date on which
such amounts are subsequently recovered.

     "DISTRIBUTION ACCOUNT" means the Distribution Account maintained by the
Paying Agent on behalf of the Trustee, in accordance with the provisions of
Section 5.3, which account shall be an Eligible Account.

     "DISTRIBUTION DATE" means the 13th day of each month or, if such day is not
a Business Day, the next succeeding Business Day, commencing November 13, 2003.

     "DUE DATE" means, with respect to a Mortgage Loan, the WestShore Plaza
Companion Loan or a B Note, the date on which a Scheduled Payment is due.

     "ELIGIBLE ACCOUNT" means an account (or accounts) that is any of the
following: (i) maintained with a depository institution or trust company whose
(A) commercial paper, short-term unsecured debt obligations or other short-term
deposits are rated at least "F-1+" by Fitch and "P-1" by Moody's, if the
deposits are to be held in the account for 30 days or less, or (B) long-term
unsecured debt obligations are rated at least "AA-" by Fitch and at least "Aa2"
by Moody's, if the deposits are to be held in the account more than 30 days or
(ii) a segregated trust account or accounts maintained in the trust department
of the Trustee, the Paying Agent or other financial institution having a
combined capital and surplus of at least $50,000,000 and subject to regulations
regarding fiduciary funds on deposit similar to Title 12 of the Code of Federal
Regulations Section 9.10(b), or (iii) an account or accounts of a depository
institution acceptable

                                      -35-
<PAGE>

to each Rating Agency, as evidenced by Rating Agency Confirmation with respect
to the use of any such account as the Certificate Account or the Distribution
Account. Notwithstanding anything in the foregoing to the contrary, an account
shall not fail to be an Eligible Account solely because it is maintained with
Wells Fargo Bank, National Association or Wells Fargo Bank Iowa, N.A., each a
wholly-owned subsidiary of Wells Fargo & Co., provided that such subsidiary's or
its parent's (A) commercial paper, short-term unsecured debt obligations or
other short-term deposits are at least "F-1" in the case of Fitch, and "P-1" in
the case of Moody's, if the deposits are to be held in the account for 30 days
or less, or (B) long-term unsecured debt obligations are rated at least "A+" in
the case of Fitch and at least "Aa3" in the case of Moody's, if the deposits are
to be held in the account for more than 30 days.

     "ELIGIBLE INVESTMENTS" means any one or more of the following financial
assets or other property:

         (i) direct obligations of, and obligations fully guaranteed as to
timely payment of principal and interest by, the United States of America, FNMA,
FHLMC or any agency or instrumentality of the United States of America the
obligations of which are backed by the full faith and credit of the United
States of America; provided that any obligation of FNMA or FHLMC, other than an
unsecured senior debt obligation of FNMA or FHLMC, shall be an Eligible
Investment only if Rating Agency Confirmation is obtained with respect to such
investment;

         (ii) demand or time deposits in, unsecured certificates of deposit of,
money market deposit accounts of, or bankers' acceptances issued by, any
depository institution or trust company (including the Trustee, the Master
Servicer, the Special Servicer, the Paying Agent or any Affiliate of the Master
Servicer, the Special Servicer, the Paying Agent or the Trustee, acting in its
commercial capacity) incorporated or organized under the laws of the United
States of America or any State thereof and subject to supervision and
examination by federal or state banking authorities, so long as the commercial
paper or other short-term debt obligations of such depository institution or
trust company are rated "Prime-1" by Moody's and "F-1+" by Fitch or the
long-term unsecured debt obligations of such depository institution or trust
company have been assigned a rating by each Rating Agency at least equal "Aa2"
by Moody's and "AA" by Fitch or its equivalent or, in each case, if not rated by
a Rating Agency, then such Rating Agency has issued a Rating Agency
Confirmation;

         (iii) repurchase agreements or obligations with respect to any security
described in clause (i) above where such security has a remaining maturity of
one year or less and where such repurchase obligation has been entered into with
a depository institution or trust company (acting as principal) described in
clause (ii) above and where such repurchase obligation will mature prior to the
Business Day preceding the next date upon which, as described in this Agreement,
such amounts are required to be withdrawn from the Certificate Account and which
meets the minimum rating requirement for such entity described above (or for
which Rating Agency Confirmation is obtained with respect to such ratings);

         (iv) debt obligations (other than stripped bonds or stripped coupons)
bearing interest or sold at a discount issued by any corporation incorporated
under the laws of the United States of America or any state thereof, which
securities are rated "AA-" or its equivalent by each Rating Agency, unless
otherwise specified in writing by the Rating Agency; provided that securities
issued by any particular corporation will not be Eligible Investments to the
extent that investment therein will cause the then-outstanding principal amount
of securities issued by

                                      -36-
<PAGE>

such corporation and held in the Certificate Account to exceed 5% of the sum of
the aggregate Certificate Principal Balance of the Principal Balance
Certificates and the aggregate principal amount of all Eligible Investments in
the Certificate Account;

         (v) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a specified
date not more than one year after the date of issuance thereof) rated "Prime-1"
by Moody's and "F-1+" by Fitch (or for which Rating Agency Confirmation is
obtained with respect to such ratings);

         (vi) units of investment funds (including money market funds) that are
rated in the highest long-term category by Moody's, or if not rated by Moody's
then Moody's has issued a Rating Agency Confirmation, and the highest long-term
category by Fitch, or if not rated by Fitch, then Fitch has issued a Rating
Agency Confirmation;

         (vii) guaranteed reinvestment agreements maturing within 365 days or
less issued by any bank, insurance company or other corporation whose long-term
unsecured debt rating is not less than "Aa2" by Moody's and "AA" by Fitch, or
for which Rating Agency Confirmation is obtained with respect to such ratings;

         (viii) any money market funds (including those managed or advised by
the Paying Agent or its affiliates) that maintain a constant asset value and
that are rated "AAA" (or its equivalent rating) by Fitch and "Aaa" (or its
equivalent) by Moody's, and any other demand, money-market or time deposit, or
any other obligation, security or investment, with respect to which Rating
Agency Confirmation has been obtained; and

         (ix) such other investments bearing interest or sold at a discount,
earning a return "in the nature of interest" within the meaning of Treasury
Regulation Section 1.860G-2(g)(1)(i) (as evidenced by an Opinion of Counsel
delivered to the Trustee and the Paying Agent by the Master Servicer at the
Master Servicer's expense), as are acceptable to the Rating Agencies (as
evidenced by Rating Agency Confirmation) and treated as "permitted investments"
that are "cash flow investments" under Section 860G(a)(5) of the Code;

provided (A) such investment is held for a temporary period pursuant to Section
1.860G-2(g)(i) of the Treasury Regulations, (B) such investment is payable by
the obligor in U.S. dollars, and (C) that no such instrument shall be an
Eligible Investment (1) if such instrument evidences either (a) a right to
receive only interest payments or only principal payments with respect to the
obligations underlying such instrument or (b) a right to receive both principal
and interest payments derived from obligations underlying such instrument and
the principal and interest payments with respect to such instrument provide a
yield to maturity of greater than 120% of the yield to maturity at par of such
underlying obligations, or (2) if it may be redeemed at a price below the
purchase price or (3) if it is not treated as a "permitted investment" that is a
"cash flow investment" under Section 860G(a)(5) of the Code; and provided,
further, that any such instrument shall have a maturity date no later than the
date such instrument is required to be used to satisfy the obligations under
this Agreement, and, in any event, shall not have a maturity in excess of one
year; any such instrument must have a predetermined fixed dollar of principal
due at maturity that cannot vary or change; if rated, the obligation must not
have an "r" highlighter affixed to its rating; interest on any variable rate
instrument shall be tied to a single interest rate index plus a single fixed
spread (if any) and move proportionally with that index; and provided, further,
that no amount beneficially owned by any REMIC Pool (including any amounts
collected by the Master Servicer but not yet deposited in the Certificate
Account) may be invested in investments treated as equity interests for Federal
income tax purposes. No Eligible

                                      -37-
<PAGE>

Investments shall be purchased at a price in excess of par. For the purpose of
this definition, units of investment funds (including money market funds) shall
be deemed to mature daily.

     "ENVIRONMENTAL INSURANCE POLICY" shall mean, with respect to any Mortgage
Loan or the related Mortgaged Property or REO Property, any insurance policy
covering pollution conditions and/or other environmental conditions that is
maintained from time to time in respect of such Mortgage Loan, Mortgaged
Property or REO Property, as the case may be, for the benefit of, among others,
the Trustee on behalf of the Certificateholders.

     "ENVIRONMENTAL LAWS" means any and all federal, state and local statutes,
laws, regulations, ordinances, rules, judgments, orders, decrees, permits,
concessions, grants, franchises, licenses, agreements or other governmental
restrictions, now or hereafter in effect, relating to health or the environment
or to emissions, discharges or releases of chemical substances, including,
without limitation, any and all pollutants, contaminants, petroleum or petroleum
products, asbestos or asbestos-containing materials, polychlorinated biphenyls,
urea-formaldehyde insulation, radon, industrial, toxic or hazardous substances
or wastes, into the environment, including, without limitation, ambient air,
surface water, ground water or land, or otherwise relating to the manufacture,
processing, distribution, use, labeling, registration, treatment, storage,
disposal, transport or handling of any of the foregoing substances or wastes or
the clean-up or other remediation thereof.

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

     "ESCROW ACCOUNT" means an account established by or on behalf of the Master
Servicer pursuant to Section 8.3(e).

     "ESCROW AMOUNT" means any amount payable with respect to a Mortgage Loan
(including an A/B Mortgage Loan) for taxes, assessments, water rates, Standard
Hazard Insurance Policy premiums, ground lease payments, reserves for capital
improvements, deferred maintenance, repairs, tenant improvements, leasing
commissions, rental achievements, environmental matters and other reserves or
comparable items.

     "EUROCLEAR BANK" means Euroclear Bank, S.A./N.V., as operator of the
Euroclear system.

     "EVENT OF DEFAULT" has the meaning set forth in Section 8.28(a).

     "EXCESS INTEREST" means, with respect to an ARD Loan if an ARD Loan is not
prepaid in full on or before its Anticipated Repayment Date, the excess, if any
of (i) interest accrued at the rate of interest applicable to such Mortgage Loan
after such Anticipated Repayment Date (plus any interest on such interest as may
be provided for under the Mortgage Loan documents) over (ii) interest accrued at
the rate of interest applicable to such Mortgage Loan before such Anticipated
Repayment Date. Excess Interest on an ARD Loan is an asset of the Trust, but
shall not be an asset of any REMIC Pool formed hereunder.

     "EXCESS INTEREST SUB-ACCOUNT" means an administrative account deemed to be
a sub-account of the Distribution Account. The Excess Interest Sub-account shall
not be an asset of any REMIC Pool formed hereunder.

                                      -38-
<PAGE>

     "EXCESS LIQUIDATION PROCEEDS" means, with respect to any Mortgage Loan, the
excess of (i) Liquidation Proceeds of a Mortgage Loan or related REO Property,
over (ii) the amount that would have been received if a Principal Prepayment in
full had been made with respect to such Mortgage Loan (or, in the case of an REO
Property related to an A/B Mortgage Loan, a Principal Prepayment in full had
been made with respect to both the related A Note and B Note, or, in the case of
an REO Property related to the Loan Pair, a Principal Prepayment in full had
been made with respect to both the WestShore Plaza Pari Passu Loan and the
WestShore Plaza Companion Loan) on the date such proceeds were received.

     "EXCESS SERVICING FEE" means, with respect to the Mortgage Loans or the
WestShore Plaza Companion Loan for which an "excess servicing fee rate" is
designated on the Mortgage Loan Schedule, the monthly fee payable to (a) Wells
Fargo Bank, National Association or its successors and assigns, and (b) JHREF,
or its successors and assigns, each as holder of excess servicing rights, which
fee shall accrue on the Scheduled Principal Balance of each such Mortgage Loan
immediately prior to the Due Date occurring in each month at the per annum rate
(determined in the same manner as the applicable Mortgage Rate for such Mortgage
Loan is determined for such month) specified on the Mortgage Loan Schedule (the
"Excess Servicing Fee Rate"). Each holder of excess servicing rights is entitled
to Excess Servicing Fees only with respect to the Mortgage Loans as indicated on
Exhibit J hereto.

     "EXCHANGE ACT" has the meaning set forth in Section 8.26(a).

     "EXCHANGE CERTIFICATION" means an Exchange Certification substantially in
the form set forth in Exhibit H hereto executed by a holder of an interest in a
Regulation S Global Certificate or a Rule 144A-IAI Global Certificate, as
applicable.

     "EXEMPTION" means each of the individual prohibited transaction exemptions
granted by the United States Department of Labor to the Underwriters, as
amended.

     "EXPENSE LOSS" means a loss realized upon payment by the Trust of an
Additional Trust Expense.

     "EXTENSION" has the meaning set forth in Section 9.15(a).

     "FDIC" means the Federal Deposit Insurance Corporation or any successor
thereto.

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

     "FHLMC AUDIT PROGRAM" has the meaning set forth in Section 8.13.

     "FINAL CERTIFICATION" has the meaning set forth in Section 2.2.

     "FINAL JUDICIAL DETERMINATION" has the meaning set forth in Section 2.3(a).

     "FINAL PROSPECTUS SUPPLEMENT" has the meaning set forth in the Preliminary
Statement hereto.

                                      -39-
<PAGE>

     "FINAL RECOVERY DETERMINATION" means a determination with respect to any
Mortgage Loan, B Note, Specially Serviced Mortgage Loan or the WestShore Plaza
Companion Loan by the Special Servicer in consultation with the Operating
Adviser and the Master Servicer (including a Mortgage Loan, the WestShore Plaza
Companion Loan or a B Note that became an REO Property), in each case, in its
good faith discretion, consistent with the Servicing Standard, that all
Insurance Proceeds, Condemnation Proceeds, Liquidation Proceeds, Purchase
Proceeds and other payments or recoveries that the Special Servicer expects to
be finally recoverable on such Mortgage Loan, the WestShore Plaza Companion Loan
or a B Note, without regard to any obligation of the Master Servicer, the
Special Servicer, the Trustee or the Fiscal Agent, as the case may be, to make
payments from its own funds pursuant to Article IV hereof, have been recovered.
The Special Servicer shall be required to provide the Master Servicer with
prompt written notice of any Final Recovery Determination with respect to any
Specially Serviced Mortgage Loan upon making such determination. The Master
Servicer shall notify the Trustee and the Paying Agent of such determination and
the Paying Agent shall deliver a copy of such notice to each Rating Agency.

     "FINAL SCHEDULED DISTRIBUTION DATE" means, for each Class of rated
Certificates, the Distribution Date on which such Class would be paid in full if
payments were made on the Mortgage Loans in accordance with their terms, except
that ARD Loans are assumed to be repaid on their Anticipated Repayment Dates.

     "FISCAL AGENT" means ABN AMRO Bank N.V., a banking association organized
under the laws of the Netherlands and its permitted successors and assigns.

     "FISCAL AGENT TERMINATION EVENT" has the meaning set forth in Section 4.7.

     "FITCH" means Fitch Ratings, Inc. or its successor in interest.

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

     "GLOBAL CERTIFICATE" means any Rule 144A-IAI Global Certificate, Regulation
S Temporary Global Certificate or Regulation S Permanent Global Certificate.

     "GRANTOR TRUST" means that portion of the Trust consisting of the Class A-1
Grantor Trust Interest, Class X-1 Grantor Trust Interest, Class X-2 Grantor
Trust Interest and Class O Grantor Trust Interest.

     "HOLDER" means the Person in whose name a Certificate is registered on the
Certificate Register.

     "IAI DEFINITIVE CERTIFICATE" means, with respect to any Class of
Certificates sold to Institutional Accredited Investors who are not Qualified
Institutional Buyers, a Certificate in definitive, fully registered certificated
form without interest coupons.

     "INDEPENDENT" means, when used with respect to any Accountants, a Person
who is "independent" within the meaning of Rule 2-01(B) of the Securities and
Exchange Commission's Regulation S-X. Independent means, when used with respect
to any other Person, a Person who (A) is in fact independent of another
specified Person and any Affiliate of such

                                      -40-
<PAGE>

other Person, (B) does not have any material direct or indirect financial
interest in such other Person or any Affiliate of such other Person, (C) is not
connected with such other Person or any Affiliate of such other Person as an
officer, employee, promoter, underwriter, trustee, partner, director or Person
performing similar functions and (D) is not a member of the immediate family of
a Person defined in clause (B) or (C) above.

     "INDEPENDENT CONTRACTOR" means, either (i) with respect to any Mortgage
Loan (A) that is not a Specially Serviced Mortgage Loan, any Person designated
by the Master Servicer (other than the Master Servicer, but which may be an
Affiliate of the Master Servicer), or (B) that is a Specially Serviced Mortgage
Loan, any Person designated by the Special Servicer that would be an
"independent contractor" with respect to a REMIC within the meaning of Section
856(d)(3) of the Code if such REMIC were a real estate investment trust (except
that the ownership test set forth in such Section shall be considered to be met
by any Person that owns, directly or indirectly, 35% or more of the Aggregate
Certificate Balance or Notional Amount, as the case may be, of any Class of the
Certificates (other than the Class R-III Certificates), a Percentage Interest of
35% or more in the Class R-III Certificates or such other interest in any Class
of the Certificates or of the applicable REMIC as is set forth in an Opinion of
Counsel, which shall be at no expense to the Trustee or the Trust) so long as
such REMIC does not receive or derive any income from such Person and provided
that the relationship between such Person and such REMIC is at arm's length, all
within the meaning of Treasury Regulation Section 1.856-4(b)(5), or (ii) any
other Person (including the Master Servicer or the Special Servicer) upon
receipt by the Trustee of an Opinion of Counsel, which shall be at the expense
of the Person delivering such opinion to the Trustee, to the effect that the
taking of any action in respect of any REO Property by such Person, subject to
any conditions therein specified, that is otherwise herein contemplated to be
taken by an Independent Contractor will not cause such REO Property to cease to
qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of
the Code (determined without regard to the exception applicable for purposes of
Section 860D(a) of the Code), or cause any income realized in respect of such
REO Property to fail to qualify as Rents from Real Property.

     "INITIAL CERTIFICATION" has the meaning set forth in Section 2.2.

     "INITIAL DEPOSIT" means the amount of all collections made on the Mortgage
Loans from the Cut-Off Date to and excluding the Closing Date.

     "INITIAL REVIEW PERIOD" has the meaning set forth in Section 9.4(d).

     "INSPECTION REPORT" means the report delivered by the Master Servicer or
the Special Servicer, as the case may be, substantially in the form of Exhibit L
hereto.

     "INSTITUTIONAL ACCREDITED INVESTOR" means an institutional accredited
investor qualifying pursuant to Rule 501(a)(1), (2), (3) or (7) of Regulation D
of the 1933 Act.

     "INSURED ENVIRONMENTAL EVENT" has the meaning set forth in Section 9.1(f).

     "INSURANCE POLICIES" means, collectively, any Standard Hazard Insurance
Policy, flood insurance policy, title insurance policy, terrorism insurance
policy or Environmental Insurance Policy relating to the Mortgage Loans or the
Mortgaged Properties in effect as of the Closing Date or thereafter during the
term of this Agreement.

                                      -41-
<PAGE>

     "INSURANCE PROCEEDS" means amounts paid by the insurer under any Insurance
Policy, other than amounts required to be paid over to the Mortgagor pursuant to
law, the related Mortgage Loan, the WestShore Plaza Companion Loan, the related
B Note or the Servicing Standard and with respect to the Mortgaged Property
securing the Non-Serviced Mortgage Loans and the Non-Serviced Mortgage Loan
Companion Loans, any portion of such amounts payable to the holder of the
related Non-Serviced Mortgage Loan.

     "INTERCREDITOR AGREEMENT" means, with respect to an A/B Mortgage Loan, the
related intercreditor agreement by and between the holder of the related A Note
and the holder of the related B Note relating to the relative rights of such
holders of the respective A Note and B Note, as the same may be further amended
from time to time in accordance with the terms thereof.

     "INTEREST" means a Kimball Lane Loan REMIC Interest, a REMIC I Interest or
a REMIC II Interest, as applicable.

     "INTEREST ACCRUAL PERIOD" means, for any Distribution Date, with respect to
all Classes of Certificates and Interests (other than the Residual
Certificates), the period beginning on the first day of the month preceding the
month in which such Distribution Date occurs and ending on the last day of the
month preceding the month in which such Distribution Date occurs.

     "INTEREST RESERVE ACCOUNT" means that Interest Reserve Account maintained
by the Master Servicer pursuant to Section 5.1(a), which account shall be an
Eligible Account.

     "INTEREST RESERVE AMOUNT" has the meaning set forth in Section 5.1(d).

     "INTEREST RESERVE LOANS" shall mean the Mortgage Loans which bear interest
other than on the basis of a 360-day year consisting of twelve (12) 30-day
months.

     "INTERESTED PERSON" means, as of any date of determination, the Master
Servicer, the Special Servicer, the Depositor, the holder of any related Junior
Indebtedness (with respect to any particular Mortgage Loan), a holder of 50% or
more of the Controlling Class, the Operating Adviser, any Independent Contractor
engaged by the Master Servicer or the Special Servicer pursuant to this
Agreement, or any Person actually known to a Responsible Officer of the Trustee
to be an Affiliate of any of them.

     "JHREF" has the meaning set forth in the Preliminary Statement hereto.

     "JHREF LOANS" means, collectively, those Mortgage Loans sold to the
Depositor pursuant to Mortgage Loan Purchase Agreement V and shown on Schedule V
hereto.

     "JUNIOR INDEBTEDNESS" means any indebtedness of any Mortgagor that is
secured by a lien that is junior in right of payment to the lien of the Mortgage
securing the related Mortgage Note.

     "KIMBALL LANE LOAN" means that certain Mortgage Loan identified on the
Mortgage Loan Schedule as Mortgage Loan No. 54.

                                      -42-
<PAGE>

     "KIMBALL LANE LOAN REMIC" means the segregated pool of assets consisting of
the Kimball Lane Loan, such amounts with respect thereto as shall from time to
time be held in the Certificate Account, the Interest Reserve Account and the
Distribution Account, the related Insurance Policies and any related REO
Properties, for which a REMIC election has been made pursuant to Section 12.1(a)
hereof.

     "KIMBALL LANE LOAN REMIC INTERESTS" mean collectively, the Kimball Lane
Loan REMIC Regular Interest and the Kimball Lane Loan REMIC Residual Interest.

     "KIMBALL LANE LOAN REMIC NET MORTGAGE RATE" means, with respect to any
Distribution Date, as to the Kimball Lane Loan REMIC Regular Interest, a rate
per annum equal to the annualized rate that, when applied to the Principal
Balance of the Kimball Lane Loan (on the day prior to the Due Date preceding
such Distribution Date) on a 30/360 basis for the related loan accrual period,
yields the amount of net interest that would have accrued during the related
loan accrual period assuming a net interest rate equal to (a) the Mortgage Rate
of the Kimball Lane Loan (without taking into account any default interest rate)
as of the Cut-Off Date and without regard to any modification, waiver or
amendment of the terms thereof following the Cut-Off Date, minus (b) the
Administrative Cost Rate, and assuming an interest accrual basis that is the
same as the actual interest accrual basis of the Kimball Lane Loan, provided
that (i) the Kimball Lane Loan REMIC Net Mortgage Rate for the loan accrual
period relating to the Due Dates in both January and February in any year that
is not a leap year and in February in any year that is a leap year, shall be
determined net of any amounts transferred to the Interest Reserve Account
relating to such Mortgage Loan and (ii) the Kimball Lane Loan REMIC Net Mortgage
Rate for the loan accrual period relating to the Due Date in March in any year
shall be determined taking into account the addition of any amounts withdrawn
from the Interest Reserve Account. For any Distribution Date following the date
on which one or more Qualifying Substitute Mortgage Loans are substituted for
the Kimball Lane Loan pursuant to Section 2.3(e), the Kimball Lane Loan REMIC
Net Mortgage Rate shall be 7.2728% per annum, subject to the proviso in the
preceding sentence.

     "KIMBALL LANE LOAN REMIC REGULAR INTEREST" means, the uncertificated
interest designated as the "regular interest" in the Kimball Lane Loan REMIC,
which shall consist of, an interest having an initial Certificate Balance equal
to the Cut-Off Date Scheduled Principal Balance of the Kimball Lane Loan (or, if
applicable, the deemed Scheduled Principal Balance of any successor REO Loan),
and which has a Pass-Through Rate equal to the Kimball Lane Loan REMIC Net
Mortgage Rate. Payments and other collections of amounts received on or in
respect to the Kimball Lane Loan (or any related REO Property) shall be deemed
distributable on the Kimball Lane Loan REMIC Regular Interest.

     "KIMBALL LANE LOAN REMIC RESIDUAL INTEREST" means the sole class of
"residual interest," within the meaning of Code Section 860G(a)(2), in the
Kimball Lane Loan REMIC. The Kimball Lane Loan REMIC Residual Interest shall be
represented by the Class R-K Certificates.

     "KIMBALL LANE SUB-ACCOUNT" means an administrative account deemed to be a
sub-account of the Distribution Account. The Kimball Lane Sub-account shall not
be an asset of any REMIC Pool formed hereunder.

                                      -43-
<PAGE>

     "KIMBALL LANE YIELD MAINTENANCE AMOUNTS" means any amounts received by the
Trustee in respect of the Seller's obligation pursuant to Section 5(d) of the
Mortgage Loan Purchase Agreement I. Kimball Lane Yield Maintenance Amounts are
assets of the Trust, but shall not be an asset of any REMIC Pool formed
hereunder.

     "LATE COLLECTIONS" means, with respect to any Mortgage Loan, the WestShore
Plaza Companion Loan or any B Note, all amounts received during any Collection
Period, whether as late payments or as Liquidation Proceeds, Insurance Proceeds,
Condemnation Proceeds, Purchase Proceeds or otherwise, that represent payments
or collections of Scheduled Payments due but delinquent for a previous
Collection Period and not previously recovered.

     "LATE FEES" means a fee payable to the Master Servicer or the Special
Servicer, as the case may be, to the extent actually collected from the
Mortgagor as provided in the related Mortgage Loan or the related B Note in
connection with a late payment made by such Mortgagor.

     "LIQUIDATION EXPENSES" means reasonable and direct expenses incurred by the
Special Servicer on behalf of the Trust in connection with the liquidation of
any Specially Serviced Mortgage Loan or REO Property acquired in respect thereof
including, without limitation, reasonable legal fees and expenses in connection
with a closing, brokerage commissions and conveyance taxes for such Specially
Serviced Mortgage Loan. All Liquidation Expenses relating to disposition of the
Specially Serviced Mortgage Loan shall be (i) paid out of income from the
related REO Property, to the extent available, (ii) paid out of related proceeds
from liquidation or (iii) advanced by the Master Servicer or the Special
Servicer, subject to Section 4.4 and Section 4.6(e) hereof, as a Servicing
Advance.

     "LIQUIDATION FEE" means a fee equal to the product of (x) 1.0% and (y) the
Liquidation Proceeds received in connection with a final disposition of a
Specially Serviced Mortgage Loan or REO Property and any Condemnation Proceeds
and Insurance Proceeds received by the Trust (net of any expenses incurred by
the Special Servicer on behalf of the Trust in connection with the collection of
such Condemnation Proceeds and Insurance Proceeds other than Liquidation
Proceeds received in connection with any Non-Serviced Mortgage Loan).

     "LIQUIDATION PROCEEDS" means proceeds from the sale or liquidation
(provided that for the purposes of calculating Liquidation Fees hereunder,
Liquidation Proceeds shall not include any proceeds from a repurchase of a
Mortgage Loan by a Seller due to a Material Breach of a representation or
warranty or Material Document Defect) of a Mortgage Loan, the WestShore Plaza
Companion Loan or a B Note or related REO Property, net of Liquidation Expenses
and any related Advances and interest thereon (to the extent not otherwise paid
pursuant to Section 4.6(c)) and with respect to the sale or liquidation of any
REO Property related to the Non-Serviced Mortgage Loans and the Non-Serviced
Mortgage Loan Companion Loans, any portion of such amounts allocable to the
related Non-Serviced Mortgage Loan.

     "LIQUIDATION REALIZED LOSS" means, with respect to each Mortgage Loan or
REO Property, as the case may be, as to which a Cash Liquidation or REO
Disposition has occurred, an amount equal to the sum, without duplication, of
(A) the Principal Balance of the Mortgage Loan (or deemed Principal Balance, in
the case of an REO Mortgage Loan) as of the date of the Cash Liquidation or REO
Disposition (adjusted in accordance with Section 6.6(c)(i)),

                                      -44-
<PAGE>

plus (B) unpaid interest and interest accrued thereon at the applicable Mortgage
Rate (including interest accrued and unpaid on the portion of the Principal
Balance added in accordance with Section 6.6(c)(i), which interest shall accrue
from the date of the reduction in the Principal Balance resulting from the
allocation of a Realized Loss incurred pursuant to Section 6.6(b)(i)), plus (C)
any expenses (including Additional Trust Expenses) incurred in connection with
such Mortgage Loan that are payable or reimbursable to any Person, other than
amounts included in the definition of Liquidation Expenses and amounts
previously treated as Expense Losses (and interest thereon) minus the sum of (i)
REO Income applied as recoveries of principal or interest on the related
Mortgage Loan or REO Property, and (ii) Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds, Late Collections and all other amounts recovered
from the related Mortgagor and received during the Collection Period in which
such Cash Liquidation or REO Disposition occurred and which are not required
under any Intercreditor Agreement, the Loan Pair Intercreditor Agreement or
Non-Serviced Mortgage Loan Intercreditor Agreement to be payable or reimbursable
to any holder of a B Note or the WestShore Plaza Companion Loan. REO Income,
Liquidation Proceeds, Condemnation Proceeds and Insurance Proceeds shall be
applied first against any Expense Losses (to the extent not included in the
definition of Liquidation Expenses) for such Mortgage Loan, the unpaid interest
on the Mortgage Loan, calculated as described in clause (B) above, and then
against the Principal Balance of such Mortgage Loan, calculated as described in
clause (A) above.

     "LOAN PAIR" means the WestShore Plaza Pari Passu Loan and the WestShore
Plaza Companion Loan, collectively.

     "LOAN PAIR INTERCREDITOR AGREEMENT" means, with respect to the Loan Pair,
the intercreditor agreement by and between the holders of the WestShore Plaza
Pari Passu Loan and the WestShore Plaza Companion Loan relating to the relative
rights of such holders, as the same may be further amended from time to time in
accordance with the terms thereof.

     "LOAN-TO-VALUE RATIO" means, as of any date with respect to a Mortgage
Loan, the fraction, expressed as a percentage, the numerator of which is the
Principal Balance of such Mortgage Loan at the date of determination and the
denominator of which is the value of the Mortgaged Property as shown on the most
recent Appraisal or valuation of the Mortgaged Property which is available as of
such date or, in the case of any Non-Serviced Mortgage Loan or Loan Pair, the
allocable portion thereof.

     "LOCK-BOX ACCOUNT" has the meaning set forth in Section 8.3(g).

     "LOCK-BOX AGREEMENT" means, with respect to any Mortgage Loan, any lock-box
agreement relating to such Mortgage Loan among the related Mortgagor, a
depositary institution and the Master Servicer (or a Primary Servicer or
Sub-Servicer on its behalf) pursuant to which a Lock-Box Account is created.

     "LOSSES" has the meaning set forth in Section 12.4.

     "LUXEMBOURG PAYING AGENT" has the meaning set forth in Section 7.18.

     "LUXEMBOURG TRANSFER AGENT" has the meaning set forth in Section 7.18.

     "MAI" means Member of the Appraisal Institute.

                                      -45-
<PAGE>

     "MAJORITY MORTGAGE LOAN" shall mean any Mortgage Loan other than the
Kimball Lane Loan.

     "MASTER SERVICER" means Wells Fargo Bank, National Association and its
permitted successors or assigns.

     "MASTER SERVICER CONSENT MATTERS" has the meaning set forth in Section
8.3(a).

     "MASTER SERVICER INDEMNIFIED PARTIES" has the meaning set forth in Section
8.25(a).

     "MASTER SERVICER LOSSES" has the meaning set forth in Section 8.25(a).

     "MASTER SERVICER REMITTANCE DATE" means, for each Distribution Date, the
Business Day immediately preceding such Distribution Date.

     "MASTER SERVICER REMITTANCE REPORT" means a report prepared by the Master
Servicer and in such media as may be agreed upon by the Master Servicer and the
Paying Agent containing such information regarding the Mortgage Loans as will
permit the Paying Agent to calculate the amounts to be distributed to the
Certificateholders pursuant to this Agreement and to furnish the Monthly
Certificateholders Report to Certificateholders required to be delivered
hereunder and containing such additional information as the Master Servicer, the
Paying Agent and the Depositor may from time to time mutually agree.

     "MASTER SERVICING FEE" means for each calendar month, as to each Mortgage
Loan, the WestShore Plaza Companion Loan and each B Note (including REO Mortgage
Loans and Defeasance Loans) but not as to any Non-Serviced Mortgage Loan (as to
which there is no Master Servicing Fee payable to the Master Servicer under this
Trust), an amount equal to the Master Servicing Fee Rate applicable to such
month (determined in the same manner (other than the rate of accrual) as the
applicable Mortgage Rate is determined for such Mortgage Loan, the WestShore
Plaza Companion Loan or B Note for such month) multiplied by the Scheduled
Principal Balance of such Mortgage Loan, the WestShore Plaza Companion Loan or B
Note immediately before the Due Date occurring in such month, subject to
reduction in respect of Compensating Interest, as set forth in Section 8.10(c).

     "MASTER SERVICING FEE RATE" means, with respect to each Mortgage Loan
(other than any Non-Serviced Mortgage Loan), the WestShore Plaza Companion Loan
and each B Note (including any Mortgage Loan relating to an REO Property), the
rate per annum specified as such on the Mortgage Loan Schedule. With respect to
a Non-Serviced Mortgage Loan, no Master Servicing Fee Rate is charged by the
Master Servicer, but the Pari Passu Loan Servicing Fee Rate is charged by the
applicable Non-Serviced Mortgage Loan Master Servicer pursuant to the related
Non-Serviced Mortgage Loan Pooling and Servicing Agreement.

     "MATERIAL BREACH" has the meaning set forth in Section 2.3(a).

     "MATERIAL DOCUMENT DEFECT" has the meaning set forth in Section 2.3(a).

     "MATURITY DATE" means, with respect to any Mortgage Loan, the WestShore
Plaza Companion Loan or any B Note as of any date of determination, the date on
which the last

                                      -46-
<PAGE>

payment of principal is due and payable under the related Mortgage Loan, the
WestShore Plaza Companion Loan or the related B Note, after taking into account
all Principal Prepayments received and any Deficient Valuation, Debt Service
Reduction Amount or modification of the Mortgage Loan, the WestShore Plaza
Companion Loan or a B Note occurring prior to such date of determination, but
without giving effect to (i) any acceleration of the principal of such Mortgage
Loan, the WestShore Plaza Companion Loan or B Note or (ii) any grace period
permitted by the related Mortgage Loan, the related B Note or the WestShore
Plaza Companion Loan.

     "MODIFICATION FEE" means a fee, if any, collected from a Mortgagor by the
Master Servicer in connection with a modification of any Mortgage Loan, the
WestShore Plaza Companion Loan or any B Note other than a Specially Serviced
Mortgage Loan or collected in connection with a modification by the Special
Servicer of a Specially Serviced Mortgage Loan.

     "MODIFICATION LOSS" means, with respect to each Mortgage Loan, (i) a
decrease in the Principal Balance of such Mortgage Loan as a result of a
modification thereof in accordance with the terms hereof, (ii) any expenses
connected with such modification, to the extent (x) reimbursable to the Trustee,
the Special Servicer or the Master Servicer and (y) not recovered from the
Mortgagor or (iii) in the case of a modification of such Mortgage Loan that
reduces the Mortgage Rate thereof, the excess, on each Due Date, of the amount
of interest that would have accrued at a rate equal to the original Mortgage
Rate, over interest that actually accrued on such Mortgage Loan during the
preceding Collection Period. "MONEY TERM" means with respect to any Mortgage
Loan, the WestShore Plaza Companion Loan or any B Note, the Maturity Date,
Mortgage Rate, Principal Balance, amortization term or payment frequency thereof
or any provision thereof requiring the payment of a prepayment premium, yield
maintenance charge or percentage premium in connection with a principal
prepayment (and shall not include late fees or default interest provisions).

     "MONTHLY ADDITIONAL REPORT ON RECOVERIES AND REIMBURSEMENTS" means with
respect to each Collection Period, a report prepared by the Master Servicer, in
a format reasonably acceptable to the Special Servicer, the Paying Agent, the
Trustee and the Certificate Registrar, that identifies the following with
respect to such Collection Period, in all cases both on a loan-by-loan basis and
in the aggregate:

         (a) the amount of any Advance (and accrued and unpaid Advance Interest
     thereon) that became a Workout-Delayed Reimbursement Amount during such
     Collection Period;

         (b)(i) the amount of any Workout-Delayed Reimbursement Amount that was
     reimbursed to the Master Servicer, the Special Servicer, the Trustee or the
     Fiscal Agent during such Collection Period, (ii) the extent to which any
     reimbursement of a Workout-Delayed Reimbursement Amount made during such
     Collection Period was made from principal collections on the related
     Mortgage Loan received during the Collection Period as contemplated by
     subsection (iii) of Section 5.2(a)(II), (iii) the extent to which any
     reimbursement of a Workout-Delayed Reimbursement Amount made during such
     Collection Period was made from principal collections on the remainder of
     the Mortgage Loans received during such Collection Period as contemplated
     by

                                      -47-
<PAGE>

     subsection (iii) of Section 5.2(a)(II) and (iv) the amount of any related
     Unliquidated Advances;

         (c) the amount of any Unliquidated Advances recovered from the related
     Mortgagor or otherwise from the proceeds of the related Mortgage Loan or
     REO Property on behalf of the Trust during the current Collection Period;

         (d)(i) the amount of any Unliquidated Advance that became a
     Nonrecoverable Advance in the current Collection Period, and (ii) the
     amount of any Workout-Delayed Reimbursement Amount that arose in a prior
     Collection Period, was not reimbursed to the Master Servicer, the Special
     Servicer, the Trustee or the Fiscal Agent in the current or a prior
     Collection Period (and therefore had not become an Unliquidated Advance)
     but which has became a Nonrecoverable Advance in the current Collection
     Period;

         (e) the amount of any Advance (and accrued and unpaid Advance Interest
     thereon), other than an amount described in clause (d) above, that became a
     Nonrecoverable Advance during such Collection Period;

         (f)(i) the amount of any Nonrecoverable Advance (and accrued and unpaid
     Advance Interest thereon) that was reimbursed to the Master Servicer, the
     Special Servicer, the Trustee or the Fiscal Agent during the current
     Collection Period, and (ii) the extent (if any) to which any reimbursement
     of a Nonrecoverable Advance (and accrued and unpaid Advance Interest
     thereon) was made from principal collections on the Mortgage Loans received
     during such Collection Period as contemplated by subsection (iv) of Section
     5.2(a)(II);

         (g)(i) the amount of any Advance reimbursed to the Master Servicer, the
     Special Servicer, the Trustee or the Fiscal Agent as a Nonrecoverable
     Advance in a prior Collection Period but recovered from the related
     Mortgagor or otherwise from the proceeds of the related Mortgage Loan or
     REO Property on behalf of the Trust during the current Collection Period
     (notwithstanding that it was previously determined to constitute a
     Nonrecoverable Advance) and (ii) the extent to which any such amount is an
     amount described by clause (I)(C) of the definition of Principal
     Distribution Amount; and

         (h) a reconciliation of Advance Interest accrued on any Workout-Delayed
     Reimbursement Amount or any Nonrecoverable Advance, any Late Fees and
     default interest collected during the related Collection Period and the
     amount of Late Fees and default interest that were applied to pay such
     Advance Interest.

     The preparation of each Monthly Additional Report on Recoveries and
Reimbursements shall constitute a responsibility of the Master Servicer and
shall not constitute a responsibility of any other party. Each Loan Periodic
Update File prepared by the Master Servicer shall be accompanied by a Monthly
Additional Report on Recoveries and Reimbursements. Notwithstanding anything in
this Agreement that suggests otherwise, the Master Servicer shall not be
required to deliver a Monthly Additional Report on Recoveries and Reimbursements
(and no Loan Periodic Update File need be accompanied by any such report)

                                      -48-
<PAGE>

with respect to any Collection Period for which all of the entries in the report
would be "zero" or "not applicable."

     "MONTHLY CERTIFICATEHOLDERS REPORT" means a report provided pursuant to
Section 5.4 by the Paying Agent monthly as of the related Determination Date
generally in the form and substance of Exhibit M, which sets forth, to the
extent applicable: (i) the amount, if any, of such distributions to the holders
of each Class of Principal Balance Certificates applied to reduce the respective
Certificate Balances thereof; (ii) the amount of such distribution to holders of
each Class of Certificates allocable to (A) interest accrued at the respective
Pass-Through Rates, less any Net Aggregate Prepayment Interest Shortfalls and
(B) Prepayment Premiums (including any Kimball Lane Yield Maintenance Amounts);
(iii) the number of outstanding Mortgage Loans and the aggregate Principal
Balance and Scheduled Principal Balance of the Mortgage Loans at the close of
business on such Determination Date; (iv) the number and aggregate Scheduled
Principal Balance of Mortgage Loans (A) delinquent 30-59 days, (B) delinquent
60-89 days, (C) delinquent 90 or more days, (D) as to which foreclosure
proceedings have been commenced, or (E) as to which bankruptcy proceedings have
been commenced; (v) with respect to any REO Property included in the Trust, the
Principal Balance of the related Mortgage Loan as of the date of acquisition of
the REO Property and the Scheduled Principal Balance thereof; (vi) as of the
related Determination Date (A) as to any REO Property sold during the related
Collection Period, the date of the related determination by the Special Servicer
that it has recovered all payments which it expects to be finally recoverable
and the amount of the proceeds of such sale deposited into the Certificate
Account, and (B) the aggregate amount of other revenues collected by the Special
Servicer with respect to each REO Property during the related Collection Period
and credited to the Certificate Account, in each case identifying such REO
Property by the loan number of the related Mortgage Loan; (vii) the Aggregate
Certificate Balance or Notional Amount, as the case may be, of each Class of
Certificates before and after giving effect to the distribution made on such
Distribution Date; (viii) the aggregate amount of Principal Prepayments made
during the related Collection Period; (ix) the Pass-Through Rate applicable to
each Class of Certificates for such Distribution Date; (x) the aggregate amount
of the Master Servicing Fee, the Primary Servicing Fee, the Special Servicing
Fee, the Excess Servicing Fees and the fees paid to the applicable Non-Serviced
Mortgage Loan Master Servicer and the Non-Serviced Mortgage Loan Special
Servicer solely as such fees relate to the Non-Serviced Mortgage Loans; (xi) the
amount of Unpaid Interest and Realized Losses, if any, incurred with respect to
the Mortgage Loans, including a breakout by type of such Realized Losses; (xii)
the aggregate amount of Servicing Advances and P&I Advances outstanding
separately stated that have been made by the Master Servicer, the Special
Servicer, the Trustee and the Fiscal Agent and the aggregate amount of Servicing
Advances and P&I Advances made by the applicable Non-Serviced Mortgage Loan
Master Servicer in respect of the Non-Serviced Mortgage Loans and the
Non-Serviced Mortgage Loan Companion Loans and (xiii) the amount of any
Appraisal Reductions effected during the related Collection Period on a
loan-by-loan basis and the total Appraisal Reductions in effect as of such
Distribution Date (and in the case of the Non-Serviced Mortgage Loans, the
amount of any appraisal reductions effected under the related Non-Serviced
Mortgage Loan Pooling and Servicing Agreement). In the case of information
furnished pursuant to subclauses (i), (ii) and (xi) above, the amounts shall be
expressed in the aggregate and as a dollar amount per $1,000 of original
principal amount of the Certificates for all Certificates of each applicable
Class.

     "MOODY'S" means Moody's Investors Service Inc. or its successor in
interest.

                                      -49-
<PAGE>

     "MORTGAGE" means the mortgage, deed of trust or other instrument securing a
Mortgage Note.

     "MORTGAGE FILE" means the mortgage documents listed below:

     (i) the original Mortgage Note bearing all intervening endorsements,
endorsed in blank or endorsed "Pay to the order of LaSalle Bank National
Association, as Trustee for Bear Stearns Commercial Mortgage Securities Inc.,
Commercial Mortgage Pass-Through Certificates, Series 2003-TOP12, without
recourse, representation or warranty" or if the original Mortgage Note is not
included therein, then a lost note affidavit with a copy of the Mortgage Note
attached thereto;

     (ii) the original Mortgage, with evidence of recording thereon, and, if the
Mortgage was executed pursuant to a power of attorney, a certified true copy of
the power of attorney certified by the public recorder's office, with evidence
of recording thereon (if recording is customary in the jurisdiction in which
such power of attorney was executed) or certified by a title insurance company
or escrow company to be a true copy thereof; provided that if such original
Mortgage cannot be delivered with evidence of recording thereon on or prior to
the 45th day following the Closing Date because of a delay caused by the public
recording office where such original Mortgage has been delivered for recordation
or because such original Mortgage has been lost, the Depositor shall deliver or
cause to be delivered to the Trustee a true and correct copy of such Mortgage,
together with (A) in the case of a delay caused by the public recording office,
an Officer's Certificate of the applicable Seller stating that such original
Mortgage has been sent to the appropriate public recording official for
recordation or (B) in the case of an original Mortgage that has been lost after
recordation, a certification by the appropriate county recording office where
such Mortgage is recorded that such copy is a true and complete copy of the
original recorded Mortgage;

     (iii) the originals of all agreements modifying a Money Term or other
material modification, consolidation and extension agreements, if any, with
evidence of recording thereon (which are reflected in the Mortgage Loan
Schedule), or if such original modification, consolidation and extension
agreements have been delivered to the appropriate recording office for
recordation and either have not yet been returned on or prior to the 45th day
following the Closing Date with evidence of recordation thereon or have been
lost after recordation, true copies of such modifications, consolidations and
extensions certified by the applicable Seller together with (A) in the case of a
delay caused by the public recording office, an Officer's Certificate of the
applicable Seller stating that such original modification, consolidation or
extension agreement has been dispatched or sent to the appropriate public
recording official for recordation or (B) in the case of an original
modification, consolidation or extension agreement that has been lost after
recordation, a certification by the appropriate county recording office where
such document is recorded that such copy is a true and complete copy of the
original recorded modification, consolidation or extension agreement, and the
originals of all assumption agreements, if any;

     (iv) an original Assignment of Mortgage for each Mortgage Loan, in form and
substance acceptable for recording, signed by the holder of record in blank or
in favor of "LaSalle Bank National Association, as Trustee for Bear Stearns
Commercial Mortgage Securities Inc., Commercial Mortgage Pass-Through
Certificates, Series 2003-TOP12;"

                                      -50-
<PAGE>

     (v) originals of all intervening assignments of Mortgage, if any, with
evidence of recording thereon or, if such original assignments of Mortgage have
been delivered to the appropriate recorder's office for recordation, certified
true copies of such assignments of Mortgage certified by the applicable Seller,
or in the case of an original blanket intervening assignment of Mortgage
retained by the applicable Seller, a copy thereof certified by the applicable
Seller or, if any original intervening assignment of Mortgage has not yet been
returned on or prior to the 45th day following the Closing Date from the
applicable recording office or has been lost, a true and correct copy thereof,
together with (A) in the case of a delay caused by the public recording office,
an Officer's Certificate of the applicable Seller stating that such original
intervening assignment of Mortgage has been sent to the appropriate public
recording official for recordation or (B) in the case of an original intervening
assignment of Mortgage that has been lost after recordation, a certification by
the appropriate county recording office where such assignment is recorded that
such copy is a true and complete copy of the original recorded intervening
assignment of Mortgage;

     (vi) if the related Assignment of Leases is separate from the Mortgage, the
original of such Assignment of Leases with evidence of recording thereon or, if
such Assignment of Leases has not been returned on or prior to the 45th day
following the Closing Date from the applicable public recording office, a copy
of such Assignment of Leases certified by the applicable Seller to be a true and
complete copy of the original Assignment of Leases submitted for recording,
together with (A) an original of each assignment of such Assignment of Leases
with evidence of recording thereon and showing a complete recorded chain of
assignment from the named assignee to the holder of record, and if any such
assignment of such Assignment of Leases has not been returned from the
applicable public recording office, a copy of such assignment certified by the
applicable Seller to be a true and complete copy of the original assignment
submitted for recording, and (B) an original assignment of such Assignment of
Leases, in recordable form, signed by the holder of record in favor of "LaSalle
Bank National Association, as Trustee for Bear Stearns Commercial Mortgage
Securities Inc., Commercial Mortgage Pass-Through Certificates, Series
2003-TOP12," which assignment may be effected in the related Assignment of
Mortgage;

     (vii) the original of each guaranty, if any, constituting additional
security for the repayment of such Mortgage Loan;

     (viii) the original Title Insurance Policy or in the event such original
Title Insurance Policy has not been issued, an original binder or actual title
commitment or a copy thereof certified by the title company with the original
Title Insurance Policy to follow within 180 days of the Closing Date or a
preliminary title report with an original Title Insurance Policy to follow
within 180 days of the Closing Date;

     (ix) (A) UCC financing statements (together with all assignments thereof)
and (B) UCC-2 or UCC-3 financing statements to the Trustee duly authorized and
executed and delivered in connection with the Mortgage Loan;

     (x) copies of the related ground lease(s), if any, related to any Mortgage
Loan where the Mortgagor is the lessee under such ground lease and there is a
lien in favor of the mortgagee in such lease;

                                      -51-
<PAGE>

     (xi) copies of any loan agreements, lock-box agreements and intercreditor
agreements (including, without limitation, the Intercreditor Agreement, any
Non-Serviced Mortgage Loan Intercreditor Agreement and the Loan Pair
Intercreditor Agreement, and a copy (that is, not the original) of the mortgage
note evidencing the WestShore Plaza Companion Loan and the related B Note)
related to any Mortgage Loan;

     (xii) either (A) the original of each letter of credit, if any,
constituting additional collateral for such Mortgage Loan, which shall be
assigned and delivered to the Trustee on behalf of the Trust with a copy to be
held by the applicable Primary Servicer (or the Master Servicer), and applied,
drawn, reduced or released in accordance with documents evidencing or securing
the applicable Mortgage Loan, this Agreement and the applicable Primary
Servicing Agreement or (B) the original of each letter of credit, if any,
constituting additional collateral for such Mortgage Loan, which shall be held
by the applicable Primary Servicer (or the Master Servicer) on behalf of the
Trustee, with a copy to be held by the Trustee, and applied, drawn, reduced or
released in accordance with documents evidencing or securing the applicable
Mortgage Loan, this Agreement and the applicable Primary Servicing Agreement (it
being understood that each Seller has agreed (a) that the proceeds of such
letter of credit belong to the Trust, (b) to notify, on or before the Closing
Date, the bank issuing the letter of credit that the letter of credit and the
proceeds thereof belong to the Trust, and to use reasonable efforts to obtain
within 30 days (but in any event to obtain within 90 days) following the Closing
Date, an acknowledgement thereof by the bank (with a copy of such
acknowledgement to be sent to the Trustee) and (c) to indemnify the Trust for
any liabilities, charges, costs, fees or other expenses accruing from the
failure of the Seller to assign the letter of credit hereunder). In the case of
clause (B) above, each Primary Servicer (and the Master Servicer) acknowledges
that any letter of credit held by it shall be held in its capacity as agent of
the Trust, and if a Primary Servicer (or Master Servicer) sells its rights to
service the applicable Mortgage Loan, the applicable Primary Servicer (or Master
Servicer) will assign the applicable letter of credit to the Trust or at the
direction of the Special Servicer to such party as the Special Servicer may
instruct, in each case, at the expense of the Primary Servicer (or Master
Servicer). The Primary Servicer (or Master Servicer) shall indemnify the Trust
for any loss caused by the ineffectiveness of such assignment;

     (xiii)   the original environmental indemnity agreement, if any, related to
any Mortgage Loan;

     (xiv)    third-party management agreements for all hotels and for such
other Mortgaged Properties securing Mortgage Loans with a Cut-Off Date Principal
Balance equal to or greater than $20,000,000;

     (xv)     any Environmental Insurance Policy;

     (xvi)    any affidavit and indemnification agreement; and

     (xvii)   with respect to any Non-Serviced Mortgage Loan, a copy of the
related Non-Serviced Mortgage Loan Pooling and Servicing Agreement.

     With respect to any Non-Serviced Mortgage Loan, the preceding document
delivery requirements will be met by the delivery by the Depositor of copies of
the documents

                                      -52-
<PAGE>

specified above (other than the Mortgage Notes (and all intervening
endorsements) respectively evidencing such Non-Serviced Mortgage Loan with
respect to which the originals shall be required), including a copy of such
Non-Serviced Mortgage Loan Mortgage.

     "MORTGAGE LOAN" means a Mortgage Note secured by a Mortgage, and all
amendments and modifications thereof, identified on the Mortgage Loan Schedule,
as amended from time to time, and Mortgage Loan shall also include any
Defeasance Loan and any Non-Serviced Mortgage Loan (but shall not include any
Non-Serviced Mortgage Loan Companion Loan) but with respect to (i) any A/B
Mortgage Loan, shall include the A Note (but shall not include the related B
Note) and (ii) the Loan Pair, shall include the WestShore Plaza Pari Passu Loan
(but shall not include the WestShore Plaza Companion Loan).

     "MORTGAGE LOAN PURCHASE AGREEMENT" means Mortgage Loan Purchase Agreement
I, Mortgage Loan Purchase Agreement II, Mortgage Loan Purchase Agreement III,
Mortgage Loan Purchase Agreement IV or Mortgage Loan Purchase Agreement V, as
the case may be.

     "MORTGAGE LOAN PURCHASE AGREEMENT I" means that certain Mortgage Loan
Purchase Agreement between BSCMI and the Depositor dated as of October 1, 2003
with respect to the BSCMI Loans, a form of which is attached hereto as Exhibit
K-1.

     "MORTGAGE LOAN PURCHASE AGREEMENT II" means that certain Mortgage Loan
Purchase Agreement between Wells Fargo and the Depositor dated as of October 1,
2003 with respect to the Wells Fargo Loans, a form of which is attached hereto
as Exhibit K-2.

     "MORTGAGE LOAN PURCHASE AGREEMENT III" means that certain Mortgage Loan
Purchase Agreement between Principal and the Depositor dated as of October 1,
2003 with respect to the Principal Loans, a form of which is attached hereto as
Exhibit K-3.

     "MORTGAGE LOAN PURCHASE AGREEMENT IV" means that certain Mortgage Loan
Purchase Agreement between MSMC and the Depositor dated as of October 1, 2003
with respect to the MSMC Loans, a form of which is attached hereto as Exhibit
K-4.

     "MORTGAGE LOAN PURCHASE AGREEMENT V" means that certain
Mortgage Loan Purchase Agreement between JHREF and the Depositor dated as of
October 1, 2003 with respect to the JHREF Loans, a form of which is attached
hereto as Exhibit K-5.

     "MORTGAGE LOAN SCHEDULE" or "LOAN SCHEDULE" means collectively the schedule
attached hereto as Schedule I, which identifies each BSCMI Loan, the schedule
attached hereto as Schedule II, which identifies each Wells Fargo Loan, the
schedule attached hereto as Schedule III, which identifies each Principal Loan,
the schedule attached hereto as Schedule IV, which identifies each MSMC Loan and
the schedule attached hereto as Schedule V, which identifies each JHREF Loan as
such schedules may be amended from time to time pursuant to Section 2.3.

     "MORTGAGE NOTE" means the note or other evidence of indebtedness evidencing
the indebtedness of a Mortgagor under a Mortgage Loan.

                                      -53-
<PAGE>

     "MORTGAGE RATE" means, for a given Mortgage Loan, the WestShore Plaza
Companion Loan or a B Note, the per annum rate at which interest accrues on such
Mortgage Loan, the WestShore Plaza Companion Loan or B Note. In connection with
the Kimball Lane Loan, the Mortgage Rate shall be the per annum rate equal to
the "Note A Interest Rate" as defined in the related Intercreditor Agreement.

     "MORTGAGED PROPERTY" means the real property, together with improvements
thereto, securing the indebtedness of the Mortgagor under the related Mortgage
Loan and, in the case of an A/B Mortgage Loan, the related B Note and, in the
case of the Loan Pair, the WestShore Plaza Companion Loan.

     "MORTGAGEE" means, with respect to any Mortgage as of any date
of determination, the mortgagee named therein as of such date.

     "MORTGAGOR" means the obligor on a Mortgage Note.

     "MSMC" has the meaning set forth in the Preliminary Statement
hereto.

     "MSMC LOANS" means, collectively, those Mortgage Loans sold to the
Depositor pursuant to the Mortgage Loan Purchase Agreement IV and shown on
Schedule IV hereto.

     "NET AGGREGATE PREPAYMENT INTEREST SHORTFALL" means for any Distribution
Date, with respect to all Mortgage Loans which are not Specially Serviced
Mortgage Loans, the excess, if any, of aggregate Prepayment Interest Shortfalls
for such Mortgage Loans over the sum of (A) the Compensating Interest to be paid
by the Master Servicer on such Distribution Date and (B) the aggregate
Prepayment Interest Excesses for such Collection Period for all Mortgage Loans
which are not Specially Serviced Mortgage Loans.

     "NEW LEASE" means any lease of any REO Property entered into on behalf of
the Trust, including any lease renewed or extended on behalf of the Trust if the
Trust has the right to renegotiate the terms of such lease.

     "1933 ACT" means the Securities Act of 1933, as amended.

     "1934 ACT" means the Securities Exchange Act of 1934, as amended.

     "NONDISQUALIFICATION OPINION" means a written Opinion of Counsel to the
effect that a contemplated action (i) will neither cause any REMIC Pool to fail
to qualify as a REMIC at any time that any Certificates are outstanding nor
cause a "prohibited transaction," "prohibited contribution" or any other tax
(other than a tax on "net income from foreclosure property" permitted to be
incurred under this Agreement) to be imposed on any REMIC Pool or the Trust and
(ii) will not cause the Grantor Trust to fail to qualify as a grantor trust.

     "NONECONOMIC RESIDUAL INTEREST" means a residual interest that is a
"noneconomic residual interest" within the meaning of Treasury Regulation
Section 1.860E-1(c).

     "NON-INVESTMENT GRADE CERTIFICATES" means each Class of Certificates that,
at the time of transfer, is not rated in one of the four highest generic rating
categories by at least one of Moody's or Fitch.

                                      -54-
<PAGE>

     "NONRECOVERABLE ADVANCE" means any of the following: (i) any Pari Passu
Loan Nonrecoverable Advance (including interest accrued thereon at the Advance
Rate) and (ii) the portion of any Advance (including interest accrued thereon at
the Advance Rate) or Unliquidated Advance (not including interest thereon)
previously made or proposed to be made by the Master Servicer, the Special
Servicer, the Trustee or the Fiscal Agent, that, in its respective sole
discretion, exercised in good faith and, with respect to the Master Servicer and
the Special Servicer, taking into account the Servicing Standard, will not be
or, in the case of a current delinquency, would not be, ultimately recoverable,
from Insurance Proceeds, Condemnation Proceeds, Liquidation Proceeds or Purchase
Proceeds (or from any other collections) with respect to the related Mortgage
Loan or the WestShore Plaza Companion Loan (and taking into consideration any
Crossed Mortgage Loans) (in the case of Servicing Advances) or B Note (in the
case of Servicing Advances) or REO Property (in the case of P&I Advances and
Servicing Advances), as evidenced by an Officer's Certificate delivered pursuant
to Section 4.4. Such Officer's Certificate shall be delivered to the Trustee
(upon which the Trustee may conclusively rely) or to the Depositor (if the
Trustee or the Fiscal Agent is delivering such Officer's Certificate) and (in
either case) to the Special Servicer and the Paying Agent in the time periods as
specified in Section 4.4 and shall include the information and reports set forth
in Section 4.4. Absent bad faith, the Master Servicer's determination as to the
recoverability of any Advance shall be conclusive and binding on the
Certificateholders and, in the case of any B Note or the WestShore Plaza
Companion Loan, the holder of the B Note or the WestShore Plaza Companion Loan,
as applicable, and may, in all cases, be relied on by the Trustee and the Fiscal
Agent; provided, however, that the Special Servicer may, at its option, make a
determination in accordance with the Servicing Standard that any P&I Advance or
Servicing Advance, if made, be a Nonrecoverable Advance and shall deliver to the
Master Servicer and the Trustee notice of such determination. Absent bad faith,
any such determination shall be conclusive and binding on the
Certificateholders, the Master Servicer, the Trustee and the Fiscal Agent.
Absent bad faith, and pursuant to Section 4.1A of this Agreement, any
determination as to the recoverability of any advance made with respect to any
Non-Serviced Mortgage Loan by the Master Servicer or any Other Master Servicer
shall be conclusive and binding on the Certificateholders and may, in all cases,
be relied on by the Trustee, the Fiscal Agent and the Master Servicer. In making
any nonrecoverability determination as described above, the relevant party shall
be entitled (i) to consider (among other things) the obligations of the
Mortgagor under the terms of the Mortgage Loan as it may have been modified,
(ii) to consider (among other things) the related Mortgaged Properties in their
"as is" then-current conditions and occupancies and such party's assumptions
(consistent with the Servicing Standard in the case of the Master Servicer or
the Special Servicer) regarding the possibility and effects of future adverse
change with respect to such Mortgaged Properties, (iii) to estimate and
consider, consistent with the Servicing Standard in the case of the Master
Servicer or the Special Servicer (among other things), future expenses and (iv)
to estimate and consider, consistent with the Servicing Standard (among other
things), the timing of recovery to such party. In addition, the relevant party
may, consistent with the Servicing Standard in the case of the Master Servicer
or the Special Servicer, update or change its nonrecoverability determinations
at any time in accordance with the terms hereof and may, consistent with the
Servicing Standard in the case of the Master Servicer or the Special Servicer,
obtain from the Special Servicer any analysis, appraisals or other information
in the possession of the Special Servicer for such purposes.

                                      -55-
<PAGE>

     "NON-REGISTERED CERTIFICATE" means unless and until registered under the
Securities Act, any Class X, Class E, Class F, Class G, Class H, Class J, Class
K, Class L, Class M, Class N, Class O or Residual Certificate.

     "NON-SERVICED MORTGAGE LOAN" means the Berkeley & Brown Pari Passu Loan and
the RSA Pari Passu Loan.

     "NON-SERVICED MORTGAGE LOAN COMPANION LOANS" means the Berkeley & Brown
Companion Loans and the RSA Companion Loan.

     "NON-SERVICED MORTGAGE LOAN FISCAL AGENT" means the applicable "fiscal
agent" under the related Non-Serviced Mortgage Loan Pooling and Servicing
Agreement.

     "NON-SERVICED MORTGAGE LOAN INTERCREDITOR AGREEMENT" means, (i) with
respect to Mortgage Loan No. 3, that certain intercreditor agreement, dated
September 30, 2003, by and between the holders of the Berkeley & Brown Pari
Passu Loan, the Berkeley & Brown Companion Loans and the holders of the related
subordinated notes relating to the relative rights of such holders, as the same
may be amended from time to time in accordance with the terms thereof and (ii)
with respect to Mortgage Loan No. 29, that certain intercreditor agreement, by
and between the holders of the RSA Pari Passu Loan and the RSA Companion Loan,
as the same may be amended from time to time in accordance with the terms
thereof.

     "NON-SERVICED MORTGAGE LOAN MASTER SERVICER" means the applicable "master
servicer" under the related Non-Serviced Mortgage Loan Pooling and Servicing
Agreement.

     "NON-SERVICED MORTGAGE LOAN MORTGAGE" means the Berkeley & Brown Pari Passu
Mortgage and the RSA Pari Passu Mortgage, as applicable.

     "NON-SERVICED MORTGAGE LOAN POOLING AND SERVICING AGREEMENT" means the
2003-IQ5 Pooling and Servicing Agreement and the 2003-TOP11 Pooling and
Servicing Agreement, as applicable.

     "NON-SERVICED MORTGAGE LOAN SPECIAL SERVICER" means the applicable "special
servicer" under the related Non-Serviced Mortgage Loan Pooling and Servicing
Agreement.

     "NON-SERVICED MORTGAGE LOAN TRUSTEE" means the applicable "trustee" under
the related Non-Serviced Mortgage Loan Pooling and Servicing Agreement.

     "NOTIONAL AMOUNT" means, as of any date of determination: (i)
with respect to all of the Class X-1 Certificates as a Class, the Class X-1
Notional Amount as of such date of determination; (ii) with respect to any Class
X-1 Certificate, the product of the Percentage Interest evidenced by such
Certificate and the Class X-1 Notional Amount as of such date of determination;
(iii) with respect to all of the Class X-2 Certificates as a Class, the Class
X-2 Notional Amount as of such date of determination and (iv) with respect to
any Class X-2 Certificate, the product of the Percentage Interest evidenced by
such Certificate and the Class X-2 Notional Amount as of such date of
determination.

     "OFFICER'S CERTIFICATE" means (v) in the case of the Depositor, a
certificate signed by one or more of the Chairman of the Board, any Vice
Chairman, the President, or any Senior

                                      -56-
<PAGE>

Vice President, Vice President or Assistant Vice President, and by one or more
of the Treasurer, any Assistant Treasurer, the Secretary or any Assistant
Secretary of the Depositor, or (w) in the case of the Master Servicer and the
Special Servicer, any of the officers referred to above or an employee thereof
designated as a Servicing Officer or Special Servicing Officer pursuant to this
Agreement, (x) in the case of the Trustee or the Fiscal Agent, a certificate
signed by a Responsible Officer, (y) in the case of a Seller, a certificate
signed by one or more of the Chairman of the Board, any Vice Chairman, any
Managing Director or Director, the President, or any Executive Vice President,
any Senior Vice President, Vice President, Second Vice President or Assistant
Vice President and (z) in the case of the Paying Agent, a certificate signed by
a Responsible Officer, each with specific responsibilities for the matters
contemplated by this Agreement.

     "OPERATING ADVISER" shall mean the Person elected to serve as the Operating
Adviser pursuant to Section 9.37(a).

     "OPINION OF COUNSEL" means a written opinion of counsel addressed to the
Trustee and the Paying Agent, reasonably acceptable in form and substance to the
Trustee and the Paying Agent, and who is not in-house counsel to the party
required to deliver such opinion but who, in the good faith judgment of the
Trustee and the Paying Agent, is Independent outside counsel knowledgeable of
the issues occurring in the practice of securitization with respect to any such
opinion of counsel concerning the taxation, or status as a REMIC for tax
purposes, of the Trust or any REMIC Pool.

     "OPTION PURCHASE PRICE" has the meaning set forth in Section 9.36(b)
hereof.

     "OTHER ADVANCE REPORT DATE" means with respect to a Berkeley & Brown
Companion Loan, the RSA Companion Loan or the WestShore Plaza Companion Loan, as
applicable, which has been deposited into a commercial mortgage securitization
trust, the date under the related Other Companion Loan Pooling and Servicing
Agreement that the related Other Master Servicer is required (pursuant to the
terms thereof) to make a determination as to whether it will make a P&I Advance
as required under such Other Companion Loan Pooling and Servicing Agreement.

     "OTHER COMPANION LOAN POOLING AND SERVICING AGREEMENT" means the 2003-IQ5
Pooling and Servicing Agreement or any pooling and servicing agreement relating
to a Berkeley & Brown Companion Loan, the RSA Companion Loan or a WestShore
Plaza Companion Loan that creates a commercial mortgage securitization trust, as
applicable.

     "OTHER MASTER SERVICER" means the 2003-IQ5 Master Servicer or any other
master servicer under an Other Companion Loan Pooling and Servicing Agreement
relating to a Berkeley & Brown Companion Loan, the RSA Companion Loan or a
WestShore Plaza Companion Loan, as applicable.

     "OTHER OPERATING ADVISER" has the meaning set forth in Section 9.4(d)
hereof.

     "OTHER POOLING AND SERVICING AGREEMENT" has the meaning set forth in
Section 9.4(d) hereof.

     "OTHER SECURITIZATION" has the meaning set forth in Section 9.4(d) hereof.

                                      -57-
<PAGE>

     "OTHER SPECIAL SERVICER" has the meaning set forth in Section 9.4(d)
hereof.

     "OWNERSHIP INTEREST" means, as to any Certificate, any ownership or
security interest in such Certificate as the Holder thereof and any other
interest therein, whether direct or indirect, legal or beneficial, as owner or
as pledgee.

     "P&I ADVANCE" shall mean, (i) with respect to any Mortgage Loan or
Specially Serviced Mortgage Loan (other than the WestShore Plaza Companion Loan
or a B Note) as to which all or a portion of the Scheduled Payment (other than a
Balloon Payment) due during the related Collection Period was not received by
the Master Servicer as of the related Determination Date (subject to Section
5.1(h)), the portion of such Scheduled Payment not received; (ii) with respect
to any Balloon Mortgage Loan (including any REO Property as to which the related
Mortgage Loan provided for a Balloon Payment) as to which a Balloon Payment was
due during or prior to the related Collection Period but was delinquent, in
whole or in part, as of the related Determination Date, an amount equal to the
excess, if any, of the Assumed Scheduled Payment for such Balloon Mortgage Loan
for the related Collection Period, over any Late Collections received in respect
of such Balloon Payment during such Collection Period; and (iii) with respect to
each REO Property, an amount equal to the excess, if any, of the Assumed
Scheduled Payment for the Mortgage Loan related to such REO Property during the
related Collection Period, over remittances of REO Income to the Master Servicer
by the Special Servicer, reduced by any amounts required to be paid as taxes on
such REO Income (including taxes imposed pursuant to Section 860G(c) of the
Code); provided, however, that the interest portion of any Scheduled Payment or
Assumed Scheduled Payment shall be advanced at a per annum rate equal to the sum
of the REMIC I Net Mortgage Rate or Kimball Lane Loan REMIC Net Mortgage Rate,
as applicable, relating to such Mortgage Loan or such REO Mortgage Loan and the
Trustee Fee Rate, such that the Scheduled Payment or Assumed Scheduled Payment
to be advanced as a P&I Advance shall be net of the Master Servicing Fee, the
Excess Servicing Fee and the Primary Servicing Fees; and provided, further, that
the Scheduled Payment or Assumed Scheduled Payment for any Mortgage Loan which
has been modified shall be calculated based on its terms as modified and
provided, further, that the interest component of any P&I Advance with respect
to a Mortgage Loan as to which there has been an Appraisal Reduction shall be an
amount equal to the product of (i) the amount of interest required to be
advanced without giving effect to this proviso and (ii) a fraction, the
numerator of which is the Principal Balance of such Mortgage Loan as of the
immediately preceding Determination Date less any Appraisal Reduction applicable
to such Mortgage Loan (or, in the case of the Berkeley & Brown Pari Passu Loan,
the RSA Pari Passu Loan and the WestShore Plaza Pari Passu Loan, the portion
thereof allocable (based upon their respective Principal Balances) to the
Berkeley & Brown Pari Passu Loan, the RSA Pari Passu Loan or the WestShore Plaza
Pari Passu Loan under the related Intercreditor Agreement or the Loan Pair
Intercreditor Agreement and Section 1.6 of this Agreement) and the denominator
of which is the Principal Balance of such Mortgage Loan as of such Determination
Date. All P&I Advances for any Mortgage Loans that have been modified shall be
calculated on the basis of their terms as modified.

     "P&I ADVANCE AMOUNT" means, with respect to any Mortgage Loan or any REO
Property, the amount of the P&I Advance for each Mortgage Loan computed for any
Distribution Date.

                                      -58-

<PAGE>

     "PARI PASSU LOAN NONRECOVERABLE ADVANCE" means any "Nonrecoverable
Servicing Advance" (as defined in the related Non-Serviced Mortgage Loan Pooling
and Servicing Agreement) made with respect to any Non-Serviced Mortgage Loan
pursuant to and in accordance with the related Non-Serviced Mortgage Loan
Pooling and Servicing Agreement; provided that if the applicable Non-Serviced
Mortgage Loan Master Servicer shall have made a "Servicing Advance" (as defined
in the related Non-Serviced Mortgage Loan Pooling and Servicing Agreement) in
the nature of an expenditure benefiting the related Mortgaged Property
generally, the portion thereof attributable to any Non-Serviced Mortgage Loan
shall be determined based on the outstanding balances of such Non-Serviced
Mortgage Loan and all the related pari passu loans secured by such Non-Serviced
Mortgage Loan Mortgage on a pari passu basis on the date such advance was made.

     "PARI PASSU LOAN SERVICING FEE RATE" means the "Master
Servicing Fee Rate" and any other servicing fee rate (other than those payable
to the applicable Non-Serviced Mortgage Loan Master Servicer) applicable to any
Non-Serviced Mortgage Loan as defined in the related Non-Serviced Mortgage Loan
Pooling and Servicing Agreement.

     "PARTICIPANT" means a broker, dealer, bank, other financial institution or
other Person for whom the Clearing Agency effects book-entry transfers and
pledges of securities deposited with the Clearing Agency.

     "PASS-THROUGH RATE" or "PASS-THROUGH RATES" means with respect to the
Kimball Lane Loan REMIC Regular Interest, any Class of REMIC I Regular
Interests, REMIC II Regular Interests or REMIC Regular Certificates, other than
the Class X, Class B, Class C, Class D, Class E, Class F and Class G
Certificates, for the first Distribution Date, the rate set forth in the
Preliminary Statement hereto (subject to the calculations set forth in the
following sentence). For any Distribution Date occurring thereafter (and with
respect to the Class X, Class B, Class C, Class D, Class E, Class F and Class G
Certificates, for each Distribution Date), the Pass-Through Rates for (i) the
Kimball Lane Loan REMIC Regular Interest shall equal the Kimball Lane Loan REMIC
Net Mortgage Rate on the Kimball Lane Loan for such Distribution Date, (ii) the
REMIC I Regular Interests shall equal the REMIC I Net Mortgage Rate on the
related Mortgage Loan for such Distribution Date, (iii) the REMIC II Regular
Interests shall equal the Weighted Average REMIC I Net Mortgage Rate for such
Distribution Date, (iv) the Class A-1, Class A-2 and Class A-3 Certificates, the
fixed rate corresponding to such Class set forth in the Preliminary Statement
hereto, (v) the Class A-4 Certificates shall equal the lesser of (A) 4.68% per
annum and (B) the Weighted Average REMIC I Net Mortgage Rate for such
Distribution Date, (vi) the Class B Certificates shall equal the Weighted
Average REMIC I Net Mortgage Rate for such Distribution Date less 0.43%, (vii)
the Class C Certificates shall equal the Weighted Average REMIC I Net Mortgage
Rate for such Distribution Date less 0.31%, (viii) the Class D Certificates
shall equal the Weighted Average REMIC I Net Mortgage Rate for such Distribution
Date less 0.04%, (ix) the Class E, Class F and Class G Certificates shall equal
the Weighted Average REMIC I Net Mortgage Rate for such Distribution Date, (x)
the Class H, Class J, Class K, Class L, Class M, Class N and Class O
Certificates shall equal the lesser of (A) 4.941% per annum and (B) the Weighted
Average REMIC I Net Mortgage Rate for such Distribution Date, (xi) the Class X-1
Certificates, the per annum rate equal to the product of the Accrued Certificate
Interest thereon for such Distribution Date and 12, divided by the Class X-1
Notional Amount and (xii) the Class X-2 Certificates, the per annum rate equal
to the product of the Accrued Certificate Interest thereon for such Distribution
Date and 12, divided by the Class X-2 Notional

                                      -59-
<PAGE>

Amount. The Pass-Through Rate for the Class A-1A Component, the Class A-1B
Component, the Class A-1C Component and the Class A-1D Component shall equal the
Pass-Through Rate of the Class A-1 Certificates. The Pass-Through Rate for the
Class A-2A Component and the Class A-2B Component shall equal the Pass-Through
Rate of the Class A-2 Certificates. The Pass-Through Rate for the Class A-3A
Component, the Class A-3B Component and the Class A-3C Component shall equal the
Pass-Through Rate of the Class A-3 Certificates. The Pass-Through Rate for the
Class A-4A Component, the Class A-4B Component and the Class A-4C Component
shall equal the Pass-Through Rate of the Class A-4 Certificates. The
Pass-Through Rate for the Class B-1 Component, the Class B-2 Component and the
Class B-3 Component shall equal the Pass-Through Rate of the Class B
Certificates. The Pass-Through Rate for the Class C-1 Component, the Class C-2
Component and the Class C-3 Component shall equal the Pass-Through Rate of the
Class C Certificates. The Pass-Through Rate for the Class D-1 Component and the
Class D-2 Component shall equal the Pass-Through Rate of the Class D
Certificates. The Pass-Through Rate for the Class E-1 Component and the Class
E-2 Component shall equal the Pass-Through Rate of the Class E Certificates. The
Pass-Through Rate for the Class H-1 Component and the Class H-2 Component shall
equal the Pass-Through Rate of the Class H Certificates.

     "PAYING AGENT" means Wells Fargo Bank Minnesota, National Association and
any successor or assign, as provided herein. The Luxembourg Paying Agent shall
not be the Paying Agent and the duties of the Luxembourg Paying Agent shall be
distinct from the duties of the Paying Agent.

     "PAYING AGENT FEE" means the portion of the Trustee Fee payable to the
Paying Agent in an amount agreed to between the Trustee and the Paying Agent.

     "PERCENTAGE INTEREST" means with respect to each Class of Certificates
other than the Residual Certificates, the fraction of such Class evidenced by
such Certificate, expressed as a percentage (carried to four decimal places and
rounded, if necessary), the numerator of which is the Certificate Balance or
Notional Amount, as applicable, represented by such Certificate determined as of
the Closing Date (as stated on the face of such Certificate) and the denominator
of which is the Aggregate Certificate Balance or Notional Amount, as applicable,
of all of the Certificates of such Class determined as of the Closing Date. With
respect to each Residual Certificate, the percentage interest in distributions
(if any) to be made with respect to the relevant Class, as stated on the face of
such Certificate.

     "PERFORMING PARTY" has the meaning set forth in Section
8.26(b).

     "PERMITTED TRANSFEREE" means any Transferee other than a Disqualified
Organization.

     "PERSON" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.

     "PHASE I ENVIRONMENTAL REPORT" means a report by an Independent Person who
regularly conducts environmental site assessments in accordance with then
current standards

                                      -60-
<PAGE>

imposed by institutional commercial mortgage lenders and who has a reasonable
amount of experience conducting such assessments.

     "PLACEMENT AGENT" means Bear, Stearns & Co. Inc., Morgan Stanley & Co.
Incorporated, Goldman, Sachs & Co. and Wells Fargo Brokerage Services, LLC or
its respective successor in interest.

     "PLAN" has the meaning set forth in Section 3.3(d).

     "PLAN ASSET REGULATIONS" means the Department of Labor regulations set
forth in 29 C.F.R.(Section)2510.3-101.

     "PRELIMINARY PROSPECTUS SUPPLEMENT" has the meaning set forth in the
Preliminary Statement hereto.

     "PREPAYMENT INTEREST EXCESS" means for any Distribution Date and the
related Collection Period, during which a full or partial Principal Prepayment
(including payment of a Balloon Payment other than in connection with the
foreclosure or liquidation of a Mortgage Loan) is made after the Due Date for
such Mortgage Loan through and including the last day of the Collection Period,
the amount of interest that accrues on the amount of such Principal Prepayment
from such Due Date to the date such payment was made, plus (if made) any payment
by the Mortgagor of interest that would have accrued to the next succeeding Due
Date (net of the Master Servicing Fee, the Primary Servicing Fees, the Excess
Servicing Fees, the Special Servicing Fee, the Trustee Fee and the servicing fee
and trustee fee payable in connection with any Non-Serviced Mortgage Loan (in
the case of any Non-Serviced Mortgage Loan), to the extent collected.

     "PREPAYMENT INTEREST SHORTFALL" means, with respect to any Distribution
Date, a shortfall in the collection of a full month's interest on any Mortgage
Loan, by reason of a full or partial Principal Prepayment (including payment of
a Balloon Payment other than in connection with the foreclosure or liquidation
of a Mortgage Loan) made during any Collection Period prior to the Due Date for
such Mortgage Loan in such Collection Period (including any shortfall resulting
from such a payment during the grace period relating to such Due Date). The
amount of any Prepayment Interest Shortfall shall equal the excess of (A) the
aggregate amount of interest which would have accrued on the Scheduled Principal
Balance of such Mortgage Loan if the Mortgage Loan had paid on its Due Date and
such Principal Prepayment or Balloon Payment had not been made (net of the
Master Servicing Fee, the Primary Servicing Fees, the Excess Servicing Fees, the
Special Servicing Fee, the Trustee Fee and the servicing fee payable in
connection with any Non-Serviced Mortgage Loan (in the case of any Non-Serviced
Mortgage Loan)) over (B) the aggregate interest that did so accrue through the
date such payment was made (net of such fees). A Prepayment Interest Shortfall
in respect of the Kimball Lane Loan shall be a Prepayment Interest Shortfall in
respect of the Kimball Lane Loan REMIC Regular Interest.

     "PREPAYMENT PREMIUM" means, with respect to any Mortgage Loan, the
WestShore Plaza Companion Loan or any B Note for any Distribution Date, the
prepayment premiums, yield maintenance charges or percentage premiums, if any,
received during the

                                      -61-

<PAGE>

related Collection Period in connection with Principal Prepayments on such
Mortgage Loan, the WestShore Plaza Companion Loan or B Note.

     "PRIMARY COLLATERAL" means the portion of the Mortgaged
Property securing the Repurchased Loan or Crossed-Mortgage Loan, as applicable,
that is encumbered by a first mortgage lien.

     "PRIMARY SERVICERS" means Principal Global Investors, LLC and JHREF and
each of their respective permitted successors and assigns.

     "PRIMARY SERVICING AGREEMENT" means, with respect to each Primary Servicer,
the agreement between such Primary Servicer and the Master Servicer, dated as of
October 1, 2003, a form of which is attached hereto as Exhibit G, under which
such Primary Servicer services the Mortgage Loans set forth on the schedule
attached thereto.

     "PRIMARY SERVICING FEE" means, for each calendar month, as to each Mortgage
Loan, the applicable Primary Servicing Fee Rate multiplied by the Scheduled
Principal Balance of such Mortgage Loan immediately before the Due Date
occurring in such month, but prorated for the number of days during the calendar
month for such Mortgage Loan for which interest actually accrues on such
Mortgage Loan and payable only from collections on such Mortgage Loan.

     "PRIMARY SERVICING FEE RATE" means, the monthly fee payable to the
applicable Primary Servicer (or the Master Servicer, as applicable) based on the
per annum rate specified on the Mortgage Loan Schedule, as more specifically
described, in the case of the Primary Servicer, in the applicable Primary
Servicing Agreement (determined in the same manner (other than the rate of
accrual) as the applicable Mortgage Rate is determined for such Mortgage Loan
for such month).

     "PRINCIPAL" has the meaning set forth in the Preliminary Statement hereto.

     "PRINCIPAL BALANCE" means, with respect to any Mortgage Loan, the WestShore
Plaza Companion Loan, any B Note or REO Mortgage Loan, for purposes of
performing calculations with respect to any Distribution Date, the principal
balance of such Mortgage Loan, the WestShore Plaza Companion Loan, B Note or the
related REO Mortgage Loan outstanding as of the Cut-Off Date after taking into
account all principal and interest payments made or due on or prior to the
Cut-Off Date (assuming, for any Mortgage Loan, the WestShore Plaza Companion
Loan or any B Note with a Due Date in October 2003 that is not October 1, 2003,
that principal and interest payments for such month were paid on October 1,
2003), reduced (to not less than zero) by (i) any payments or other collections
of amounts allocable to principal on such Mortgage Loan, the WestShore Plaza
Companion Loan, any B Note or any related REO Mortgage Loan that have been
collected or received during any preceding Collection Period, other than any
Scheduled Payments due in any subsequent Collection Period, and (ii) any
Realized Principal Loss incurred in respect of such Mortgage Loan or related REO
Mortgage Loan during any related Collection Period.

     "PRINCIPAL BALANCE CERTIFICATES" means, collectively, the Class A-1, Class
A-2, Class A-3, Class A-4, Class B, Class C, Class D, Class E, Class F, Class G,
Class H, Class J, Class K, Class L, Class M, Class N and Class O Certificates.

                                      -62-
<PAGE>

     "PRINCIPAL DISTRIBUTION AMOUNT" means, on any Distribution Date, the amount
equal to the excess, if any, of

     (I) the sum of:

     (A) the aggregate (without duplication) of the following:

     (i) the principal portion of all Scheduled Payments (other than the
principal portion of Balloon Payments) and any Assumed Scheduled Payments, in
each case, to the extent received or advanced, as the case may be, in respect of
the Mortgage Loans and any REO Mortgage Loans (but not in respect of the
WestShore Plaza Companion Loan or any B Note or its successor REO Mortgage Loan)
for their respective Due Dates occurring during the related Collection Period;
and

     (ii) all payments (including Principal Prepayments and the principal
portion of Balloon Payments but not in respect of the WestShore Plaza Companion
Loan or any B Note or its respective successor REO Mortgage Loan) and any other
collections (including Liquidation Proceeds (other than the portion thereof, if
any, constituting Excess Liquidation Proceeds), Condemnation Proceeds, Insurance
Proceeds, Purchase Proceeds and REO Income) received on or in respect of the
Mortgage Loans during the related Collection Period and that were identified and
applied by the Master Servicer as recoveries of principal thereof;

     (B) the aggregate amount of any collections of principal received on or in
respect of the Mortgage Loans during the related Collection Period that, in each
case, represents a delinquent amount as to which an Advance had been made, which
Advance was previously reimbursed during the Collection Period for a prior
Distribution Date as part of a Workout-Delayed Reimbursement Amount for which a
deduction was made under clause (II)(A) below with respect to such Distribution
Date; and

     (C) the aggregate amount of any collections identified and
applied by the Master Servicer as recoveries of principal and received on or in
respect of the Mortgage Loans during the related Collection Period that, in each
case, represents a recovery of an amount previously determined (in a Collection
Period for a prior Distribution Date) to have been a Nonrecoverable Advance and
for which a deduction was made under clause (II)(B) below with respect to a
prior Distribution Date, and which are applied pursuant to Section 6.6(c)(i);
over

     (II) the sum of:

     (A) the aggregate amount of Workout-Delayed Reimbursement Amounts (and
Advance Interest thereon) that was reimbursed or paid during the related
Collection Period to one or more of the Master Servicer, the Special Servicer,
the Trustee and the Fiscal Agent from principal collections on the Mortgage
Loans pursuant to subsection (iii) of Section 5.2(a)(II); and

     (B) the aggregate amount of Nonrecoverable Advances (and Advance Interest
thereon) that was reimbursed or paid during the related Collection Period to one
or more of the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent during the related Collection Period from principal collections on the
Mortgage Loans pursuant to subsection (iv) of Section 5.2(a)(II).

                                      -63-
<PAGE>

     "PRINCIPAL LOANS" means, collectively those Mortgage Loans
sold to the Depositor pursuant to Mortgage Loan Purchase Agreement III and shown
on Schedule III hereto.

     "PRINCIPAL PREPAYMENT" means any voluntary or involuntary payment or
collection of principal on a Mortgage Loan, the WestShore Plaza Companion Loan
or a B Note which is received or recovered in advance of its scheduled Due Date
and applied to reduce the Principal Balance of the Mortgage Loan, the WestShore
Plaza Companion Loan or B Note in advance of its scheduled Due Date, including,
without limitation, all proceeds, to the extent allocable to principal, received
from the payment of cash in connection with a substitution shortfall pursuant to
Section 2.3; provided, that the pledge by a Mortgagor of Defeasance Collateral
with respect to a Defeasance Loan shall not be deemed to be a Principal
Prepayment.

     "PRIVATE PLACEMENT MEMORANDUM" means the Private Placement Memorandum dated
October 1, 2003, pursuant to which the Class X-1, Class X-2, Class E, Class F,
Class G, Class H, Class J, Class K, Class L, Class M, Class N and Class O
Certificates will be offered for sale.

     "PROSPECTUS" has the meaning set forth in the Preliminary Statement hereto.

     "PURCHASE PRICE" means, with respect to the purchase by the Seller or
liquidation by the Special Servicer of (i) a Mortgage Loan or an REO Mortgage
Loan pursuant to Article II of this Agreement, (ii) an REO Mortgage Loan
pursuant to Section 9.15 or (iii) a Mortgage Loan pursuant to Section 9.36 under
the circumstances described therein, a price equal to the sum of (A) 100% of the
unpaid Principal Balance of such Mortgage Loan (or deemed Principal Balance, in
the case of an REO Mortgage Loan), plus (B) accrued but unpaid interest thereon
calculated at the Mortgage Rate to, but not including, the Due Date in the
Collection Period in which such purchase or liquidation occurs, plus (C) the
amount of any expenses related to such Mortgage Loan and/or (if applicable) the
WestShore Plaza Companion Loan or the related B Note or the related REO Property
(including any Servicing Advances and Advance Interest thereon (which have not
been paid by the Mortgagor or out of Late Fees or default interest paid by the
related Mortgagor on the related Mortgage Loan and/or (if applicable) the
WestShore Plaza Companion Loan or the related B Note) related to such Mortgage
Loan and/or (if applicable) the WestShore Plaza Companion Loan or the related B
Note and all Special Servicing Fees and Liquidation Fees paid with respect to
the Mortgage Loan and/or (if applicable) the WestShore Plaza Companion Loan or
the related B Note) that are reimbursable or payable to the Master Servicer, the
Special Servicer, the Paying Agent, the Trustee, the Fiscal Agent, any
Non-Serviced Mortgage Loan Master Servicer or any Non-Serviced Mortgage Loan
Special Servicer, plus (D) if such Mortgage Loan or REO Mortgage Loan is being
repurchased or substituted for by a Seller pursuant to the related Mortgage Loan
Purchase Agreement, all expenses reasonably incurred or to be incurred by a
Primary Servicer, the Master Servicer, the Special Servicer, the Depositor, the
Paying Agent or the Trustee in respect of the Material Breach or Material
Document Defect giving rise to the repurchase or substitution obligation (and
that are not otherwise included in (C) above).

     "PURCHASE PROCEEDS" means any cash amounts received by the Master Servicer
in connection with: (i) the repurchase of a Mortgage Loan or an REO Mortgage
Loan by a Seller pursuant to Section 2.3 or (ii) the purchase of the Mortgage
Loans and REO Properties by the

                                      -64-

<PAGE>

Depositor, the Master Servicer, the Special Servicer or the holders of the Class
R-I Certificates pursuant to Section 10.1(b).

     "QUALIFIED BIDDER" means (A) as used in section 8.29(c), a Person qualified
to act as successor Master Servicer hereunder pursuant to Section 8.22(b)
(including the requirement set forth in Section 8.22(b) that Rating Agency
Confirmation shall have been obtained from each Rating Agency with respect to
such Person) and (B) as used in Section 9.31(c), any Person qualified to act as
successor Special Servicer hereunder pursuant to Section 9.21(b) (including the
requirement set forth in Section 9.21(b) that Rating Agency Confirmation shall
have been obtained form each Rating Agency with respect to such Person).

     "QUALIFIED INSTITUTIONAL BUYER" means a qualified institutional buyer
qualifying pursuant to Rule 144A.

     "QUALIFIED INSURER" means, (i) with respect to any Mortgage Loan, the
WestShore Plaza Companion Loan or any B Note, an insurance company duly
qualified as such under the laws of the state in which the related Mortgaged
Property is located, duly authorized and licensed in such state to transact the
applicable insurance business and to write the insurance, but in no event rated
lower than "A2" by Moody's, if rated by Moody's or if not rated by Moody's, then
Moody's has issued a Rating Agency Confirmation and "A" by Fitch if rated by
Fitch or if not rated by Fitch, then Fitch has issued a Rating Agency
Confirmation, and (ii) with respect to the Servicer Errors and Omissions
Insurance Policy or Servicer Fidelity Bond an insurance company that has a claim
paying ability no lower than "A2" by Moody's if rated by Moody's, or if not
rated by Moody's, then Moody's has issued a Rating Agency Confirmation, and "A"
by Fitch if rated by Fitch or if not rated by Fitch, then as to which Fitch has
issued a Rating Agency Confirmation, or (iii) in either case, a company not
satisfying clause (i) or (ii) but with respect to which a Rating Agency
Confirmation is obtained. "Qualified Insurer" shall also mean any entity that
satisfies all of the criteria, other than the ratings criteria, set forth in one
of the foregoing clauses and whose obligations under the related insurance
policy are guaranteed or backed by an entity that satisfies the ratings criteria
set forth in such clause (construed as if such entity were an insurance company
referred to therein).

     "QUALIFYING SUBSTITUTE MORTGAGE LOAN" means, in the case of a Mortgage Loan
substituted for a Deleted Mortgage Loan, a Mortgage Loan which, on the date of
substitution, (i) has an outstanding principal balance, after deduction of the
principal portion of the Scheduled Payment due in the month of substitution, not
in excess of the Principal Balance of the Deleted Mortgage Loan; provided,
however, that, to the extent that the principal balance of such Mortgage Loan is
less than the Principal Balance of the Deleted Mortgage Loan, then such
differential in principal amount, together with interest thereon at the Mortgage
Rate on the related Mortgage Loan from the date as to which interest was last
paid through the last day of the month in which such substitution occurs, shall
be paid by the party effecting such substitution to the Master Servicer for
deposit into the Certificate Account, and shall be treated as a Principal
Prepayment hereunder; (ii) is accruing interest at a rate of interest at least
equal to that of the Deleted Mortgage Loan; (iii) has a remaining term to stated
maturity not greater than, and not more than two years less than, that of the
Deleted Mortgage Loan; (iv) has an original Loan-to-Value Ratio not higher than
that of the Deleted Mortgage Loan and a current Loan-to-Value Ratio (equal to
the outstanding principal balance on the date of substitution divided by its
current Appraised Value) not higher than the current Loan-to-Value Ratio of the
Deleted Mortgage Loan

                                      -65-

<PAGE>

and has a current Debt Service Coverage Ratio equal to or greater than the
current Debt Service Coverage Ratio of the Deleted Mortgage Loan; (v) will
comply with all of the representations and warranties relating to Mortgage Loans
set forth herein, as of the date of substitution; (vi) has a Phase I
Environmental Report relating to the related Mortgaged Property in its Mortgage
Files and such Phase I Environmental Report does not, in the good faith
reasonable judgment of the Special Servicer, consistent with the Servicing
Standard raise material issues that have not been adequately addressed; (vii)
has an engineering report relating to the related Mortgaged Property in its
Mortgage Files and such engineering report does not, in the good faith
reasonable judgment of the Special Servicer, consistent with the Servicing
Standard raise material issues that have not been adequately addressed; and
(viii) as to which the Trustee and the Paying Agent have received an Opinion of
Counsel, at the related Seller's expense, that such Mortgage Loan is a
"qualified replacement mortgage" within the meaning of Section 860G(a)(4) of the
Code; provided that no Mortgage Loan may have a Maturity Date after the date
three years prior to the Rated Final Distribution Date, and provided, further,
that no such Mortgage Loan shall be substituted for a Deleted Mortgage Loan
unless Rating Agency Confirmation is obtained, and provided, further that no
such Mortgage Loan shall be substituted for a Deleted Mortgage Loan unless the
Operating Adviser shall have approved of such substitution (provided, however,
that such approval of the Operating Adviser may not be unreasonably withheld).
In the event that either one mortgage loan is substituted for more than one
Deleted Mortgage Loan or more than one mortgage loan is substituted for one or
more Deleted Mortgage Loans, then (A) the Principal Balance referred to in
clause (i) above shall be determined on the basis of aggregate Principal
Balances and (B) the rates referred to in clause (ii) above and the remaining
term to stated maturity referred to in clause (iii) above shall be determined on
a weighted average basis (provided, that the REMIC I Net Mortgage Rate and
Kimball Lane Loan REMIC Net Mortgage Rate for any Qualifying Substitute Mortgage
Loan may not be less than the highest Pass-Through Rate of any outstanding Class
of Certificates that is not subject to a cap based on the Weighted Average REMIC
I Net Mortgage Rate). Whenever a Qualifying Substitute Mortgage Loan is
substituted for a Deleted Mortgage Loan pursuant to this Agreement, the party
effecting such substitution shall certify that such Mortgage Loan meets all of
the requirements of this definition and shall send such certification to the
Paying Agent, which shall deliver a copy of such certification to the Special
Servicer, the Trustee and the Operating Adviser promptly, and in any event
within five Business Days following the Paying Agent's receipt of such
certification. Notwithstanding the foregoing, a "Qualifying Substitute Mortgage
Loan" delivered in connection with a substitution pursuant to Section 2.3(e)
need not satisfy the requirements set forth in clauses (i) and (ii) above so
long as the scheduled cash flow of the substitute mortgage loan is sufficient to
pay all of the scheduled interest payments and the ultimate payment of principal
that would have been payable on the Deleted Mortgage Loan. Any excess cashflow
over the amount required to pay the scheduled principal and interest of the
Deleted Mortgage Loan shall be payable to the holder of the Kimball Lane Loan
REMIC Residual Interest or the REMIC I Residual Interest, as applicable. A
"Qualifying Substitute Mortgage Loan" delivered in connection with a
substitution pursuant to Section 2.3(e) may be secured on a senior or pari passu
basis with one or more other notes secured by the related Mortgaged Property
pursuant to the related Mortgage, and in such case such other notes shall be
serviced hereunder in accordance with the terms hereof and the related
Intercreditor Agreement.

     "RATED FINAL DISTRIBUTION DATE" means with respect to each rated Class of
Certificates, the Distribution Date in August 2039.

                                      -66-
<PAGE>

     "RATING AGENCIES" means Moody's and Fitch.

     "RATING AGENCY CONFIRMATION" means, with respect to any matter,
confirmation in writing by each Rating Agency (or such Rating Agency as is
specified herein) that a proposed action, failure to act, or other event
specified herein will not in and of itself result in the withdrawal, downgrade,
or qualification, as applicable, of the then-current rating assigned by such
Rating Agency to any Class of Certificates then rated by such Rating Agency.

     "REALIZED INTEREST LOSS" means, with respect to each Mortgage Loan, (i) in
the case of a Liquidation Realized Loss, the portion of any Liquidation Realized
Loss that exceeds the Realized Principal Loss on the related Mortgage Loan, (ii)
in the case of a Bankruptcy Loss, the portion of such Realized Loss attributable
to accrued interest on the related Mortgage Loan, (iii) in the case of an
Expense Loss, an Expense Loss resulting in any period from the payment of the
Special Servicing Fee and any Expense Losses treated as Realized Interest Losses
pursuant to the last sentence of the definition of "Realized Principal Loss" or
(iv) in the case of a Modification Loss, a Modification Loss described in clause
(iii) of the definition thereof.

     "REALIZED LOSS" means a Liquidation Realized Loss, a
Modification Loss, a Bankruptcy Loss or an Expense Loss with respect to a
Mortgage Loan.

     "REALIZED PRINCIPAL LOSS" means, with respect to each Mortgage Loan, (i) in
the case of a Liquidation Realized Loss, the amount of such Realized Loss, to
the extent that it does not exceed the Principal Balance of the Mortgage Loan
(or deemed Principal Balance, in the case of REO Property), (ii) in the case of
a Modification Loss, the amount of such Modification Loss described in clause
(i) of the definition thereof, (iii) in the case of a Bankruptcy Loss, the
portion of such Realized Loss attributable to the reduction in the Principal
Balance of the related Mortgage Loan, (iv) in the case of an Expense Loss, any
such Expense Loss (other than Expense Losses resulting from the payment of
Special Servicing Fees) to the extent that such Expense Losses do not exceed
amounts collected in respect of the Mortgage Loans that were identified as
allocable to principal, and any such excess shall be treated as a Realized
Interest Loss and (v) the amounts in respect thereof that are withdrawn from the
Certificate Account pursuant to Section 6.6(b)(i).

     "RECORD DATE" means, for each Distribution Date and each Class of
Certificates, the close of business on the last Business Day of the month
immediately preceding the month in which such Distribution Date occurs.

     "RECOVERIES" means, as of any Distribution Date, any amounts recovered with
respect to a Mortgage Loan, the WestShore Plaza Companion Loan, a B Note or REO
Property following the period in which a Final Recovery Determination occurs
plus other amounts defined as "Recoveries" herein.

     "REGULATION S" means Regulation S under the 1933 Act.

     "REGULATION S CERTIFICATE" means a written certification
substantially in the form set forth in Exhibit F hereto certifying that a
beneficial owner of an interest in a Regulation S Temporary Global Certificate
is not a U.S. Person (as defined in Regulation S).

                                      -67-
<PAGE>

     "REGULATION S GLOBAL CERTIFICATES" means the Regulation S Permanent Global
Certificates together with the Regulation S Temporary Global Certificates.

     "REGULATION S PERMANENT GLOBAL CERTIFICATE" means any single
permanent global Certificate, in definitive, fully registered form without
interest coupons received in exchange for a Regulation S Temporary Global
Certificate.

     "REGULATION S TEMPORARY GLOBAL CERTIFICATE" means, with respect to any
Class of Certificates offered and sold outside of the United States in reliance
on Regulation S, a single temporary global Certificate, in definitive, fully
registered form without interest coupons.

     "REHABILITATED MORTGAGE LOAN" means any Specially Serviced Mortgage Loan
with respect to which (i) three consecutive Scheduled Payments have been made
(in the case of any such Mortgage Loan, the WestShore Plaza Companion Loan or B
Note that was modified, based on the modified terms), or a complete defeasance
shall have occurred, (ii) no other Servicing Transfer Event has occurred and is
continuing (or with respect to determining whether a Required Appraisal Loan is
a Rehabilitated Mortgage Loan for applying Appraisal Reductions, no other
Appraisal Event has occurred and is continuing) and (iii) the Trust has been
reimbursed for all costs incurred as a result of the occurrence of a Servicing
Transfer Event, such amounts constitute a Workout-Delayed Reimbursement Amount,
or such amounts have been forgiven. An A Note shall not constitute a
Rehabilitated Mortgage Loan unless its related B Note would constitute a
Rehabilitated Mortgage Loan. A B Note shall not constitute a Rehabilitated
Mortgage Loan unless its related A Note also would constitute a Rehabilitated
Mortgage Loan. The WestShore Plaza Pari Passu Loan shall not constitute a
Rehabilitated Mortgage Loan unless the WestShore Plaza Companion Loan would
constitute a Rehabilitated Mortgage Loan. The WestShore Plaza Companion Loan
shall not constitute a Rehabilitated Mortgage Loan unless the WestShore Plaza
Pari Passu Loan also would constitute a Rehabilitated Mortgage Loan. Under the
terms of the applicable Non-Serviced Mortgage Loan Pooling and Servicing
Agreement, a Non-Serviced Mortgage Loan shall not constitute a Rehabilitated
Mortgage Loan unless its related Non-Serviced Mortgage Loan Companion Loan would
also constitute a Rehabilitated Mortgage Loan.

     "RELEASE DATE" means the date 40 days after the later of (i) the
commencement of the offering of the Certificates and (ii) the Closing Date.

     "REMIC" means a real estate mortgage investment conduit within the meaning
of Section 860D of the Code.

     "REMIC I" means the segregated pool of assets consisting of (i) the
Majority Mortgage Loans (other than any Excess Interest payable thereon), such
amounts with respect thereto as shall from time to time be held in the
Certificate Account, the Distribution Account (other than the portion thereof
constituting the Excess Interest Sub-account) and the Interest Reserve Account
(other than with respect to the Kimball Lane Loan), the Insurance Policies
(other than with respect to the Kimball Lane Loan and other than the interests
of the holder of the WestShore Plaza Companion Loan or any B Note therein) and
any REO Properties (other than with respect to the Kimball Lane Loan and other
than the interests of the holder of the WestShore Plaza Companion Loan or any B
Note therein) and (ii) the Kimball Lane Loan REMIC Regular Interest and
collections thereon, for which a REMIC election has been made

                                      -68-
<PAGE>

pursuant to Section 12.1(a) hereof. Excess Interest on the Mortgage Loans and
the Excess Interest Sub-account shall constitute assets of the Trust but shall
not be a part of any REMIC Pool formed hereunder. The Non-Serviced Mortgage Loan
Companion Loans and any amounts payable thereon shall not constitute assets of
the Trust or any REMIC Pool formed hereunder. No B Note or any amounts payable
thereon shall constitute an asset of the Trust or any REMIC Pool formed
hereunder. Neither the WestShore Plaza Companion Loan or any amounts payable
thereon shall constitute an asset of the Trust or any REMIC Pool formed
hereunder. The Kimball Lane Loan, collections thereon, and any related REO
Property acquired in respect thereof shall be held as assets of the Kimball Lane
Loan REMIC.

     "REMIC I INTERESTS" means, collectively, the REMIC I Regular Interests and
the REMIC I Residual Interest.

     "REMIC I NET MORTGAGE RATE" means, with respect to any Distribution Date,
(I) as to any REMIC I Regular Interest, other than the REMIC I Regular Interest
corresponding to the Kimball Lane Loan REMIC Regular Interest, a rate per annum
equal (a) with respect to any Majority Mortgage Loan that accrues interest on
the basis of a 360-day year consisting of twelve (12) 30-day months ("30/360
basis"), (i) the Mortgage Rate thereof (without taking into account any increase
therein after the Anticipated Repayment Date in respect of an ARD Loan or any
default interest rate) as of the Cut-Off Date and without regard to any
modification, waiver or amendment of the terms thereof following the Cut-Off
Date, minus (ii) the Administrative Cost Rate, and (b) with respect to any
Majority Mortgage Loan that accrues interest on a basis other than a 30/360
basis, the annualized rate that, when applied to the Principal Balance of the
related Mortgage Loan (on the day prior to the Due Date preceding such
Distribution Date) on a 30/360 basis for the related loan accrual period, yields
the amount of net interest that would have accrued during the related loan
accrual period assuming a net interest rate equal to the rate described in
clause (a) above, and assuming an interest accrual basis that is the same as the
actual interest accrual basis of such Mortgage Loan, provided that for purposes
of this clause (b), (i) the REMIC I Net Mortgage Rate for the loan accrual
period relating to the Due Dates in both January and February in any year that
is not a leap year and in February in any year that is a leap year, shall be
determined net of any amounts transferred to the Interest Reserve Account and
(ii) the REMIC I Net Mortgage Rate for the loan accrual period relating to the
Due Date in March shall be determined taking into account the addition of any
amounts withdrawn from the Interest Reserve Account and (II) as to the REMIC I
Regular Interest corresponding to the Kimball Lane Loan REMIC Regular Interest,
the Kimball Lane Loan REMIC Net Mortgage Rate.

     "REMIC I REGULAR INTERESTS" means, collectively, the uncertificated
interests designated as "regular interests" in REMIC I, which shall consist of,
with respect to each Mortgage Loan, an interest having an initial Certificate
Balance equal to the Cut-Off Date Scheduled Principal Balance of such Mortgage
Loan, and which has a Pass-Through Rate equal to the REMIC I Net Mortgage Rate
of such Mortgage Loan.

     "REMIC I RESIDUAL INTEREST" means the sole class of "residual interest,"
within the meaning of Code Section 860G(a)(2), in REMIC I. The REMIC I Residual
Interest shall be represented by the Class R-I Certificates.

                                      -69-
<PAGE>

     "REMIC II" means the segregated pool of assets consisting of the REMIC I
Regular Interests for which a REMIC election has been made pursuant to Section
12.1(a) hereof.

     "REMIC II INTERESTS" means, collectively, the REMIC II Regular Interests
and the Class R-II Certificates.

     "REMIC II REGULAR INTEREST A-1A" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having initial Certificate Balance equal to $43,083,000, and which has
a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST A-1B" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having initial Certificate Balance equal to $60,397,000, and which has
a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST A-1C" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having initial Certificate Balance equal to $57,957,000, and which has
a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST A-1D" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having initial Certificate Balance equal to $36,563,000, and which has
a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST A-2A" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $65,549,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST A-2B" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $85,051,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST A-3A" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $37,576,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST A-3B" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $96,602,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST A-3C" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate

                                      -70-
<PAGE>

Balance equal to $51,722,000, and which has a Pass-Through Rate equal to the
Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST A-4A" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $63,825,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST A-4B" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $22,980,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST A-4C" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $400,483,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST B-1" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $9,187,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST B-2" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $4,859,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST B-3" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $16,433,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST C-1" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $15,478,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST C-2" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $14,516,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST C-3" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $1,937,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

                                      -71-
<PAGE>

     "REMIC II REGULAR INTEREST D-1" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $11,642,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST D-2" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $1,421,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST E-1" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $6,139,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST E-2" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $8,375,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST F" means the uncertificated interest designated
as a "regular interest" in REMIC II, which shall consist of an interest having a
Certificate Balance equal to the Aggregate Certificate Balance of the Class F
Certificates, and which has a Pass-Through Rate equal to the Weighted Average
REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST G" means the uncertificated interest designated
as a "regular interest" in REMIC II, which shall consist of an interest having a
Certificate Balance equal to the Aggregate Certificate Balance of the Class G
Certificates, and which has a Pass-Through Rate equal to the Weighted Average
REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST H-1" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $4,754,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST H-2" means the uncertificated interest
designated as a "regular interest" in REMIC II, which shall consist of an
interest having an initial Certificate Balance equal to $1,051,000, and which
has a Pass-Through Rate equal to the Weighted Average REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST J" means the uncertificated interest designated
as a "regular interest" in REMIC II, which shall consist of an interest having a
Certificate Balance equal to the Aggregate Certificate Balance of the Class J
Certificates, and which has a Pass-Through Rate equal to the Weighted Average
REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST K" means the uncertificated interest designated
as a "regular interest" in REMIC II, which shall consist of an interest having a
Certificate Balance equal to the Aggregate Certificate Balance of the Class K
Certificates, and which has a Pass-Through Rate equal to the Weighted Average
REMIC I Net Mortgage Rate.

                                      -72-

<PAGE>

     "REMIC II REGULAR INTEREST L" means the uncertificated interest designated
as a "regular interest" in REMIC II, which shall consist of an interest having a
Certificate Balance equal to the Aggregate Certificate Balance of the Class L
Certificates, and which has a Pass-Through Rate equal to the Weighted Average
REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST M" means the uncertificated interest designated
as a "regular interest" in REMIC II, which shall consist of an interest having a
Certificate Balance equal to the Aggregate Certificate Balance of the Class M
Certificates, and which has a Pass-Through Rate equal to the Weighted Average
REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST N" means the uncertificated interest designated
as a "regular interest" in REMIC II, which shall consist of an interest having a
Certificate Balance equal to the Aggregate Certificate Balance of the Class N
Certificates, and which has a Pass-Through Rate equal to the Weighted Average
REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTEREST O" means the uncertificated interest designated
as a "regular interest" in REMIC II, which shall consist of an interest having a
Certificate Balance equal to the Aggregate Certificate Balance of the Class O
Certificates, and which has a Pass-Through Rate equal to the Weighted Average
REMIC I Net Mortgage Rate.

     "REMIC II REGULAR INTERESTS" means, collectively, the REMIC II Regular
Interest A-1A, REMIC II Regular Interest A-1B, REMIC II Regular Interest A-1C,
REMIC II Regular Interest A-1D, REMIC II Regular Interest A-2A, REMIC II Regular
Interest A-2B, REMIC II Regular Interest A-3A, REMIC II Regular Interest A-3B,
REMIC II Regular Interest A-3C, REMIC II Regular Interest A-4A, REMIC II Regular
Interest A-4B, REMIC II Regular Interest A-4C, REMIC II Regular Interest B-1,
REMIC II Regular Interest B-2, REMIC II Regular Interest B-3, REMIC II Regular
Interest C-1, REMIC II Regular Interest C-2, REMIC II Regular Interest C-3,
REMIC II Regular Interest D-1, REMIC II Regular Interest D-2, REMIC II Regular
Interest E-1, REMIC II Regular Interest E-2, REMIC II Regular Interest F, REMIC
II Regular Interest G, REMIC II Regular Interest H-1, REMIC II Regular Interest
H-2, REMIC II Regular Interest J, REMIC II Regular Interest K, REMIC II Regular
Interest L, REMIC II Regular Interest M, REMIC II Regular Interest N and REMIC
II Regular Interest O.

     "REMIC III" means the segregated pool of assets consisting of the REMIC II
Regular Interests for which a REMIC election has been made pursuant to Section
12.1(a) hereof.

     "REMIC III CERTIFICATES" has the meaning set forth in the final paragraph
of the Preliminary Statement hereto.

     "REMIC III REGULAR INTERESTS" means, collectively, the Class A-1
Certificates, Class A-2 Certificates, Class A-3 Certificates, Class A-4
Certificates, Class X-1 Certificates (each Class X-1 Certificate representing
multiple "regular interests" in REMIC III), Class X-2 Certificates (each Class
X-2 Certificate representing multiple "regular interests" in REMIC III), Class B
Certificates, Class C Certificates, Class D Certificates, Class E Certificates,
Class F Certificates, Class G Certificates, Class H Certificates, Class J
Certificates, Class K Certificates, Class L Certificates, Class M Certificates,
Class N Certificates and Class O Certificates. With respect to the Class A-1,
Class X-1, Class X-2 and Class O Certificates, references to REMIC III Regular
Interests will be considered to refer to the Class A-1 REMIC Interest, Class X-1
REMIC
                                      -73-
<PAGE>

Interest, Class X-2 REMIC Interest and Class O REMIC Interest, respectively,
which are "regular interests" in REMIC III, where appropriate.

     "REMIC POOL" means each of the four segregated pools of assets designated
as a REMIC pursuant to Section 12.1(a) hereof.

     "REMIC PROVISIONS" means the provisions of the federal income tax law
relating to real estate mortgage investment conduits, which appear at Sections
860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and final, temporary and proposed regulations and rulings
promulgated thereunder, as the foregoing may be in effect from time to time and
taking account, as appropriate, of any proposed legislation or regulations
which, as proposed, would have an effective date prior to enactment or
promulgation thereof.

     "REMIC REGULAR CERTIFICATES" means, collectively, the Class A,
Class X-1, Class X-2, Class B, Class C, Class D, Class E, Class F, Class G,
Class H, Class J, Class K, Class L, Class M, Class N and Class O Certificates.

     "RENT LOSS POLICY" or "RENT LOSS INSURANCE" means a policy of insurance
generally insuring against loss of income or rent resulting from hazards or acts
of God.

     "RENTS FROM REAL PROPERTY" means, with respect to any REO Property, income
of the character described in Section 856(d) of the Code.

     "REO ACCOUNT" shall have the meaning set forth in Section 9.14(a) hereof.

     "REO DISPOSITION" means the receipt by the Master Servicer or the Special
Servicer of Liquidation Proceeds and other payments and recoveries (including
proceeds of a final sale) from the sale or other disposition of REO Property.

     "REO INCOME" means, with respect to any REO Property that had not been
security for an A/B Mortgage Loan or the Loan Pair for any Collection Period,
all income received in connection with such REO Property during such period less
any operating expenses, utilities, real estate taxes, management fees, insurance
premiums, expenses for maintenance and repairs and any other capital expenses
directly related to such REO Property paid during such period or, with respect
to an REO Property that had been security for an A/B Mortgage Loan or the Loan
Pair, the portion of the amounts described above received with respect to such
REO Property and allocable to the related A Note or the WestShore Plaza Pari
Passu Loan, as applicable, pursuant to the related Intercreditor Agreement or
Loan Pair Intercreditor Agreement, as applicable. With respect to any
Non-Serviced Mortgage Loan (if the applicable Non-Serviced Mortgage Loan Special
Servicer has foreclosed upon the Mortgaged Property secured by such Non-Serviced
Mortgage Loan Mortgage), the REO Income shall comprise only such portion of the
foregoing that is allocable to the holder of such Non-Serviced Mortgage Loan.

     "REO MORTGAGE LOAN" means a Mortgage Loan, the WestShore Plaza Companion
Loan or a B Note as to which the related Mortgaged Property is an REO Property.

     "REO PROPERTY" means a Mortgaged Property (or an interest therein, if the
Mortgaged Property securing any Non-Serviced Mortgage Loan and related
Non-Serviced Mortgage Loan Companion Loans, the Loan Pair or the Mortgaged
Property securing an A/B

                                      -74-
<PAGE>

Mortgage Loan has been acquired by the Trust) acquired by the Trust through
foreclosure, deed-in-lieu of foreclosure, abandonment or reclamation from
bankruptcy in connection with a Defaulted Mortgage Loan or otherwise treated as
foreclosure property under the REMIC Provisions.

     "REPORT DATE" means the third Business Day before the related Distribution
Date.

     "REPURCHASED LOAN" has the meaning set forth in Section 2.3(a).

     "REQUEST FOR RELEASE" means a request for release of certain documents
relating to the Mortgage Loans, a form of which is attached hereto as Exhibit C.

     "REQUIRED APPRAISAL LOAN" means any Mortgage Loan, the Loan Pair or any B
Note as to which an Appraisal Event has occurred. A Mortgage Loan, the Loan Pair
or a B Note will cease to be a Required Appraisal Loan at such time as it is a
Rehabilitated Mortgage Loan.

     "RESERVE ACCOUNT" shall mean the Reserve Account maintained by the Paying
Agent in accordance with the provisions of Section 5.3, which shall be an
Eligible Account.

     "RESIDUAL CERTIFICATES" means, with respect to the Kimball Lane Loan REMIC,
the Class R-K Certificates; with respect to REMIC I, the Class R-I Certificates;
with respect to REMIC II, the Class R-II Certificates; and with respect to REMIC
III, the Class R-III Certificates.

     "RESPONSIBLE OFFICER" means, when used with respect to the initial Trustee
or the Fiscal Agent, any officer assigned to the Asset-Backed Securities Trust
Services Group, or with respect to the Paying Agent, any officer assigned to the
Corporate Trust Services Group, each with specific responsibilities for the
matters contemplated by this Agreement and when used with respect to any
successor Trustee, Fiscal Agent or Paying Agent, any Vice President, Assistant
Vice President, corporate trust officer or any assistant corporate trust officer
or persons performing similar roles on behalf of the Trustee, Fiscal Agent or
Paying Agent.

     "RESTRICTED SERVICER REPORTS" means the following reports in CMSA format
(as in effect on the date hereof or as such formats may be changed from time to
time by the CMSA) in, and containing substantially the information contemplated
by, the forms attached hereto as part of Exhibit W prepared by the Master
Servicer (combining reports in such forms prepared by the Master Servicer and
the Special Servicer (with respect to Specially Serviced Mortgage Loans and REO
Properties)): (i) a Comparative Financial Status Report; (ii) without
duplication with Section 8.14, an NOI Adjustment Worksheet; (iii) without
duplication with Section 8.14, a CMSA Operating Statement Analysis Report, (iv)
subject to Section 8.11(h), a Servicer Watch List, (v) a Property File, (vi)
without duplication with Section 8.14, a Financial File and (vii) a CMSA Special
Servicer Loan File.

     "REVERSE SEQUENTIAL ORDER" means sequentially to the Class O, Class N,
Class M, Class L, Class K, Class J, Class H, Class G, Class F, Class E, Class D,
Class C, Class B and finally to the Class X and Class A Certificates, on a pro
rata basis, as described herein.

     "RSA COMPANION LOAN" means, with respect to the Mortgage Loan identified on
the Mortgage Loan Schedule as Mortgage Loan No. 29, which is secured by the
related

                                      -75-
<PAGE>

Mortgage on a pari passu basis with the RSA Pari Passu Loan. The RSA Companion
Loan is not a "Mortgage Loan."

     "RSA PARI PASSU LOAN" means, with respect to the Mortgage Loan identified
on the Mortgage Loan Schedule as Mortgage Loan No. 29, which is secured by the
related Mortgage on a pari passu basis with the RSA Companion Loan. The RSA Pari
Passu Loan is a "Mortgage Loan."

     "RULE 144A" means Rule 144A under the 1933 Act.

     "RULE 144A-IAI GLOBAL CERTIFICATE" means, with respect to any Class of
Certificates offered and sold in reliance on Rule 144A or to certain
Institutional Accredited Investors, a single, permanent global Certificate, in
definitive, fully registered form without interest coupons.

     "SARBANES-OXLEY CERTIFICATION" has the meaning set forth in Section
8.26(b).

     "SCHEDULED PAYMENT" means each scheduled payment of principal of, and/or
interest on, a Mortgage Loan, the WestShore Plaza Companion Loan or a B Note
required to be paid on its Due Date by the Mortgagor in accordance with the
terms of the related Mortgage Note, the WestShore Plaza Companion Loan or the
related B Note (excluding all amounts of principal and interest which were due
on or before the Cut-Off Date, whenever received, and taking account of any
modifications thereof and the effects of any Debt Service Reduction Amounts and
Deficient Valuation Amounts). Notwithstanding the foregoing, the amount of the
Scheduled Payment for the WestShore Plaza Pari Passu Loan or the WestShore Plaza
Companion Loan or any A Note or B Note shall be calculated without regard to the
Loan Pair Intercreditor Agreement or the related Intercreditor Agreement, as
applicable, and for the avoidance of doubt, the Scheduled Payment calculated in
respect of the Kimball Lane Loan shall not include any portion thereof defined
as the "Fixed Retained Yield" in the related Intercreditor Agreement.

     "SCHEDULED PRINCIPAL BALANCE" means, with respect to any Mortgage Loan, the
WestShore Plaza Companion Loan, any B Note or REO Mortgage Loan, for purposes of
performing calculations with respect to any Distribution Date, the Principal
Balance thereof minus the aggregate amount of any P&I Advances of principal
previously made with respect to such Mortgage Loan, the WestShore Plaza
Companion Loan, B Note or REO Mortgage Loan.

     "SELLER" means Principal, Wells Fargo, BSCMI, JHREF or MSMC as the case may
be.

     "SENIOR CERTIFICATES" means the Class A and Class X Certificates.

     "SERVICER ERRORS AND OMISSIONS INSURANCE POLICY" or "ERRORS AND OMISSIONS
INSURANCE POLICY" means an errors and omissions insurance policy maintained by
the Master Servicer, the Special Servicer, the Trustee, the Fiscal Agent or the
Paying Agent, as the case may be, in accordance with Section 8.2, Section 9.2
and Section 7.17, respectively.

     "SERVICER FIDELITY BOND" or "FIDELITY BOND" means a bond or insurance
policy under which the insurer agrees to indemnify the Master Servicer, the
Special Servicer, the

                                      -76-
<PAGE>

Trustee, the Fiscal Agent or the Paying Agent, as the case may be, (subject to
standard exclusions) for all losses (less any deductible) sustained as a result
of any theft, embezzlement, fraud or other dishonest act on the part of the
Master Servicer's, the Special Servicer's, the Trustee's, the Fiscal Agent's or
the Paying Agent's, as the case may be, directors, officers or employees and is
maintained in accordance with Section 8.2, Section 9.2 and Section 7.17,
respectively.

     "SERVICER MORTGAGE FILE" means copies of the mortgage documents listed in
the definition of Mortgage File relating to a Mortgage Loan and shall also
include, to the extent required to be (and actually) delivered to the applicable
Seller pursuant to the applicable Mortgage Loan documents, copies of the
following items: the Mortgage Note, any Mortgage, the Assignment of Leases and
the Assignment of Mortgage, any guaranty/indemnity agreement, any loan
agreement, any insurance policies or certificates (as applicable), any property
inspection reports, any financial statements on the property, any escrow
analysis, any tax bills, any Appraisal, any environmental report, any
engineering report, any asset summary, financial information on the
Mortgagor/sponsor and any guarantors, any letters of credit, any intercreditor
agreement and any Environmental Insurance Policies.

     "SERVICING ADVANCE" means any cost or expense of the Master Servicer, the
Special Servicer, the Trustee or the Fiscal Agent, as the case may be,
designated as a Servicing Advance pursuant to this Agreement and any other costs
and expenses incurred by the Master Servicer, the Special Servicer, the Trustee
or the Fiscal Agent, as the case may be, to protect and preserve the security
for such Mortgage Loan and/or (if applicable) the WestShore Plaza Companion Loan
or the related B Note.

     "SERVICING OFFICER" means, any officer or employee of the Master Servicer
involved in, or responsible for, the administration and servicing of the
Mortgage Loans, the WestShore Plaza Companion Loan and any B Note whose name and
specimen signature appear on a list of servicing officers or employees furnished
to the Trustee by the Master Servicer and signed by an officer of the Master
Servicer, as such list may from time to time be amended.

     "SERVICING STANDARD" means, with respect to the Master Servicer or the
Special Servicer, as the case may be, to service and administer the Mortgage
Loans (and the WestShore Plaza Companion Loan and any B Note) that it is
obligated to service and administer pursuant to this Agreement on behalf of the
Trustee and in the best interests of and for the benefit of the
Certificateholders (and in the case of the WestShore Plaza Companion Loan or any
B Note, the related holder of the WestShore Plaza Companion Loan or B Note, as
applicable) (as determined by the Master Servicer or the Special Servicer, as
the case may be, in its good faith and reasonable judgment), in accordance with
applicable law, the terms of this Agreement and the terms of the respective
Mortgage Loans, the WestShore Plaza Companion Loan and any B Note (and, in the
case of the Loan Pair or any A Note and B Note, the Loan Pair Intercreditor
Agreement or the related Intercreditor Agreement, as applicable) and, to the
extent consistent with the foregoing, further as follows:

     (a) with the same care, skill and diligence as is normal and usual in its
general mortgage servicing and REO property management activities on behalf of
third parties or on behalf of itself, whichever is higher, with respect to
mortgage loans and REO properties that are comparable to those for which it is
responsible hereunder;

                                      -77-
<PAGE>

     (b) with a view to the timely collection of all scheduled payments of
principal and interest under the Mortgage Loans, the WestShore Plaza Companion
Loan and any B Note or, if a Mortgage Loan, the WestShore Plaza Companion Loan
or any B Note comes into and continues in default and if, in the good faith and
reasonable judgment of the Special Servicer, no satisfactory arrangements can be
made for the collection of the delinquent payments, the maximization of the
recovery on such Mortgage Loan to the Certificateholders (as a collective whole)
(or in the case of any A/B Mortgage Loan and its related B Note or the Loan
Pair, the maximization of recovery on such A/B Mortgage Loan or the Loan Pair,
as applicable, to the Certificateholders and the holder of the related B Note or
the WestShore Plaza Companion Loan, as applicable, all taken as a collective
whole) on a present value basis (the relevant discounting of anticipated
collections that will be distributable to Certificateholders to be performed at
the related REMIC I Net Mortgage Rate, in the case of the Mortgage Loans (other
than any A Note or the WestShore Plaza Pari Passu Loan) or the weighted average
of the mortgage rates on the related A Note and B Note, in the case of any A/B
Mortgage Loan, and on the WestShore Plaza Pari Passu Loan and the WestShore
Plaza Companion Loan in the case of the Loan Pair); and without regard to: (I)
any other relationship that the Master Servicer or the Special Servicer, as the
case may be, or any Affiliate thereof may have with the related Mortgagor; (II)
the ownership of any Certificate or any interest in the Berkeley & Brown
Companion Loans, the RSA Companion Loan, the WestShore Plaza Companion Loan, a B
Note or any mezzanine loan related to a Mortgage Loan by the Master Servicer or
the Special Servicer, as the case may be, or any Affiliate thereof; (III) the
Master Servicer's obligation to make Advances; (IV) the right of the Master
Servicer (or any Affiliate thereof) or the Special Servicer (or any Affiliate
thereof), as the case may be, to receive reimbursement of costs, or the
sufficiency of any compensation payable to it, hereunder or with respect to any
particular transaction and (V) any obligation of the Master Servicer (or any
Affiliate thereof) to repurchase any Mortgage Loan from the Trust.

     "SERVICING TRANSFER EVENT" means the occurrence of any of the following
events: (i) any Mortgage Loan, the WestShore Plaza Companion Loan or any B Note
as to which a Balloon Payment is past due, and the Master Servicer has
determined, in its good faith reasonable judgment in accordance with the
Servicing Standard, that payment is unlikely to be made on or before the 60th
day succeeding the date the Balloon Payment was due, or any other payment is
more than 60 days past due or has not been made on or before the second Due Date
following the Due Date such payment was due; (ii) any Mortgage Loan, the
WestShore Plaza Companion Loan or any B Note as to which, to the Master
Servicer's knowledge, the Mortgagor has consented to the appointment of a
receiver or conservator in any insolvency or similar proceeding of, or relating
to, such Mortgagor or to all or substantially all of its property, or the
Mortgagor has become the subject of a decree or order issued under a bankruptcy,
insolvency or similar law and such decree or order shall have remained
undischarged or unstayed for a period of 30 days; (iii) any Mortgage Loan, the
WestShore Plaza Companion Loan or any B Note as to which the Master Servicer
shall have received notice of the foreclosure or proposed foreclosure of any
other lien on the Mortgaged Property; (iv) any Mortgage Loan, the WestShore
Plaza Companion Loan or any B Note as to which the Master Servicer has knowledge
of a default (other than a failure by the related Mortgagor to pay principal or
interest) which in the good faith reasonable judgment of the Master Servicer
materially and adversely affects the interests of the Certificateholders or the
holder of the WestShore Plaza Companion Loan or any related B Note and which has
occurred and remains unremedied for the applicable grace period specified in
such Mortgage Loan (or, if no grace period is specified, 60 days); (v) any
Mortgage Loan, the WestShore Plaza Companion Loan or any B Note as to which the
Mortgagor admits in writing its

                                      -78-

<PAGE>

inability to pay its debts generally as they become due, files a petition to
take advantage of any applicable insolvency or reorganization statute, makes an
assignment for the benefit of its creditors or voluntarily suspends payment of
its obligations; (vi) any Mortgage Loan, the WestShore Plaza Companion Loan or
any B Note as to which, in the good faith reasonable judgment of the Master
Servicer, (a) (other than with respect to any A/B Mortgage Loan) a payment
default is imminent or is likely to occur within 60 days, or (b) any other
default is imminent or is likely to occur within 60 days and such default, in
the judgment of the Master Servicer, is reasonably likely to materially and
adversely affect the interests of the Certificateholders or the holder of the
WestShore Plaza Companion Loan or any related B Note (as the case may be); and
(vii) with respect to any A/B Mortgage Loan, if the holder of the B Note chooses
not to cure a monetary default that is permitted to be cured under the related
Intercreditor Agreement, the Business Day following the expiration of the Cure
Period (as defined in the related Intercreditor Agreement) that commences one
month after such monetary default; provided, however, that (1) if the holder of
the B Note exercised its right to cure a monetary default and a monetary default
occurs in the following month due to the holder of the B Note's failure to cure,
then servicing of such Mortgage Loan shall be transferred to the Special
Servicer on the Business Day following the expiration of the Cure Period (as
defined in the related Intercreditor Agreement) of the holder of the B Note if
the holder of the B Note does not cure the current monetary default or (2) if
the holder of the B Note has exercised its right to cure three consecutive
monetary defaults and a monetary default occurs in the following month, then
servicing of such Mortgage Loan shall be transferred to the Special Servicer at
the expiration of the Mortgagor's grace period for the current monetary default.
If a Servicing Transfer Event occurs with respect to an A Note, it shall be
deemed to have occurred also with respect to its related B Note. If a Servicing
Transfer Event occurs with respect to a B Note, it shall be deemed to have
occurred also with respect to its related A Note. However, if a Servicing
Transfer Event has not occurred with respect to an A Note solely due to the
holder of the related B Note exercising its cure rights under the related
Intercreditor Agreement, then a Servicing Transfer Event will not occur with
respect to such B Note. If a Servicing Transfer Event occurs with respect to the
WestShore Plaza Pari Passu Loan, it shall be deemed to have occurred also with
respect to the WestShore Plaza Companion Loan. If a Servicing Transfer Event
occurs with respect to the WestShore Plaza Companion Loan, it shall be deemed to
have occurred also with respect to the WestShore Plaza Pari Passu Loan. Under
the applicable Non-Serviced Mortgage Loan Pooling and Servicing Agreement, if a
Servicing Transfer Event occurs with respect to any Non-Serviced Mortgage Loan
Companion Loan, it shall be deemed to have occurred also with respect to the
related Non-Serviced Mortgage Loan.

     "SIMILAR LAWS" has the meaning set forth in Section 3.3(d).

     "SINGLE-PURPOSE ENTITY" means a Person, other than an individual, whose
organizational documents provide substantially to the effect that it is formed
or organized solely for the purpose of owning and collecting payments from
Defeasance Collateral for the benefit of the Trust and which (i) does not engage
in any business unrelated thereto and the financing thereof; (ii) does not have
any assets other than those related to its interest in Defeasance Collateral;
(iii) maintains its own books, records and accounts, in each case which are
separate and apart from the books, records and accounts of any other Person;
(iv) conducts business in its own name and uses separate stationery, invoices
and checks; (v) does not guarantee or assume the debts or obligations of any
other Person; (vi) does not commingle its assets or funds with those of any
other Person; (vii) transacts business with affiliates on an arm's length basis

                                      -79-
<PAGE>

pursuant to written agreements; and (viii) holds itself out as being a legal
entity, separate and apart from any other Person, and otherwise complies with
the single-purpose requirements established by the Rating Agencies. The entity's
organizational documents also provide that any dissolution and winding up or
insolvency filing for such entity requires the unanimous consent of all partners
or members, as applicable, and that such documents may not be amended with
respect to the Single-Purpose Entity requirements.

     "SPECIAL SERVICER" means ARCap Servicing, Inc., or any successor Special
Servicer as herein provided, including without limitation, any successor Special
Servicer appointed pursuant to Section 9.39 hereof.

     "SPECIAL SERVICER COMPENSATION" means, with respect to any applicable
period, the sum of the Special Servicing Fees, the Liquidation Fees and Work-Out
Fees and any other amounts to be paid to the Special Servicer pursuant to the
terms of this Agreement.

     "SPECIAL SERVICER REMITTANCE DATE" means the Business Day preceding each
Determination Date.

     "SPECIAL SERVICING FEE" means, for each calendar month, as to each Mortgage
Loan (other than any Non-Serviced Mortgage Loan), the WestShore Plaza Companion
Loan or each B Note that is a Specially Serviced Mortgage Loan (including REO
Mortgage Loans), the fraction or portion of the Special Servicing Fee Rate
applicable to such month (determined using the same interest accrual methodology
that is applied with respect to the Mortgage Rate for such Mortgage Loan, the
WestShore Plaza Companion Loan or B Note for such month) multiplied by the
Scheduled Principal Balance of such Specially Serviced Mortgage Loan immediately
before the Due Date occurring in such month.

     "SPECIAL SERVICING FEE RATE" means 0.25% per annum.

     "SPECIAL SERVICING OFFICER" means any officer or employee of the Special
Servicer involved in, or responsible for, the administration and servicing of
the Specially Serviced Mortgage Loans whose name and specimen signature appear
on a list of servicing officers or employees furnished to the Trustee, the
Paying Agent and the Master Servicer by the Special Servicer signed by an
officer of the Special Servicer, as such list may from time to time be amended.

     "SPECIALLY SERVICED MORTGAGE LOAN" means, as of any date of determination,
any Mortgage Loan (other than any Non-Serviced Mortgage Loan), the WestShore
Plaza Companion Loan or any B Note with respect to which the Master Servicer has
notified the Special Servicer, the Operating Adviser and the Trustee that a
Servicing Transfer Event has occurred (which notice shall be effective upon
receipt) and the Special Servicer has received all information, documents and
records relating to such Mortgage Loan, the WestShore Plaza Companion Loan or B
Note as reasonably requested by the Special Servicer to enable it to assume its
duties with respect to such Mortgage Loan, the WestShore Plaza Companion Loan or
B Note. A Specially Serviced Mortgage Loan shall cease to be a Specially
Serviced Mortgage Loan from and after the date on which the Special Servicer
notifies the Master Servicer, the Operating Adviser, the Paying Agent and the
Trustee, in accordance with Section 8.1(b), that such Mortgage Loan (and the
related B Note in the case of an A/B Mortgage Loan, and the

                                      -80-

<PAGE>

WestShore Plaza Companion Loan in the case of the Loan Pair) has become a
Rehabilitated Mortgage Loan (and, in the case of an A Note (or B Note) that is
or was a Specially Serviced Mortgage Loan, its related B Note (or A Note) has
also become a Rehabilitated Mortgage Loan and, in the case of the WestShore
Plaza Pari Passu Loan (or the WestShore Plaza Companion Loan) that is or was a
Specially Serviced Mortgage Loan, the WestShore Plaza Companion Loan (or the
WestShore Plaza Pari Passu Loan) has also become a Rehabilitated Mortgage Loan),
with respect to such Servicing Transfer Event, unless and until the Master
Servicer notifies the Special Servicer, the Paying Agent and the Trustee, in
accordance with Section 8.1(b) that another Servicing Transfer Event with
respect to such Mortgage Loan, the WestShore Plaza Companion Loan or B Note
exists or occurs.

     "STANDARD HAZARD INSURANCE POLICY" means a fire and casualty extended
coverage insurance policy in such amount and with such coverage as required by
this Agreement.

     "STARTUP DAY" with respect to each of the Kimball Lane Loan REMIC, REMIC I,
REMIC II and REMIC III, the day designated as such in Section 12.1(b).

     "SUB-SERVICER" has the meaning set forth in Section 8.4.

     "SUBORDINATE CERTIFICATES" means, collectively, the Class B, Class C, Class
D, Class E, Class F, Class G, Class H, Class J, Class K, Class L, Class M, Class
N and Class O Certificates.

     "SUCCESSFUL BIDDER" has the meaning set forth in Section 8.29(d) or Section
9.31(d), as applicable.

     "TAX MATTERS PERSON" means the person designated as the "tax matters
person" of each REMIC Pool pursuant to Treasury Regulations Section 1.860F-4(d)
and temporary Treasury Regulations Section 301.6231(a)(7)-1T.

     "TERMINATION PRICE" has the meaning set forth in Section 10.1(b).

     "TITLE INSURANCE POLICY" means a title insurance policy maintained with
respect to a Mortgage Loan issued on the date of origination of the related
Mortgage Loan.

     "TRANSFER" means any direct or indirect transfer, sale, pledge,
hypothecation, or other form of assignment of any Ownership Interest in a
Certificate.

     "TRANSFEREE" means any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.

     "TRANSFEROR" means any Person who is disposing by Transfer any Ownership
Interest in a Certificate.

     "TRUST" means the trust created pursuant to this Agreement, the assets
which consist of all the assets of the Kimball Lane Loan REMIC (including the
Kimball Lane Loan and related assets), REMIC I (including the Majority Mortgage
Loans (other than Excess Interest), such amounts related thereto as shall from
time to time be held in the Certificate Account, the

                                      -81-

<PAGE>

Distribution Account, the Interest Reserve Account, the Insurance Policies, any
REO Properties and other items referred to in Section 2.1(a) hereof), REMIC II,
REMIC III, the Excess Interest Sub-account and any Excess Interest on the
Mortgage Loans, the Kimball Lane Sub-account and any Kimball Lane Yield
Maintenance Amounts. The Trust shall not include any Non-Serviced Mortgage Loan
Companion Loan, any B Note, any interest of the holders of a B Note, any A/B
Loan Custodial Account or the WestShore Plaza Companion Loan, any interest of
the holders the WestShore Plaza Companion Loan or the WestShore Plaza Companion
Loan Custodial Account.

     "TRUSTEE" means LaSalle Bank National Association, as trustee, or its
successor-in-interest, or if any successor trustee, or any co-trustee shall be
appointed as herein provided, then "Trustee" shall also mean such successor
trustee (subject to Section 7.7 hereof) and such co-trustee (subject to Section
7.9 hereof), as the case may be.

     "TRUSTEE FEE" means for each calendar month, as to each Mortgage Loan
(including REO Mortgage Loans and Defeasance Loans), the portion of the Trustee
Fee Rate applicable to such month (determined using the same interest accrual
methodology (other than the rate of accrual) that is applied with respect to the
Mortgage Rate for such Mortgage Loan for such month) multiplied by the Scheduled
Principal Balance of each such Mortgage Loan immediately before the Due Date
occurring in such month; provided that a portion of the Trustee Fee agreed upon
between the Trustee and the Paying Agent shall be applied to pay the Paying
Agent Fee.

     "TRUSTEE FEE RATE" means 0.0022% per annum (which includes the Paying Agent
Fee).

     "TRUSTEE MORTGAGE FILE" means the mortgage documents listed in the
definition of Mortgage File hereof pertaining to a particular Mortgage Loan
(and, if applicable, the WestShore Plaza Companion Loan and the related B Note)
and any additional documents required to be added to the Mortgage File pursuant
to this Agreement; provided that whenever the term "Trustee Mortgage File" is
used to refer to documents actually received by the Trustee or a Custodian on
its behalf, such terms shall not be deemed to include such documents required to
be included therein unless they are actually so received.

     "2003-IQ5 DEPOSITOR" means the "depositor" under the 2003-IQ5 Pooling and
Servicing Agreement, which as of the date hereof is Morgan Stanley Capital I
Inc.

     "2003-IQ5 FISCAL AGENT" means the "fiscal agent" under the 2003-IQ5 Pooling
and Servicing Agreement, which as of the date hereof is ABN AMRO Bank N.V.

     "2003-IQ5 MASTER SERVICER" means the "master servicer" under the 2003-IQ5
Pooling and Servicing Agreement, which as of the date hereof is GMAC Commercial
Mortgage Corporation.

     "2003-IQ5 POOLING AND SERVICING AGREEMENT" means the pooling and servicing
agreement dated as of September 1, 2003 by and between the 2003-IQ5 Depositor,
the 2003-IQ5 Master Servicer, the 2003-IQ5 Special Servicer, the 2003-IQ5
Trustee and the 2003-IQ5 Fiscal Agent, pursuant to which the 2003-IQ5 Trust
issued its Commercial Mortgage Pass-Through Certificates, Series 2003-IQ5.

                                      -82-
<PAGE>

     "2003-IQ5 SPECIAL SERVICER" means the "special servicer" under the 2003-IQ5
Pooling and Servicing Agreement, which as of the date hereof is Midland Loan
Services, Inc., or, as it relates to the Berkeley & Brown Loan Group, is ARCap
Servicing, Inc.

     "2003-IQ5 TRUST" means the trust established pursuant to the 2003-IQ5
Pooling and Servicing Agreement.

     "2003-IQ5 TRUSTEE" means the "trustee" under the 2003-IQ5 Pooling and
Servicing Agreement, which as of the date hereof is LaSalle Bank National
Association.

     "2003-TOP11 DEPOSITOR" means the "depositor" under the 2003-TOP11 Pooling
and Servicing Agreement, which as of the date hereof is Morgan Stanley Capital I
Inc.

     "2003-TOP11 FISCAL AGENT" means the "fiscal agent" under the 2003-TOP11
Pooling and Servicing Agreement, which as of the date hereof is ABN AMRO Bank
N.V.

     "2003-TOP11 MASTER SERVICER" means the "master servicer " under the
2003-TOP11 Pooling and Servicing Agreement, which as of the date hereof is Wells
Fargo Bank, National Association.

     "2003-TOP11 PAYING AGENT" means the "paying agent" under the 2003-TOP11
Pooling and Servicing Agreement, which as of the date hereof is Wells Fargo Bank
Minnesota, National Association.

     "2003-TOP11 POOLING AND SERVICING AGREEMENT" means the pooling and
servicing agreement dated as of August 1, 2003 by and between the 2003-TOP11
Depositor, the 2003-TOP11 Master Servicer, the 2003-TOP11 Special Servicer, the
2003-TOP11 Paying Agent, the 2003-TOP11 Trustee and the 2003-TOP11 Fiscal Agent,
pursuant to which the 2003-TOP11 Trust issued its Commercial Mortgage
Pass-Through Certificates, Series 2003-TOP11.

     "2003-TOP11 SPECIAL SERVICER" means the "special servicer" under the
2003-TOP11 Pooling and Servicing Agreement, which as of the date hereof is ARCap
Servicing, Inc.

     "2003-TOP11 TRUST" means the trust established pursuant to the 2003-TOP11
Pooling and Servicing Agreement.

     "2003-TOP11 TRUSTEE" means the "trustee" under the 2003-TOP11 Pooling and
Servicing Agreement, which as of the date hereof is LaSalle Bank National
Association.

     "UNDERWRITER" means each of Bear, Stearns & Co. Inc., Morgan Stanley & Co.
Incorporated, Goldman, Sachs & Co. and Wells Fargo Brokerage Services, LLC or
its successors in interest.

     "UNITED STATES TAX PERSON" means any of (i) a citizen or resident of the
United States, (ii) corporation or partnership organized in or under the laws of
the United States, any State thereof or the District of Columbia, (iii) an
estate the income of which is includible in gross income for United States tax
purposes, regardless of its source or (iv) a trust if a court within the United
States is able to exercise primary supervision over the administration of such
trust, and

                                      -83-
<PAGE>

one or more United States Tax Persons has the authority to control all
substantial decisions of such trust.

     "UNLIQUIDATED ADVANCE" means any Advance previously made by a party hereto
that has been previously reimbursed to the Person that made the Advance by the
Trust Fund as part of a Workout-Delayed Reimbursement Amount pursuant to
subsection (iii) of Section 5.2(a)(II), but that has not been recovered from the
Mortgagor or otherwise from collections on or the proceeds of the Mortgage Loan
or REO Property in respect of which the Advance was made.

     "UNPAID INTEREST" means, on any Distribution Date with respect to any Class
of Interests or Certificates (other than the Residual Certificates), the portion
of Distributable Certificate Interest for such Class remaining unpaid as of the
close of business on the preceding Distribution Date, plus one month's interest
thereon at the applicable Pass-Through Rate.

     "UNRESTRICTED SERVICER REPORTS" means the following reports in CMSA format
(as in effect on the date hereof or as such formats may be changed from time to
time by the CMSA) in, and containing substantially the information contemplated
by, the forms attached hereto as part of Exhibit X prepared by the Master
Servicer (combining reports in such forms prepared by the Master Servicer and
the Special Servicer (with respect to Specially Serviced Mortgaged Loans and REO
Properties)): (a) the following electronic files; (i) a Loan Set-Up File (with
respect to the initial Distribution Date only); and (ii) a Loan Periodic Update
File; and (b) the following supplemental reports: (i) a Delinquent Loan Status
Report, (ii) an Historical Loan Modification Report, (iii) an Historical
Liquidation Report, (iv) an REO Status Report, and (v) a CMSA Loan Level
Reserve/LOC Report.

     "USAP" shall have the meaning set forth in Section 8.13.

     "WEIGHTED AVERAGE REMIC I NET MORTGAGE RATE" means, with respect to any
Distribution Date, the weighted average of the REMIC I Net Mortgage Rates for
the REMIC I Regular Interests, weighted on the basis of their respective
Certificate Balances as of the close of business on the preceding Distribution
Date.

     "WELLS FARGO" has the meaning set forth in the Preliminary Statement
hereto.

     "WELLS FARGO LOANS" means, collectively, those Mortgage Loans sold to the
Depositor pursuant to Mortgage Loan Purchase Agreement II and shown on Schedule
II hereto.

     "WESTSHORE PLAZA COMPANION LOAN" means with respect to the Mortgage Loan
designated as Mortgage Loan No. 2, the related A-2 Note, which is secured by the
related Mortgage on a pari passu basis with the WestShore Plaza Pari Passu Loan.
The WestShore Plaza Companion Loan is not a "Mortgage Loan."

     "WESTSHORE PLAZA COMPANION LOAN CUSTODIAL ACCOUNT" means each of the
custodial sub-account(s) of the Certificate Account (but which are not included
in the Trust) created and maintained by the Master Servicer pursuant to Section
5.1(c) on behalf of the holder of the WestShore Plaza Companion Loan. Any such
sub-account(s) shall be maintained as sub-accounts of an Eligible Account.

                                      -84-
<PAGE>

     "WESTSHORE PLAZA PARI PASSU LOAN" means the Mortgage Loan designated as
Mortgage Loan No. 2 on the Mortgage Loan Schedule, comprised of the related A-1
Note and which is secured on a pari passu basis with the WestShore Plaza
Companion Loan. The WestShore Plaza Pari Passu Loan is a "Mortgage Loan."

     "WESTSHORE PLAZA PARI PASSU MORTGAGE" means the Mortgage securing the
WestShore Plaza Companion Loan and the WestShore Plaza Pari Passu Loan secured
by the related Mortgaged Property.

     "WORKOUT-DELAYED REIMBURSEMENT AMOUNT" has the meaning set forth in
subsection (II)(A) of Section 5.2(a).

     "WORK-OUT FEE" means a fee payable with respect to any Rehabilitated
Mortgage Loan (other than any Non-Serviced Mortgage Loan), the WestShore Plaza
Companion Loan or any B Note, equal to the product of (x) 1.0% and (y) the
amount of each collection of interest (other than default interest and any
Excess Interest) and principal received (including any Condemnation Proceeds
received and applied as a collection of such interest and principal) on such
Mortgage Loan, the WestShore Plaza Companion Loan or B Note for so long as it
remains a Rehabilitated Mortgage Loan.

     SECTION 1.2 Calculations Respecting Mortgage Loans. (a) Calculations
required to be made by the Paying Agent pursuant to this Agreement with respect
to any Mortgage Loan, the WestShore Plaza Companion Loan or any B Note shall be
made based upon current information as to the terms of such Mortgage Loan, the
WestShore Plaza Companion Loan and B Note and reports of payments received from
the Master Servicer on such Mortgage Loan, the WestShore Plaza Companion Loan
and B Note and payments to be made to the Paying Agent as supplied to the Paying
Agent by the Master Servicer. The Paying Agent shall not be required to
recompute, verify or recalculate the information supplied to it by the Master
Servicer and may conclusively rely upon such information in making such
calculations. If, however, a Responsible Officer of the Paying Agent has actual
knowledge of an error in the calculations, the Paying Agent shall inform the
Master Servicer of such error.

     (b) Unless otherwise required by law or the applicable Mortgage Loan, the
WestShore Plaza Companion Loan or B Note documents (or the related Intercreditor
Agreement or Loan Pair Intercreditor Agreement, as applicable), any amounts
(other than escrow and reserve deposits and reimbursements of lender advances
and expenses) received in respect of a Mortgage Loan, the WestShore Plaza
Companion Loan or a B Note as to which a default has occurred and is continuing
shall be applied first to overdue interest due with respect to such Mortgage
Loan, the WestShore Plaza Companion Loan or B Note at the Mortgage Rate thereof,
next to current interest due with respect to such Mortgage Loan, the WestShore
Plaza Companion Loan or B Note at the Mortgage Rate thereof, next to the
reduction of the Principal Balance of such Mortgage Loan, the WestShore Plaza
Companion Loan or B Note to zero if such Mortgage Loan, the WestShore Plaza
Companion Loan or B Note has been accelerated and in respect of any scheduled
payments of principal then due to the extent that such Mortgage Loan, the
WestShore Plaza Companion Loan or B Note has not yet been accelerated, next to
any default interest and other amounts due on such Mortgage Loan, the WestShore
Plaza Companion Loan or B Note and finally to Late Fees due with respect to such
Mortgage Loan, the WestShore Plaza Companion Loan or B Note.

                                      -85-

<PAGE>

     SECTION 1.3 CALCULATIONS RESPECTING ACCRUED INTEREST. Accrued interest on
any Certificate shall be calculated based upon a 360-day year consisting of
twelve 30-day months and Pass-Through Rates shall be carried out to eight
decimal places, rounded if necessary. All dollar amounts calculated hereunder
shall be rounded to the nearest penny.

     SECTION 1.4 INTERPRETATION.

     (a) Whenever the Agreement refers to a Distribution Date and a "related"
Collection Period, Interest Accrual Period, Record Date, Due Date, Report Date,
Monthly Certificateholders Report, Special Servicer Remittance Date, Master
Servicer Remittance Date or Determination Date, such reference shall be to the
Collection Period, Interest Accrual Period, Record Date, Due Date, Report Date,
Special Servicer Remittance Date, Master Servicer Remittance Date or
Determination Date, as applicable, immediately preceding such Distribution Date.

     (b) As used herein and in any certificate or other document made or
delivered pursuant hereto or thereto, accounting terms not defined in Section
1.1 shall have the respective meanings given to them under generally accepted
accounting principles or regulatory accounting principles, as applicable.

     (c) The words "hereof," "herein" and "hereunder," and words of similar
import, when used in this Agreement, shall refer to this agreement as a whole
and not to any particular provision of this Agreement, and references to
Sections, Schedules and Exhibits contained in this Agreement are references to
Sections, Schedules and Exhibits in or to this Agreement unless otherwise
specified.

     (d) Whenever a term is defined herein, the definition ascribed to such term
shall be equally applicable to both the singular and plural forms of such term
and to masculine, feminine and neuter genders of such term.

     (e) This Agreement is the result of arm's-length negotiations between the
parties and has been reviewed by each party hereto and its counsel. Each party
agrees that any ambiguity in this Agreement shall not be interpreted against the
party drafting the particular clause which is in question.

     SECTION 1.5 ARD LOANS. Notwithstanding any provision of this Agreement:

     (a) For the ARD Loans, the Excess Interest accruing as a result of the
step-up in the Mortgage Rate upon failure of the related Mortgagor to pay the
principal on the Anticipated Repayment Date as specifically provided for in the
related Mortgage Note shall not be taken into account for purposes of the
definitions of "Appraisal Reduction," "Assumed Scheduled Payment," "Mortgage
Rate," "Purchase Price" and "Realized Loss."

     (b) Excess Interest shall constitute an asset of the Trust but not an asset
of any REMIC Pool.

     (c) Neither the Master Servicer nor the Special Servicer shall take any
enforcement action with respect to the payment of Excess Interest unless the
taking of such action is consistent with the Servicing Standard and all other
amounts due under such Mortgage

                                      -86-
<PAGE>

Loan have been paid, and, in the good faith and reasonable judgment of the
Master Servicer and the Special Servicer, as the case may be, the Liquidation
Proceeds expected to be recovered in connection with such enforcement action
will cover the anticipated costs of such enforcement action and, if applicable,
any associated interest thereon.

     (d) Liquidation Fees shall not be deemed to be earned on Excess Interest.

     (e) With respect to an ARD Loan after its Anticipated Repayment Date, the
Master Servicer or the Special Servicer, as the case may be, shall be permitted,
in its discretion, to waive in accordance with Section 8.18 and Section 9.5
hereof, all or any accrued Excess Interest if, prior to the related Maturity
Date, the related Mortgagor has requested the right to prepay the Mortgage Loan
in full together with all payments required by the Mortgage Loan in connection
with such prepayment except for all or a portion of accrued Excess Interest,
provided that the Master Servicer's or the Special Servicer's determination to
waive the right to such accrued Excess Interest is in accordance with the
Servicing Standard and with Section 8.18 and Section 9.5 hereof. The Master
Servicer or the Special Servicer, as the case may be, will have no liability to
the Trust, the Certificateholders or any other person so long as such
determination is based on such criteria.

     SECTION 1.6 CERTAIN MATTERS WITH RESPECT TO LOAN PAIRS AND A/B MORTGAGE
LOANS.

     (a) The parties hereto acknowledge that, pursuant to the Loan Pair
Intercreditor Agreement or the related Intercreditor Agreement, if the WestShore
Plaza Pari Passu Loan or B Note, as applicable, is no longer part of the Trust
Fund, the new holder of such WestShore Plaza Pari Passu Loan or B Note, as
applicable, shall negotiate one or more new servicing agreements with the Master
Servicer and the Special Servicer, provided that, prior to entering into any
such new servicing agreement, the new holder of such WestShore Plaza Pari Passu
Loan or B Note, as applicable, shall obtain and provide to the holder of the
WestShore Plaza Companion Loan and/or the related B Note written confirmation
from each rating agency then rating any securitization relating to such
WestShore Plaza Companion Loan and/or B Note providing that such new servicing
agreement will not result in the downgrade, qualification or withdrawal of its
then-current ratings of any securities issued in such securitization; provided,
that prior to such time the Master Servicer and the Special Servicer shall
continue to service the related Loan Pair and/or A/B Mortgage Loan to the extent
provided in the Loan Pair Intercreditor Agreement or the related Intercreditor
Agreement, as applicable.

     (b) For the avoidance of doubt and subject to subsection (a) above, the
parties acknowledge that the rights and duties of each of the Master Servicer
and the Special Servicer under Article VIII and Article IX and the obligation of
the Master Servicer to make Advances, insofar as such rights, duties and
obligations relate to any A/B Mortgage Loan (including both the related A Note
and the related B Note) or the Loan Pair (including both the WestShore Plaza
Pari Passu Loan and the WestShore Plaza Companion Loan), shall terminate upon
the earliest to occur of the following with respect to such A/B Mortgage Loan or
Loan Pair, as the case may be: (i) any repurchase of or substitution for the
related A Note or the WestShore Plaza Pari Passu Loan by the applicable Seller
pursuant to Section 2.3, (ii) any purchase of the related A Note by the owner of
the related B Note pursuant to the terms of the related Intercreditor Agreement
and

                                      -87-

<PAGE>

(iii) any payment in full of any and all amounts due (or deemed due) under the
related A Note or the WestShore Plaza Pari Passu Loan (or its successor REO
Mortgage Loan) (including amounts to which the holder of such A Note or the
WestShore Plaza Pari Passu Loan is entitled under the related Intercreditor
Agreement or Loan Pair Intercreditor Agreement), as applicable; provided,
however, that this statement shall not limit (A) the duty of the Master Servicer
or the Special Servicer to deliver or make available the reports otherwise
required of it hereunder with respect to the Collection Period in which such
event occurs or (B) the rights of the Master Servicer or the Special Servicer
that may otherwise accrue or arise in connection with the performance of its
duties hereunder with respect to such A/B Mortgage Loan or Loan Pair prior to
the date on which such event occurs.

     (c) In connection with any purchase described in clause (ii) of subsection
(b) or an event described in clause (iii) of subsection (b), the Trustee, the
Master Servicer and the Special Servicer shall each tender to (in the case of a
purchase under such clause (ii)) the related purchaser (provided that the
related purchaser shall have paid the full amount of the applicable purchase
price) or (in the case of such clause (iii)) to the holder of the WestShore
Plaza Companion Loan or the related B Note (if then still outstanding), upon
delivery to them of a receipt executed by such purchaser or holder, all portions
of the Mortgage File and other documents pertaining to such Loan Pair or A/B
Mortgage Loan, as applicable, possessed by it, and each document that
constitutes a part of the Mortgage File shall be endorsed or assigned to the
extent necessary or appropriate to such purchaser or holder (or the designee of
such purchaser or holder) in the same manner, and pursuant to appropriate forms
of assignment, substantially similar to the manner and forms pursuant to which
documents were previously assigned to the Trustee by the related Seller, but in
any event, without recourse, representation or warranty; provided that such
tender by the Trustee shall be conditioned upon its receipt from the Master
Servicer of a Request for Release. The Master Servicer shall, and is also hereby
authorized and empowered by the Trustee to, convey to such purchaser or such
holder any deposits then held in an Escrow Account relating to the applicable
A/B Mortgage Loan or the Loan Pair. If the WestShore Plaza Pari Passu Loan and
the WestShore Plaza Companion Loan or an A Note and the related B Note under the
applicable Mortgage Loan are then REO Mortgage Loans, then the Special Servicer
shall, and is also hereby authorized and empowered by the Trustee to, convey to
such purchaser or such holder, in each case, to the extent not needed to pay or
reimburse the Master Servicer, the Special Servicer, the Trustee or the Fiscal
Agent in accordance with this Agreement, deposits then held in the REO Account
insofar as they relate to the related REO Property.

     (d) If an expense under this Agreement relates, in the reasonable judgment
of the Master Servicer, the Special Servicer, the Trustee or the Paying Agent,
as applicable, primarily to the administration of the Trust Fund or any REMIC
formed hereunder or to any determination respecting the amount, payment or
avoidance of any tax under the REMIC Provisions or the actual payment of any
REMIC tax or expense with respect to any REMIC formed hereunder, then such
expense shall not be allocated to, deducted or reimbursed from, or otherwise
charged against the holder of the WestShore Plaza Companion Loan or any B Note
and such holder shall not suffer any adverse consequences as a result of the
payment of such expense.

                                      -88-

<PAGE>

                                   ARTICLE II

                              DECLARATION OF TRUST;
                            ISSUANCES OF CERTIFICATES

     SECTION 2.1 CONVEYANCE OF MORTGAGE LOANS.

     (a) Effective as of the Closing Date, the Depositor does hereby assign in
trust to the Trustee, without recourse, for the benefit of the
Certificateholders all the right, title and interest of the Depositor, in, to
and under (i) the Mortgage Loans identified on the Mortgage Loan Schedule
including the related Mortgage Notes, Mortgages, security agreements and title,
hazard and other insurance policies, including all Qualifying Substitute
Mortgage Loans, all distributions with respect thereto payable after the Cut-Off
Date, the Mortgage File and all rights, if any, of the Depositor in the
Distribution Account, all REO Accounts, the Certificate Account, the Reserve
Account and the Interest Reserve Account, (ii) the Depositor's rights under each
Mortgage Loan Purchase Agreement that are permitted to be assigned to the
Trustee pursuant to Section 14 thereof, (iii) the Initial Deposit, (iv) the
Depositor's rights under any Intercreditor Agreement, Loan Pair Intercreditor
Agreement, Non-Serviced Mortgage Loan Intercreditor Agreement and the related
Non-Serviced Mortgage Loan Pooling and Servicing Agreement with respect to any
Non-Serviced Mortgage Loan and (v) all other assets included or to be included
in the Kimball Lane Loan REMIC or REMIC I for the benefit of REMIC II and REMIC
III or the Grantor Trust for the benefit of the Class A-1, Class X-1, Class X-2
and Class O Certificates. Such assignment includes all interest and principal
received or receivable on or with respect to the Mortgage Loans and due after
the Cut-Off Date. The transfer of the Mortgage Loans and the related rights and
property accomplished hereby is absolute and is intended by the parties to
constitute a sale. In connection with the initial sale of the Certificates by
the Depositor, the purchase price to be paid includes a portion attributable to
interest accruing on the Certificates from and after the Cut-Off Date. The
transfer and assignment of any Non-Serviced Mortgage Loan to the Trustee and the
right to service such Mortgage Loans are subject to the terms and conditions of
the related Non-Serviced Mortgage Loan Pooling and Servicing Agreement and the
related Non-Serviced Mortgage Loan Intercreditor Agreement.

     (b) In connection with the Depositor's assignment pursuant to Section
2.1(a) above, the Depositor shall direct, and hereby represents and warrants
that it has directed, each Seller pursuant to the applicable Mortgage Loan
Purchase Agreement to deliver to and deposit with, or cause to be delivered to
and deposited with, the Trustee or a Custodian appointed hereunder, on or before
the Closing Date, the Mortgage Note for each Mortgage Loan so assigned, endorsed
to the Trustee as specified in clause (i) of the definition of "Mortgage File."
Each Seller is required, pursuant to the applicable Mortgage Loan Purchase
Agreement, to deliver to the Trustee the remaining documents constituting the
Mortgage File for each Mortgage Loan within the time period set forth therein.
None of the Trustee, the Fiscal Agent, the Paying Agent, any Custodian, the
Master Servicer or the Special Servicer shall be liable for any failure by any
Seller or the Depositor to comply with the document delivery requirements of the
Mortgage Loan Purchase Agreements and this Section 2.1(b).

     (c) The applicable Seller shall, at the expense of such Seller as to each
of its respective Mortgage Loans, promptly (and in any event within 45 days
following the receipt thereof) cause to be submitted for recording or filing, as
the case may be, in the appropriate

                                      -89-

<PAGE>

public office for real property records or UCC financing statements, as
appropriate, each assignment to the Trustee referred to in clauses (iv), (vi)(B)
and (ix)(B) of the definition of "Mortgage File". Each such assignment shall
reflect that it should be returned by the public recording office to the Trustee
following recording or filing; provided that in those instances where the public
recording office retains the original Assignment of Mortgage, assignment of
Assignment of Leases or assignment of UCC financing statements, the applicable
Seller shall obtain therefrom a certified copy of the recorded original. The
applicable Seller shall forward copies thereof to the Trustee and the Special
Servicer. If any such document or instrument is lost or returned unrecorded or
unfiled, as the case may be, because of a defect therein, the applicable Seller
shall, pursuant to the applicable Mortgage Loan Purchase Agreement, promptly
prepare or cause to be prepared a substitute therefor or cure such defect, as
the case may be, and thereafter the applicable Seller shall upon receipt thereof
cause the same to be duly recorded or filed, as appropriate.

     The parties acknowledge the obligation of each Seller pursuant to Section 2
of the related Mortgage Loan Purchase Agreement to deliver to the Trustee, on or
before the fifth Business Day after the Closing Date, five limited powers of
attorney substantially in the form attached as Exhibit C to the Primary
Servicing Agreement in favor of the Trustee and the Special Servicer to empower
the Trustee and, in the event of the failure or incapacity of the Trustee, the
Special Servicer, to submit for recording, at the expense of the applicable
Seller, any mortgage loan documents required to be recorded as described in the
preceding paragraph and any intervening assignments with evidence of recording
thereon that are required to be included in the Mortgage Files (so long as
original counterparts have previously been delivered to the Trustee). The
Sellers agree to reasonably cooperate with the Trustee and the Special Servicer
in connection with any additional powers of attorney or revisions thereto that
are requested by such parties for purposes of such recordation. The Trustee and
each other party hereto agrees that no such power of attorney shall be used with
respect to any Mortgage Loan by or under authorization by any party hereto
except that to the extent that the absence of a document described in the second
preceding sentence with respect to such Mortgage Loan remains unremedied as of
the earlier of (i) the date that is 180 days following the delivery of notice of
such absence to the related Seller, but in no event earlier than 18 months from
the Closing Date, and (ii) the date (if any) on which such Mortgage Loan becomes
a Specially Serviced Mortgage Loan. The Trustee shall submit such documents for
recording, at the related Seller's expense, after the periods set forth above;
provided, however, the Trustee shall not submit such assignments for recording
if the applicable Seller produces evidence that it has sent any such assignment
for recording and certifies that it is awaiting its return from the applicable
recording office.

     (d) All relevant servicing or loan documents and records in the possession
of the Depositor or the Sellers that relate to the Mortgage Loans, the WestShore
Plaza Companion Loan or B Notes and that are not required to be a part of a
Mortgage File in accordance with the definition thereof shall be delivered to
the Master Servicer or the related Primary Servicer on its behalf, on or before
the date that is 45 days following the Closing Date and shall be held by the
Master Servicer or related Primary Servicer on behalf of the Trustee in trust
for the benefit of the Certificateholders. To the extent delivered to the Master
Servicer or the related Primary Servicer by the related Seller, the Servicer
Mortgage File, will include, to the extent required to be (and actually)
delivered to the applicable Seller pursuant to the applicable Mortgage Loan
documents, copies of the following items: the Mortgage Note, any Mortgage, the
Assignment of Leases and

                                      -90-
<PAGE>

the Assignment of Mortgage, any guaranty/indemnity agreement, any loan
agreement, the insurance policies or certificates (as applicable), the property
inspection reports, any financial statements on the property, any escrow
analysis, the tax bills, the Appraisal, the environmental report, the
engineering report, the asset summary, financial information on the Mortgagor/
sponsor and any guarantors, any letters of credit, any intercreditor agreement
and any Environmental Insurance Policies. Delivery of any of the foregoing
documents to the applicable Primary Servicer (or sub-servicer) shall be deemed
delivery to the Master Servicer and satisfy the Depositor's obligations under
this Section 2.1(d). None of the Master Servicer, the Special Servicer or any
Primary Servicer shall have any liability for the absence of any of the
foregoing items from the Servicing Mortgage File if such item was not delivered
by the related Seller.

     (e) In connection with the Depositor's assignment pursuant to Section
2.1(a) above, the Depositor shall deliver to the Trustee on or before the
Closing Date a copy of a fully executed counterpart of each Mortgage Loan
Purchase Agreement, as in full force and effect on the Closing Date, which
Mortgage Loan Purchase Agreements shall contain the representations and
warranties made by the Sellers with respect to each related Mortgage Loan as of
the Closing Date.

     (f) In connection herewith, the Depositor has acquired the Principal Loans
from Principal, the Wells Fargo Loans from Wells Fargo, the BSCMI Loans from
BSCMI, the JHREF Loans from JHREF and the MSMC Loans from MSMC. The Depositor
will deliver or cause to be delivered the original Mortgage Notes (or lost note
affidavits with copies of the related Mortgage Notes, as described in the
definition of Mortgage File) relating to the Principal Loans to the Trustee,
endorsed as otherwise provided herein, to effect the transfer to the Trustee of
such Mortgage Notes and all related deeds of trust, mortgages and other loan
documents. The Depositor will deliver or cause to be delivered the original
Mortgage Notes (or lost note affidavits with copies of the related Mortgage
Notes, as described in the definition of Mortgage File) relating to the Wells
Fargo Loans to the Trustee, endorsed as otherwise provided herein, to effect the
transfer to the Trustee of such Mortgage Notes and all related deeds of trust,
mortgages and other loan documents. The Depositor will deliver or cause to be
delivered the original Mortgage Notes (or lost note affidavits with copies of
the related Mortgage Notes, as described in the definition of Mortgage File)
relating to the BSCMI Loans to the Trustee, endorsed as otherwise provided
herein, to effect the transfer to the Trustee of such Mortgage Notes and all
related deeds of trust, mortgages and other loan documents. The Depositor will
deliver or cause to be delivered the original Mortgage Notes (or lost note
affidavits with copies of the related Mortgage Notes, as described in the
definition of Mortgage File) relating to the MSMC Loans to the Trustee, endorsed
as otherwise provided herein, to effect the transfer to the Trustee of such
Mortgage Notes and all related deeds of trust, mortgages and other loan
documents. The Depositor will deliver or cause to be delivered the original
Mortgage Notes (or lost note affidavits with copies of the related Mortgage
Notes, as described in the definition of Mortgage File) relating to the JHREF
Loans to the Trustee, endorsed as otherwise provided herein, to effect the
transfer to the Trustee of such Mortgage Notes and all related deeds of trust,
mortgages and other loan documents. To avoid the unnecessary expense and
administrative inconvenience associated with the execution and recording of
multiple assignment documents, Principal, Wells Fargo, BSCMI, JHREF and MSMC, as
applicable, are required under the Mortgage Loan Purchase Agreements to deliver
Assignments of Mortgages and assignments of Assignments of Leases and
assignments of UCC financing statements naming the Trustee, on behalf of the
Certificateholders, as assignee. Notwithstanding the fact that the assignments
shall name the

                                      -91-
<PAGE>

Trustee, on behalf of the Certificateholders, as the assignee, the parties
hereto acknowledge and agree that for all purposes the Principal Loans shall be
deemed to have been transferred from Principal to the Depositor, the Wells Fargo
Loans shall be deemed to have been transferred from Wells Fargo to the
Depositor, the BSCMI Loans shall be deemed to have been transferred from BSCMI
to the Depositor, the JHREF Loans shall be deemed to have been transferred from
JHREF to the Depositor and the MSMC Loans shall be deemed to have been
transferred from MSMC to the Depositor, and all Mortgage Loans shall be deemed
to have been transferred from the Depositor to the Trustee on behalf of the
Certificateholders.

     SECTION 2.2 ACCEPTANCE BY TRUSTEE. The Trustee will hold (i) the documents
constituting a part of the Mortgage Files delivered to it, (ii) the Kimball Lane
Loan REMIC Regular Interest, (iii) the REMIC I Regular Interests, and (iv) the
REMIC II Regular Interests, in each case, in trust for the use and benefit of
all present and future Certificateholders. To the extent that the contents of
the Mortgage File for any A Note relate to the corresponding B Note, the
Trustee, or the Custodian on the Trustee's behalf, will also hold such Mortgage
File in trust for the benefit of the holder of the related B Note; provided,
that if a B Note remains outstanding following payment in full of the amounts
due under the related A Notes, the Mortgage Loan documents relating to such A/B
Mortgage Loan (exclusive of any related solely to the A Notes) shall be assigned
to the holder of the B Note or its designee. To the extent that the contents of
the Mortgage File for the WestShore Plaza Pari Passu Loan relate to the
WestShore Plaza Companion Loan, the Trustee, or the Custodian, on the Trustee's
behalf, will also hold such Mortgage File in trust for the benefit of the holder
of the WestShore Plaza Companion Loan.

     On the Closing Date in respect of the Initial Certification, and within 75
days after the Closing Date in respect of the Final Certification, the Trustee
shall examine the Mortgage Files in its possession, and shall deliver to the
Depositor, the Sellers, the Master Servicer, the Special Servicer and the
Operating Adviser a certification (the "Initial Certification" and the "Final
Certification", respectively, in the respective forms set forth as Exhibit B-1
and Exhibit B-2 hereto), which may be in electronic format (i) in the case of
the Initial Certification, as to each Mortgage Loan listed in the Mortgage Loan
Schedule, except as may be specified in the schedule of exceptions attached
thereto, to the effect that: (A) all documents pursuant to clause (i) of the
definition of Mortgage File are in its possession, (B) such documents have been
reviewed by it and have not been materially mutilated, damaged, defaced, torn or
otherwise physically altered, and such documents relate to such Mortgage Loan,
and (C) each Mortgage Note has been endorsed as provided in clause (i) of the
definition of Mortgage File, and (ii) in the case of the Final Certification, as
to each Mortgage Loan listed in the Mortgage Loan Schedule, except as may be
specified in the schedule of exceptions attached thereto, to the effect that:
(A) all documents pursuant to clauses (i), (ii), (iv), (v), (vi), (viii), (x)
and (xii) of the definition of Mortgage File required to be included in the
Mortgage File (to the extent required to be delivered pursuant to this Agreement
and any applicable Primary Servicing Agreement), and with respect to all
documents specified in the other clauses of the definition of Mortgage File to
the extent known by a Responsible Officer of the Trustee to be required pursuant
to this Agreement, are in its possession, (B) such documents have been reviewed
by it and have not been materially mutilated, damaged, defaced, torn or
otherwise physically altered, and such documents relate to such Mortgage Loan,
(C) based on its examination and only as to the Mortgage Note and Mortgage, the
street address of the Mortgaged Property set forth in the Mortgage Loan Schedule
respecting such Mortgage Loan accurately reflects the information contained in
the documents in the Mortgage File, and (D) each Mortgage Note has been
endorsed. Notwithstanding the

                                      -92-
<PAGE>

foregoing, the delivery of a commitment to issue a Title Insurance Policy in
lieu of the delivery of the actual Title Insurance Policy shall not be
considered a Material Document Defect with respect to any Mortgage File if such
actual Title Insurance Policy is delivered to the Trustee or a Custodian on its
behalf not later than the 180th day following the Closing Date. The Trustee
shall deliver to the Master Servicer, the Special Servicer, the Operating
Adviser and each Seller a copy of such Final Certification, which may be in
electronic format.

     Within 360 days after the Cut-Off Date, the Trustee shall provide a
confirmation of receipt of recorded assignments of Mortgage (as described in the
definition of Mortgage File, with evidence of recording thereon) or otherwise
provide evidence of such recordation to the Master Servicer, the Special
Servicer, the Operating Adviser and each Seller, and if any recorded assignment
of Mortgage has not been received by the Trustee by such time, the Trustee shall
provide information in such confirmation on the status of missing assignments.
The Trustee agrees to use reasonable efforts to submit for recording any
unrecorded assignments of Mortgage that have been delivered to it (including
effecting such recordation process through or cooperating with the applicable
Seller) such recordation to be at the expense of the applicable Seller;
provided, however, that the Trustee shall not submit for recording any such
assignments if the applicable Seller produces evidence that it has sent any such
assignment for recording and is awaiting its return from the applicable
recording office. In giving the certifications required above, the Trustee shall
be under no obligation or duty to inspect, review or examine any such documents,
instruments, securities or other papers to determine whether they or the
signatures thereon are valid, legal, genuine, enforceable, in recordable form or
appropriate for their represented purposes, or that they are other than what
they purport to be on their face, or to determine whether any Mortgage File
should include any assumption agreement, modification agreement, consolidation
agreement, extension agreement, Assignment of Lease, ground lease, UCC financing
statement, guaranty, written assurance, substitution agreement, lock box
agreement, intercreditor agreement, management agreement or letter of credit.

     If any exceptions are noted on a schedule of exceptions attached to the
Final Certification, including exceptions resulting from the fact that the
recordation and/or filing has not been completed (based solely on the absence of
receipt by the Custodian (or the Trustee) of the particular documents showing
evidence of the recordation and/or filing), then the Custodian on behalf of the
Trustee (or the Trustee) shall continuously update such schedule of exceptions
to reflect receipt of any corrected documents, additional documents or
instruments or evidences of recordation and/or filing, as to each Mortgage Loan,
until the earliest of the following dates: (i) the date on which all such
exceptions are eliminated (any such elimination resulting from the fact that
recordation and/or filing has been completed shall be based solely on receipt by
the Custodian or the Trustee of the particular documents showing evidence of the
recordation and/or filing), (ii) the date on which all the affected Mortgage
Loans are removed from the Trust and (iii) the second anniversary of the Closing
Date, and shall provide such updated schedule of exceptions (which may be in
electronic format) to each of the Depositor, each Seller (as to its respective
Mortgage Loans only), the Master Servicer, the Special Servicer, the Operating
Adviser and the Paying Agent on or about the date that is 180 days after the
Closing Date and then again every 90 days thereafter (until the earliest date
specified above). Upon request, the Paying Agent shall promptly forward a copy
thereof to each Certificateholder in the Controlling Class and shall deliver or
make available a copy thereof to other Certificateholders. Promptly, and in any
event within two Business Days, following any request therefor by the Depositor,
the Master Servicer, the Special Servicer or the Operating Adviser that is made
later than two years

                                      -93-
<PAGE>

following the Closing Date, the Custodian (or the Trustee) shall deliver an
updated schedule of exceptions, which may be in electronic format (to the extent
the prior schedule showed exceptions), to the requesting Person and the Paying
Agent, which shall make available a copy thereof.

     The Trustee or its authorized agents shall retain possession and custody of
each Trustee Mortgage File in accordance with and subject to the terms and
conditions set forth herein.

     SECTION 2.3 SELLERS' REPURCHASE OF MORTGAGE LOANS FOR MATERIAL DOCUMENT
DEFECTS AND MATERIAL BREACHES OF REPRESENTATIONS AND WARRANTIES.

     (a) If any party hereto discovers that any document or documents
constituting a part of a Mortgage File has not been delivered as and when
required, has not been properly executed, or is defective on its face or
discovers or receives notice of a breach of any of the representations and
warranties relating to the Mortgage Loans required to be made by a Seller
regarding the characteristics of the Mortgage Loans and/or related Mortgaged
Properties as set forth in the related Mortgage Loan Purchase Agreements, and in
either case such defect or breach either (i) materially and adversely affects
the interests of the holders of the Certificates in the related Mortgage Loan,
or (ii) both (A) the document defect or breach materially and adversely affects
the value of the Mortgage Loan and (B) the Mortgage Loan is a Specially Serviced
Mortgage Loan or Rehabilitated Mortgage Loan (such a document defect described
in the preceding clause (i) or (ii), a "Material Document Defect", and such a
breach described in the preceding clause (i) or (ii), a "Material Breach") such
party shall give prompt written notice to the other parties hereto and to each
Rating Agency subject to the terms of the applicable Mortgage Loan Purchase
Agreement. Promptly (but in any event within three Business Days) upon becoming
aware of any such Material Document Defect or Material Breach, the Master
Servicer shall, and the Special Servicer may, request that the related Seller,
not later than 90 days from such Seller's receipt of the notice of such Material
Document Defect or Material Breach, cure such Material Document Defect or
Material Breach, as the case may be, in all material respects; provided,
however, that if such Material Document Defect or Material Breach, as the case
may be, cannot be corrected or cured in all material respects within such 90-day
period, and such Material Document Defect or Material Breach would not cause the
Mortgage Loan to be other than a "qualified mortgage" (as defined in the Code)
but the related Seller is diligently attempting to effect such correction or
cure, as certified by such Seller in an Officer's Certificate delivered to the
Trustee, then the cure period will be extended for an additional 90 days unless,
solely in the case of a Material Document Defect, (x) the Mortgage Loan is then
a Specially Serviced Mortgage Loan and a Servicing Transfer Event has occurred
as a result of a monetary default or as described in clause (ii) or clause (v)
of the definition of "Servicing Transfer Event" and (y) the Material Document
Defect was identified in a certification delivered to the Seller by the Trustee
pursuant to Section 2.2 not less than 90 days prior to the delivery of the
notice of such Material Document Defect. The parties acknowledge that neither
delivery of a certification or schedule of exceptions to a Seller pursuant to
Section 2.2 or otherwise nor possession of such certification or schedule by the
Seller shall, in and of itself, constitute delivery of notice of any Material
Document Defect or knowledge or awareness by the Seller of any Material Document
Defect listed therein.

                                      -94-
<PAGE>

     If any such Material Document Defect or Material Breach cannot be corrected
or cured in all material respects within the above cure periods, the related
Seller will be obligated, not later than the last day of such permitted cure
period, to (i) repurchase the affected Mortgage Loan or REO Mortgage Loan from
the Trust at the applicable Purchase Price in accordance with the related
Mortgage Loan Purchase Agreement, or (ii) if within the three-month period
commencing on the Closing Date (or within the two-year period commencing on the
Closing Date if the related Mortgage Loan is a "defective obligation" within the
meaning of Section 860G(a)(4)(B)(ii) of the Code and Treasury Regulation Section
1.860G-2(f)), at the related Seller's option, without recourse (other than the
representations and warranties made with respect thereto), replace such Mortgage
Loan or REO Mortgage Loan with a Qualifying Substitute Mortgage Loan. If such
Material Document Defect or Material Breach would cause the Mortgage Loan to be
other than a "qualified mortgage" (as defined in the Code), then notwithstanding
the previous sentence or the previous paragraph, the repurchase must occur
within 85 days from the date the related Seller was notified of the defect and
substitution must occur within the sooner of (i) 85 days from the date the
related Seller was notified of the defect or (ii) two years from the Closing
Date. In connection with a repurchase of the Kimball Lane Loan, as contemplated
by this Section 2.3(a), the Paying Agent shall effect a "qualified liquidation"
of the Kimball Lane Loan REMIC in accordance with the REMIC Provisions. In the
case of a substitution for the Kimball Lane Loan, all references in this
Agreement to the Kimball Lane Loan shall be to the Qualifying Substitute
Mortgage Loan or Loans substituted therefor; provided, however, that the Kimball
Lane Loan REMIC Net Mortgage Rate and the Certificate Balance of the Kimball
Lane Loan REMIC Regular Interest shall not change.

     As to any Qualifying Substitute Mortgage Loan or Loans, the Master Servicer
shall not execute any instrument effecting the substitution unless the related
Seller has delivered to the Trustee for such Qualifying Substitute Mortgage Loan
or Loans, the Mortgage Note, the Mortgage, the related Assignment of Mortgage,
and such other documents and agreements as are required by Section 2.1, with the
Mortgage Note endorsed as required by Section 2.1 and the Master Servicer shall
be entitled to rely on statements and certifications from the Trustee for this
purpose. No substitution may be made in any calendar month after the
Determination Date for such month. Monthly payments due with respect to
Qualifying Substitute Mortgage Loans in the month of substitution shall not be
part of the Trust and will be retained by Master Servicer and remitted by the
Master Servicer to the related Seller on the next succeeding Distribution Date.
For the month of substitution, distributions to Certificateholders will include
the Scheduled Payment due on the related Deleted Mortgage Loan for such month
and thereafter the related Seller shall be entitled to retain all amounts
received in respect of such Deleted Mortgage Loan.

     The Master Servicer shall amend or cause to be amended the Mortgage Loan
Schedule to reflect the removal of such Deleted Mortgage Loan and the
substitution of the Qualifying Substitute Mortgage Loan or Loans and upon such
amendment the Master Servicer shall deliver or cause to be delivered such
amended Mortgage Loan Schedule to the Trustee, the Paying Agent and the Special
Servicer. Upon such substitution, the Qualifying Substitute Mortgage Loan or
Loans shall be subject to the terms of this Agreement in all respects. Upon
receipt of the Trustee Mortgage File pertaining to any Qualifying Substitute
Mortgage Loans, the Trustee shall release the Trustee Mortgage File relating to
such Deleted Mortgage Loan to the related Seller, and the Trustee (and the
Depositor, if necessary) shall execute and deliver such instruments of transfer
or assignment in the form presented to it, in each case without recourse,
representation or warranty, as shall be necessary to vest title (to the extent
that such title was

                                      -95-
<PAGE>

transferred to the Trustee or the Depositor) in the related Seller or its
designee to any Deleted Mortgage Loan (including any property acquired in
respect thereof or any insurance policy proceeds relating thereto) substituted
for pursuant to this Section 2.3.

     If (x) a Mortgage Loan is to be repurchased or replaced as contemplated
above (a "Defective Mortgage Loan"), (y) such Defective Mortgage Loan is
cross-collateralized and cross-defaulted with one or more other Mortgage Loans
("Crossed Mortgage Loans") and (z) the applicable document defect or breach does
not constitute a Material Document Defect or Material Breach, as the case may
be, as to such Crossed Mortgage Loans (without regard to this paragraph), then
the applicable document defect or breach (as the case may be) shall be deemed to
constitute a Material Document Defect or Material Breach (as the case may be) as
to each such Crossed Mortgage Loan for purposes of the above provisions, and the
related Seller shall be obligated to repurchase or replace each such Crossed
Mortgage Loan in accordance with the provisions above unless, in the case of
such breach or document defect, the Seller (A) provides a Nondisqualification
Opinion to the Trustee at the expense of the Seller and (B) both of the
following conditions would be satisfied if the related Seller were to repurchase
or replace only those Mortgage Loans as to which a Material Breach or Material
Document Defect had occurred without regard to this paragraph (the "Affected
Loan(s)"): (i) the Debt Service Coverage Ratio for all such other Mortgage Loans
(excluding the Affected Loan(s)) for the four calendar quarters immediately
preceding the repurchase or replacement is not less than the lesser of (A) 0.10x
below the debt service coverage ratio for all such other Mortgage Loans
(including the Affected Loan(s)) set forth in Appendix II to the Final
Prospectus Supplement and (B) the debt service coverage ratio for all such
Crossed Mortgage Loans (including the Affected Loan(s)) for the four preceding
calendar quarters preceding the repurchase or replacement, and (ii) the
Loan-to-Value Ratio for all such Crossed Mortgage Loans (excluding the Affected
Loan(s)) is not greater than the greater of (A) the loan-to-value ratio,
expressed as a whole number (taken to one decimal place), for all such Crossed
Mortgage Loans (including the Affected Loan(s)) set forth in Appendix II to the
Final Prospectus Supplement plus 10% and (B) the loan-to-value ratio for all
such Crossed Mortgage Loans (including the Affected Loan(s)), at the time of
repurchase or replacement. The determination of the Master Servicer as to
whether the conditions set forth above have been satisfied shall be conclusive
and binding in the absence of manifest error. The Master Servicer will be
entitled to cause to be delivered, or direct the related Seller to (in which
case the related Seller shall) cause to be delivered to the Master Servicer, an
Appraisal of any or all of the related Mortgaged Properties for purposes of
determining whether the condition set forth in clause (ii) above has been
satisfied, in each case at the expense of the related Seller if the scope and
cost of the Appraisal is approved by the related Seller (such approval not to be
unreasonably withheld).

     With respect to any Defective Mortgage Loan, to the extent that the
applicable Seller is required to repurchase or substitute for such Defective
Mortgage Loan (each, a "Repurchased Loan") in the manner prescribed above while
the Trustee continues to hold any Crossed Mortgage Loan, the applicable Seller
and the Depositor have agreed in the related Mortgage Loan Purchase Agreement to
forbear from enforcing any remedies against the other's Primary Collateral but
each is permitted to exercise remedies against the Primary Collateral securing
its respective Mortgage Loans, including with respect to the Trustee, the
Primary Collateral securing Mortgage Loans still held by the Trustee, so long as
such exercise does not impair the ability of the other party to exercise its
remedies against its Primary Collateral. If the exercise of remedies by one
party would impair the ability of the other party to exercise its

                                      -96-
<PAGE>

remedies with respect to the Primary Collateral securing the Mortgage Loan or
Mortgage Loans held by such party, then both parties have agreed to forbear from
exercising such remedies until the loan documents evidencing and securing the
relevant Mortgage Loans can be modified in a manner that complies with the
applicable Mortgage Loan Purchase Agreement to remove the threat of impairment
as a result of the exercise of remedies. Any reserve or other cash collateral or
letters of credit securing the Crossed-Mortgage Loans shall be allocated between
such Mortgage Loans in accordance with the Mortgage Loan documents, or otherwise
on a pro rata basis based upon their outstanding Principal Balances. All other
terms of the Mortgage Loans shall remain in full force and effect, without any
modification thereof. The Mortgagors set forth on Schedule VIII hereto are
intended third-party beneficiaries of the provisions set forth in this paragraph
and the preceding paragraph. The provisions of this paragraph and the preceding
paragraph may not be modified with respect to any Mortgage Loan without the
related Mortgagor's consent.

     Any of the following document defects shall be conclusively presumed
materially and adversely to affect the interests of Certificateholders in a
Mortgage Loan and be a Material Document Defect: (a) the absence from the
Mortgage File of the original signed Mortgage Note, unless the Mortgage File
contains a signed lost note affidavit and indemnity that appears to be regular
on its face; (b) the absence from the Mortgage File of the original signed
Mortgage (or with respect to any Non-Serviced Mortgage Loan, a copy thereof)
that appears to be regular on its face, unless there is included in the Mortgage
File a certified copy of the Mortgage by the local authority with which the
Mortgage was recorded; or (c) the absence from the Mortgage File of the item
called for by paragraph (viii) of the definition of Mortgage File (or with
respect to any Non-Serviced Mortgage Loan, a copy thereof). If any of the
foregoing Material Document Defects is discovered by the Custodian (or the
Trustee if there is no Custodian), the Trustee (or as set forth in Section
2.3(a), the Master Servicer) will take the steps described elsewhere in this
section, including the giving of notices to the Rating Agencies and the parties
hereto and making demand upon the related Seller for the cure of the document
defect or repurchase or replacement of the related Mortgage Loan.

     If the related Seller disputes that a Material Document Defect or Material
Breach exists with respect to a Mortgage Loan or otherwise refuses (i) to effect
a correction or cure of such Material Document Defect or Material Breach, (ii)
to repurchase the affected Mortgage Loan from the Trust or (iii) to replace such
Mortgage Loan with a Qualifying Substitute Mortgage Loan, each in accordance
with the related Mortgage Loan Purchase Agreement, then provided that (x) the
period of time provided for the related Seller to correct, repurchase or cure
has expired and (y) the Mortgage Loan is then in default and is then a Specially
Serviced Mortgage Loan, the Special Servicer may, subject to the Servicing
Standard, modify, workout or foreclose, sell or otherwise liquidate (or permit
the liquidation of) the Mortgage Loan pursuant to Section 9.5, Section 9.12,
Section 9.15 and Section 9.36, as applicable, hereof, while pursuing the
repurchase claim. The related Seller has acknowledged and agreed under the
related Mortgage Loan Purchase Agreement that any modification of the Mortgage
Loan pursuant to a workout shall not constitute a defense to any repurchase
claim nor shall such modification and workout change the Purchase Price due from
the related Seller for any repurchase claim. In the event of any such
modification and workout, the related Seller has agreed under the related
Mortgage Loan Purchase Agreement to repurchase the Mortgage Loan as modified and
that the Purchase Price shall include any Work-Out Fee paid to the Special
Servicer up to the date of repurchase plus the present value (calculated at a
discount rate equal to the applicable Mortgage

                                      -97-
<PAGE>

Rate) of the Work-Out Fee that would have been payable to the Special Servicer
in respect of such Mortgage Loan if the Mortgage Loan performed in accordance
with its terms to its Maturity Date, provided that no amount shall be paid by
the related Seller in respect of any Work-Out Fee if a Liquidation Fee already
comprises (or will comprise) a portion of the Purchase Price. The related Seller
shall be notified promptly and in writing by (i) the Trustee of any notice that
it receives that an Option Holder intends to exercise its Option to purchase the
Mortgage Loan in accordance with and as described in Section 9.36 hereof and
(ii) the Special Servicer of any offer that it receives to purchase the
applicable REO Property, each in connection with such liquidation. Upon the
receipt of such notice by the related Seller, the related Seller shall then have
the right to purchase the related Mortgage Loan or REO Property, as applicable,
from the Trust at a purchase price equal to, in the case of clause (i) of the
immediately preceding sentence, the Option Purchase Price or, in the case of
clause (ii) of the immediately preceding sentence, the amount of such offer.
Notwithstanding anything to the contrary contained herein or in the related
Mortgage Loan Purchase Agreement, the right of any Option Holder to purchase
such Mortgage Loan shall be subject and subordinate to the Seller's right to
purchase such Mortgage Loan as described in the immediately preceding sentence.
The related Seller shall have five (5) Business Days to notify the Trustee or
the Special Servicer, as applicable, of its intent to so purchase the Mortgage
Loan or related REO Property from the date that it was notified of such
intention to exercise such Option or of such offer. The Special Servicer shall
be obligated to provide the related Seller with any appraisal or other third
party reports relating to the Mortgaged Property within its possession to enable
the related Seller to evaluate the related Mortgage Loan or REO Property. Any
sale of the related Mortgage Loan, or foreclosure upon such Mortgage Loan and
sale of the related REO Property, to a Person other than the related Seller
shall be without (i) recourse of any kind (either expressed or implied) by such
Person against the related Seller and (ii) representation or warranty of any
kind (either expressed or implied) by the related Seller to or for the benefit
of such Person.

     The fact that a Material Document Defect or Material Breach is not
discovered until after foreclosure (but in all instances prior to the sale of
the related REO Property or Mortgage Loan) shall not prejudice any claim against
the Seller for repurchase of the REO Mortgage Loan or REO Property. In such an
event, the Master Servicer shall notify the related Seller of the discovery of
the Material Document Defect or Material Breach and the related Seller shall
have 90 days to correct or cure such Material Document Defect or Material Breach
or purchase the REO Property at the Purchase Price. If the related Seller fails
to correct or cure the Material Document Defect or Material Breach or purchase
the REO Property, then the provisions above regarding notice of offers related
to such REO Property and the related Seller's right to purchase such REO
Property shall apply. After a final liquidation of the Mortgage Loan or REO
Mortgage Loan, if a court of competent jurisdiction issues a final order after
the expiration of any applicable appeal period that the related Seller is or was
obligated to repurchase the related Mortgage Loan or REO Mortgage Loan (a "Final
Judicial Determination") or the related Seller otherwise accepts liability,
then, but in no event later than the Termination of the Trust pursuant to
Section 9.30 hereof, the related Seller will be obligated to pay to the Trust
the difference between any Liquidation Proceeds received upon such liquidation
(including those arising from any sale to the related Seller) and the Purchase
Price.

     Notwithstanding anything to the contrary contained herein, in connection
with any sale or other liquidation of a Mortgage Loan or REO Property as
described in this Section 2.3, the Special Servicer shall not receive a
Liquidation Fee from the applicable Seller (but may

                                      -98-
<PAGE>

collect such Liquidation Fee from the related Liquidation Proceeds as otherwise
provided herein); provided, however, that in the event the applicable Seller is
obligated to repurchase the Mortgage Loan or REO Property after a final
liquidation of such Mortgage Loan or REO Property pursuant to the immediately
preceding paragraph, an amount equal to any Liquidation Fee (calculated on the
basis of Liquidation Proceeds) payable to the Special Servicer shall be included
in the definition of "Purchase Price" in respect of such Mortgage Loan or REO
Property. Except as expressly set forth above, no Liquidation Fee shall be
payable in connection with a repurchase of a Mortgage Loan by a Seller.

     In any month in which the related Seller substitutes one or more Qualifying
Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the Master
Servicer will determine the amount (if any) by which the aggregate Principal
Balance of all such Qualifying Substitute Mortgage Loans as of the date of
substitution is less than the aggregate Principal Balance of all such Deleted
Mortgage Loans (in each case after application of scheduled principal portion of
the monthly payments received in the month of substitution). The Depositor shall
cause the related Seller to deposit the amount of such shortage into the
Certificate Account in the month of substitution, without any reimbursement
thereof. In addition, the Depositor shall cause the related Seller to deposit
into the Certificate Account, together with such shortage, if any, an amount
equal to interest on the Deleted Mortgage Loans at a rate equal to the sum of
the applicable Mortgage Rate from the Due Date as to which interest was last
paid up to the Due Date next succeeding such substitution together with the
amount of unreimbursed Servicing Advances, amounts required to be paid to the
Special Servicer but remaining unpaid or unreimbursed, and interest on
unreimbursed Advances with respect to such Deleted Mortgage Loans at the Advance
Rate. The Depositor shall cause the related Seller, in the case of the Mortgage
Loans, to give notice in writing (accompanied by an Officer's Certificate as to
the calculation of such shortage) to the Trustee, the Paying Agent and the
Master Servicer of such event which notice shall be accompanied by an Officer's
Certificate as to the calculation of such shortfall.

     If the affected Mortgage Loan is to be repurchased, the Master Servicer
shall designate the Certificate Account as the account to which funds in the
amount of the Purchase Price are to be wired. Any such purchase of a Mortgage
Loan shall be on a whole loan, servicing released basis.

     (b) In connection with any repurchase of or substitution for a Mortgage
Loan contemplated by this Section 2.3, the Trustee, the Master Servicer and the
Special Servicer shall each tender to the related Seller, upon delivery to each
of them of a receipt executed by such Seller, all portions of the Mortgage File
and other documents pertaining to such Mortgage Loan possessed by it, and each
document that constitutes a part of the Mortgage File shall be endorsed or
assigned to the extent necessary or appropriate to the related Seller or its
designee in the same manner, and pursuant to appropriate forms of assignment,
substantially similar to the manner and forms pursuant to which documents were
previously assigned to the Trustee, but in any event, without recourse,
representation or warranty; provided that such tender by the Trustee shall be
conditioned upon its receipt from the Master Servicer of a Request for Release.
The Master Servicer shall, and is hereby authorized and empowered by the Trustee
to, prepare, execute and deliver in its own name, on behalf of the
Certificateholders and the Trustee or any of them, the endorsements and
assignments contemplated by this Section 2.3, and the Trustee shall execute and
deliver any powers of attorney necessary to permit the Master Servicer to do so.
The Master

                                      -99-
<PAGE>

Servicer shall, and is also hereby authorized and empowered by the Trustee to,
reconvey to the related Seller any deposits then held in an Escrow Account
relating to the Mortgage Loan being repurchased or substituted for. The Master
Servicer shall indemnify the Trustee for all costs, liabilities and expenses
(including attorneys' fees) incurred by the Trustee in connection with any
negligent or intentional misuse of any such powers of attorney by the Master
Servicer.

     (c) The Mortgage Loan Purchase Agreements provide the sole remedies
available to the Certificateholders, or the Trustee on behalf of the
Certificateholders, respecting any Material Document Defect or Material Breach.
The parties hereunder understand that (i) Principal, as Seller under Mortgage
Loan Purchase Agreement III, will be providing the remedies with respect to the
Principal Loans, (ii) Wells Fargo, as Seller under Mortgage Loan Purchase
Agreement II, will be providing the remedies with respect to the Wells Fargo
Loans, (iii) BSCMI, as Seller under Mortgage Loan Purchase Agreement I, will be
providing the remedies with respect to the BSCMI Loans, (iv) JHREF, as Seller
under Mortgage Loan Purchase Agreement V, will be providing the remedies with
respect to the JHREF Loans and (v) MSMC, as Seller under Mortgage Loan Purchase
Agreement IV, will be providing the remedies with respect to the MSMC Loans.

     If the Master Servicer or the Special Servicer receives notice from the
Mortgagor under the Kimball Lane Loan that such Mortgagor intends to defease the
Kimball Lane Loan on or before the second anniversary of the Startup Day, the
Master Servicer or the Special Servicer shall promptly notify the Trustee, the
Paying Agent and the applicable Seller of such Mortgagor's intention, and the
Master Servicer shall direct such Seller to repurchase the Kimball Lane Loan at
the Purchase Price on a Due Date, but in no event later than one Business Day
prior to the date scheduled for such defeasance. In addition, the applicable
Seller, in this circumstance, shall be required to remit the Kimball Lane Yield
Maintenance Amount to the Paying Agent to distribute to the Class A-1, Class X-1
and Class X-2 Certificateholders the amounts to which they are entitled in
accordance with Section 6.11. If the applicable Seller fails to purchase the
Kimball Lane Loan as required, the Special Servicer shall sell such Kimball Lane
Loan from the Trust Fund at the highest available price and shall effect a
"qualified liquidation" of the Kimball Lane Loan REMIC, within the meaning of
Section 860F(a)(4) of the Code, as soon as reasonably practicable (but in no
event later than one Business Day prior to the date of such early defeasance).
The Trust shall be indemnified by the applicable Seller for any amount by which
the Purchase Price plus the Kimball Lane Yield Maintenance Amount exceeds the
proceeds received by the Trust with respect to such sale and liquidation of the
Kimball Lane Loan.

     (d) The Trustee or its designee (which, with the Master Servicer's consent,
may be the Master Servicer or which, with the Special Servicer's consent, may be
the Special Servicer) shall enforce the provisions of this Section 2.3.

     (e) BSCMI shall have the right, prior to January 14, 2004 and in its sole
discretion, to substitute one or more Qualifying Substitute Mortgage Loans for
one or more of the Mortgage Loans sold to the Depositor by Bear Stearns
Commercial Mortgage, Inc., provided that the aggregate Principal Balance of such
Deleted Mortgage Loans shall not exceed $9,500,000 and provided, further, that
such substitution is part of a bona fide replacement (and not part of a swap of
mortgages) within the meaning of Section 860G(e)(5) of the Code. In connection
with such a substitution, BSCMI and the parties hereto shall comply with the
second,

                                     -100-

<PAGE>

third, fourth and eleventh paragraphs of Section 2.3(a) and Section 2.3(b). In
connection with any substitution pursuant to this Section 2.3(e), (i) the
Certificate Balance and Kimball Lane Loan REMIC Net Mortgage Rate of the Kimball
Lane Loan REMIC Regular Interest shall not be changed, and (ii) the Certificate
Balance and REMIC I Net Mortgage Rate of the related REMIC I Regular Interest
shall not be changed. If BSCMI exercises its right to substitute one or more
Qualifying Substitute Mortgage Loans for the Kimball Lane Loan pursuant to this
Section 2.3(e), and the Qualifying Substitute Mortgage Loan or Loans delivered
in connection therewith do not otherwise satisfy the requirements set forth in
clauses (i) and (ii) of the definition of "Qualifying Substitute Mortgage Loan"
(but the aggregate scheduled cash flow of the Qualifying Substitute Mortgage
Loan or Loans is sufficient to pay interest on the Due Date(s) of the related
Qualifying Substitute Mortgage Loan or Loans on the Certificate Balance of the
Kimball Lane Loan REMIC Regular Interest at the Kimball Lane Loan REMIC Net
Mortgage Rate and the ultimate payment of principal in an amount sufficient to
reduce the Certificate Balance of the Kimball Lane Loan REMIC Regular Interest
to zero), then that cash flow when received shall be allocated first to the
accrued and unpaid interest on the Certificate Balance of the Kimball Lane Loan
REMIC Regular Interest at the Kimball Lane Loan REMIC Net Mortgage Rate, second
in respect of principal in reduction of the Certificate Balance of the Kimball
Lane Loan REMIC Regular Interest until reduced to zero at which time the
remainder of the cash flow shall be paid to the Kimball Lane Loan REMIC Residual
Interest, and such amounts allocable as interest and principal shall be deemed
to constitute interest paid on and principal of the Mortgage Loan underlying the
Kimball Lane Loan REMIC Regular Interest in the amounts reallocated hereunder
for all purposes of this Agreement (notwithstanding the characterization of such
payments prior to such reallocation).

     SECTION 2.4 REPRESENTATIONS AND WARRANTIES. The Depositor hereby represents
and warrants to the Master Servicer, the Special Servicer, the Trustee (in its
capacity as Trustee of the Trust), the Fiscal Agent and the Paying Agent as of
the Closing Date that:

     (a) The Depositor is a corporation duly organized, validly existing and in
good standing under the laws governing its creation and existence and has full
corporate power and authority to own its property, to carry on its business as
presently conducted, to enter into and perform its obligations under this
Agreement, and to create the trust pursuant hereto;

     (b) The execution and delivery by the Depositor of this Agreement have been
duly authorized by all necessary corporate action on the part of the Depositor;
neither the execution and delivery of this Agreement, nor the consummation of
the transactions herein contemplated, nor compliance with the provisions hereof,
will conflict with or result in a breach of, or constitute a default under, (i)
any of the provisions of any law, governmental rule, regulation, judgment,
decree or order binding on the Depositor or its properties; (ii) the certificate
of incorporation or bylaws of the Depositor; or (iii) the terms of any indenture
or other agreement or instrument to which the Depositor is a party or by which
it is bound; neither the Depositor nor any of its Affiliates is a party to,
bound by, or in breach of or violation of any indenture or other agreement or
instrument, or subject to or in violation of any statute, order or regulation of
any court, regulatory body, administrative agency or governmental body having
jurisdiction over it, which materially and adversely affects or to the best
knowledge of the Depositor may in the future materially and adversely affect (i)
the ability of the Depositor to perform its obligations under this Agreement or
(ii) the business, operations, financial condition, properties or assets of the
Depositor;

                                     -101-
<PAGE>

     (c) The execution, delivery and performance by the Depositor of this
Agreement and the consummation of the transactions contemplated hereby do not
require the consent or approval of, the giving of notice to, the registration
with, or the taking of any other action in respect of, any state, federal or
other governmental authority or agency, except such as has been obtained, given,
effected or taken prior to the date hereof;

     (d) This Agreement has been duly executed and delivered by the Depositor
and, assuming due authorization, execution and delivery by the Trustee,
constitutes a valid and binding obligation of the Depositor enforceable against
it in accordance with its terms;

     (e) There are no actions, suits or proceedings pending or, to the best of
the Depositor's knowledge, threatened or likely to be asserted against or
affecting the Depositor, before or by any court, administrative agency,
arbitrator or governmental body (A) with respect to any of the transactions
contemplated by this Agreement or (B) with respect to any other matter which in
the judgment of the Depositor will be determined adversely to the Depositor and
will, if determined adversely to the Depositor, materially and adversely affect
it or its business, assets, operations or condition, financial or otherwise, or
adversely affect its ability to perform its obligations under this Agreement;
and

     (f) Immediately prior to the consummation of the transactions contemplated
in this Agreement, the Depositor had good title to and was the sole owner of
each Mortgage Loan free and clear of any and all adverse claims, charges or
security interests (including liens arising under the federal tax laws or the
Employee Retirement Income Security Act of 1974, as amended).

     SECTION 2.5 CONVEYANCE OF INTERESTS. Effective as of the Closing Date, the
Depositor does hereby transfer, assign, set over, deposit with and otherwise
convey to the Trustee, without recourse, in trust, all the right, title and
interest of the Depositor in and to (i) the Majority Mortgage Loans and the
Kimball Lane Loan REMIC Regular Interest in exchange for the REMIC I Regular
Interests, (ii) the REMIC I Regular Interests in exchange for the REMIC II
Interests, (iii) the REMIC II Regular Interests in exchange for the REMIC III
Certificates, (iv) the Excess Interest in exchange for the Class O Grantor Trust
Interest and (v) the Kimball Lane Yield Maintenance Amounts in exchange for the
Class A-1 Grantor Trust Interest, Class X-1 Grantor Trust Interest and Class X-2
Grantor Trust Interest.

                                  ARTICLE III

                                THE CERTIFICATES

     SECTION 3.1 THE CERTIFICATES.

     (a) The Certificates shall be in substantially the forms set forth in the
Exhibits attached hereto, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Agreement or as may in the reasonable judgment of the Trustee or the Depositor
be necessary, appropriate or convenient to comply, or facilitate compliance,
with applicable laws, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange on which any of the
Certificates may be listed, or as may, consistently

                                     -102-
<PAGE>

herewith, be determined by the officers executing such Certificates, as
evidenced by their execution thereof.

     The Definitive Certificates shall be printed, typewritten, lithographed or
engraved or produced by any combination of these methods or may be produced in
any other manner permitted by the rules of any securities exchange on which any
of the Certificates may be listed, all as determined by the officers executing
such Certificates, as evidenced by their execution thereof.

     (b) The Class A Certificates will be issuable in denominations of $25,000
initial Certificate Balance and in any whole dollar denomination in excess
thereof. The Class X, Class B, Class C, Class D, Class E, Class F, Class G,
Class H, Class J, Class K, Class L, Class M, Class N and Class O Certificates
will be issuable in denominations of $100,000 initial Certificate Balance or
initial Notional Amount (as applicable) or in any whole dollar denomination in
excess thereof. The Class R-I, Class R-II, Class R-III and Class R-K
Certificates will be issued in minimum Percentage Interests of 10% and integral
multiples of 10% in excess thereof.

     (c) Each Certificate shall, on original issue, be executed by the
Certificate Registrar and authenticated by the Authenticating Agent upon the
order of the Depositor. No Certificate shall be entitled to any benefit under
this Agreement, or be valid for any purpose, unless there appears on such
Certificate a certificate of authentication substantially in the form provided
for herein, executed by an authorized officer of the Authenticating Agent by
manual signature, and such certification upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication. At any time and from time to time after the execution
and delivery of this Agreement, the Depositor may deliver Certificates to the
Authenticating Agent for authentication and the Authenticating Agent shall
authenticate and deliver such Certificates as in this Agreement provided and not
otherwise. In the event that additional Certificates need to be prepared at any
time subsequent to the Closing Date, the Depositor shall prepare, or cause to be
prepared, deliver, or cause to be delivered, at the Depositor's expense, any
such additional Certificates. With respect to the Class A, Class X, Class B,
Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class K, Class L,
Class M, Class N and Class O Certificates that are issued in book-entry form, on
the Closing Date, the Authenticating Agent upon the order of the Depositor shall
authenticate Book-Entry Certificates that are issued to a Clearing Agency or its
nominee as provided in Section 3.7 against payment of the purchase price
thereof. With respect to the Class H, Class J, Class K, Class L, Class M, Class
N and Class O Certificates that are issued in definitive form, on the Closing
Date, the Authenticating Agent upon the order of the Depositor shall
authenticate Definitive Certificates that are issued to the registered holder
thereof against payment of the purchase price thereof.

     SECTION 3.2 REGISTRATION. The Paying Agent shall be the initial Certificate
Registrar in respect of the Certificates and the Certificate Registrar shall
maintain books for the registration and for the transfer of Certificates (the
"Certificate Register"). The Certificate Registrar may resign or be discharged
or removed by the Paying Agent or the Certificateholders, and a new successor
may be appointed, in accordance with the procedures and requirements set forth
in Sections 7.6 and 7.7 hereof with respect to the resignation, discharge or
removal of the Paying Agent and the appointment of a successor Paying Agent. The
Certificate Registrar may

                                     -103-

<PAGE>

appoint, by a written instrument delivered to the Holders and the Trustee, any
trust company to act as co-registrar under such conditions as the Certificate
Registrar may prescribe; provided that the Certificate Registrar shall not be
relieved of any of its duties or responsibilities hereunder by reason of such
appointment.

     SECTION 3.3 TRANSFER AND EXCHANGE OF CERTIFICATES.

     (a) A Certificate may be transferred by the Holder thereof only upon
presentation and surrender of such Certificate at the Corporate Trust Office,
duly endorsed or accompanied by a written instrument of transfer duly executed
by such Holder or such Holder's duly authorized attorney in such form as shall
be satisfactory to the Certificate Registrar. Upon the transfer of any
Certificate in accordance with the preceding sentence, and subject to the
restrictions set forth in the other subsections of this Section 3.3, the
Certificate Registrar shall execute, and the Authenticating Agent shall
authenticate and deliver to the transferee, one or more new Certificates of the
same Class and evidencing, in the aggregate, the same aggregate initial
Certificate Balance, initial Notional Amount or Percentage Interest, as the case
may be, as the Certificate being transferred. No service charge shall be made to
a Certificateholder for any registration of transfer of Certificates, but the
Certificate Registrar may require payment of a sum sufficient to cover any tax
or governmental charge that may be imposed in connection with any registration
or transfer of Certificates. The Certificate Registrar may decline to accept any
request for a registration of transfer of any Certificate during the period
beginning five calendar days prior to any Distribution Date.

     (b) A Certificate may be exchanged by the Holder thereof for any number of
new Certificates of the same Class, in authorized denominations, representing in
the aggregate the same initial Certificate Balance, initial Notional Amount or
Percentage Interest, as the case may be, as the Certificate surrendered, upon
surrender of the Certificate to be exchanged at the offices of the Certificate
Registrar duly endorsed or accompanied by a written instrument of exchange duly
executed by such Holder or such Holder's duly authorized attorney in such form
as is satisfactory to the Certificate Registrar. Certificates delivered upon any
such exchange will evidence the same obligations, and will be entitled to the
same rights and privileges, as the Certificates surrendered. No service charge
shall be made to a Certificateholder for any exchange of Certificates, but the
Certificate Registrar may require payment of a sum sufficient to cover any tax
or governmental charge that may be imposed in connection with any exchange of
Certificates. Whenever any Certificates are so surrendered for exchange, the
Certificate Registrar shall execute and the Authenticating Agent shall
authenticate, date and deliver the Certificates which the Certificateholder
making the exchange is entitled to receive.

     (c) No transfer, sale, pledge or other disposition of any Non-Registered
Certificate or interest therein shall be made unless such transfer, sale, pledge
or other disposition is exempt from the registration and/or qualification
requirements of the Securities Act and any applicable state securities laws, or
is otherwise made in accordance with the Securities Act and such state
securities laws. If a transfer of any Non-Registered Certificate held as a
Definitive Certificate is to be made without registration under the Securities
Act (other than in connection with the initial issuance of the Certificates or a
transfer of such Non-Registered Certificate by the Depositor or one of its
Affiliates), then the Certificate Registrar shall refuse to register such
transfer unless it receives (and upon receipt, may conclusively rely upon)
either: (i) a certificate from the Certificateholder desiring to effect such
transfer substantially in the form attached as

                                     -104-
<PAGE>

Exhibit D-1 hereto and a certificate from such Certificateholder's prospective
Transferee substantially in the form attached either as Exhibit D-2A hereto or
as Exhibit D-2B hereto; or (ii) an Opinion of Counsel satisfactory to the
Certificate Registrar to the effect that such transfer shall be made without
registration under the Securities Act, together with the written
certification(s) as to the facts surrounding such transfer from the
Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective Transferee on which such Opinion of Counsel is
based (such Opinion of Counsel shall not be an expense of the Trust or of the
Depositor, the Master Servicer, the Special Servicer, the Paying Agent, the
Trustee or the Certificate Registrar in their respective capacities as such). If
a transfer of any interest in a Non-Registered Certificate that constitutes a
Book-Entry Certificate is to be made without registration under the Securities
Act (other than in connection with the initial issuance of the Certificates or a
transfer of any interest in such Non-Registered Certificate by the Depositor or
any of its Affiliates), then the Certificate Owner desiring to effect such
transfer shall be required to obtain either (i) a certificate from such
Certificate Owner's prospective Transferee substantially in the form attached as
Exhibit D-3A hereto or as Exhibit D-3B hereto, or (ii) an Opinion of Counsel to
the effect that such transfer may be made without registration under the
Securities Act. None of the Depositor, the Fiscal Agent, the Paying Agent, the
Trustee, the Master Servicer, the Special Servicer or the Certificate Registrar
is obligated to register or qualify any Class of Non-Registered Certificates
under the Securities Act or any other securities law or to take any action not
otherwise required under this Agreement to permit the transfer of any
Certificate. Any Certificateholder or Certificate Owner desiring to effect a
transfer of Non-Registered Certificates or interests therein shall, and does
hereby agree to, indemnify the Depositor, each Underwriter, the Trustee, the
Fiscal Agent, the Master Servicer, the Special Servicer, the Paying Agent and
the Certificate Registrar against any liability that may result if the transfer
is not exempt from such registration or qualification or is not made in
accordance with such federal and state laws.

     (d) No transfer of a Non-Investment Grade Certificate or Residual
Certificate or any interest therein shall be made (A) to any employee benefit
plan or other retirement arrangement, including individual retirement accounts
and annuities, Keogh plans and collective investment funds and separate accounts
in which such plans, accounts or arrangements are invested, including, without
limitation, insurance company general accounts, that is subject to Title I of
ERISA or Section 4975 of the Code or any applicable federal, state or local law
("Similar Laws") materially similar to the foregoing provisions of ERISA or the
Code (each, a "Plan"), (B) in book-entry form to an Institutional Accredited
Investor who is not also a Qualified Institutional Buyer or (C) to any Person
who is directly or indirectly purchasing such Certificate or interest therein on
behalf of, as named fiduciary of, as trustee of, or with "plan assets" of a
Plan, unless: (i) in the case of a Non-Investment Grade Certificate that
constitutes a Book-Entry Certificate and is being sold to a Qualified
Institutional Buyer, the purchase and holding of such Certificate or interest
therein qualifies for the exemptive relief available under Sections I and III of
U.S. Department of Labor Prohibited Transaction Class Exemption ("PTCE") 95-60;
or (ii) in the case of a Non-Investment Grade Certificate held as a Definitive
Certificate, the prospective Transferee provides the Certificate Registrar with
a certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Certificate Registrar that such transfer will not constitute
or result in a non-exempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code or subject the Depositor, the Trustee, the Fiscal
Agent, the Paying Agent, the Master Servicer, the Special Servicer or the
Certificate Registrar to any obligation in addition to those undertaken in this
Agreement. Each Person who acquires any Non-Investment Grade Certificate or
Residual Certificate or interest therein (unless

                                     -105-

<PAGE>

it shall have acquired such Certificate or interest therein from the Depositor
or an Affiliate thereof or unless it shall have delivered to the Certificate
Registrar the certification of facts and Opinion of Counsel referred to in
clause (ii) of the preceding sentence) shall be required to deliver to the
Certificate Registrar (or, in the case of an interest in a Non-Investment Grade
Certificate that constitutes a Book-Entry Certificate, to the Certificate Owner
that is transferring such interest) a certification to the effect that: (i) it
is neither a Plan nor any Person who is directly or indirectly purchasing such
Certificate or interest therein on behalf of, as named fiduciary of, as trustee
of, or with "plan assets" of a Plan; or (ii) that, in the case of a
Non-Investment Grade Certificate, the purchase and holding of such Certificate
or interest therein by such person qualifies for the exemptive relief available
under Sections I and III of PTCE 95-60 or another exemption from the "prohibited
transactions" rules under ERISA by the U.S. Department of Labor or similar
exemption under Similar Laws.

     (e) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and to
have irrevocably authorized the Paying Agent under clause (F) below to deliver
payments to a Person other than such Person and to have irrevocably authorized
the Certificate Registrar under clause (G) below to negotiate the terms of any
mandatory sale and to execute all instruments of Transfer and to do all other
things necessary in connection with any such sale. The rights of such person
acquiring any Ownership Interest in a Residual Certificate are expressly subject
to the following provisions:

          (A) (1) Each Person holding or acquiring any Ownership Interest in a
     Residual Certificate shall be a Permitted Transferee and a United States
     Tax Person and shall promptly notify the Certificate Registrar of any
     change or impending change in its status as a Permitted Transferee and (2)
     each Person holding or acquiring any Ownership Interest in a Residual
     Certificate shall be a Qualified Institutional Buyer and shall promptly
     notify the Certificate Registrar of any change or impending change in its
     status as a Qualified Institutional Buyer.

          (B) In connection with any proposed Transfer of any Ownership Interest
     in a Residual Certificate, the Certificate Registrar shall require delivery
     to it, and no Transfer of any Residual Certificate shall be registered
     until the Certificate Registrar receives, an affidavit and agreement
     substantially in the form attached hereto as Exhibit E-1 (a "Transfer
     Affidavit and Agreement") from the proposed Transferee, in form and
     substance satisfactory to the Certificate Registrar, representing and
     warranting, among other things, that such Transferee is a Permitted
     Transferee, that it is a Qualified Institutional Buyer, that it is not
     acquiring its Ownership Interest in the Residual Certificate that is the
     subject of the proposed Transfer as a nominee, trustee or agent for any
     Person that is not a Permitted Transferee, that for so long as it retains
     its Ownership Interest in a Residual Certificate, it will endeavor to
     remain a Permitted Transferee, that it is a United States Tax Person, that
     it is not a foreign permanent establishment or fixed base, within the
     meaning of any applicable income tax treaty, of any United States Tax
     Person, that it has historically paid its debts as they have come due and
     will continue to do so in the future, that it understands that its tax
     liability with respect to the Residual Certificates may exceed cash flows
     thereon and it intends to pay such taxes as they come due, that it will not
     cause income with respect to the

                                     -106-
<PAGE>

     Residual Certificates to be attributable to a foreign permanent
     establishment or fixed base, within the meaning of any applicable income
     tax treaty, of such proposed Transferee or any other United States Tax
     Person, that it will provide the Certificate Registrar with all information
     necessary to determine that the applicable paragraphs of Section 13 of such
     Transfer Affidavit and Agreement are true or that Section 13 is not
     applicable, and that it has reviewed the provisions of this Section 3.3(e)
     and agrees to be bound by them.

          (C) Notwithstanding the delivery of a Transfer Affidavit and Agreement
     by a proposed Transferee under clause (B) above, if the Certificate
     Registrar has actual knowledge that the proposed Transferee is not a
     Permitted Transferee or is not a United States Tax Person, no Transfer of
     an Ownership Interest in a Residual Certificate to such proposed Transferee
     shall be effected.

          (D) Each Person holding or acquiring an Ownership Interest in a
     Residual Certificate shall agree (1) to require a Transfer Affidavit and
     Agreement from any prospective Transferee to whom such Person attempts to
     transfer its Ownership Interest in such Residual Certificate and (2) not to
     transfer its Ownership Interest in such Residual Certificate unless it
     provides to the Certificate Registrar a certificate substantially in the
     form attached hereto as Exhibit E-2 among other things stating that (x) it
     has conducted a reasonable investigation of the financial condition of the
     proposed Transferee and, as a result of the investigation, the Transferor
     determines that the proposed Transferee had historically paid its debts as
     they came due and found no significant evidence that the proposed
     Transferee will not continue to pay its debts as they come due in the
     future and, (y) it has no actual knowledge that such prospective Transferee
     is not a Permitted Transferee, is not a United States Tax Person, is a
     foreign permanent establishment or fixed base, within the meaning of any
     applicable income tax treaty, of any United States Tax Person or is a
     Person with respect to which income on the Residual Certificate is
     attributable to a foreign permanent establishment or fixed base, within the
     meaning of any applicable income tax treaty.

          (E) Each Person holding or acquiring an Ownership Interest in a
     Residual Certificate that is a "pass-through interest holder" within the
     meaning of temporary Treasury Regulation Section 1.67-3T(a)(2)(i)(A) or is
     holding an Ownership Interest in a Residual Certificate on behalf of a
     "pass-through interest holder", by purchasing an Ownership Interest in such
     Certificate, agrees to give the Certificate Registrar written notice of its
     status as such immediately upon holding or acquiring such Ownership
     Interest in a Residual Certificate.

          (F) If any purported Transferee shall become a Holder of a Residual
     Certificate in violation of the provisions of this Section 3.3(e) or if any
     Holder of a Residual Certificate shall lose its status as a Permitted
     Transferee or a United States Tax Person, then the last preceding Holder of
     such Residual Certificate that was in compliance with the provisions of
     this Section 3.3(e) shall be restored, to the extent permitted by law, to
     all rights and obligations as Holder thereof retroactive to the date of
     registration of such Transfer of such Residual Certificate. None of the
     Trustee, the Fiscal Agent, the Master Servicer, the Special Servicer, the
     Certificate Registrar or the Paying Agent shall be under any liability to
     any Person for any registration of Transfer of a Residual

                                     -107-
<PAGE>

     Certificate that is in fact not permitted by this Section 3.3(e) or for
     making any payments due on such Certificate to the Holder thereof or for
     taking any other action with respect to such Holder under the provisions of
     this Agreement.

          (G) If any purported Transferee shall become a Holder of a Residual
     Certificate in violation of the restrictions in this Section 3.3(e), or if
     any Holder of a Residual Certificate shall lose its status as a Permitted
     Transferee or a United States Tax Person, and to the extent that the
     retroactive restoration of the rights and obligations of the prior Holder
     of such Residual Certificate as described in clause (F) above shall be
     invalid, illegal or unenforceable, then the Trustee shall have the right,
     without notice to the Holder or any prior Holder of such Residual
     Certificate, but not the obligation, to sell or cause to be sold such
     Residual Certificate to a purchaser selected by the Trustee on such terms
     as the Trustee may choose. Such noncomplying Holder shall promptly endorse
     and deliver such Residual Certificate in accordance with the instructions
     of the Certificate Registrar. Such purchaser may be the Certificate
     Registrar itself or any Affiliate of the Certificate Registrar. The
     proceeds of such sale, net of the commissions (which may include
     commissions payable to the Certificate Registrar or its Affiliates),
     expenses and taxes due, if any, will be remitted by the Certificate
     Registrar to such noncomplying Holder. The terms and conditions of any sale
     under this clause (G) shall be determined in the sole discretion of the
     Certificate Registrar, and the Certificate Registrar shall not be liable to
     any Person having an Ownership Interest in a Residual Certificate as a
     result of its exercise of such discretion.

The Master Servicer, on behalf of the Paying Agent, shall make available, upon
written request from the Paying Agent, to the Internal Revenue Service and those
Persons specified by the REMIC Provisions, all information necessary to compute
any tax imposed (A) as a result of the Transfer of an Ownership Interest in a
Residual Certificate to any Person who is not a Permitted Transferee, including
the information described in Treasury Regulations Sections 1.860D-1(b)(5) and
1.860E-2(a)(5) with respect to the "excess inclusions" of such Residual
Certificate and (B) as a result of any regulated investment company, real estate
investment trust, common trust fund, partnership, trust, estate or organization
described in Section 1381 of the Code that holds an Ownership Interest in a
Residual Certificate having as among its record holders at any time any Person
which is not a Permitted Transferee. The Person holding such Ownership Interest
shall be responsible for the reasonable compensation of the Master Servicer and
the Paying Agent for providing such information.

     The provisions of this Section 3.3(e) may be modified, added to or
eliminated, provided that there shall have been delivered to the Trustee, the
Paying Agent, the Certificate Registrar, the Master Servicer, the Operating
Adviser and the Depositor the following:

          (A) written notification from each Rating Agency to the effect that
     the modification of, addition to or elimination of such  provisions will
     not cause such

                                     -108-
<PAGE>

     Rating Agency to qualify, downgrade or withdraw its then current rating of
     any Class of Certificates; and

          (B) an Opinion of Counsel, in form and substance satisfactory to the
     Trustee, the Certificate Registrar and the Depositor, to the effect that
     such modification of, addition to or elimination of such provisions will
     not cause any of the Kimball Lane Loan REMIC, REMIC I, REMIC II or REMIC
     III to (x) cease to qualify as a REMIC or (y) be subject to an entity-level
     tax caused by the Transfer of any Residual Certificate to a Person which is
     not a Permitted Transferee, or cause a Person other than the prospective
     Transferee to be subject to a tax caused by the Transfer of a Residual
     Certificate to a Person which is not a Permitted Transferee.

     (f) None of the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Paying Agent or the Certificate Registrar shall have any
liability to the Trust arising from a transfer of any Certificate in reliance
upon a certification, ruling or Opinion of Counsel described in this Section
3.3; provided, however, that the Certificate Registrar shall not register the
transfer of a Residual Certificate if it has actual knowledge that the proposed
transferee does not meet the qualifications of a permitted Holder of a Residual
Certificate as set forth in Section 3.3(e); provided, further, that the
Certificate Registrar shall not register the transfer of a Noneconomic Residual
Interest if it shall have received notice that the Transferor has determined, as
a result of the investigation under Section 3.3(e)(D), that the proposed
Transferee has not paid its debts as they came due or that it will not pay its
debts as they come due in the future. The Certificate Registrar shall have no
obligation or duty to monitor, determine or inquire as to compliance with any
restriction on transfer or exchange of Certificates or any interest therein
imposed under this Article III or under applicable law other than to require
delivery of the certifications and/or opinions described in this Article III;
provided, however, that the Certificate Registrar shall not register the
transfer of a Residual Certificate if it has actual knowledge that the proposed
transferee does not meet the qualifications of a permitted Holder of a Residual
Certificate as set forth in Section 3.3(e). The Certificate Registrar shall have
no liability for transfers (including without limitation transfers made through
the book-entry facilities of the Depository or between or among Participants or
Certificate Owners) made in violation of applicable restrictions, provided that
the Certificate Registrar has satisfied its duties expressly set forth in
Sections 3.3(c), 3.3(d) and 3.3(e).

     (g) All Certificates surrendered for transfer and exchange shall be
physically cancelled by the Certificate Registrar, and the Certificate Registrar
shall hold such cancelled Certificates in accordance with its standard
procedures.

     (h) The Certificate Registrar shall provide the Master Servicer, the
Special Servicer and the Depositor, upon written request, with an updated copy
of the Certificate Register within a reasonable period of time following receipt
of such request.

     (i) Unless and until it is exchanged in whole for the individual
Certificates represented thereby, a Global Certificate representing all of the
Certificates of a Class may not be transferred, except as a whole by the
Depository to a nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository or by the Depository or any
such nominee to a successor Clearing Agency or a nominee of such successor
Clearing

                                     -109-

<PAGE>

Agency, and no such transfer to any such other Person may be registered;
provided that this subsection (i) shall not prohibit any transfer of a
Certificate of a Class that is issued in exchange for a Global Certificate of
the same Class pursuant to Section 3.9 below. Nothing in this subsection (i)
shall prohibit or render ineffective any transfer of a beneficial interest in a
Global Certificate effected in accordance with the other provisions of this
Section 3.3.

     SECTION 3.4 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. If (A) any
mutilated Certificate is surrendered to the Certificate Registrar, or the
Certificate Registrar receives evidence to its satisfaction of the destruction,
loss or theft of any Certificate and (B) except in the case of a mutilated
Certificate so surrendered, there is delivered to the Certificate Registrar such
security or indemnity as may be required by it to save it harmless, then, in the
absence of notice to the Certificate Registrar that such Certificate has been
acquired by a bona fide purchaser, the Certificate Registrar shall execute, and
the Authenticating Agent shall authenticate and deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like tenor and interest in the Trust. In connection with the
issuance of any new Certificate under this Section 3.4, the Certificate
Registrar may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Certificate Registrar)
connected therewith. Any replacement Certificate issued pursuant to this Section
3.4 shall constitute complete and indefeasible evidence of ownership in the
Trust, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.

     SECTION 3.5 PERSONS DEEMED OWNERS. Prior to presentation of a Certificate
for registration of transfer, the Master Servicer, the Special Servicer, the
Fiscal Agent, the Trustee, the Operating Adviser, the Paying Agent and any agent
of the Master Servicer, the Special Servicer, the Fiscal Agent, the Paying
Agent, the Trustee or the Operating Adviser may treat the Person in whose name
any Certificate is registered as of the related Record Date as the owner of such
Certificate for the purpose of receiving distributions as provided in this
Agreement and for all other purposes whatsoever, and neither the Master
Servicer, the Special Servicer, the Fiscal Agent, the Trustee, the Paying Agent,
the Operating Adviser nor any agent of the Master Servicer, the Special
Servicer, the Fiscal Agent, the Trustee, the Paying Agent or the Operating
Adviser shall be affected by any notice to the contrary.

     SECTION 3.6 ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND ADDRESSES.

     If three or more Certificateholders, a Certificateholder holding all the
Certificates of any Class of Certificates, the Master Servicer, the Special
Servicer, the Paying Agent, the Trustee, the Operating Adviser or the Depositor
(A) request in writing from the Certificate Registrar a list of the names and
addresses of Certificateholders and (B) in the case of a request by
Certificateholders, state that such Certificateholders desire to communicate
with other Certificateholders with respect to their rights under this Agreement
or under the Certificates, then the Certificate Registrar shall, within ten
Business Days after the receipt of such request, afford such Certificateholders,
the Master Servicer, the Special Servicer, the Depositor, the Paying Agent, the
Trustee or the Operating Adviser, as applicable, access during normal business
hours to a current list of the Certificateholders. The expense of providing any
such information requested by such Person shall be borne by the party requesting
such information and shall not be borne by the Certificate Registrar or the
Trustee. Every Certificateholder, by receiving and holding a Certificate, agrees
that the Certificate Registrar and the Trustee shall not be held

                                     -110-
<PAGE>

accountable by reason of the disclosure of any such information as to the list
of the Certificateholders hereunder, regardless of the source from which such
information was derived.

     SECTION 3.7 BOOK-ENTRY CERTIFICATES.

     (a) The Class A-1, Class A-2, Class A-3, Class A-4, Class X-1, Class X-2,
Class B, Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class K,
Class L, Class M, Class N and Class O Certificates, upon original issuance, each
shall be issued in the form of one or more Certificates representing the
Book-Entry Certificates, to be delivered to the Certificate Registrar, as
custodian for The Depository Trust Company (the "Depository"), the initial
Clearing Agency, by, or on behalf of, the Depositor, provided, that any
Non-Investment Grade Certificates sold to Institutional Accredited Investors
that are not Qualified Institutional Buyers will be issued as Definitive
Certificates. The Certificates shall initially be registered on the Certificate
Register in the name of Cede & Co., the nominee of the Depository, as the
initial Clearing Agency, and no Certificate Owner will receive a definitive
certificate representing such Certificate Owner's interest in the Certificates,
except as provided in Section 3.9. Unless and until Definitive Certificates have
been issued to the Certificate Owners pursuant to Section 3.9:

          (i) the provisions of this Section 3.7 shall be in full force and
effect with respect to each such Class;

          (ii) the Depositor, the Master Servicer, the Paying Agent, the
Certificate Registrar and the Trustee may deal with the Clearing Agency for all
purposes (including the making of distributions on the Certificates) as the
authorized representative of the Certificate Owners;

          (iii) to the extent that the provisions of this Section 3.7 conflict
with any other provisions of this Agreement, the provisions of this Section 3.7
shall control with respect to each such Class; and

          (iv) the rights of the Certificate Owners of each such Class shall be
exercised only through the Clearing Agency and the applicable Participants and
shall be limited to those established by law and agreements between such
Certificate Owners and the Clearing Agency and/or the Participants. Pursuant to
the Depository Agreement, unless and until Certificates are issued pursuant to
Section 3.9, the initial Clearing Agency will make book-entry transfers among
the Participants and receive and transmit distributions of principal and
interest on the related Certificates to such Participants.

     (b) For purposes of any provision of this Agreement requiring or permitting
actions with the consent of, or at the direction of, Holders of the Certificates
evidencing a specified percentage of the aggregate unpaid principal amount of
Certificates, such direction or consent may be given by the Clearing Agency at
the direction of Certificate Owners owning Certificates evidencing the requisite
percentage of principal amount of Certificates. The Clearing Agency may take
conflicting actions with respect to the Certificates to the extent that such
actions are taken on behalf of the Certificate Owners.

     (c) The Certificates of each Class (other than the Residual Certificates)
initially sold in reliance on Rule 144A or with respect to the Class E, Class F
and Class G Certificates sold to Institutional Accredited Investors shall be
represented by the Rule 144A-IAI

                                     -111-
<PAGE>

Global Certificate for such Class, which shall be deposited with the Certificate
Registrar, as custodian for the Depository and registered in the name of Cede &
Co. as nominee of the Depository. The Class H, Class J, Class K, Class L, Class
M, Class N and Class O Certificates initially sold to Institutional Accredited
Investors that are not Qualified Institutional Buyers shall be represented by
IAI Definitive Certificates for such Class. The Certificates evidenced by any
Rule 144A-IAI Global Certificate or IAI Definitive Certificate shall be subject
to certain restrictions on transfer as set forth in Section 3.3 hereof and shall
bear legend(s) regarding such restrictions described herein.

     (d) The Certificates of each Class (other than the Residual Certificates)
initially sold in offshore transactions in reliance on Regulation S shall be
represented by the Regulation S Temporary Global Certificate for such Class,
which shall be deposited with the Certificate Registrar, as custodian for the
Depository and registered in the name of Cede & Co. as nominee of the
Depository. Not earlier than the Release Date, beneficial interests in any
Regulation S Temporary Global Certificate shall be exchangeable for beneficial
interests in the Regulation S Permanent Global Certificate for such Class.
Beneficial interests in any Regulation S Temporary Global Certificate may be
held only through Euroclear Bank or Clearstream Bank; provided, however, that
such interests may be exchanged for interests in the Rule 144A-IAI Global
Certificate for such Class in accordance with the certification requirements
described in Section 3.7(f). The Regulation S Permanent Global Certificates
shall be deposited with the Certificate Registrar, as custodian for the
Depository and registered in the name of Cede & Co. as nominee of the
Depository.

     On or prior to the Release Date and on or prior to any Distribution Date
occurring prior to the Release Date, each Certificate Owner of a Regulation S
Temporary Global Certificate that holds a beneficial interest therein on the
Release Date or on any such Distribution Date, as the case may be, must deliver
to Euroclear Bank or Clearstream Bank (as applicable) a Regulation S
Certificate; provided, however, that any Certificate Owner that holds a
beneficial interest in a Regulation S Temporary Global Certificate on the
Release Date or on any such Distribution Date that has previously delivered a
Regulation S Certificate to Euroclear Bank or Clearstream Bank with respect to
its interest therein does not need to deliver any subsequent Regulation S
Certificate (unless the certificate previously delivered is no longer true as of
such subsequent date, and such Certificate Owner must promptly notify Euroclear
Bank or Clearstream Bank, as applicable, thereof). Euroclear Bank or Clearstream
Bank, as applicable, shall be required to promptly deliver to the Certificate
Registrar a certificate substantially in the form of Exhibit I hereto to the
effect that it has received the requisite Regulation S Certificates for each
such Class, and no Certificate Owner (or transferee from any such Certificate
Owner) shall be entitled to receive an interest in the Regulation S Permanent
Global Certificate for such Class or any payment or principal or interest with
respect to its interest in such Regulation S Temporary Global Certificate prior
to the Certificate Registrar receiving such certification from Euroclear Bank or
Clearstream Bank with respect to the portion of the Regulation S Temporary
Global Certificate owned by such Certificate Owner (and, with respect to an
interest in the applicable Regulation S Permanent Global Certificate, prior to
the Release Date). After the Release Date, distributions due with respect to any
beneficial interest in a Regulation S Temporary Global Certificate shall not be
made to the holders of such beneficial interests unless exchange for a
beneficial interest in the related Regulation S Permanent Global Certificate is
improperly withheld or refused. No interest in a Regulation S Global Certificate
may be held by

                                     -112-
<PAGE>

or transferred to a U.S. Person (as defined in Regulation S) except for
exchanges for a beneficial interest in the Rule 144A-IAI Global Certificate for
such Class as described in Section 3.7(f).

     (e) Except in the limited circumstances described below in Section 3.9,
owners of beneficial interests in Global Certificates shall not be entitled to
receive physical delivery of Definitive Certificates. The Certificates are not
issuable in bearer form. Upon the issuance of each Global Certificate, the
Depository or its custodian shall credit, on its internal system, the respective
principal amount of the individual beneficial interests represented by such
Global Certificate to the accounts of Persons who have accounts with such
Depository. Such accounts initially shall be designated by or on behalf of the
Underwriters and Placement Agents. Ownership of beneficial interests in a Global
Certificate shall be limited to Customers or Persons who hold interests directly
or indirectly through Customers. Ownership of beneficial interests in the Global
Certificates shall be shown on, and the transfer of that ownership shall be
effected only through, records maintained by the Depository or its nominee (with
respect to interests of Customers) and the records of Customers (with respect to
interests of Persons other than Customers).

     So long as the Depository, or its nominee, is the registered holder of a
Global Certificate, the Depository or such nominee, as the case may be, shall be
considered the sole owner and holder of the Certificates represented by such
Global Certificate for all purposes under this Agreement and the Certificates,
including, without limitation, obtaining consents and waivers thereunder, and
the Trustee, the Paying Agent and the Certificate Registrar shall not be
affected by any notice to the contrary. Except under the circumstance described
in Section 3.9, owners of beneficial interests in a Global Certificate will not
be entitled to have any portions of such Global Certificate registered in their
names, will not receive or be entitled to receive physical delivery of
Definitive Certificates in certificated form and shall not be considered the
owners or holders of the Global Certificate (or any Certificates represented
thereby) under this Agreement or the Certificates. In addition, no Certificate
Owner of an interest in a Global Certificate shall be able to transfer that
interest except in accordance with the Depository's applicable procedures (in
addition to those under this Agreement and, if applicable, those of Euroclear
Bank and Clearstream Bank).

     (f) Any holder of an interest in a Regulation S Global Certificate shall
have the right, upon prior written notice to the Certificate Registrar,
Euroclear Bank or Clearstream Bank, as applicable, and the Depository, in the
form of an Exchange Certification (substantially in the form of Exhibit H
attached hereto), to exchange all or a portion of such interest (in authorized
denominations as set forth in Section 3.1(b)) for an equivalent interest in the
Rule 144A-IAI Global Certificate for such Class in connection with a transfer of
its interest therein to a transferee that is eligible to hold an interest in
such Rule 144A-IAI Global Certificate as described herein; provided, however,
that no Exchange Certification shall be required if any such exchange occurs
after the Release Date. Any holder of an interest in the Rule 144A-IAI Global
Certificate shall have the right, upon prior written notice to the Certificate
Registrar, the Depository and Euroclear Bank or Clearstream Bank, as applicable,
in the form of an Exchange Certification, to exchange all or a portion of such
interest (in authorized denominations as set forth in Section 3.1(b)) for an
equivalent interest in the Regulation S Global Certificate for such Class in
connection with a transfer of its interest therein to a transferee that is
eligible to hold an interest in such Regulation S Global Certificate as
described herein; provided, however, that if such exchange occurs prior to the
Release Date, the transferee shall acquire an interest in a

                                     -113-
<PAGE>

Regulation S Temporary Global Certificate only and shall be subject to all of
the restrictions associated therewith described in Section 3.7(d). Following
receipt of any Exchange Certification or request for transfer, as applicable, by
the Certificate Registrar: (i) the Certificate Registrar shall endorse the
schedule to any Global Certificate representing the Certificate or Certificates
being exchanged to reduce the stated principal amount of such Global Certificate
by the denominations of the Certificate or Certificates for which such exchange
is to be made, and (ii) the Certificate Registrar shall endorse the schedule to
any Global Certificate representing the Certificate or Certificates for which
such exchange is to be made to increase the stated principal amount of such
Global Certificate by the denominations of the Certificate or Certificates being
exchanged therefor. The form of the Exchange Certification shall be available
from the Certificate Registrar.

     SECTION 3.8 NOTICES TO CLEARING AGENCY. Whenever notice or other
communication to the Certificateholders is required under this Agreement, unless
and until Definitive Certificates shall have been issued to the related
Certificateholders pursuant to Section 3.9, the Paying Agent shall give all such
notices and communications specified herein to be given to Holders of the
Book-Entry Certificates to the Clearing Agency which shall give such notices and
communications to the related Participants in accordance with its applicable
rules, regulations and procedures.

     SECTION 3.9 DEFINITIVE CERTIFICATES.

     (a) Definitive Certificates will be issued to the owners of beneficial
interests in a Global Certificate or their nominees if (i) the Clearing Agency
notifies the Depositor and the Certificate Registrar in writing that the
Clearing Agency is unwilling or unable to continue as depositary for such Global
Certificate and a qualifying successor depositary is not appointed by the
Depositor within 90 days thereof, (ii) the Trustee has instituted or caused to
be instituted or has been directed to institute any judicial proceeding in a
court to enforce the rights of the Certificateholders under this Agreement and
under such Global Certificate and the Trustee has been advised by counsel that
in connection with such proceeding it is necessary or advisable for the Trustee
or its custodian to obtain possession of such Global Certificate, or (iii) after
the occurrence of an Event of Default, Certificate Owners representing a
majority in aggregate outstanding Certificate Balance of such Global Certificate
advise the Clearing Agency through the Participants in writing (and the Clearing
Agency so advises the Depositor, the Certificate Registrar and the Master
Servicer in writing) that the continuation in global form of the Certificates
being evidenced by such Global Certificate is no longer in their best interests;
provided, that under no circumstances will Definitive Certificates be issued to
Certificate Owners of the Regulation S Temporary Global Certificate. Upon notice
of the occurrence of any of the events described in the preceding sentence, the
Certificate Registrar shall notify the Clearing Agency and request the Clearing
Agency to notify all Certificate Owners, through the applicable Participants, of
the occurrence of the event and of the availability of Definitive Certificates
to such Certificate Owners requesting the same. Upon surrender to the
Certificate Registrar of the Global Certificates by the Clearing Agency,
accompanied by registration instructions from the Clearing Agency for
registration, the Certificate Registrar shall execute, and the Authenticating
Agent shall authenticate and deliver, the Definitive Certificates. None of the
Depositor, the Trustee, the Paying Agent, the Certificate Registrar or the
Fiscal Agent shall be liable for any delay in delivery of such instructions and
may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Certificates, all

                                      -114-
<PAGE>

references herein to obligations imposed upon or to be performed by the Clearing
Agency shall be deemed to be imposed upon and performed by the Certificate
Registrar, to the extent applicable with respect to such Definitive
Certificates, and the Certificate Registrar and the Trustee and the Paying Agent
shall recognize the Holders of Definitive Certificates as Certificateholders
hereunder.

     (b) Distributions of principal and interest on the Definitive Certificates
shall be made by the Paying Agent directly to holders of Definitive Certificates
in accordance with the procedures set forth in this Agreement.

                                   ARTICLE IV

                                    ADVANCES

     P&I Advances and Servicing Advances shall be made as provided herein by the
Master Servicer and, if the Master Servicer does not make such Advances, by the
Trustee, and if the Trustee does not make such Advances, by the Fiscal Agent
except to the extent that the Master Servicer, the Trustee or the Fiscal Agent,
as applicable, determines in accordance with Section 4.4 below, that any such
Advance would be a Nonrecoverable Advance.

     SECTION 4.1 P&I ADVANCES BY MASTER SERVICER.

     (a) On or prior to the Advance Report Date, the Master Servicer shall
notify the Trustee and the Paying Agent if the P&I Advance Amount for such
Distribution Date is greater than zero, and the Master Servicer shall make a P&I
Advance in respect of each Mortgage Loan of such amount no later than the Master
Servicer Remittance Date. It is understood that the obligation of the Master
Servicer to make such P&I Advances is mandatory and shall apply through any
court appointed stay period or similar payment delay resulting from any
insolvency of the Mortgagor or related bankruptcy, notwithstanding any other
provision of this Agreement. Notwithstanding the foregoing, the Master Servicer
shall not be required to make such P&I Advance, if the Master Servicer
determines, in accordance with Section 4.4 below, that any such P&I Advance
would be a Nonrecoverable Advance and shall not make such P&I Advance if such
P&I Advance if made would be a Nonrecoverable Advance as determined by the
Special Servicer in accordance with the Servicing Standard, in which event the
Special Servicer shall promptly direct the Master Servicer not to make such P&I
Advance. Such determination shall be conclusive and binding on the Trustee, the
Fiscal Agent and the Certificateholders. The Special Servicer shall not make P&I
Advances under this Agreement. If the Master Servicer fails to make a P&I
Advance that it is required to make under this Section 4.1, it shall promptly
notify the Trustee and the Paying Agent of such failure.

     (b) If the Master Servicer determines that there is a P&I Advance Amount
for a Distribution Date, the Master Servicer shall on the related Master
Servicer Remittance Date either (A) deposit in the Certificate Account an amount
equal to the P&I Advance Amount or (B) utilize funds in the Certificate Account
being held for future distributions or withdrawals to make such Advance. Any
funds being held in the Certificate Account for future distribution or
withdrawal and so used shall be replaced by the Master Servicer from its own
funds by deposit in the Certificate Account on or before any future Master
Servicer Remittance Date to the extent

                                     -115-
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that funds in the Certificate Account on such Master Servicer Remittance Date
shall be less than payments to the Paying Agent or other Persons required to be
made on such date.

     (c) The applicable Non-Serviced Mortgage Loan Master Servicer is obligated
to make Servicing Advances pursuant to the related Non-Serviced Mortgage Loan
Pooling and Servicing Agreement with respect to any Non-Serviced Mortgage Loan,
and the Master Servicer shall not have any obligation to make Servicing Advances
with respect to such Mortgage Loan.

     SECTION 4.1A P&I ADVANCES WITH RESPECT TO THE BERKELEY & BROWN PARI PASSU
LOAN, THE RSA PARI PASSU LOAN AND THE WESTSHORE PLAZA PARI PASSU LOAN.

     With respect to the Berkeley & Brown Pari Passu Loan, the RSA Pari Passu
Loan and the WestShore Plaza Pari Passu Loan (the "Serviced Pari Passu Loans"),
the Master Servicer shall make its determination that a P&I Advance previously
made on any Serviced Pari Passu Loan is a Nonrecoverable Advance or that any
proposed P&I Advance, if made, would constitute a Nonrecoverable Advance with
respect to such Serviced Pari Passu Loan in accordance with Section 4.1
independently of any determination made by any Other Master Servicer under the
related Other Companion Loan Pooling and Servicing Agreement in respect of any
Serviced Pari Passu Loan following deposit of the Berkeley & Brown Companion
Loans, RSA Companion Loan or WestShore Plaza Companion Loan into a commercial
mortgage securitization trust, and the Other Master Servicer shall make its own
determination that it has made a P&I Advance that is a Nonrecoverable Advance
(both as defined in the related Other Companion Loan Pooling and Servicing
Agreement) or that any proposed P&I Advance, if made, would constitute a
Nonrecoverable Advance (both as defined in the related Other Companion Loan
Pooling and Servicing Agreement) with respect to the Berkeley & Brown Companion
Loans, RSA Companion Loan or WestShore Plaza Companion Loan, as applicable, in
accordance with the related Other Companion Loan Pooling and Servicing
Agreement. The determination by either the Master Servicer or the Other Master
Servicer made on the earlier of (i) the Advance Report Date and (ii) the Other
Advance Report Date that any such P&I Advance is nonrecoverable shall be binding
on the Other Master Servicer and the Master Servicer, as applicable, the
Certificateholders and the holders of any securities relating to the Berkeley &
Brown Companion Loans, RSA Companion Loan or WestShore Plaza Companion Loan, as
applicable. The Master Servicer shall not make a P&I Advance with respect to any
Serviced Pari Passu Loan after its receipt of notice from the related Other
Master Servicer that it has determined that it has made a P&I Advance that is a
Nonrecoverable Advance on the Berkeley & Brown Companion Loans, RSA Companion
Loan or WestShore Plaza Companion Loan, as applicable, or that any proposed P&I
Advance, if made, would constitute a Nonrecoverable Advance pursuant to the
relevant Other Companion Loan Pooling and Servicing Agreement.

     If the Master Servicer determines that an Advance would be (if made), or
any outstanding Advance previously made is, a Nonrecoverable Advance, the Master
Servicer shall provide the Other Master Servicer written notice of such
determination. If the Master Servicer receives written notice by the Other
Master Servicer that it has determined, with respect to any Mortgage Loan, that
any proposed future Advance would be, or any outstanding Advance is, a
Nonrecoverable Advance, the Master Servicer shall not make any additional
Advances with respect to such Mortgage Loan unless the Master Servicer has
consulted with the Other Master Servicer and they both agree that circumstances
with respect to such Mortgage Loan have changed such that a proposed future
Advance would not be a Nonrecoverable Advance.

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<PAGE>

Notwithstanding the foregoing, the Master Servicer shall continue to have the
discretion provided in this Agreement to determine that any future Advance or
outstanding Advance would be, or is, as applicable, a Nonrecoverable Advance.
Once such a determination is made by the Master Servicer or the Master Servicer
receives written notice of such determination by the Other Master Servicer, the
Master Servicer shall follow the process set forth in this paragraph before
making any additional Advances with respect to such Mortgage Loan.

     Following a securitization of the WestShore Plaza Companion Loan, the
Master Servicer shall be required to deliver to the related Other Master
Servicer the following information: (i) any loan related information (in the
form received), including without limitation CMSA Reports relating to the
WestShore Plaza Pari Passu Loan, applicable to a determination that an Advance
is or would be a Nonrecoverable Advance, within one Business Day of the Master
Servicer's receipt thereof, (ii) notice of any Servicing Advance it, the Trustee
or the Fiscal Agent makes with respect to the related Mortgage Loan within one
Business Day of the making of such Advance and (iii) notice of any determination
that any Servicing Advance is a Nonrecoverable Advance within one Business Day
thereof.

     SECTION 4.2 SERVICING ADVANCES. The Master Servicer and, if the Master
Servicer does not, the Trustee to the extent the Trustee receives written notice
from the Paying Agent that such Advance has not been made by the Master
Servicer, and if the Trustee does not, the Fiscal Agent (if the Fiscal Agent has
knowledge that such Advance is required to be made), shall make Servicing
Advances to the extent provided in this Agreement, except to the extent that the
Master Servicer, the Trustee or the Fiscal Agent, as applicable, determines in
accordance with Section 4.4 below, that any such Advance would be a
Nonrecoverable Advance and, subject to the last sentence of this Section 4.2,
except to the extent the Special Servicer determines in accordance with the
Servicing Standard and Section 4.4 that such Advance, if made, would be a
Nonrecoverable Advance, in which event the Special Servicer shall promptly
direct the Master Servicer not to make such Advance. Such determination by the
Master Servicer or the Special Servicer shall be conclusive and binding on the
Trustee, the Fiscal Agent and the Certificateholders and, in the case of any B
Note, the holder of the related B Note and, in the case of the WestShore Plaza
Pari Passu Loan, the holder of the WestShore Plaza Companion Loan. The Special
Servicer shall not be required to make Servicing Advances under this Agreement
but may make such Servicing Advances at its option in which event the Master
Servicer shall reimburse the Special Servicer for such Servicing Advance within
30 days of receipt of a statement therefor. Promptly after discovering that the
Master Servicer has failed to make a Servicing Advance that the Master Servicer
is required to make hereunder, the Paying Agent shall promptly notify the
Trustee in writing of the failure by the Master Servicer to make such Servicing
Advance. The Master Servicer may make Servicing Advances in its own discretion
if it determines that making such Servicing Advance is in the best interest of
the Certificateholders, even if the Master Servicer or the Special Servicer has
determined, in accordance with Section 4.4 below, that any such Advance would be
a Nonrecoverable Advance.

     SECTION 4.3 ADVANCES BY THE TRUSTEE AND THE FISCAL AGENT.

     (a) To the extent that the Master Servicer fails to make a P&I Advance with
respect to a Mortgage Loan by the Master Servicer Remittance Date (other than a
P&I Advance that the Master Servicer or the Special Servicer determines is a
Nonrecoverable Advance), the Trustee shall make such P&I Advance with respect to
such Mortgage Loan to the extent the

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Trustee receives written notice from the Paying Agent not later than 10:00 a.m.
(New York City time) on the Distribution Date that such Advance has not been
made by the Master Servicer on the Master Servicer Remittance Date unless the
Trustee determines that such P&I Advance, if made, would be a Nonrecoverable
Advance. To the extent that the Trustee fails to make a P&I Advance required to
be made by the Trustee hereunder on the Distribution Date (other than a P&I
Advance that the Master Servicer or the Trustee determines is a Nonrecoverable
Advance), the Fiscal Agent will advance such P&I Advance unless the Fiscal Agent
determines that any such P&I Advance, if made, would be a Nonrecoverable
Advance. To the extent that the Fiscal Agent is required hereunder to make P&I
Advances on the Mortgage Loans, it shall deposit the amount thereof in the
Distribution Account by 1:00 p.m. (New York City time) on each such Distribution
Date. The Paying Agent shall notify the Trustee in writing as soon as
practicable, but not later than 10:00 a.m. (New York City time) on the
Distribution Date if the Master Servicer has failed to make a P&I Advance.

     (b) To the extent that the Master Servicer fails to make a Servicing
Advance by the date such Servicing Advance is required to be made (other than a
Servicing Advance that the Master Servicer determines is a Nonrecoverable
Advance), and a Responsible Officer of the Trustee receives notice thereof, the
Trustee shall make such Servicing Advance promptly, but in any event, not later
than five Business Days after notice thereof in accordance with Section 4.2,
unless the Trustee determines that such Servicing Advance, if made, would be a
Nonrecoverable Advance.

     (c) To the extent that the Trustee fails to make a Servicing Advance
required to be made by the Trustee hereunder by the later of (i) the date such
Servicing Advance is required to be made and (ii) five Business Days after the
date the Trustee has received notice pursuant to subsection (b) above, that such
Servicing Advance has not been made by the Master Servicer (other than a
Servicing Advance that the Master Servicer or the Trustee has determined to be a
Nonrecoverable Advance), the Fiscal Agent will advance such Servicing Advance,
unless the Fiscal Agent determines that such Servicing Advance, if made, would
be a Nonrecoverable Advance.

     The initial Trustee's failure to make any Advance required to be made by it
hereunder shall not constitute a default by the initial Trustee hereunder if the
initial Fiscal Agent makes such Advance at or before the time when the Trustee
was required to make such Advance.

     SECTION 4.4 EVIDENCE OF NONRECOVERABILITY.

     (a) If the Master Servicer or the Special Servicer determines at any time,
in its sole discretion, exercised in good faith, that any Advance previously
made (or Unliquidated Advance in respect thereof) or any proposed Advance, if
made, would constitute a Nonrecoverable Advance, such determination shall be
evidenced by an Officer's Certificate delivered to the Trustee, the Master
Servicer, the Paying Agent, the Special Servicer, the Operating Adviser and the
Rating Agencies (and the holder of the WestShore Plaza Companion Loan if the
Advance relates to the Loan Pair) by the Business Day prior to the Distribution
Date. Such Officer's Certificate shall set forth the reasons for such
determination of nonrecoverability, together with, to the extent such
information, report or document is in the Master Servicer's or Special
Servicer's possession, any related financial information such as related income
and expense statements, rent rolls, occupancy status, property inspections and
any Appraisals

                                     -118-

<PAGE>

performed within the last 12 months on the Mortgaged Property, and, if such
reports are used by the Master Servicer or the Special Servicer, as applicable,
to determine that any P&I Advance or Servicing Advance, as applicable, would be
a Nonrecoverable Advance, any engineers' reports, environmental surveys,
internal final valuations or other information relevant thereto which support
such determination. If the Trustee or the Fiscal Agent, as applicable,
determines at any time that any portion of an Advance previously made or a
portion of a proposed Advance that the Trustee or the Fiscal Agent, as
applicable, is required to make pursuant to this Agreement, if made, would
constitute a Nonrecoverable Advance, such determination shall be evidenced by an
Officer's Certificate of a Responsible Officer of the Trustee or the Fiscal
Agent, as applicable, delivered to the Depositor, the Master Servicer, the
Special Servicer, the Paying Agent and the Operating Adviser similar to the
Officer's Certificate of the Master Servicer or the Special Servicer described
in the prior sentence. If the Special Servicer determines at any time that any
portion of an Advance previously made would constitute a Nonrecoverable Advance,
such determination shall be evidenced by an Officer's Certificate of a
Responsible Officer of the Special Servicer, delivered to the Depositor, the
Master Servicer, the Trustee, the Fiscal Agent, the Paying Agent and the
Operating Adviser similar to the Officer's Certificate of the Master Servicer
described above. The Trustee and the Fiscal Agent shall not be required to make
an Advance that the Master Servicer or the Special Servicer (or with respect to
a Mortgage Loan included in the Loan Pair or any Non-Serviced Mortgage Loan, the
related Other Master Servicer) has previously determined to be a Nonrecoverable
Advance. Notwithstanding any other provision of this Agreement, none of the
Master Servicer, the Special Servicer, the Trustee or the Fiscal Agent shall be
obligated to, nor shall it, make any Advance or make any payment that is
designated in this Agreement to be an Advance, if it determines in its good
faith judgment that such Advance or such payment (including interest accrued
thereon at the Advance Rate) would be a Nonrecoverable Advance. The Master
Servicer's determination in accordance with the above provisions shall be
conclusive and binding on the Trustee, the Fiscal Agent, the Paying Agent and
the Certificateholders. The Master Servicer shall consider Unliquidated Advances
in respect of prior P&I Advances and Servicing Advances as outstanding Advances
for purposes of nonrecoverablility determinations as if such Unliquidated
Advance were a P&I Advance or Servicing Advance, as applicable.

     (b) Any Non-Serviced Mortgage Loan Master Servicer, Non-Serviced Mortgage
Loan Trustee or Non-Serviced Mortgage Loan Fiscal Agent, as applicable, shall be
entitled to reimbursement for Pari Passu Loan Nonrecoverable Advances (with, in
each case, any accrued and unpaid interest thereon provided for under the
related Non-Serviced Mortgage Loan Pooling and Servicing Agreement) in the
manner set forth in Section 5.2.

     SECTION 4.5 INTEREST ON ADVANCES; CALCULATION OF OUTSTANDING ADVANCES WITH
RESPECT TO A MORTGAGE LOAN. Any unreimbursed Advance funded from the Master
Servicer's, the Special Servicer's, the Trustee's or the Fiscal Agent's own
funds shall accrue interest on a daily basis, at a per annum rate equal to the
Advance Rate, from and including the date such Advance was made to but not
including the date on which such Advance has been reimbursed; provided, however,
that neither the Master Servicer nor any other party shall be entitled to
interest accrued on the amount of any P&I Advance with respect to any Mortgage
Loan or any B Note for the period commencing on the date of such P&I Advance and
ending on the day on which the grace period applicable to the related
Mortgagor's obligation to make the related Scheduled Payment expires pursuant to
the related Mortgage Loan or B Note documents.

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<PAGE>

All Late Collections on any Non-Serviced Mortgage Loan in respect of interest
shall, promptly following receipt thereof, be applied by the Master Servicer to
reimburse the interest component of any P&I Advance outstanding with respect to
such Non-Serviced Mortgage Loan. Any party that makes a P&I Advance with respect
to any Non-Serviced Mortgage Loan shall provide to the applicable Non-Serviced
Mortgage Loan Master Servicer monthly, at least two Business Days prior to the
next succeeding Due Date, written notice of whether (and, if any, how much)
Advance Interest will be payable on the interest component of a P&I Advance
through the next succeeding related Master Servicer Remittance Date. For
purposes of determining whether a P&I Advance is outstanding, amounts collected
with respect to a particular Mortgage Loan, any B Note or any REO Property and
treated as collections of principal or interest shall be applied first to
reimburse the earliest P&I Advance, and then each succeeding P&I Advance to the
extent not inconsistent with Section 4.6. The Master Servicer shall use efforts
consistent with the Servicing Standard to collect (but shall have no further
obligation to collect), with respect to the Mortgage Loans (and the WestShore
Plaza Companion Loan) that are not Specially Serviced Mortgage Loans, Late Fees
and default interest from the Mortgagor in an amount sufficient to pay Advance
Interest. The Master Servicer shall be entitled to retain Late Fees and default
interest paid by any Mortgagor during a Collection Period with respect to any
Mortgage Loan (other than the portion of such Late Fee and default interest that
relates to the period commencing after the Servicing Transfer Event in respect
of a Specially Serviced Mortgage Loan, as to which the Special Servicer shall
retain Late Fees and default interest with respect to such Specially Serviced
Mortgage Loan, subject to the offsets set forth below) as additional servicing
compensation only to the extent such Late Fees and default interest exceed
Advance Interest on a "pool basis" for all Mortgage Loans other than Specially
Serviced Mortgaged Loans. The Special Servicer, with respect to any Specially
Serviced Mortgage Loan, shall (i) pay from any Late Fees and default interest
collected from such Specially Serviced Mortgage Loan (a) any outstanding and
unpaid Advance Interest to the Master Servicer, the Trustee or the Fiscal Agent,
as applicable and (b) to the Trust, any losses previously incurred by the Trust
with respect to such Specially Serviced Mortgage Loan and (ii) retain any
remaining portion of such Late Fees and default interest as additional Special
Servicer Compensation.

     SECTION 4.6 REIMBURSEMENT OF ADVANCES AND ADVANCE INTEREST.

     (a) Advances made with respect to each Mortgage Loan, the WestShore Plaza
Companion Loan, each B Note, Specially Serviced Mortgage Loan or REO Property
(including Advances later determined to be Nonrecoverable Advances) and Advance
Interest thereon shall be reimbursed to the extent of the amounts identified to
be applied therefor in Section 5.2. The aggregate of the amounts available to
repay Advances and Advance Interest thereon pursuant to Section 5.2 collected in
any Collection Period with respect to Mortgage Loans, the WestShore Plaza
Companion Loan or any B Note or Specially Serviced Mortgage Loans or REO
Property shall be an "Available Advance Reimbursement Amount."

     (b) To the extent that Advances have been made on the Mortgage Loans, the
WestShore Plaza Companion Loan, any B Note, any Specially Serviced Mortgage
Loans or any REO Mortgage Loans, the Available Advance Reimbursement Amount with
respect to any Determination Date shall be applied to reimburse (i) the Fiscal
Agent for any Advances outstanding to the Fiscal Agent with respect to any of
such Mortgage Loans, the WestShore Plaza Companion Loan, B Note, Specially
Serviced Mortgage Loans or REO Mortgage Loans, plus any Advance Interest owed to
the Fiscal Agent with respect to such Advances and then

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<PAGE>

(ii) the Trustee for any Advances outstanding to the Trustee with respect to any
of such Mortgage Loans, the WestShore Plaza Companion Loan, B Note, Specially
Serviced Mortgage Loans or REO Mortgage Loans, plus any Advance Interest owed to
the Trustee with respect to such Advances and then (iii) the Master Servicer for
any Advances outstanding to the Master Servicer with respect to any of such
Mortgage Loans, the WestShore Plaza Companion Loan, B Note, Specially Serviced
Mortgage Loans or REO Mortgage Loans, plus any Advance Interest owed to the
Master Servicer with respect to such Advances and then (iv) the Special Servicer
for any Advances outstanding to the Special Servicer with respect to any of such
Mortgage Loans, the WestShore Plaza Companion Loan, B Note, Specially Serviced
Mortgage Loans or REO Mortgage Loans, plus any Advance Interest owed to the
Special Servicer with respect to such Advances. To the extent that any Advance
Interest payable to the Master Servicer, the Special Servicer, the Trustee or
the Fiscal Agent with respect to a Specially Serviced Mortgage Loan or REO
Mortgage Loan cannot be recovered from the related Mortgagor, the amount of such
Advance Interest shall be payable to the Fiscal Agent, the Trustee, the Special
Servicer or the Master Servicer, as the case may be, from amounts on deposit in
the Certificate Account (or sub-account thereof) or the Distribution Account
pursuant to Section 5.2(a) or Section 5.3(b)(ii). The Master Servicer's, the
Special Servicer's, the Fiscal Agent's and the Trustee's right of reimbursement
under this Agreement for Advances shall be prior to the rights of the
Certificateholders (and, in the case of the WestShore Plaza Companion Loan, the
holder thereof and, in the case of a B Note, the holder thereof) to receive any
amounts recovered with respect to such Mortgage Loans, the WestShore Plaza
Companion Loan, B Notes or REO Mortgage Loans.

     (c) Advance Interest will be paid to the Fiscal Agent, the Trustee, the
Master Servicer and/or the Special Servicer (in accordance with the priorities
specified in the preceding paragraph) first, from Late Fees and default interest
collected from the Mortgage Loans during the Collection Period during which the
related Advance is reimbursed, and then from Excess Liquidation Proceeds then
available prior to payment from any other amounts. Late Fees and default
interest will be applied on a "pool basis" for non-Specially Serviced Mortgage
Loans and on a "loan-by-loan basis" (under which Late Fees and default interest
will be offset against the Advance Interest arising only from that particular
Specially Serviced Mortgage Loan) for Specially Serviced Mortgage Loans, as the
case may be, to the payment of Advance Interest on all Advances on such
non-Specially Serviced Mortgage Loans or such Specially Serviced Mortgage Loans,
as the case may be, then being reimbursed. Advance Interest payable to the
Master Servicer, the Special Servicer, the Fiscal Agent or the Trustee in
respect of Servicing Advances on the Loan Pair shall be allocated to the
WestShore Plaza Pari Passu Loan and the WestShore Plaza Companion Loan on a pro
rata basis based upon the Principal Balance thereof.

     (d) Amounts applied to reimburse Advances shall first be applied to reduce
Advance Interest thereon that was not paid from amounts specified in the
preceding paragraph (c) and then to reduce the outstanding amount of such
Advances.

     (e) To the extent that the Special Servicer incurs out-of-pocket expenses,
in accordance with the Servicing Standard, in connection with servicing
Specially Serviced Mortgage Loans, the Master Servicer shall reimburse the
Special Servicer for such expenditures within 30 days after receiving an invoice
and a report from the Special Servicer, subject to Section 4.4. With respect to
each Collection Period, the Special Servicer shall deliver such invoice and
report to the Master Servicer by the following Determination Date. All such
amounts reimbursed by the Master Servicer shall be a Servicing Advance. In the
event that the

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<PAGE>

Master Servicer fails to reimburse the Special Servicer hereunder or
the Master Servicer determines that such Servicing Advance was or, if made,
would be a Nonrecoverable Advance and the Master Servicer does not make such
payment, the Special Servicer shall notify the Master Servicer and the Paying
Agent in writing of such nonpayment and the amount payable to the Special
Servicer and shall be entitled to receive reimbursement from the Trust as an
Additional Trust Expense. The Master Servicer, the Paying Agent and the Trustee
shall have no obligation to verify the amount payable to the Special Servicer
pursuant to this Section 4.6(e) and circumstances surrounding the notice
delivered by the Special Servicer pursuant to this Section 4.6(e).

     SECTION 4.7 FISCAL AGENT TERMINATION EVENT. "Fiscal Agent Termination
Event," wherever used herein, means any one of the following events:

     (i) Any failure by the Fiscal Agent to remit to the Paying Agent when due
any required Advance for any Mortgage Loan; or

     (ii) A decree or order of a court or agency or supervisory authority having
jurisdiction in the premises in an involuntary case under any present or future
federal or state bankruptcy, insolvency or similar law for the appointment of a
conservator, receiver, liquidator, trustee or similar official in any
bankruptcy, insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against the Fiscal Agent and such decree or
order shall have remained in force undischarged or unstayed for a period of 60
days; or

     (iii) The Fiscal Agent shall consent to the appointment of a conservator,
receiver, liquidator, trustee or similar official in any bankruptcy, insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings or relating to the Fiscal Agent or relating to all or substantially
all of its property; or

     (iv) The Fiscal Agent shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable bankruptcy, insolvency or reorganization statute, make an assignment
for the benefit of its creditors, voluntarily suspend payment of its
obligations, or take any corporate action in furtherance of the foregoing; or

     (v) The long-term unsecured debt of the Fiscal Agent is rated below "Aa3"
by Moody's or "AA-" by Fitch (or "A+" by Fitch if the Fiscal Agent's short-term
unsecured debt is rated at least "F-1" by Fitch), unless such other rating shall
be acceptable to the Rating Agencies as evidenced by a Rating Agency
Confirmation; or

     (vi) With respect to the initial Fiscal Agent, LaSalle Bank National
Association resigns or is removed pursuant to Section 7.6 hereof.

     SECTION 4.8 PROCEDURE UPON TERMINATION EVENT.

     (a) On the date specified in a written notice of termination given to the
Fiscal Agent pursuant to Section 7.6(c), all authority, power and rights of the
Fiscal Agent under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall terminate and a successor Fiscal Agent, if necessary, shall be
appointed by the Trustee, with the consent of the

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Depositor; provided that the successor Fiscal Agent meets the eligibility
requirements set forth in Section 7.5. The Fiscal Agent agrees to cooperate with
the Trustee in effecting the termination of the Fiscal Agent's responsibilities
and rights hereunder as Fiscal Agent.

     (b) Notwithstanding the termination of its activities as Fiscal Agent, the
terminated Fiscal Agent shall continue to be entitled to reimbursement to the
extent provided in Section 4.6 but only to the extent such reimbursement relates
to the period up to and including the date on which the Fiscal Agent's
termination is effective. The Fiscal Agent shall be reimbursed for all amounts
owed to it hereunder on or prior to the effective date of its termination from
amounts on deposit in the Certificate Account.

     SECTION 4.9 MERGER OR CONSOLIDATION OF FISCAL AGENT. Any Person into which
the Fiscal Agent may be merged or consolidated, or any Person resulting from any
merger, conversion, other change in form or consolidation to which the Fiscal
Agent shall be a party, or any Person succeeding to the business of the Fiscal
Agent, shall be the successor of the Fiscal Agent hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding; provided that
(i) the successor to the Fiscal Agent or resulting Person shall have a net worth
of not less than $100,000,000, (ii) such successor or resulting Person shall be
satisfactory to the Trustee, (iii) such successor or resulting Person shall
execute and deliver to the Trustee an agreement, in form and substance
satisfactory to the Trustee, which contains an assumption by such Person of the
due and punctual performance and observance of each covenant and condition to be
performed or observed by the Fiscal Agent under this Agreement from and after
the date of such agreement, (iv) the successor or surviving entity meets the
eligibility requirements set forth in Section 7.5, and (v) the Fiscal Agent
shall deliver to the Trustee an Officer's Certificate and an Opinion of Counsel
acceptable to the Trustee (which opinion shall be at the expense of the Fiscal
Agent) stating that all conditions precedent to such action under this Section
4.9 have been completed and such action is permitted by and complies with the
terms of this Section 4.9.

     SECTION 4.10 LIMITATION ON LIABILITY OF THE FISCAL AGENT AND OTHERS.
Neither the Fiscal Agent nor any of the directors, officers, employees, agents
or Controlling Persons of the Fiscal Agent shall be under any liability to the
Certificateholders, the Depositor or the Trustee for any action taken or for
refraining from the taking of any action in good faith, and using reasonable
business judgment pursuant to this Agreement, or for errors in judgment;
provided that this provision shall not protect the Fiscal Agent or any such
Person against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or negligence in its performance of duties under
this Agreement. The Fiscal Agent and any director, officer, employee or agent of
the Fiscal Agent may rely in good faith on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising
hereunder. The Fiscal Agent shall not be under any obligation to appear in,
prosecute or defend any legal action which is not incidental to its obligations
under this Agreement. In such event, all legal expenses and costs of such action
shall be expenses and costs of the Trust, and the Fiscal Agent shall be entitled
to be reimbursed therefor as Servicing Advances as provided by this Agreement.
The provisions of this Section 4.10 shall survive the resignation or removal of
the Fiscal Agent and the termination of this Agreement.

     SECTION 4.11 INDEMNIFICATION OF FISCAL AGENT. The Fiscal Agent and each of
its directors, officers, employees, agents and Controlling Persons shall be
indemnified by the

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Trust and held harmless against any and all claims, losses, penalties, fines,
forfeitures, legal fees and related costs, judgments and any other costs,
liabilities, fees and expenses incurred in connection with any legal action
relating to this Agreement other than any loss, liability or expense incurred by
reason of the Fiscal Agent's willful misfeasance, bad faith or negligence in the
performance of its duties hereunder. The Depositor shall indemnify and hold
harmless the Fiscal Agent, its directors, officers, employees, agents or
Controlling Persons from and against any loss, claim, damage or liability, joint
or several, and any action in respect thereof, to which the Fiscal Agent, its
directors, officers, employees, agents or Controlling Person may become subject
under the 1933 Act, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon any untrue statement or alleged untrue statement
of a material fact contained in the Private Placement Memorandum, Preliminary
Prospectus Supplement, Final Prospectus Supplement or Prospectus or arises out
of, or is based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein in light of the circumstances under which they were made, not misleading
and shall reimburse the Fiscal Agent, its directors, officers, employees, agents
or Controlling Person for any legal and other expenses reasonably incurred by
the Fiscal Agent or any such director, officer, employee, agent or Controlling
Person in investigating or defending or preparing to defend against any such
loss, claim, damage, liability or action. The Fiscal Agent shall immediately
notify the Depositor, the Sellers, the Paying Agent, the Special Servicer, the
Master Servicer and the Trustee if a claim is made by a third party with respect
to this Section 4.11 entitling the Fiscal Agent, its directors, officers,
employees, agents or Controlling Person to indemnification hereunder, whereupon
the Depositor shall assume the defense of any such claim (with counsel
reasonably satisfactory to the Fiscal Agent) and pay all expenses in connection
therewith, including counsel fees, and promptly pay, discharge and satisfy any
judgment or decree which may be entered against it or them in respect of such
claim. Any failure to so notify the Depositor shall not affect any rights the
Fiscal Agent, its directors, officers, employees, agents or Controlling Person
may have to indemnification under this Section 4.11, unless the Depositor's
defense of such claim is materially prejudiced thereby. The indemnification
provided herein shall survive the termination of this Agreement and the
resignation or removal of the Fiscal Agent.

                                    ARTICLE V

                           ADMINISTRATION OF THE TRUST

     SECTION 5.1 COLLECTIONS.

     (a) On or prior to the Closing Date, the Master Servicer shall open, or
cause to be opened, and shall thereafter maintain, or cause to be maintained, a
separate account or accounts, which accounts must be Eligible Accounts, in the
name of "Wells Fargo Bank, National Association, as Master Servicer for LaSalle
Bank National Association, as Trustee for the Holders of Bear Stearns Commercial
Mortgage Securities Inc., Commercial Mortgage Pass-Through Certificates, Series
2003-TOP12" (the "Certificate Account"). On or prior to the Closing Date, the
Master Servicer shall open, or cause to be opened, and shall maintain, or cause
to be maintained an additional separate account or accounts in the name of
"Wells Fargo Bank, National Association, as Master Servicer for LaSalle Bank
National Association, as Trustee for

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<PAGE>

the Holders of Bear Stearns Commercial Mortgage Securities Inc., Commercial
Mortgage Pass-Through Certificates, Series 2003-TOP12" (the "Interest Reserve
Account").

     (b) On or prior to the date the Master Servicer shall first deposit funds
in a Certificate Account or the Interest Reserve Account, as the case may be,
the Master Servicer shall give to the Paying Agent and the Trustee prior written
notice of the name and address of the depository institution(s) at which such
accounts are maintained and the account number of such accounts. The Master
Servicer shall take such actions as are necessary to cause the depository
institution holding the Certificate Account and the Interest Reserve Account to
hold such account in the name of the Master Servicer as provided in Section
5.1(a), subject to the Master Servicer's (or its Primary Servicer's or its
Sub-Servicer's) right to direct payments and investments and its rights of
withdrawal under this Agreement.

     (c) The Master Servicer shall deposit, or cause to be deposited, into the
Certificate Account on the Business Day following receipt (or, in the case of an
inadvertent failure to make such deposit on the Business Day following receipt,
within 3 Business Days of discovery of such failure and in the case of
unscheduled remittances of principal or interest, on the Business Day following
identification of the proper application of such amounts), the following amounts
received by it (including amounts remitted to the Master Servicer by the Special
Servicer from an REO Account pursuant to Section 9.14), other than in respect of
interest and principal on the Mortgage Loans, the WestShore Plaza Companion Loan
or any B Note due on or before the Cut-Off Date which shall be remitted to the
Depositor (provided that the Master Servicer (I) may retain amounts otherwise
payable to the Master Servicer as provided in Section 5.2(a) rather than deposit
them into the Certificate Account, (II) shall, rather than deposit them in the
Certificate Account, directly remit to the Primary Servicer the applicable
Primary Servicing Fees payable as provided in Section 5.2(a)(iv)(unless already
retained by the applicable Primary Servicer), and (III) shall, rather than
deposit them in the Certificate Account, directly remit the Excess Servicing
Fees to the holders thereof as provided in Section 5.2(a)(iv))(unless already
retained by the applicable holder of the excess servicing rights)):

          (A) Principal: all payments on account of principal, including
     Principal Prepayments, the principal component of Scheduled Payments, and
     any Late Collections in respect thereof, on the Mortgage Loans, the
     WestShore Plaza Companion Loan and any B Note;

          (B) Interest: subject to subsection (d) hereof, all payments on
     account of interest on the Mortgage Loans, the WestShore Plaza Companion
     Loan and any B Note (minus any portion of any such payment that is
     allocable to the period prior to the Cut-Off Date which shall be remitted
     to the Depositor and excluding Interest Reserve Amounts to be deposited in
     the Interest Reserve Account pursuant to Section 5.1(d) below);

          (C) Liquidation Proceeds: all Liquidation Proceeds with respect to the
     Mortgage Loans, the WestShore Plaza Companion Loan and any B Note;

          (D) Insurance Proceeds: all Insurance Proceeds other than proceeds to
     be applied to the restoration or repair of the property subject to the
     related Mortgage or released to the related Mortgagor in accordance with
     the Servicing

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<PAGE>

     Standard, which proceeds shall be deposited by the Master Servicer into an
     Escrow Account and not deposited in the Certificate Account;

          (E) Condemnation Proceeds: all Condemnation Proceeds other than
     proceeds to be applied to the restoration or repair of the property subject
     to the related Mortgage or released to the related Mortgagor in accordance
     with the Servicing Standard, which proceeds shall be deposited by the
     Master Servicer into an Escrow Account and not deposited in the Certificate
     Account;

          (F) REO Income: all REO Income received from the Special Servicer;

          (G) Investment Losses: any amounts required to be deposited by the
     Master Servicer pursuant to Section 5.1(e) in connection with losses
     realized on Eligible Investments with respect to funds held in the
     Certificate Account and amounts required to be deposited by the Special
     Servicer pursuant to Section 9.14(b) in connection with losses realized on
     Eligible Investments with respect to funds held in the REO Account;

          (H) Advances: all P&I Advances unless made directly to the
     Distribution Account; and

          (I) Other: all other amounts, including Prepayment Premiums and any
     Kimball Lane Yield Maintenance Amounts, required to be deposited in the
     Certificate Account pursuant to this Agreement, including Purchase Proceeds
     of any Mortgage Loans repurchased by a Seller or substitution shortfall
     amounts (as described in the fifth paragraph of Section 2.3(a)) paid by a
     Seller in connection with the substitution of any Qualifying Substitute
     Mortgage Loans, amounts with respect to the WestShore Plaza Companion Loan
     and with respect to any B Note, all other amounts received pursuant to the
     cure and purchase rights set forth in the applicable Intercreditor
     Agreement.

     With respect to any A/B Mortgage Loan, the Master Servicer shall establish
and maintain one or more sub-accounts of the Certificate Account (each an "A/B
Loan Custodial Account") into which the Master Servicer shall deposit any
amounts described above that are required to be paid to the holder of the
related B Note pursuant to the terms of the related Intercreditor Agreement, in
each case on the same day as the deposit thereof into the Certificate Account.
Any A/B Loan Custodial Account shall be held in trust for the benefit of the
holder of the related B Note and shall not be part of any REMIC Pool.

     With respect to the Loan Pair, the Master Servicer shall establish and
maintain one or more sub-accounts of the Certificate Account (collectively, the
WestShore Plaza Companion Loan Custodial Account) into which the Master Servicer
shall deposit any amounts described above that are required to be paid to the
holder of the WestShore Plaza Companion Loan pursuant to the terms of the Loan
Pair Intercreditor Agreement, in each case on the same day as the deposit
thereof into the Certificate Account. The WestShore Plaza Companion Loan
Custodial Account shall be held in trust for the benefit of the holder of the
WestShore Plaza Companion Loan and shall not be part of any REMIC Pool.

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<PAGE>

     Remittances from any REO Account to the Master Servicer for deposit in the
Certificate Account shall be made by the Special Servicer no later than the
Special Servicer Remittance Date.

     (d) The Master Servicer, with respect to each Distribution Date occurring
in January (other than in any leap year) and February of each year, shall
deposit in the Interest Reserve Account in respect of each Interest Reserve
Loan, an amount equal to one day's interest at the related REMIC I Net Mortgage
Rate (without any conversion to a 30/360 basis as provided in the definition
thereof) on the Scheduled Principal Balance of such Mortgage Loan as of the Due
Date in the month in which such Distribution Date occurs, to the extent a
Scheduled Payment or P&I Advance is timely made in respect thereof for such Due
Date (all amounts so deposited in any consecutive January and February in
respect of each Interest Reserve Loan, the "Interest Reserve Amount"). For
purposes of determining amounts to be deposited into the Interest Reserve
Account, the REMIC I Net Mortgage Rate used in this calculation for those months
will be calculated without regard to any adjustment for Interest Reserve Amounts
or the interest accrual basis as described in the proviso to the definition of
"REMIC I Net Mortgage Rate."

     (e) Funds in the Certificate Account (including any A/B Loan Custodial
Accounts and the WestShore Plaza Companion Loan Custodial Account) and Interest
Reserve Account may be invested and, if invested, shall be invested by, and at
the risk of, the Master Servicer in Eligible Investments selected by the Master
Servicer which shall mature, unless payable on demand, not later than the
Business Day immediately preceding the next Master Servicer Remittance Date, and
any such Eligible Investment shall not be sold or disposed of prior to its
maturity unless payable on demand. All such Eligible Investments shall be made
in the name of "LaSalle Bank National Association, as Trustee for the Holders of
the Bear Stearns Commercial Mortgage Securities Inc., Commercial Mortgage
Pass-Through Certificates, Series 2003-TOP12 and the holder of the WestShore
Plaza Companion Loan or any related B Note as their interests may appear." None
of the Depositor, the Mortgagors, the Paying Agent or the Trustee shall be
liable for any loss incurred on such Eligible Investments.

     An amount equal to all income and gain realized from any such investment
shall be paid to the Master Servicer as additional servicing compensation and
shall be subject to its withdrawal at any time from time to time. The amount of
any losses incurred in respect of any such investments shall be for the account
of the Master Servicer which shall deposit the amount of such loss (to the
extent not offset by income from other investments) in the Certificate Account
(and, solely to the extent that the loss is of an amount credited to an A/B Loan
Custodial Account or the WestShore Plaza Companion Loan Custodial Account,
deposit to the related A/B Loan Custodial Account or the WestShore Plaza
Companion Loan Custodial Account, as the case may be) or Interest Reserve
Account, as the case may be, out of its own funds immediately as realized. If
the Master Servicer deposits in or transfers to any Certificate Account, any A/B
Loan Custodial Account, the WestShore Plaza Companion Loan Custodial Account or
the Interest Reserve Account, as the case may be, any amount not required to be
deposited therein or transferred thereto, it may at any time withdraw such
amount or retransfer such amount from the Certificate Account, such A/B Loan
Custodial Account, such WestShore Plaza Companion Loan Custodial Account or the
Interest Reserve Account, as the case may be, any provision herein to the
contrary notwithstanding.

                                      -127-

<PAGE>

     (f) Except as expressly provided otherwise in this Agreement, if any
default occurs in the making of a payment due under any Eligible Investment, or
if a default occurs in any other performance required under any Eligible
Investment, the Paying Agent on behalf of and at the direction of the Trustee
may take such action as may be appropriate to enforce such payment or
performance, including the institution and prosecution of appropriate
proceedings; provided, however, that if the Master Servicer shall have deposited
in the Certificate Account, the WestShore Plaza Companion Loan Custodial
Account, the related A/B Loan Custodial Account and the Interest Reserve Account
an amount equal to all amounts due under any such Eligible Investment (net of
anticipated income or earnings thereon that would have been payable to the
Master Servicer as additional servicing compensation) the Master Servicer shall
have the sole right to enforce such payment or performance.

     (g) Certain of the Mortgage Loans may provide for payment by the Mortgagor
to the Master Servicer of amounts to be used for payment of Escrow Amounts for
the account of the Mortgagor. The Master Servicer shall deal with these amounts
in accordance with the Servicing Standard, the terms of the related Mortgage
Loans and Section 8.3(e) hereof, and each Primary Servicer will be entitled to
hold any Escrow Accounts relating to the Mortgage Loans that it services in
accordance with the requirements set forth in Section 8.3(e). Within 20 days
following the first anniversary of the Closing Date, the Master Servicer shall
deliver to the Trustee, the Paying Agent and the Operating Adviser, for each
Mortgage Loan set forth on Schedule VII hereto, a brief statement as to the
status of the work or project based on the most recent information provided by
the Mortgagor. Schedule VII sets forth those Mortgage Loans as to which an
upfront reserve was collected at closing in an amount in excess of $75,000 with
respect to specific immediate engineering work, completion of additional
construction, environmental remediation or similar one-time projects (but not
with respect to escrow accounts maintained for ongoing obligations, such as real
estate taxes, insurance premiums, ongoing property maintenance, replacements and
capital improvements or debt service). If the work or project is not complete in
accordance with the requirements of the escrow, the Master Servicer and the
Special Servicer (which shall itself consult with the Operating Adviser) will
consult with each other as to whether there exists a material default under the
underlying Mortgage Loan documents.

     (h) In the case of the Mortgage Loans set forth on Schedule XVIII, as to
which the Scheduled Payment is due in a calendar month on a Due Date (including
any grace period) that may occur after the end of the Collection Period ending
in such calendar month, the Master Servicer shall, unless the Scheduled Payment
is received before the end of such Collection Period, make a P&I Advance by
deposit to the Certificate Account on the Master Servicer Remittance Date in an
amount equal to the Scheduled Payment or the Assumed Scheduled Payment, as
applicable, and for purposes of the definition of "Available Distribution
Amount" and "Principal Distribution Amount," such Scheduled Payment or Assumed
Scheduled Payment, as applicable, shall be deemed to have been received in such
Collection Period.

     SECTION 5.2 APPLICATION OF FUNDS IN THE CERTIFICATE ACCOUNT AND INTEREST
RESERVE ACCOUNT.

     (a) Subsection (I). The Master Servicer shall, from time to time, make
withdrawals from the Certificate Account and remit them by wire transfer prior
to 12:00 p.m., New York City time, on the related Master Servicer Remittance
Date in immediately available

                                      -128-

<PAGE>

funds to the account specified in this Section or otherwise (w) to such account
as it shall determine from time to time of amounts payable to the Master
Servicer from the Certificate Account (or, insofar as they relate to a B Note,
from the related A/B Loan Custodial Account or, insofar as they relate to the
WestShore Plaza Companion Loan, from the WestShore Plaza Companion Loan
Custodial Account) pursuant to clauses (i), (ii), (iii), (iv), (vi), (viii) and
(ix) below; (x) to the account specified in writing by the Paying Agent from
time to time of amounts payable to the Paying Agent and the Trustee from the
Certificate Account (and, insofar as they relate to a B Note, from the related
A/B Loan Custodial Account and, insofar as they relate to the WestShore Plaza
Companion Loan, from the WestShore Plaza Companion Loan Custodial Account)
pursuant to clauses (ii), (iii), (v), (vi), (xi), (xii) and (xiii) below; and
(y) to the Special Servicer from time to time of amounts payable to the Special
Servicer from such Certificate Account (or, insofar as they relate to a B Note,
from the related A/B Loan Custodial Account or, insofar as they relate to the
WestShore Plaza Companion Loan, from the WestShore Plaza Companion Loan
Custodial Account) pursuant to clauses (i), (iv), (vi), (vii) and (ix) below of
the following amounts, from the amounts specified for the following purposes:

     (i) Fees: the Master Servicer shall pay (A) to itself Late Fees (in excess
of amounts used to pay Advance Interest) relating to Mortgage Loans or B Notes
which are not Specially Serviced Mortgage Loans, Modification Fees relating to
Mortgage Loans, the WestShore Plaza Companion Loan or B Notes which are not
Specially Serviced Mortgage Loans as provided in Section 8.18, 50% of any
assumption fees payable under Section 8.7(a) or 8.7(b), 100% of any extension
fees payable under Section 8.10 or other fees payable to the Master Servicer
hereunder and (B) directly to the Special Servicer, 50% of any assumption fees
as provided in Section 8.7(a), 50% of any assumption fees as provided in Section
8.7(b), all assumption fees relating to Specially Serviced Mortgage Loans,
Modification Fees and other fees collected on Specially Serviced Mortgage Loans,
in each case to the extent provided for herein from funds paid by the applicable
Mortgagor, and Late Fees collected on Specially Serviced Mortgage Loans in
excess of Advance Interest (which Advance Interest the Master Servicer shall
retain to the extent provided for in this Agreement) to the extent the Special
Servicer is entitled to such Late Fees under Section 4.5;

     (ii) Servicing Advances (including amounts later determined to be
Nonrecoverable Advances): (A) in the case of all Mortgage Loans, the WestShore
Plaza Companion Loan and any B Note, subject to clause (B) below and subsection
(iv) of Section 5.2(a)(II), to reimburse or pay to the Master Servicer, the
Special Servicer, the Trustee and the Fiscal Agent, pursuant to Section 4.6, (x)
prior to a Final Recovery Determination or determination in accordance with
Section 4.4 that any Advance is a Nonrecoverable Advance, Servicing Advances on
the related Mortgage Loan, the WestShore Plaza Companion Loan and any B Note
from payments made by the related Mortgagor of the amounts to which a Servicing
Advance relates or from REO Income from the related REO Property or from
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds or Purchase
Proceeds and, to the extent that a Servicing Advance has been or is being
reimbursed, any related Advance Interest thereon first, from Late Fees and
default interest collected during the Collection Period during which such
Advance is reimbursed, and then from Excess Liquidation Proceeds then available
and then from any other amounts on deposit in the Certificate Account; provided
that, Late Fees and default interest will be applied on a "pool basis" for
non-Specially Serviced Mortgage Loans (and the WestShore Plaza Companion Loan
and the related B Note) and on a "loan-by-loan basis" (under which Late Fees and
default interest will be offset against the Advance Interest

                                     -129-

<PAGE>

arising only from the particular Specially Serviced Mortgage Loan) for Specially
Serviced Mortgage Loans, as the case may be, to the payment of Advance Interest
on all Advances on such non-Specially Serviced Mortgage Loans (and the WestShore
Plaza Companion Loan and any B Note) or such Specially Serviced Mortgage Loans,
as the case may be, then being reimbursed or (y) after a Final Recovery
Determination or determination that any Servicing Advance on the related
Mortgage Loan, the WestShore Plaza Companion Loan or any B Note is a
Nonrecoverable Advance, any Servicing Advances made on the related Mortgage
Loan, the WestShore Plaza Companion Loan, the related B Note or REO Property
from any funds on deposit in the Certificate Account (regardless of whether such
amount was recovered from the applicable Mortgage Loan or REO Property) and pay
Advance Interest thereon first, from Late Fees and default interest collected
during the Collection Period during which such Advance is reimbursed (applying
such Late Fees and default interest on a "pool basis" for all non-Specially
Serviced Mortgage Loans (and the WestShore Plaza Companion Loan and any B Note)
and on a "loan-by-loan basis", as described above, for all Specially Serviced
Mortgage Loans, as the case may be, to the payment of Advance Interest on all
Advances on such non-Specially Serviced Mortgage Loans (and the WestShore Plaza
Companion Loan and any B Note) or such Specially Serviced Mortgage Loans, as the
case may be, then being reimbursed), then from Excess Liquidation Proceeds then
available and then from any other amounts on deposit in the Certificate Account
and (B) in the case of any Non-Serviced Mortgage Loan and from any funds on
deposit in the Certificate Account, to reimburse the applicable Non-Serviced
Mortgage Loan Master Servicer, the applicable Non-Serviced Mortgage Loan Special
Servicer, the applicable Non-Serviced Mortgage Loan Trustee and the applicable
Non-Serviced Mortgage Loan Fiscal Agent for Pari Passu Loan Nonrecoverable
Advances and any accrued and unpaid interest thereon provided for under the
related Pooling and Servicing Agreement;

     (iii) P&I Advances (including amounts later to be determined to be
Nonrecoverable Advances): in the case of all Mortgage Loans, subject to
subsection (iv) of Section 5.2(a)(II), to reimburse or pay to the Master
Servicer, the Trustee and the Fiscal Agent, pursuant to Section 4.6, (x) if
prior to a Final Recovery Determination or determination that any Advance is a
Nonrecoverable Advance, any P&I Advances from Late Collections made by the
Mortgagor of the amounts to which a P&I Advance relates, or REO Income from the
related REO Property or from Liquidation Proceeds, Condemnation Proceeds,
Insurance Proceeds or Purchase Proceeds and, to the extent that a P&I Advance
has been or is being reimbursed, any related Advance Interest thereon, first,
from Late Fees and default interest collected during the Collection Period
during which such Advance is reimbursed, and then from Excess Liquidation
Proceeds then available and then from any other amounts on deposit in the
Certificate Account; provided that, Late Fees and default interest will be
applied on a "pool basis" for non-Specially Serviced Mortgage Loans and on a
"loan-by-loan basis" (under which Late Fees and default interest will be offset
against the Advance Interest arising only from the particular Specially Serviced
Mortgage Loan) for Specially Serviced Mortgage Loans, as the case may be, to the
payment of Advance Interest on all Advances on such non-Specially Serviced
Mortgage Loans or such Specially Serviced Mortgage Loans, as the case may be,
then being reimbursed or (y) if after a Final Recovery Determination or
determination in accordance with Section 4.4 that any P&I Advance on the related
Mortgage Loan is a Nonrecoverable Advance, any P&I Advances made on the related
Mortgage Loan or REO Property from funds on deposit in the Certificate Account
(regardless of whether such amount was recovered from the applicable Mortgage
Loan or REO Property) and any Advance Interest thereon, first, from Late Fees
and default interest collected during the Collection Period during which such
Advance is reimbursed (applying such

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<PAGE>

Late Fees and default interest on a "pool basis" for all non-Specially Serviced
Mortgage Loans and on a "loan-by-loan basis", as described above, for all
Specially Serviced Mortgage Loans, as the case may be, to the payment of Advance
Interest on all Advances on such non-Specially Serviced Mortgage Loans or such
Specially Serviced Mortgage Loans, as the case may be, then being reimbursed),
then from Excess Liquidation Proceeds then available and then from any other
amounts on deposit in the Certificate Account;

     (iv) Servicing Fees and Special Servicer Compensation: to pay to itself the
Master Servicing Fee, subject to reduction for any Compensating Interest, to pay
to the Special Servicer the Special Servicing Fee and the Work-Out Fee, to pay
to the Primary Servicer (or the Master Servicer) the Primary Servicing Fees, and
to pay to the parties entitled thereto the Excess Servicing Fees (to the extent
not previously retained by any of such parties);

     (v) Trustee Fee and Paying Agent Fee: to pay to the Distribution Account
for withdrawal by the Paying Agent, the Paying Agent Fee and the Trustee Fee;

     (vi) Expenses of Trust: to pay to the Person entitled thereto any amounts
specified herein to be Additional Trust Expenses (at the time set forth herein
or in the definition thereof), the payment of which is not more specifically
provided for in this Agreement; provided that the Depositor shall not be
entitled to receive reimbursement for performing its duties under this
Agreement;

     (vii) Liquidation Fees: upon the occurrence of a Final Recovery
Determination to pay to the Special Servicer from the Certificate Account, the
amount certified by the Special Servicer equal to the Liquidation Fee, to the
extent provided in Section 9.11 hereof;

     (viii) Investment Income: to pay to itself income and gain realized on the
investment of funds deposited in such Certificate Account (including any A/B
Loan Custodial Accounts and the WestShore Plaza Companion Loan Custodial
Account);

     (ix) Prepayment Interest Excesses: to pay to the Master Servicer the amount
of the aggregate Prepayment Interest Excesses relating to Mortgage Loans which
are not Specially Serviced Mortgage Loans (to the extent not offset by
Prepayment Interest Shortfalls relating to such Mortgage Loans); and to pay to
the Special Servicer the amount of the aggregate Prepayment Interest Excesses
relating to Specially Serviced Mortgage Loans which have received voluntary
Principal Prepayments (not from Liquidation Proceeds or from modifications to
Specially Serviced Mortgage Loans), to the extent not offset by Prepayment
Interest Shortfalls relating to such Mortgage Loans.

     (x) Correction of Errors: to withdraw funds deposited in the Certificate
Account in error;

     (xi) Distribution Account: to make payment on each Master Servicer
Remittance Date of the remaining amounts in the Certificate Account (including
any Excess Interest and Kimball Lane Yield Maintenance Amounts) to the
Distribution Account (or in the case of any Excess Interest, deposit to the
Excess Interest Sub-account

                                     -131-
<PAGE>

under Section 5.3(b), or in the case of Kimball Lane Yield Maintenance Amounts,
deposit to the Kimball Lane Sub-account under Section 5.3(b)) other than amounts
held for payment in future periods or pursuant to clause (xii) below;

     (xii) Reserve Account: to make payment on each Master Servicer Remittance
Date to the Reserve Account, any Excess Liquidation Proceeds (subject to Section
4.6(c)); and

     (xiii) Clear and Terminate: to clear and terminate the Certificate Account
pursuant to Section 8.29;

provided, however, that in the case of any B Note:

                  (A) the Master Servicer shall be entitled to make transfers
                  from time to time, from the related A/B Loan Custodial Account
                  to the portion of the Certificate Account that does not
                  constitute the A/B Loan Custodial Account, of amounts
                  necessary for the payments or reimbursement of amounts
                  described in any one or more of clauses (i), (ii), (iii),
                  (iv), (vi), (vii), (viii), (ix) and (xii) above, but only
                  insofar as the payment or reimbursement described therein
                  arises from or is related solely to such A/B Mortgage Loan and
                  is allocable to the A/B Mortgage Loan pursuant to this
                  Agreement or the related Intercreditor Agreement, and the
                  Master Servicer shall also be entitled to make transfers from
                  time to time, from the related A/B Loan Custodial Account to
                  the portion of the Certificate Account that does not
                  constitute the A/B Loan Custodial Account, of amounts
                  transferred to such related A/B Loan Custodial Account in
                  error, and amounts necessary for the clearing and termination
                  of the Certificate Account pursuant to Section 8.29;

                  (B) the Master Servicer shall be entitled to make transfers
                  from time to time, from the related A/B Loan Custodial Account
                  to the portion of the Certificate Account that does not
                  constitute the A/B Loan Custodial Account, of amounts not
                  otherwise described in clause (A) above to which the holder of
                  an A Note is entitled under the A/B Mortgage Loan and the
                  related Intercreditor Agreement (including in respect of
                  interest, principal and Prepayment Premiums in respect of the
                  A Note (whether or not by operation of any provision of the
                  related Intercreditor Agreement that entitles the holder of
                  such A Note to receive remittances in amounts calculated
                  without regard to any modification, waiver or amendment of the
                  economic terms of such A Note)); and

                  (C) the Master Servicer shall on each Master Servicer
                  Remittance Date remit to the holder of the related B Note all
                  amounts on deposit in such A/B Loan Custodial Account (net of
                  amounts permitted or required to be transferred therefrom as
                  described in clauses (A) and/or (B) above), to the extent that
                  the holder of such B Note is entitled thereto under the
                  related Intercreditor Agreement (including by way of the
                  operation of any provision of the related Intercreditor
                  Agreement that entitles the holder of the B Note to
                  reimbursement of cure payments made by it).

and provided further, however, that in the case of the WestShore Plaza Companion
Loan:

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<PAGE>

                  (A) the Master Servicer shall be entitled to make transfers
                  from time to time, from the WestShore Plaza Companion Loan
                  Custodial Account to the portion of the Certificate Account
                  that does not constitute the WestShore Plaza Companion Loan
                  Custodial Account, of amounts necessary for the payments or
                  reimbursement of amounts described in any one or more of
                  clauses (i), (ii), (iii), (iv), (v), (vi), (vii), (viii), (ix)
                  and (xii) above, but only insofar as the payment or
                  reimbursement described therein arises from or is related
                  solely to the Loan Pair and is allocable to the WestShore
                  Plaza Companion Loan, and the Master Servicer shall also be
                  entitled to make transfers from time to time, from the
                  WestShore Plaza Companion Loan Custodial Account to the
                  portion of the Certificate Account that does not constitute
                  the WestShore Plaza Companion Loan Custodial Account, of
                  amounts transferred to such WestShore Plaza Companion Loan
                  Custodial Account in error, and amounts necessary for the
                  clearing and termination of the Certificate Account pursuant
                  to Section 8.29; provided, however that the Master Servicer
                  shall not be entitled to make transfers from the portion of
                  the Certificate Account that does not constitute the WestShore
                  Plaza Companion Loan Custodial Account (other than amounts
                  previously transferred from the WestShore Plaza Companion Loan
                  Custodial Account in accordance with this clause (A)) of
                  amounts necessary for the payment or reimbursement of amounts
                  described in any one or more of the foregoing clauses;

                  (B) the Master Servicer shall be entitled to make transfers
                  from time to time, from the WestShore Plaza Companion Loan
                  Custodial Account to the portion of the Certificate Account
                  that does not constitute the WestShore Plaza Companion Loan
                  Custodial Account, of amounts not otherwise described in
                  clause (A) above to which the holder of the WestShore Plaza
                  Pari Passu Loan is entitled under the Loan Pair Intercreditor
                  Agreement (including in respect of interest, principal and
                  Prepayment Premiums); and

                  (C) the Master Servicer shall, on the later of (i) one (1)
                  Business Day after the related Determination Date or (ii) one
                  (1) Business Day after receipt from the related Primary
                  Servicer, remit to the holder of the WestShore Plaza Companion
                  Loan all amounts on deposit in such WestShore Plaza Companion
                  Loan Custodial Account (net of amounts permitted or required
                  to be transferred therefrom as described in clauses (A) and/or
                  (B) above), to the extent that the holder of the WestShore
                  Plaza Companion Loan is entitled thereto under the Loan Pair
                  Intercreditor Agreement.

     No decision by the Master Servicer, the Trustee or the Fiscal Agent under
either this Section 5.2(a) or subsection (iv) of Section 5.2(a)(II), to defer
the reimbursement of Advances and/or Advance Interest shall be construed as an
agreement by the Master Servicer to subordinate (in respect of realizing
losses), to any Class of Certificates, such party's right to such reimbursement
during such period of deferral.

     Expenses incurred with respect to an A/B Mortgage Loan shall be allocated
in accordance with the related Intercreditor Agreement. The Master Servicer
shall keep and maintain a separate accounting for each Mortgage Loan and B Note
for the purpose of justifying any withdrawal or transfer from the Certificate
Account and any A/B Loan Custodial Account.

                                     -133-
<PAGE>

If funds collected in respect of the A Notes are insufficient to pay the Master
Servicing Fee, then the Master Servicer shall be entitled to withdraw the amount
of such shortfall from the collections on, and other proceeds of, the B Note
that are held in the related A/B Loan Custodial Account. The Master Servicer
shall not be permitted to withdraw any funds from the portion of the Certificate
Account that does not constitute the A/B Loan Custodial Account unless there are
no remaining funds in the related A/B Loan Custodial Account available and
required to be paid in accordance with the related Intercreditor Agreement.

     Expenses incurred with respect to the Loan Pair shall be allocated in
accordance with the Loan Pair Intercreditor Agreement. The Master Servicer shall
keep and maintain a separate accounting for each Mortgage Loan and the WestShore
Plaza Companion Loan for the purpose of justifying any withdrawal or transfer
from the Certificate Account and the WestShore Plaza Companion Loan Custodial
Account.

     Subsection (II). The provisions of this subsection II of this Section
5.2(a) shall apply notwithstanding any contrary provision of subsection (I) of
this Section 5.2(a):

               (i) Identification of Workout-Delayed Reimbursement Amounts: If
          any Advance made with respect to any Mortgage Loan on or before the
          date on which such Mortgage Loan becomes (or, but for the requirement
          that the Mortgagor shall have made three consecutive scheduled
          payments under its modified terms, would then constitute) a
          Rehabilitated Mortgage Loan, together with Advance Interest accrued
          thereon, is not, pursuant to the operation of the provisions of
          Section 5.2(a)(I), reimbursed to the Person who made such Advance on
          or before the date, if any, on which such Mortgage Loan becomes a
          Rehabilitated Mortgage Loan, such Advance, together with such Advance
          Interest, shall constitute a "Workout-Delayed Reimbursement Amount" to
          the extent that such amount has not been determined to constitute a
          Nonrecoverable Advance. All references herein to "Workout-Delayed
          Reimbursement Amount" shall be construed always to mean the related
          Advance and any Advance Interest thereon, together with any further
          Advance Interest that accrues on the unreimbursed portion of such
          Advance from time to time in accordance with the other provisions of
          this Agreement. That any amount constitutes all or a portion of any
          Workout-Delayed Reimbursement Amount shall not in any manner limit the
          right of any Person hereunder to determine that such amount instead
          constitutes a Nonrecoverable Advance.

               (ii) General Relationship of Provisions. Subsection (iii) below
          (subject to the terms and conditions thereof) sets forth the terms of
          and conditions to the right of a Person to be reimbursed for any
          Workout-Delayed Reimbursement Amount to the extent that such Person is
          not otherwise entitled to reimbursement and payment of such
          Workout-Delayed Reimbursement Amount pursuant to the operation of
          Section 5.2(a)(I) above. Subsection (iv) below (subject to the terms
          and conditions thereof) authorizes the Master Servicer to abstain from
          reimbursing itself (or, if applicable, the Trustee or the Fiscal Agent
          to abstain from obtaining reimbursement) for Nonrecoverable Advances
          under certain circumstances at its sole option. Upon any determination
          that all or any portion of a Workout-Delayed Reimbursement Amount
          constitutes a

                                      -134-

<PAGE>

          Nonrecoverable Advance, then the reimbursement or payment of such
          amount (and any further Advance Interest that may accrue thereon)
          shall cease to be subject to the operation of subsection (iii) below,
          such amount (and further Advance Interest) shall be as fully payable
          and reimbursable to the relevant Person as would any other
          Nonrecoverable Advance (and Advance Interest thereon) and, as a
          Nonrecoverable Advance, such amount may become the subject of the
          Master Servicer's (or, if applicable, the Trustee's or the Fiscal
          Agent's) exercise of its sole option authorized by subsection (iv)
          below.

               (iii) Reimbursements of Workout-Delayed Reimbursement Amounts:
          The Master Servicer, the Special Servicer, the Trustee and the Fiscal
          Agent, as applicable, shall be entitled to reimbursement and payment
          for all Workout-Delayed Reimbursement Amounts in each Collection
          Period; provided, however, that the aggregate amount (for all such
          Persons collectively) of such reimbursements and payments in such
          Collection Period shall not exceed (and the reimbursement and payment
          shall be made from) the aggregate principal collections and recoveries
          on the Mortgage Loans for such Collection Period contemplated by
          clause (I)(A) of the definition of Principal Distribution Amount (but
          not including any such amounts that constitute Advances) and net of
          any Nonrecoverable Advances then outstanding and reimbursable from
          such principal collections and recoveries in accordance with Section
          5.2(a)(II)(iv) below. As and to the extent provided in clause (II)(A)
          of the definition thereof, the Principal Distribution Amount for the
          Distribution Date related to such Collection Period shall be reduced
          to the extent that such payment or reimbursement of a Workout-Delayed
          Reimbursement Amount is made from aggregate principal collections
          pursuant to the preceding sentence.

               (iv) Reimbursement of Nonrecoverable Advances; Sole Option to
          Abstain from Reimbursements of Certain Nonrecoverable Advances. To the
          extent that Section 5.2(a)(I) otherwise entitles the Master Servicer
          to reimbursement for any Nonrecoverable Advance (or payment of Advance
          Interest thereon from a source other than Late Fees and default
          interest on the related Mortgage Loan) during any Collection Period,
          then, notwithstanding any contrary provision of subsection (I) above,
          (a) to the extent that one or more such reimbursements and payments of
          Nonrecoverable Advances (and such Advance Interest thereon) are made,
          such reimbursements and payments shall be made, first, from the
          aggregate principal collections and recoveries on the Mortgage Loans
          for such Collection Period contemplated by clause (I)(A) of the
          definition of Principal Distribution Amount (but not including any
          such amounts that constitute Advances, and prior to any deduction for
          Workout-Delayed Reimbursement Amounts (and Advance Interest thereon)
          that were reimbursed or paid during the related Collection Period from
          principal collections on the Mortgage Loans, as described by clause
          (II)(A) of the definition of Principal Distribution Amount and
          pursuant to subsection (iii) of Section 5.2(a)(II)), and then from
          other collections (including interest) on the Mortgage Loans for such
          Collection Period, and (b) if and to the extent that the amount of
          such a Nonrecoverable Advance (and Advance Interest thereon), together
          with all Nonrecoverable Advances (and Advance Interest thereon)
          theretofore reimbursed

                                      -135-
<PAGE>

          during such Collection Period, would exceed such principal collections
          and recoveries on the Mortgage Loans for such Collection Period (and
          Advance Interest thereon), the Master Servicer (and the Trustee or the
          Fiscal Agent, as applicable, if it made the relevant Advance) is
          hereby authorized (but shall not be construed to have any obligation
          whatsoever), if it elects at its sole option, to abstain from
          reimbursing itself (notwithstanding that it is entitled to such
          reimbursement) during that Collection Period for all or a portion of
          such Nonrecoverable Advance (and Advance Interest thereon), provided
          that the aggregate amount that is deferred with respect to all
          Nonrecoverable Advances (and Advance Interest thereon) with respect to
          all Mortgage Loans for any particular Collection Period is less than
          or equal to such excess described above in this clause (b). If the
          Master Servicer (or the Trustee or the Fiscal Agent, as applicable)
          makes such an election at its sole option to defer reimbursement with
          respect to all or a portion of a Nonrecoverable Advance (and Advance
          Interest thereon), then such Nonrecoverable Advance (and Advance
          Interest thereon) or portion thereof shall continue to be fully
          reimbursable in any subsequent Collection Period to the same extent as
          set forth above. In connection with a potential election by the Master
          Servicer to abstain from the reimbursement of a particular
          Nonrecoverable Advance or portion thereof during the Collection Period
          for any Distribution Date, the Master Servicer (or the Trustee or the
          Fiscal Agent, as applicable) shall further be authorized to wait for
          principal collections to be received before making its determination
          of whether to abstain from the reimbursement of a particular
          Nonrecoverable Advance or portion thereof until the end of the
          Collection Period.

          None of the Master Servicer, the Trustee or the Fiscal Agent shall
     have any liability whatsoever for making an election, or refraining from
     making an election, that is authorized under this subsection (II)(iv). The
     foregoing shall not, however, be construed to limit any liability that may
     otherwise be imposed on such Person for any failure by such Person to
     comply with the conditions to making such an election under this subsection
     (II)(iv) or to comply with the terms of this subsection (II)(iv) and the
     other provisions of this Agreement that apply once such an election, if
     any, has been made.

          Any election by the Master Servicer (or the Trustee or the Fiscal
     Agent, as applicable) to abstain from reimbursing itself for any
     Nonrecoverable Advance (and Advance Interest thereon) or portion thereof
     with respect to any Collection Period shall not be construed to impose on
     the Master Servicer (or the Trustee or the Fiscal Agent, as applicable) any
     obligation to make such an election (or any entitlement in favor of any
     Certificateholder or any other Person to such an election) with respect to
     any subsequent Collection Period or to constitute a waiver or limitation on
     the right of the Master Servicer (or the Trustee or the Fiscal Agent, as
     applicable) to otherwise be reimbursed for such Nonrecoverable Advance (and
     Advance Interest thereon). Any election by the Master Servicer, the Trustee
     or the Fiscal Agent to abstain from reimbursing itself for any
     Nonrecoverable Advance or portion thereof with respect to any one or more
     Collection Periods shall not limit the accrual of Advance Interest on the
     unreimbursed portion of such Nonrecoverable Advance for the period prior to
     the actual reimbursement of such Nonrecoverable Advance. None of the Master
     Servicer, the Trustee, the Fiscal Agent or

                                      -136-

<PAGE>

     the other parties to this Agreement shall have any liability to one another
     or to any of the Certificateholders or any holder of a B Note or the
     WestShore Plaza Companion Loan for any such election that such party makes
     as contemplated by this subsection or for any losses, damages or other
     adverse economic or other effects that may arise from such an election. The
     foregoing statements in this paragraph shall not limit the generality of
     the statements made in the immediately preceding paragraph. Notwithstanding
     the foregoing, none of the Master Servicer, the Trustee or the Fiscal Agent
     shall have the right to abstain from reimbursing itself for any
     Nonrecoverable Advance to the extent of the amount described in clause
     (I)(A) of the definition of Principal Distribution Amount.

               (v) Reimbursement Rights of the Master Servicer, Special
          Servicer, Trustee and Fiscal Agent Are Senior. Nothing in this
          Agreement shall be deemed to create in any Certificateholder a right
          to prior payment of distributions over the Master Servicer's, the
          Special Servicer's, the Trustee's or the Fiscal Agent's right to
          reimbursement for Advances plus Advance Interest (whether those that
          constitute Workout-Delayed Reimbursement Amounts, those that have been
          the subject of the Master Servicer's election authorized in subsection
          (iv) or otherwise).

     (b) Scheduled Payments due in a Collection Period succeeding the Collection
Period relating to such Master Servicer Remittance Date, Principal Prepayments
received after the related Collection Period, or other amounts not distributable
on the related Distribution Date, shall be held in the Certificate Account (or
sub-account thereof) and shall be distributed on the Master Servicer Remittance
Date or Dates to which such succeeding Collection Period or Periods relate,
provided, however, that as to the Mortgage Loans set forth on Schedule XVIII,
for which the Scheduled Payment due each month is due on a Due Date (including
any grace period) that may occur after the end of the Collection Period in such
month, sums received by the Master Servicer with respect to such Scheduled
Payment but after the end of such Collection Period shall be applied by the
Master Servicer to reimburse any related P&I Advance made pursuant to Section
5.1(h), and the Master Servicer shall remit to the Distribution Account on any
Master Servicer Remittance Date for a Collection Period any Principal
Prepayments and Balloon Payments received after the end of such Collection
Period but no later than the second Business Day immediately preceding such
Master Servicer Remittance Date on the Mortgage Loans set forth on Schedule
XVIII. The Master Servicer shall use its best efforts to remit to the
Distribution Account on any Master Servicer Remittance Date for a Collection
Period any Balloon Payments received after the date that is two Business Days
immediately preceding the related Master Servicer Remittance Date and prior to
the Distribution Date. In connection with the deposit of any Balloon Payments to
the Distribution Account in accordance with the immediately preceding sentence,
the Master Servicer shall promptly notify the Paying Agent and the Paying Agent
shall, if it has already reported anticipated distributions to the Depository,
use commercially reasonable efforts to cause the Depository to make the revised
distribution on a timely basis on such Distribution Date. Neither the Master
Servicer nor the Paying Agent shall be liable or held responsible for any
resulting delay or failure in the making of such distribution to
Certificateholders. For purposes of the definition of "Available Distribution
Amount" and "Principal Distribution Amount," the Scheduled Payments and
Principal Prepayments referred to in the preceding proviso shall be deemed to
have been collected in the prior Collection Period.

                                     -137-

<PAGE>

     (c) On each Master Servicer Remittance Date in March of every year
commencing in March 2004, the Master Servicer shall withdraw all amounts then in
the Interest Reserve Account and deposit such amounts into the Distribution
Account.

     SECTION 5.3 DISTRIBUTION ACCOUNT AND RESERVE ACCOUNT.

     (a) The Paying Agent, on behalf of the Trustee shall establish (with
respect to clause (i), on or prior to the Closing Date, and with respect to
clause (ii), on or prior to the date the Paying Agent determines is necessary)
and maintain in its name, on behalf of the Trustee, (i) an account (the
"Distribution Account"), to be held in trust for the benefit of the Holders
until disbursed pursuant to the terms of this Agreement, titled: "Wells Fargo
Bank Minnesota, National Association, as Paying Agent on behalf of LaSalle Bank
National Association, as Trustee, in trust for the benefit of the Holders of
Bear Stearns Commercial Mortgage Securities Inc., Commercial Mortgage
Pass-Through Certificates, Series 2003-TOP12, Distribution Account" and (ii) an
account (the "Reserve Account") to be held in trust for the benefit of the
holders of interests in the Trust until disbursed pursuant to the terms of this
Agreement, titled: "Wells Fargo Bank Minnesota, National Association, as Paying
Agent on behalf of LaSalle Bank National Association, as Trustee, in trust for
the benefit of the Holders of Bear Stearns Commercial Mortgage Securities Inc.,
Commercial Mortgage Pass-Through Certificates, Series 2003-TOP12, Reserve
Account." The Distribution Account and the Reserve Account shall be Eligible
Accounts. Funds in the Reserve Account shall not be invested. The Distribution
Account and Reserve Account shall be held separate and apart from and shall not
be commingled with any other monies including, without limitation, other monies
of the Paying Agent held under this Agreement.

     Funds in the Distribution Account may be invested and, if invested, shall
be invested by, and at the risk of, the Paying Agent in Eligible Investments
selected by the Paying Agent which shall mature, unless payable on demand, not
later than such time on the Distribution Date which will allow the Paying Agent
to make withdrawals from the Distribution Account under Section 5.3(b), and any
such Eligible Investment shall not be sold or disposed of prior to its maturity
unless payable on demand. All such Eligible Investments shall be made in the
name of "LaSalle Bank National Association, as Trustee for the Holders of the
Bear Stearns Commercial Mortgage Securities Inc., Commercial Mortgage
Pass-Through Certificates, Series 2003-TOP12 and the holder of any related B
Note as their interests may appear." None of the Depositor, the Mortgagors, the
Special Servicer, the Master Servicer, the Primary Servicer or the Trustee shall
be liable for any loss incurred on such Eligible Investments.

     An amount equal to all income and gain realized from any such investment
shall be paid to the Paying Agent as additional compensation and shall be
subject to its withdrawal at any time from time to time. The amount of any
losses incurred in respect of any such investments shall be for the account of
the Paying Agent which shall deposit the amount of such loss (to the extent not
offset by income from other investments) in the Distribution Account, as the
case may be, out of its own funds immediately as realized. If the Paying Agent
deposits in or transfers to the Distribution Account, as the case may be, any
amount not required to be deposited therein or transferred thereto, it may at
any time withdraw such amount or retransfer such amount from the Distribution
Account, as the case may be, any provision herein to the contrary
notwithstanding.

                                      -138-
<PAGE>

     (b) The Paying Agent shall deposit into the Distribution Account or the
Reserve Account, as applicable, on the Business Day received all moneys remitted
by the Master Servicer pursuant to this Agreement, including P&I Advances made
by the Master Servicer, the Trustee and the Fiscal Agent and all Excess
Liquidation Proceeds. The Paying Agent shall deposit amounts constituting
collections of (i) Excess Interest on the Mortgage Loans into the Excess
Interest Sub-account and (ii) Kimball Lane Yield Maintenance Amounts into the
Kimball Lane Sub-account. On any Master Servicer Remittance Date, the Master
Servicer shall have no duty to remit to the Distribution Account any amounts
other than amounts held in the Certificate Account and collected during the
related Collection Period as provided in clauses (v) and (xi) of Section 5.2(a)
and the P&I Advance Amount and, on the Master Servicer Remittance Date occurring
in March of any year, commencing in March 2004, amounts held in the Interest
Reserve Account. The Paying Agent shall make withdrawals from the Distribution
Account (including the Excess Interest Sub-account and the Kimball Lane
Sub-account) and the Reserve Account only for the following purposes:

          (i) to withdraw amounts deposited in the Distribution Account in error
and pay such amounts to the Persons entitled thereto;

          (ii) to pay any amounts payable to the Master Servicer, the Primary
Servicer, the Special Servicer, the Fiscal Agent and the Trustee (including the
Trustee's Fee (other than that portion thereof, that constitutes the Paying
Agent's Fee)) and the Paying Agent (including the Paying Agent Fee), or other
expenses or other amounts permitted to be paid hereunder and not previously paid
to such Persons pursuant to Section 5.2;

          (iii) to make distributions to the Certificateholders pursuant to
Section 6.5 and 6.11; and

          (iv) to clear and terminate the Distribution Account pursuant to
Section 10.2.

     SECTION 5.4 PAYING AGENT REPORTS.

     (a) On or prior to each Distribution Date, based on information provided in
monthly reports prepared by the Master Servicer and the Special Servicer and
delivered to the Paying Agent by the Master Servicer (no later than 1:00 p.m.,
New York time on the Report Date), the Paying Agent shall make available to any
interested party via its internet website initially located at
"www.ctslink.com/cmbs" (the "Paying Agent's Website"), (i) the Monthly
Certificateholders Report (substantially in the form of Exhibit M), (ii) a
report containing information regarding the Mortgage Loans as of the end of the
related Collection Period, which report shall contain substantially the
categories of information regarding the Mortgage Loans set forth in Appendix I
to the Final Prospectus Supplement and shall be presented in tabular format
substantially similar to the format utilized in such Appendix I which report may
be included as part of the Monthly Certificateholders Report, (iii) the Loan
Periodic Update File, Loan Setup File, Bond Level File and the Collateral
Summary File, (iv) the Monthly Additional Report on Recoveries and
Reimbursements, (v) the supplemental reports set forth in paragraph (b) of the
definition of Unrestricted Servicer Reports and (vi) as a convenience for
interested parties (and not in furtherance of the distribution thereof under the
securities laws), the Final Prospectus Supplement and this Agreement.

                                     -139-
<PAGE>

     In addition, on or prior to each Distribution Date, based on information
provided in monthly reports prepared by the Master Servicer and the Special
Servicer and delivered to the Paying Agent in accordance herewith, the Paying
Agent shall make available via the Paying Agent's Website, on a restricted
basis, the Restricted Servicer Reports (including the Property File on or prior
to each Distribution Date, commencing in November 2003). The Paying Agent shall
provide access to the Restricted Servicer Reports, upon request, to each
Certificateholder, each of the parties to this Agreement, each of the Rating
Agencies, each of the Underwriters, the Operating Adviser, the Placement Agents,
any prospective purchaser of the Certificates and any Certificate Owner upon
receipt (which may be in electronic form) from such person of an Investor
Certificate in the form of Exhibit Y, and any other person upon the direction of
the Depositor, the Placement Agents or any Underwriter. For assistance with the
above-mentioned Paying Agent services, Certificateholders or any party hereto
may initially call 301-815-6600.

     The Paying Agent makes no representations or warranties as to the accuracy
or completeness of any report, document or other information made available on
the Paying Agent's Website and assumes no responsibility therefor. The Paying
Agent shall be entitled to conclusively rely on any information provided to it
by the Master Servicer or the Special Servicer and shall have no obligation to
verify such information and the Paying Agent may disclaim responsibility for any
information distributed by the Paying Agent for which it is not the original
source. In connection with providing access to the Paying Agent's Website, the
Paying Agent, may require registration and the acceptance of a disclaimer. None
of the Master Servicer, the Special Servicer, any Primary Servicer or the Paying
Agent shall be liable for the dissemination of information in accordance with
this Agreement; provided that this sentence shall not in any way limit the
liability the Paying Agent may otherwise have in the performance of its duties
hereunder.

     (b) Subject to Section 8.15, upon advance written request, if required by
federal regulation, of any Certificateholder (or holder of the WestShore Plaza
Companion Loan or a B Note) that is a savings association, bank, or insurance
company, the Paying Agent shall provide (to the extent in its possession) to
each such Certificateholder (or such holder of the WestShore Plaza Companion
Loan or a B Note) such reports and access to non-privileged information and
documentation regarding the Mortgage Loans and the Certificates as such
Certificateholder (or such holder of the WestShore Plaza Companion Loan or a B
Note) may reasonably deem necessary to comply with applicable regulations of the
Office of Thrift Supervision or successor or other regulatory authorities with
respect to investment in the Certificates; provided that the Paying Agent shall
be entitled to be reimbursed by such Certificateholder (or such holder of the
WestShore Plaza Companion Loan or a B Note) for the Paying Agent's actual
expenses incurred in providing such reports and access. The holder of a B Note
shall be entitled to receive information and documentation only with respect to
its related A/B Mortgage Loan and the holder of the WestShore Plaza Companion
Loan shall be entitled to receive information and documentation only with
respect to the Loan Pair, pursuant hereto.

     (c) Upon written request, the Paying Agent shall send to each Person who at
any time during the calendar year was a Certificateholder of record, customary
information as the Paying Agent deems may be necessary or desirable for such
Holders to prepare their federal income tax returns.

     (d) Reserved

                                      -140-

<PAGE>

     (e) The Paying Agent shall afford the Rating Agencies, the Depositor, the
Master Servicer, the Special Servicer, the Primary Servicer, the Trustee, the
Fiscal Agent, the Operating Adviser, any Certificateholder, the Luxembourg
Paying Agent, prospective Certificate Owner or any Person reasonably designated
by any Placement Agent, or any Underwriter upon reasonable notice and during
normal business hours, reasonable access to all relevant, non-attorney
privileged records and documentation regarding the applicable Mortgage Loans,
REO Property and all other relevant matters relating to this Agreement, and
access to Responsible Officers of the Paying Agent.

     (f) Copies (or computer diskettes or other digital or electronic formats of
such information if reasonably available in lieu of paper copies) of any and all
of the foregoing items of this Section 5.4 shall be made available by the Paying
Agent upon request; provided, however, that the Paying Agent shall be permitted
to require payment by the requesting party (other than the Depositor, the Master
Servicer, the Special Servicer, the Trustee, the Fiscal Agent, the Operating
Adviser, any Placement Agent or any Underwriter or any Rating Agency) of a sum
sufficient to cover the reasonable expenses actually incurred by the Paying
Agent of providing access or copies (including electronic or digital copies) of
any such information requested in accordance with the preceding sentence.

     (g) The Paying Agent shall make available at its Corporate Trust Office
(either in physical or electronic form), during normal business hours, upon
reasonable advance written notice for review by any Certificateholder, any
Certificate Owner, any prospective Certificate Owner, the Placement Agents, the
Underwriters, each Rating Agency, the Special Servicer, the Depositor, and
solely as with respect to any A/B Mortgage Loan, the holder of the B Note and
solely as with respect to the Loan Pair, the holder of the WestShore Plaza
Companion Loan, originals or copies of, among other things, any Phase I
Environmental Report or engineering report prepared or appraisals performed in
respect of each Mortgaged Property provided, however, that the Paying Agent
shall be permitted to require payment by the requesting party (other than either
Rating Agency or the Operating Adviser) of a sum sufficient to cover the
reasonable expenses actually incurred by the Paying Agent or the Trustee of
providing access or copies (including electronic or digital copies) of any such
information reasonably requested in accordance with the preceding sentence.

     SECTION 5.5 PAYING AGENT TAX REPORTS. The Paying Agent shall perform all
reporting and other tax compliance duties that are the responsibility of each
REMIC Pool and the Grantor Trust under the Code, REMIC Provisions, or other
compliance guidance issued by the Internal Revenue Service or any state or local
taxing authority. Consistent with this Pooling and Servicing Agreement, the
Paying Agent shall provide or cause to be provided (i) to the United States
Treasury or other Persons (including, but not limited to, the Transferor of a
Class R-I, Class R-II, Class R-III or Class R-K Certificate, to a Disqualified
Organization or to an agent that has acquired a Class R-I, Class R-II, Class
R-III or Class R-K Certificate on behalf of a Disqualified Organization) such
information as is necessary for the application of any tax relating to the
transfer of a Class R-I, Class R-II, Class R-III or Class R-K Certificate to any
Disqualified Organization and (ii) to the Certificateholders such information or
reports as are required by the Code or REMIC Provisions; in the case of (i),
subject to reimbursement of expenses relating thereto in accordance with Section
7.12. The Master Servicer shall on a timely basis provide the Paying Agent with
such information concerning the Mortgage Loans as is necessary for the
preparation of the tax or information returns or receipts of each REMIC Pool as

                                     -141-
<PAGE>

the Paying Agent may reasonably request from time to time. The Special Servicer
is required to provide to the Master Servicer all information in its possession
with respect to the Specially Serviced Mortgage Loans in order for the Master
Servicer to comply with its obligations under this Section 5.5. The Paying Agent
shall be entitled to conclusively rely on any such information provided to it by
the Master Servicer or the Special Servicer and shall have no obligation to
verify any such information.

                                   ARTICLE VI

                                  DISTRIBUTIONS

     SECTION 6.1 DISTRIBUTIONS GENERALLY. Subject to Section 10.2(a), respecting
the final distribution on the Certificates, on each Distribution Date, the
Paying Agent shall (1) first, withdraw from the Distribution Account and pay to
the Fiscal Agent and Trustee any unpaid fees, expenses and other amounts then
required to be paid pursuant to this Agreement, and then, to the Paying Agent,
any unpaid fees, expenses and other amounts then required to be paid pursuant to
this Agreement, and then at the written direction of the Master Servicer,
withdraw from the Distribution Account and pay to the Master Servicer, the
Primary Servicer and Special Servicer any unpaid servicing compensation or other
amounts currently required to be paid pursuant to this Agreement (to the extent
not previously retained or withdrawn by the Master Servicer from the Certificate
Account), and (2) second, make distributions in the manner and amounts set forth
below.

     Each distribution to Holders of Certificates shall be made by check mailed
to such Holder's address as it appears on the Certificate Register of the
Certificate Registrar or, upon written request to the Paying Agent on or prior
to the related Record Date (or upon standing instructions given to the Paying
Agent on the Closing Date prior to any Record Date, which instructions may be
revoked at any time thereafter upon written notice to the Paying Agent five days
prior to the related Record Date) made by a Certificateholder by wire transfer
in immediately available funds to an account specified in the request of such
Certificateholder; provided, that (i) remittances to the Paying Agent shall be
made by wire transfer of immediately available funds to the Distribution Account
and the Reserve Account; and (ii) the final distribution in respect of any
Certificate shall be made only upon presentation and surrender of such
Certificate at such location specified by the Paying Agent in a notice delivered
to Certificateholders pursuant to Section 10.2(a). If any payment required to be
made on the Certificates is to be made on a day that is not a Business Day, then
such payment will be made on the next succeeding Business Day without
compensation for such delay. All distributions or allocations made with respect
to Holders of Certificates of a Class on each Distribution Date shall be made or
allocated among the outstanding Interests in such Class in proportion to their
respective initial Certificate Balances or Percentage Interests for the Class X
Certificates.

                                     -142-
<PAGE>

     SECTION 6.2 Kimball Lane Loan REMIC.

     (a) On each Distribution Date, the Paying Agent shall be deemed to
distribute to itself on behalf of the Trustee, as holder of the Kimball Lane
Loan REMIC Regular Interest, for the following purposes and in the following
order of priority:

         (i) from the portion of the Available Distribution Amount attributable
to interest collected or deemed collected on or with respect to the Kimball Lane
Loan or related REO Property, Distributable Certificate Interest to the Kimball
Lane Loan REMIC Regular Interest;

         (ii) from the portion of the Available Distribution Amount attributable
to principal collected or deemed collected on or with respect to the Kimball
Lane Loan or related REO Property, principal to the Kimball Lane Loan REMIC
Regular Interest, until the Certificate Balance thereof is reduced to zero;

         (iii) any remaining funds, to reimburse any Realized Losses previously
allocated to the Kimball Lane Loan REMIC Regular Interest, plus interest on such
Realized Losses previously allocated thereto, at the applicable Pass-Through
Rate; and

         (iv) thereafter, to the Class R-K Certificateholders with respect to
the Kimball Lane Loan REMIC Residual Interest at such time as the Certificate
Balance of the Kimball Lane Loan REMIC Regular Interest has been reduced to
zero, and Realized Losses previously allocated thereto have been reimbursed to
the Holder of the Kimball Lane Loan REMIC Regular Interest, any amounts
remaining.

     SECTION 6.3 REMIC I.

     (a) On each Distribution Date, the Paying Agent shall be deemed to
distribute to itself on behalf of the Trustee, as holder of the REMIC I Regular
Interests, for the following purposes and in the following order of priority:

         (i) from the portion of the Available Distribution Amount attributable
to interest collected or deemed collected on or with respect to each Majority
Mortgage Loan or related REO Property and the Kimball Lane Loan REMIC Regular
Interest, Distributable Certificate Interest to each Corresponding REMIC I
Regular Interest;

         (ii) from the portion of the Available Distribution Amount
attributable to principal collected or deemed collected on or with respect to
each Majority Mortgage Loan or related REO Property and the Kimball Lane Loan
REMIC Regular Interest, principal to the Corresponding REMIC I Regular Interest,
until the Certificate Balance thereof is reduced to zero;

         (iii) any remaining funds, to reimburse any Realized Losses previously
allocated to the REMIC I Regular Interests, plus interest on such Realized
Losses previously allocated thereto, at the applicable Pass-Through Rates; and

         (iv) thereafter, to the Class R-I Certificateholders (in respect of the
REMIC I Residual Interest) at such time as the Certificate Balance of all
Classes of REMIC I

                                      -143-

<PAGE>

Regular Interests have been reduced to zero, and Realized Losses previously
allocated thereto have been reimbursed to the Holders of the REMIC I Regular
Interests, any amounts remaining.

     SECTION 6.4 REMIC II.

     (a) On each Distribution Date, the Paying Agent shall be deemed to
distribute to itself on behalf of the Trustee, as holder of the REMIC II Regular
Interests, for the following purposes and in the following order of priority:

         (i) an amount equal to Distributable Certificate Interest for the Class
A-1 Certificates, Class A-2 Certificates, Class A-3 Certificates, Class A-4
Certificates, Class X-1 Certificates and Class X-2 Certificates to REMIC II
Regular Interest A-1A, REMIC II Regular Interest A-1B, REMIC II Regular Interest
A-1C, REMIC II Regular Interest A-1D, REMIC II Regular Interest A-2A, REMIC II
Regular Interest A-2B, REMIC II Regular Interest A-3A, REMIC II Regular Interest
A-3B, REMIC II Regular Interest A-3C, REMIC II Regular Interest A-4A, REMIC II
Regular Interest A-4B, REMIC II Regular Interest A-4C, REMIC II Regular Interest
B-1, REMIC II Regular Interest B-2, REMIC II Regular Interest B-3, REMIC II
Regular Interest C-1, REMIC II Regular Interest C-2, REMIC II Regular Interest
C-3, REMIC II Regular Interest D-1, REMIC II Regular Interest D-2, REMIC II
Regular Interest E-1, REMIC II Regular Interest E-2, REMIC II Regular Interest
F, REMIC II Regular Interest G, REMIC II Regular Interest H-1, REMIC II Regular
Interest H-2, REMIC II Regular Interest J, REMIC II Regular Interest K, REMIC II
Regular Interest L, REMIC II Regular Interest M, REMIC II Regular Interest N and
REMIC II Regular Interest O, divided among such REMIC II Regular Interests in
proportion to (A) in the case of the REMIC II Regular Interest A-1A, REMIC II
Regular Interest A-1B, REMIC II Regular Interest A-1C, REMIC II Regular Interest
A-1D, REMIC II Regular Interest A-2A, REMIC II Regular Interest A-2B, REMIC II
Regular Interest A-3A, REMIC II Regular Interest A-3B, REMIC II Regular Interest
A-3C, REMIC II Regular Interest A-4A, REMIC II Regular Interest A-4B and REMIC
II Regular Interest A-4C, the Accrued Certificate Interest for such Distribution
Date and (B) in the case of REMIC II Regular Interest B-1, REMIC II Regular
Interest B-2, REMIC II Regular Interest B-3, REMIC II Regular Interest C-1,
REMIC II Regular Interest C-2, REMIC II Regular Interest C-3, REMIC II Regular
Interest D-1, REMIC II Regular Interest D-2, REMIC II Regular Interest E-1,
REMIC II Regular Interest E-2, REMIC II Regular Interest F, REMIC II Regular
Interest G, REMIC II Regular Interest H-1, REMIC II Regular Interest H-2, REMIC
II Regular Interest J, REMIC II Regular Interest K, REMIC II Regular Interest L,
REMIC II Regular Interest M, REMIC II Regular Interest N and REMIC II Regular
Interest O, the product of (a) the Certificate Balance of such Interest and (b)
one-twelfth of the sum of the related Class X-1 Strip Rate and the related Class
X-2 Strip Rate (if any);

         (ii) to REMIC II Regular Interest A-1A, REMIC II Regular Interest A-1B,
REMIC II Regular Interest A-1C, REMIC II Regular Interest A-1D, REMIC II Regular
Interest A-2A, REMIC II Regular Interest A-2B, REMIC II Regular Interest A-3A,
REMIC II Regular Interest A-3B, REMIC II Regular Interest A-3C, REMIC II Regular
Interest A-4A, REMIC II Regular Interest A-4B and REMIC II Regular Interest
A-4C, in reduction of the Certificate Balances thereof, in an amount up to the
Principal Distribution Amount for such Distribution Date: (A) first, to the
REMIC II Regular Interest A-1A until the Certificate Balance of REMIC II Regular
Interest A-1A is reduced to zero, and upon payment in full of the Certificate
Balance of the REMIC II Regular Interest A-1A, to the REMIC II Regular Interest
A-1B, the Principal Distribution Amount for such Distribution Date (reduced by
any portion thereof

                                     -144-
<PAGE>

deemed to be distributed to the REMIC II Regular Interest A-1A), until the
Certificate Balance of the REMIC II Regular Interest A-1B has been reduced to
zero, and upon payment in full of the Certificate Balance of the REMIC II
Regular Interest A-1B, to the REMIC II Regular Interest A-1C, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed to the REMIC II Regular Interest A-1A and A-1B), until
the Certificate Balance of the REMIC II Regular Interest A-1C has been reduced
to zero, and upon payment in full of the Certificate Balance of the REMIC II
Regular Interest A-1C, to the REMIC II Regular Interest A-1D, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed to the REMIC II Regular Interest A-1A, A-1B and A-1C),
until the Certificate Balance of the REMIC II Regular Interest A-1D has been
reduced to zero; (B) second, to the REMIC II Regular Interest A-2A, the
Principal Distribution Amount for such Distribution Date (reduced by any portion
thereof deemed to be distributed to the REMIC II Regular Interest A-1A, A-1B,
A-1C and A-1D), until the Certificate Balance of the REMIC II Regular Interest
A-2A has been reduced to zero, and upon payment in full of the Certificate
Balance of the REMIC II Regular Interest A-2A, to the REMIC II Regular Interest
A-2B, the Principal Distribution Amount for such Distribution Date (reduced by
any portion thereof deemed to be distributed to the REMIC II Regular Interest
A-1A, A-1B, A-1C, A-1D and A-2A), until the Certificate Balance of the REMIC II
Regular Interest A-2B has been reduced to zero; (C) third, to the REMIC II
Regular Interest A-3A, the Principal Distribution Amount for such Distribution
Date (reduced by any portion thereof deemed to be distributed to the REMIC II
Regular Interest A-1A, A-1B, A-1C, A-1D, A-2A and A-2B), until the Certificate
Balance of the REMIC II Regular Interest A-3A has been reduced to zero, and upon
payment in full of the Certificate Balance of the REMIC II Regular Interest
A-3A, to the REMIC II Regular Interest A-3B, the Principal Distribution Amount
for such Distribution Date (reduced by any portion thereof deemed to be
distributed to the REMIC II Regular Interest A-1A, A-1B, A-1C, A-1D, A-2A, A-2B
and A-3A), until the Certificate Balance of the REMIC II Regular Interest A-3B
has been reduced to zero, and upon payment in full of the Certificate Balance of
the REMIC II Regular Interest A-3B, to the REMIC II Regular Interest A-3C, the
Principal Distribution Amount for such Distribution Date (reduced by any portion
thereof deemed to be distributed to the REMIC II Regular Interest A-1A, A-1B,
A-1C, A-1D, A-2A, A-2B, A-3A and A-3B), until the Certificate Balance of the
REMIC II Regular Interest A-3C has been reduced to zero; and (D) fourth, to the
REMIC II Regular Interest A-4A, the Principal Distribution Amount for such
Distribution Date (reduced by any portion thereof deemed to be distributed to
the REMIC II Regular Interest A-1A, A-1B, A-1C, A-1D, A-2A, A-2B, A-3A, A-3B and
A-3C), until the Certificate Balance of the REMIC II Regular Interest A-4A has
been reduced to zero, and upon payment in full of the Certificate Balance of the
REMIC II Regular Interest A-4A, to the REMIC II Regular Interest A-4B, the
Principal Distribution Amount for such Distribution Date (reduced by any portion
thereof deemed to be distributed to the REMIC II Regular Interest A-1A, A-1B,
A-1C, A-1D, A-2A, A-2B, A-3A, A-3B, A-3C and A-4A), until the Certificate
Balance of the REMIC II Regular Interest A-4B has been reduced to zero, and upon
payment in full of the Certificate Balance of the REMIC II Regular Interest
A-4B, to the REMIC II Regular Interest A-4C, the Principal Distribution Amount
for such Distribution Date (reduced by any portion thereof deemed to be
distributed to the REMIC II Regular Interest A-1A, A-1B, A-1C, A-1D, A-2A, A-2B,
A-3A, A-3B, A-3C, A-4A and A-4B), until the Certificate Balance of the REMIC II
Regular Interest A-4C has been reduced to zero;

         (iii) to REMIC II Regular Interest A-1A, REMIC II Regular Interest
A-1B, REMIC II Regular Interest A-1C, REMIC II Regular Interest A-1D, REMIC II
Regular

                                     -145-
<PAGE>

Interest A-2A, REMIC II Regular Interest A-2B, REMIC II Regular Interest A-3A,
REMIC II Regular Interest A-3B, REMIC II Regular Interest A-3C, REMIC II Regular
Interest A-4A, REMIC II Regular Interest A-4B, REMIC II Regular Interest A-4C,
REMIC II Regular Interest B-1, REMIC II Regular Interest B-2, REMIC II Regular
Interest B-3, REMIC II Regular Interest C-1, REMIC II Regular Interest C-2,
REMIC II Regular Interest C-3, REMIC II Regular Interest D-1, REMIC II Regular
Interest D-2, REMIC II Regular Interest E-1, REMIC II Regular Interest E-2,
REMIC II Regular Interest F, REMIC II Regular Interest G, REMIC II Regular
Interest H-1, REMIC II Regular Interest H-2, REMIC Regular Interest J, REMIC II
Regular Interest K, REMIC II Regular Interest L, REMIC II Regular Interest M,
REMIC II Regular Interest N and REMIC II Regular Interest O, pro rata on the
basis of their respective entitlements to reimbursement described in this clause
(iii), to reimburse any Realized Losses previously allocated to REMIC II Regular
Interest A-1A, REMIC II Regular Interest A-1B, REMIC II Regular Interest A-1C,
REMIC II Regular Interest A-1D, REMIC II Regular Interest A-2A, REMIC II Regular
Interest A-2B, REMIC II Regular Interest A-3A, REMIC II Regular Interest A-3B,
REMIC II Regular Interest A-3C, REMIC II Regular Interest A-4A, REMIC II Regular
Interest A-4B, REMIC II Regular Interest A-4C, REMIC II Regular Interest B-1,
REMIC II Regular Interest B-2, REMIC II Regular Interest B-3, REMIC II Regular
Interest C-1, REMIC II Regular Interest C-2, REMIC II Regular Interest C-3,
REMIC II Regular Interest D-1, REMIC II Regular Interest D-2, REMIC II Regular
Interest E-1, REMIC II Regular Interest E-2, REMIC II Regular Interest F, REMIC
II Regular Interest G, REMIC II Regular Interest H-1, REMIC II Regular Interest
H-2, REMIC Regular Interest J, REMIC II Regular Interest K, REMIC II Regular
Interest L, REMIC II Regular Interest M, REMIC II Regular Interest N and REMIC
II Regular Interest O, in the case of all such Interests other than the REMIC II
Regular Interest A-1A, REMIC II Regular Interest A-1B, REMIC II Regular Interest
A-1C, REMIC II Regular Interest A-1D, REMIC II Regular Interest A-2A, REMIC II
Regular Interest A-2B, REMIC II Regular Interest A-3A, REMIC II Regular Interest
A-3B, REMIC II Regular Interest A-3C, REMIC II Regular Interest A-4A, REMIC II
Regular Interest A-4B and REMIC II Regular Interest A-4C, as a result of the
allocation of Realized Losses to the Class X Certificates and in the case of all
such Interests, inclusive of accrued and unpaid interest at the applicable
Pass-Through Rate on such Realized Losses;

         (iv) to the REMIC II Regular Interest B-1, REMIC II Regular Interest
B-2 and REMIC II Regular Interest B-3, the remainder of the Distributable
Certificate Interest for such Interest for such Distribution Date, divided among
such REMIC II Regular Interests in proportion to the Accrued Certificate
Interest for such Distribution Date, to the extent not distributed pursuant to
clause (i) above;

         (v) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest A-4C, to the REMIC II Regular Interest B-1, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest B-1 has been reduced to
zero, and upon payment in full of the Certificate Balance of the REMIC II
Regular Interest B-1, to the REMIC II Regular Interest B-2, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest B-2 has been reduced to
zero, and upon payment in full of the Certificate Balance of the REMIC II
Regular Interest B-2, to the REMIC II Regular Interest B-3, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to

                                     -146-
<PAGE>

the preceding provisions hereof), until the Certificate Balance of the REMIC II
Regular Interest B-3 has been reduced to zero;

         (vi) to the REMIC II Regular Interest B-1, REMIC II Regular Interest
B-2 and REMIC II Regular Interest B-3, to reimburse any unreimbursed Realized
Losses previously allocated thereto, plus accrued and unpaid interest at the
applicable Pass-Through Rate on such Realized Losses, pro rata on the basis of
their respective entitlements to reimbursement;

         (vii) to the REMIC II Regular Interest C-1, REMIC II Regular Interest
C-2 and REMIC II Regular Interest C-3, the remainder of the Distributable
Certificate Interest for such Interest for such Distribution Date, divided among
such REMIC II Regular Interests in proportion to the Accrued Certificate
Interest for such Distribution Date, to the extent not distributed pursuant to
clause (i) above;

         (viii) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest B-3, to the REMIC II Regular Interest C-1, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest C-1 has been reduced to
zero, and upon payment in full of the Certificate Balance of the REMIC II
Regular Interest C-1, to the REMIC II Regular Interest C-2, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest C-2 has been reduced to
zero, and upon payment in full of the Certificate Balance of the REMIC II
Regular Interest C-2, to the REMIC II Regular Interest C-3, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest C-3 has been reduced to
zero;

         (ix) to the REMIC II Regular Interest C-1, REMIC II Regular Interest
C-2 and REMIC II Regular Interest C-3, to reimburse any unreimbursed Realized
Losses previously allocated thereto, plus accrued and unpaid interest at the
applicable Pass-Through Rate on such Realized Losses, pro rata on the basis of
their respective entitlements to reimbursement;

         (x) to the REMIC II Regular Interest D-1 and REMIC II Regular Interest
D-2, the remainder of the Distributable Certificate Interest for such Interests
for such Distribution Date, divided among such REMIC II Regular Interests in
proportion to the Accrued Certificate Interest for such Distribution Date, to
the extent not distributed pursuant to clause (i) above;

         (xi) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest C-3, to the REMIC II Regular Interest D-1, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest D-1 has been reduced to
zero, and upon payment in full of the Certificate Balance of the REMIC II
Regular Interest D-1, to the REMIC II Regular Interest D-2, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to

                                     -147-

<PAGE>

the preceding provisions hereof), until the Certificate Balance of the REMIC II
Regular Interest D-2 has been reduced to zero;

         (xii) to the REMIC II Regular Interest D-1 and REMIC II Regular
Interest D-2, to reimburse any unreimbursed Realized Losses previously allocated
thereto, plus accrued and unpaid interest at the applicable Pass-Through Rate on
such Realized Losses, pro rata on the basis of their respective entitlements to
reimbursement;

         (xiii) to the REMIC II Regular Interest E-1 and REMIC II Regular
Interest E-2, the remainder of the Distributable Certificate Interest for such
Interests for such Distribution Date, divided among such REMIC II Regular
Interests in proportion to the Accrued Certificate Interest for such
Distribution Date, to the extent not distributed pursuant to clause (i) above;

         (xiv) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest D-2, to the REMIC II Regular Interest E-1, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest E-1 has been reduced to
zero, and upon payment in full of the Certificate Balance of the REMIC II
Regular Interest E-1, to the REMIC II Regular Interest E-2, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest E-2 has been reduced to
zero;

         (xv) to the REMIC II Regular Interest E-1 and REMIC II Regular Interest
E-2, to reimburse any unreimbursed Realized Losses previously allocated thereto,
plus accrued and unpaid interest at the applicable Pass-Through Rate on such
Realized Losses, pro rata on the basis of their respective entitlements to
reimbursement;

         (xvi) to the REMIC II Regular Interest F, the remainder of the
Distributable Certificate Interest for such Interests for such Distribution
Date, to the extent not distributed pursuant to clause (i) above;

         (xvii) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest E-2, to the REMIC II Regular Interest F, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest F has been reduced to zero;

         (xviii) to the REMIC II Regular Interest F, to reimburse any
unreimbursed Realized Losses previously allocated thereto, plus accrued and
unpaid interest at the applicable Pass-Through Rate on such Realized Losses;

         (xix) to the REMIC II Regular Interest G, the remainder of the
Distributable Certificate Interest for such Interests for such Distribution
Date, to the extent not distributed pursuant to clause (i) above;

         (xx) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest F, to the REMIC II Regular Interest G, the Principal
Distribution Amount for

                                     -148-
<PAGE>

such Distribution Date (reduced by any portion thereof deemed to be distributed
pursuant to the preceding provisions hereof), until the Certificate Balance of
the REMIC II Regular Interest G has been reduced to zero;

         (xxi) to the REMIC II Regular Interest G, to reimburse any unreimbursed
Realized Losses previously allocated thereto, plus accrued and unpaid interest
at the applicable Pass-Through Rate on such Realized Losses;

         (xxii) to the REMIC II Regular Interest H-1 and REMIC II Regular
Interest H-2, the remainder of the Distributable Certificate Interest for such
Interests for such Distribution Date, divided among such REMIC II Regular
Interests in proportion to the Accrued Certificate Interest for such
Distribution Date, to the extent not distributed pursuant to clause (i) above;

         (xxiii) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest G, to the REMIC II Regular Interest H-1, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest H-1 has been reduced to
zero, and upon payment in full of the Certificate Balance of the REMIC II
Regular Interest H-1, to the REMIC II Regular Interest H-2, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest H-2 has been reduced to
zero;

         (xxiv) to the REMIC II Regular Interest H-1 and REMIC II Regular
Interest H-2, to reimburse any unreimbursed Realized Losses previously allocated
thereto, plus accrued and unpaid interest at the applicable Pass-Through Rate on
such Realized Losses, pro rata on the basis of their respective entitlements to
reimbursement;

         (xxv) to the REMIC II Regular Interest J, the remainder of the
Distributable Certificate Interest for such Interest for such Distribution Date
to the extent not distributed pursuant to clause (i) above;

         (xxvi) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest H-2, to the REMIC II Regular Interest J, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest J has been reduced to zero;

         (xxvii) to the REMIC II Regular Interest J, to reimburse any
unreimbursed Realized Losses previously allocated thereto, plus accrued and
unpaid interest at the applicable Pass-Through Rate on such Realized Losses;

         (xxviii) to the REMIC II Regular Interest K, the remainder of the
Distributable Certificate Interest for such Interest for such Distribution Date,
to the extent not distributed pursuant to clause (i) above;

         (xxix) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest J, to the REMIC II Regular Interest K, the Principal
Distribution Amount for

                                     -149-
<PAGE>

such Distribution Date (reduced by any portion thereof deemed to be distributed
pursuant to the preceding provisions hereof), until the Certificate Balance of
the REMIC II Regular Interest K has been reduced to zero;

         (xxx) to the REMIC II Regular Interest K, to reimburse any unreimbursed
Realized Losses previously allocated thereto, plus accrued and unpaid interest
at the applicable Pass-Through Rate on such Realized Losses;

         (xxxi) to the REMIC II Regular Interest L, the remainder of the
Distributable Certificate Interest for such Interest for such Distribution Date
to the extent not distributed pursuant to clause (i) above;

         (xxxii) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest K, to the REMIC II Regular Interest L, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest L has been reduced to zero;

         (xxxiii) to the REMIC II Regular Interest L, to reimburse any
unreimbursed Realized Losses previously allocated thereto, plus accrued and
unpaid interest at the applicable Pass-Through Rate on such Realized Losses;

         (xxxiv) to the REMIC II Regular Interest M, the remainder of the
Distributable Certificate Interest for such Interest for such Distribution Date
to the extent not distributed pursuant to clause (i) above;

         (xxxv) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest L, to the REMIC II Regular Interest M, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest M has been reduced to zero;

         (xxxvi) to the REMIC II Regular Interest M, to reimburse any
unreimbursed Realized Losses previously allocated thereto, plus accrued and
unpaid interest at the applicable Pass-Through Rate on such Realized Losses;

         (xxxvii) to the REMIC II Regular Interest N, the remainder of the
Distributable Certificate Interest for such Interest for such Distribution Date
to the extent not distributed pursuant to clause (i) above;

         (xxxviii) upon payment in full of the Certificate Balance of the REMIC
II Regular Interest M, to the REMIC II Regular Interest N, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest N has been reduced to zero;

         (xxxix) to the REMIC II Regular Interest N, to reimburse any
unreimbursed Realized Losses previously allocated thereto, plus accrued and
unpaid interest at the applicable Pass-Through Rate on such Realized Losses;

                                     -150-
<PAGE>

         (xl) to the REMIC II Regular Interest O, the remainder of the
Distributable Certificate Interest for such Interest for such Distribution Date
to the extent not distributed pursuant to clause (i) above;

         (xli) upon payment in full of the Certificate Balance of the REMIC II
Regular Interest N, to the REMIC II Regular Interest O, the Principal
Distribution Amount for such Distribution Date (reduced by any portion thereof
deemed to be distributed pursuant to the preceding provisions hereof), until the
Certificate Balance of the REMIC II Regular Interest O has been reduced to zero;

         (xlii) to the REMIC II Regular Interest O, to reimburse any
unreimbursed Realized Losses previously allocated thereto, plus accrued and
unpaid interest at the applicable Pass-Through Rate on such Realized Losses;

         (xliii) thereafter, to the Class R-II Certificateholders at such time
as the Certificate Balances of all Classes of REMIC II Regular Interests have
been reduced to zero, and Realized Losses previously allocated thereto have been
reimbursed to the Holders of the REMIC II Regular Interests, any amounts
remaining.

     SECTION 6.5 REMIC III.

     (a) On each Distribution Date, the Paying Agent shall withdraw from the
Distribution Account an amount equal to the Available Distribution Amount and
shall distribute such amount (other than the amount attributable to any Excess
Interest, which shall be distributed in accordance with Section 6.5(c)) and
Excess Liquidation Proceeds in the following amounts and order of priority:

         (i) to the Holders of the Class A-1 Certificates, Class A-2
Certificates, Class A-3 Certificates, Class A-4 Certificates, Class X-1
Certificates and Class X-2 Certificates, Distributable Certificate Interest for
such Distribution Date, pro rata in proportion to the Distributable Certificate
Interest payable to each such Class;

         (ii) to the Holders of the Class A-1, Class A-2, Class A-3 and Class
A-4 Certificates, in reduction of the Certificate Balances thereof, in an amount
up to the Principal Distribution Amount for such Distribution Date: first, to
the Holders of the Class A-1 Certificates, the Principal Distribution Amount for
such Distribution Date until the Certificate Balance thereof is reduced to zero;
second, upon payment in full of the aggregate Certificate Balance of the Class
A-1 Certificates, to the holders of the Class A-2 Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder) until the aggregate Certificate Balance of the
Class A-2 Certificates has been reduced to zero; third, upon payment in full of
the aggregate Certificate Balance of the Class A-2 Certificates, to the holders
of the Class A-3 Certificates, the Principal Distribution Amount for such
Distribution Date (reduced by any prior distributions thereof hereunder) until
the aggregate Certificate Balance of the Class A-3 Certificates has been reduced
to zero and fourth, upon payment in full of the aggregate Certificate Balance of
the Class A-3 Certificates, to the holders of the Class A-4 Certificates, the
Principal Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder) until the aggregate Certificate Balance of the
Class A-4 Certificates has been reduced to zero;

                                     -151-
<PAGE>

         (iii) to the Holders of the Class A Certificates, Class X-1
Certificates and Class X-2 Certificates, pro rata (treating principal and
interest losses separately), to reimburse any Realized Losses previously
allocated thereto and not previously fully reimbursed, plus one month's interest
at the applicable Pass-Through Rate on such Realized Losses;

         (iv) to the Holders of the Class B Certificates, Distributable
Certificate Interest for such Distribution Date;

         (v) upon payment in full of the Certificate Balance of the Class A-4
Certificates, to the Holders of the Class B Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class B
Certificates has been reduced to zero;

         (vi) to the Holders of the Class B Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

         (vii) to the Holders of the Class C Certificates, Distributable
Certificate Interest for such Distribution Date;

         (viii) upon payment in full of the Certificate Balance of the Class B
Certificates, to the Holders of the Class C Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class C
Certificates has been reduced to zero;

         (ix) to the Holders of the Class C Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

         (x) to the Holders of the Class D Certificates, Distributable
Certificate Interest for such Distribution Date;

         (xi) upon payment in full of the Certificate Balance of the Class C
Certificates, to the Holders of the Class D Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class D
Certificates has been reduced to zero;

         (xii) to the Holders of the Class D Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

         (xiii) to the Holders of the Class E Certificates, Distributable
Certificate Interest for such Distribution Date;

         (xiv) upon payment in full of the Certificate Balance of the Class D
Certificates, to the Holders of the Class E Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class E
Certificates has been reduced to zero;

                                     -152-

<PAGE>

         (xv) to the Holders of the Class E Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

         (xvi) to the Holders of the Class F Certificates, Distributable
Certificate Interest for such Distribution Date;

         (xvii) upon payment in full of the Certificate Balance of the Class E
Certificates, to the Holders of the Class F Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class F
Certificates has been reduced to zero;

         (xviii) to the Holders of the Class F Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

         (xix) to the Holders of the Class G Certificates, Distributable
Certificate Interest for such Distribution Date;

         (xx) upon payment in full of the Certificate Balance of the Class F
Certificates, to the Holders of the Class G Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class G
Certificates has been reduced to zero;

         (xxi) to the Holders of the Class G Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

         (xxii) to the Holders of the Class H Certificates, Distributable
Certificate Interest for such Distribution Date;

         (xxiii) upon payment in full of the Certificate Balance of the Class G
Certificates, to the Holders of the Class H Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class H
Certificates has been reduced to zero;

         (xxiv) to the Holders of the Class H Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

(xxv) to the Holders of the Class J
Certificates, Distributable Certificate Interest for such Distribution Date;

         (xxvi) upon payment in full of the Certificate Balance of the Class H
Certificates, to the Holders of the Class J Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class J
Certificates has been reduced to zero;

                                     -153-
<PAGE>

         (xxvii) to the Holders of the Class J Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

         (xxviii) to the Holders of the Class K Certificates, Distributable
Certificate Interest for such Distribution Date;

         (xxix) upon payment in full of the Certificate Balance of the Class J
Certificates, to the Holders of the Class K Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class K
Certificates has been reduced to zero;

         (xxx) to the Holders of the Class K Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

         (xxxi) to the Holders of the Class L Certificates, Distributable
Certificate Interest for such Distribution Date;

         (xxxii) upon payment in full of the Certificate Balance of the Class K
Certificates, to the Holders of the Class L Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class L
Certificates has been reduced to zero;

         (xxxiii) to the Holders of the Class L Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

         (xxxiv) to the Holders of the Class M Certificates, Distributable
Certificate Interest for such Distribution Date;

         (xxxv) upon payment in full of the Certificate Balance of the Class L
Certificates, to the Holders of the Class M Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class M
Certificates has been reduced to zero;

         (xxxvi) to the Holders of the Class M Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

         (xxxvii) to the Holders of the Class N Certificates, Distributable
Certificate Interest for such Distribution Date;

         (xxxviii) upon payment in full of the Certificate Balance of the Class
M Certificates, to the Holders of the Class N Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class N
Certificates has been reduced to zero;

                                     -154-
<PAGE>

         (xxxix) to the Holders of the Class N Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses;

         (xl) to the Holders of the Class O Certificates, Distributable
Certificate Interest for such Distribution Date;

         (xli) upon payment in full of the Certificate Balance of the Class N
Certificates, to the Holders of the Class O Certificates, the Principal
Distribution Amount for such Distribution Date (reduced by any prior
distributions thereof hereunder), until the Certificate Balance of the Class O
Certificates has been reduced to zero;

         (xlii) to the Holders of the Class O Certificates, to reimburse any
Realized Losses previously allocated thereto and not previously fully
reimbursed, plus one month's interest at the applicable Pass-Through Rate on
such Realized Losses; and

         (xliii) to the Holders of the Class R-III Certificates at such time as
the Certificate Balances of all Classes of REMIC Regular Certificates have been
reduced to zero, and Realized Losses previously allocated to each Holder have
been reimbursed to the Holders of the REMIC Regular Certificates, any amounts
remaining on deposit in the Distribution Account.

     Notwithstanding the foregoing, on each Distribution Date occurring on or
after the earliest date, if any, upon which the Certificate Balances of all the
Classes of Subordinate Certificates have been reduced to zero or the aggregate
Appraisal Reduction in effect is greater than or equal to the Certificate
Balances of all the Classes of Subordinate Certificates, the Principal
Distribution Amount will be distributed, first, to the Holders of the Class A-1,
Class A-2, Class A-3 and Class A-4 Certificates, pro rata, based on their
respective Certificate Balances, in reduction of their respective Certificate
Balances, until the Certificate Balance of each such Class is reduced to zero;
and, second, to the Holders of the Class A-1, Class A-2, Class A-3 and Class A-4
Certificates, pro rata, based on the respective amounts of unreimbursed Realized
Losses previously allocated to each such Class, plus one month's interest on
such Realized Losses at the applicable Pass-Through Rate. A similar rule shall
apply to the distribution of the Principal Distribution Amount to REMIC II
Regular Interests A-1A, A-1B, A-1C, A-1D, A-2A, A-2B, A-3A, A-3B, A-3C, A-4A,
A-4B and A-4C, in lieu of the distributions described in Section 6.3(a)(ii).

     (b) On each Distribution Date, the Paying Agent shall withdraw amounts in
the Reserve Account and shall pay the Certificateholders on such Distribution
Date such amounts in the following priority:

         (i) first, to reimburse the Holders of the Principal Balance
Certificates (in order of alphabetical Class designation) for any, and to the
extent of, Realized Losses previously allocated to them; and

         (ii) second, upon the reduction of the Aggregate Certificate Balance of
the Principal Balance Certificates to zero, to pay any amounts remaining on
deposit in such account to the Special Servicer as additional Special Servicer
Compensation.

                                     -155-

<PAGE>

     This Section 6.5(b) shall apply mutatis mutandis to reimbursement of
Realized Losses previously allocated to the REMIC II Regular Interests.

     SECTION 6.5A GRANTOR TRUST.

     (a) On each Distribution Date, the Paying Agent shall withdraw from the
Excess Interest Sub-account any Excess Interest on deposit therein, and the
Paying Agent shall pay such Excess Interest on such Distribution Date to the
Class O Certificates (even if the Certificate Balance of the Class O
Certificates has been reduced to zero for any reason).

     (b) On each Distribution Date, the Paying Agent shall withdraw from the
Kimball Lane Sub-account any Kimball Lane Yield Maintenance Amounts on deposit
therein, and the Paying Agent shall pay such Kimball Lane Yield Maintenance
Amounts on such Distribution Date to the Class A-1, Class X-1 and Class X-2
Certificates as provided in Section 6.11.

     SECTION 6.6 ALLOCATION OF REALIZED LOSSES, EXPENSE LOSSES AND SHORTFALLS
DUE TO NONRECOVERABILITY.

     (a) REMIC I. On each Distribution Date, except as provided in subsection
(b) below,

         (i) Realized Principal Losses on each Mortgage Loan realized during the
related Collection Period shall reduce the Certificate Balance of the
Corresponding REMIC I Regular Interest;

         (ii) Realized Interest Losses on each Mortgage Loan shall be allocated
to reduce first, Distributable Certificate Interest for such Distribution Date,
and then Unpaid Interest in each case owing on the Corresponding REMIC I Regular
Interest; and to the extent that such Realized Interest Loss exceeds such
amount, shall be treated as an Expense Loss; and

         (iii) Expense Losses (not otherwise applied above) realized during the
related Collection Period shall be allocated among the REMIC I Regular Interests
in proportion to their Certificate Balances and treated as Realized Principal
Losses to the extent so allocated (and shall proportionately reduce the
Certificate Balance of each REMIC I Regular Interest) after making all other
allocations for such Distribution Date.

     (b) If the Master Servicer, the Special Servicer, the Trustee or the Fiscal
Agent, determines that an Advance previously made by it (whether such Advance
(together with Advance Interest thereon) was in respect of principal or interest
on the related Mortgage Loan or a Servicing Advance) is a Nonrecoverable Advance
and the Master Servicer withdraws the amount of such Advance from the
Certificate Account pursuant to Section 5.2(a) hereof (which amount shall be
treated as an Available Advance Reimbursement Amount pursuant to Section 4.6),
the Master Servicer (after consultation with the Special Servicer) shall compute
the Realized Loss with respect to such Mortgage Loan (and the Paying Agent shall
allocate the Realized Loss) as follows:

                                     -156-

<PAGE>

          (i) the amount withdrawn from the Certificate Account shall be treated
as Realized Principal Losses up to the amount of the aggregate principal
collections and recoveries on the Mortgage Loans for such Collection Period
contemplated by clause (I)(A) of the definition of Principal Distribution
Amount, and shall be allocated to the Corresponding REMIC I Regular Interest in
accordance with Section 6.6(a)(i) (and to the extent that any Realized Principal
Loss exceeds the Certificate Balance of the Corresponding REMIC I Regular
Interest, such Realized Principal Loss shall be allocated to the other
Corresponding REMIC I Regular Interests in accordance with Section 6.6(a)(iii)),
and such withdrawal shall reduce the principal paid on each such REMIC I Regular
Interest on which principal would otherwise be paid on such Distribution Date,
in proportion to such principal payments; and

         (ii) if the amount that the Master Servicer withdraws from the
Certificate Account as referenced in clause (b)(i) above exceeds such principal
collections and recoveries on the Mortgage Loans for such Collection Period,
then such additional amounts shall constitute Unpaid Interest, and shall be
allocated to the REMIC I Regular Interests on a pro rata basis based upon the
amount of accrued and unpaid interest thereon.

     (c) At such time as a Final Recovery Determination is made with respect to
any Mortgage Loan with respect to which the Master Servicer previously had
withdrawn amounts from the Certificate Account following a determination that
Advances previously made were Nonrecoverable Advances and Realized Losses were
computed and allocated pursuant to clauses (a) and (b) above, and amounts are
recovered:

         (i) the portion of the amount of collections recovered on the Mortgage
Loan that is identified and applied by the Master Servicer as recoveries of
principal shall be applied first, to make payments of principal on the
Corresponding REMIC I Regular Interest up to an amount equal to the Realized
Principal Losses previously allocated thereto as a result of the reimbursement
of Nonrecoverable Advances or Advance Interest (and the Principal Balance of the
Mortgage Loan and the related Certificate Balance of the Corresponding REMIC I
Regular Interest shall be correspondingly increased), and thereafter to make
payments of principal to the Corresponding REMIC I Regular Interests with
respect to which principal distributions were reduced pursuant to Section
6.6(b)(i) above, in proportion to the amount of such reductions; and

         (ii) the portion of the amount recovered on the Mortgage Loan that is
identified and applied by the Master Servicer as recoveries of interest shall be
applied to make payments of Unpaid Interest on the REMIC I Regular Interests
with respect to which Unpaid Interest was allocated pursuant to Section
6.6(b)(ii).

     (d) REMIC II. On each Distribution Date, all Realized Losses on the REMIC I
Interests for such Distribution Date (or for prior Distribution Dates, to the
extent not previously allocated) shall be allocated to the Corresponding REMIC
II Regular Interests in the amounts and in the manner as will be allocated to
the REMIC Regular Certificates relating thereto pursuant to Section 6.6(f);
provided, however, that Realized Losses allocated to REMIC II Regular Interests
that have Components shall be allocated among the Components of such REMIC II
Regular Interests sequentially in alphabetical and numerical order. Realized
Losses allocated to the Class X Certificates shall reduce the amount of interest
payable on the REMIC II Regular Interest A-1A, REMIC II Regular Interest A-1B,
REMIC II Regular Interest A-1C,

                                     -157-
<PAGE>

REMIC II Regular Interest A-1D, REMIC II Regular Interest A-2A, REMIC II Regular
Interest A-2B, REMIC II Regular Interest A-3A, REMIC II Regular Interest A-3B,
REMIC II Regular Interest A-3C, REMIC II Regular Interest A-4A, REMIC II Regular
Interest A-4B, REMIC II Regular Interest A-4C, REMIC II Regular Interest B-1,
REMIC II Regular Interest B-2, REMIC II Regular Interest B-3, REMIC II Regular
Interest C-1, REMIC II Regular Interest C-2, REMIC II Regular Interest C-3,
REMIC II Regular Interest D-1, REMIC II Regular Interest D-2, REMIC II Regular
Interest E-1, REMIC II Regular Interest E-2, REMIC II Regular Interest F, REMIC
II Regular Interest G, REMIC II Regular Interest H-1, REMIC II Regular Interest
H-2, REMIC Regular Interest J, REMIC II Regular Interest K, REMIC II Regular
Interest L, REMIC II Regular Interest M, REMIC II Regular Interest N and REMIC
II Regular Interest O, which reduction shall be allocated pro rata based on the
product of the Certificate Balance of such REMIC II Regular Interest and the sum
of the Class X-1 Strip Rate and the Class X-2 Strip Rate (if any) applicable to
the Class of Certificates relating to such REMIC II Regular Interest.

     (e) Reserved

     (f) REMIC III. On each Distribution Date, all Realized Losses on the REMIC
II Regular Interests for such Distribution Date (or for prior Distribution
Dates, to the extent not previously allocated) shall be allocated to the REMIC
Regular Certificates in Reverse Sequential Order, in each case reducing (A)
first, the Certificate Balance of such Class until such Certificate Balance is
reduced to zero (in the case of the Principal Balance Certificates); (B) second,
Unpaid Interest owing to such Class to the extent thereof and (C) third,
Distributable Certificate Interest owing to such Class, provided, that such
reductions shall be allocated among the Class A-1 Certificates, Class A-2
Certificates, Class A-3 Certificates, Class A-4 Certificates, Class X-1
Certificates and Class X-2 Certificates, pro rata, based upon their outstanding
Certificate Balances or accrued interest, as the case may be, and provided
further, that Realized Losses shall not reduce the Aggregate Certificate Balance
of the REMIC III Certificates below the sum of the Aggregate Certificate
Balances of the REMIC II Regular Interests.

     SECTION 6.7 NET AGGREGATE PREPAYMENT INTEREST SHORTFALLS. On each
Distribution Date, Net Aggregate Prepayment Interest Shortfalls attributable to
the Kimball Lane Loan, shall be allocated to the Kimball Lane Loan REMIC Regular
Interest for such Distribution Date and shall reduce Distributable Certificate
Interest for such Interest. On each Distribution Date, any Net Aggregate
Prepayment Interest Shortfalls in REMIC I shall be allocated among the REMIC I
Regular Interests, pro rata in proportion to the Accrued Certificate Interest
for each such REMIC I Regular Interest for such Distribution Date and shall
reduce Distributable Certificate Interest for each such Interest. On each
Distribution Date, any Net Aggregate Prepayment Interest Shortfalls in REMIC II
shall be allocated among the REMIC II Regular Interests, pro rata in proportion
to the Accrued Certificate Interest for each such REMIC II Regular Interest for
such Distribution Date and shall reduce Distributable Certificate Interest for
each such Interest. On each Distribution Date, the amount of any Net Aggregate
Prepayment Interest Shortfalls on the REMIC III Regular Interests shall be
allocated to each Class of Certificates, pro rata, in proportion to the amount
of Accrued Certificate Interest payable to such Class of Certificates on such
Distribution Date, in each case reducing interest otherwise payable thereon. The
amount of Net Aggregate Prepayment Interest Shortfalls allocated to a Class of
Certificates pursuant to the preceding sentence shall reduce the Distributable
Certificate Interest for such Class for such Distribution Date. No Prepayment
Interest Shortfall with respect to the WestShore Plaza Companion Loan or a B
Note shall be allocated to any Class of Certificates.

                                     -158-

<PAGE>

     SECTION 6.8 ADJUSTMENT OF SERVICING FEES. The Master Servicing Fee payable
to the Master Servicer shall be adjusted as provided in Section 8.10(c) herein.
Any amount retained by REMIC I as a result of a reduction of the Master
Servicing Fee shall be treated as interest collected with respect to the prepaid
Mortgage Loans with respect to which the Master Servicing Fee adjustment occurs.

     SECTION 6.9 APPRAISAL REDUCTIONS. Not later than the date on which an
Appraisal Event occurs, the Special Servicer shall have obtained (A) an
Appraisal of the Mortgaged Property securing the related Mortgage Loan or Loan
Pair, if the Principal Balance of such Mortgage Loan or Loan Pair exceeds
$2,000,000 or (B) at the option of the Special Servicer, if such Principal
Balance is less than or equal to $2,000,000, either an internal valuation
prepared by the Special Servicer in accordance with MAI standards or an
Appraisal which in all cases shall be completed as of the date that such
Mortgage Loan or Loan Pair becomes a Required Appraisal Loan; provided that if
the Special Servicer had completed or obtained an Appraisal or internal
valuation within the immediately prior 12 months, the Special Servicer may rely
on such Appraisal or internal valuation and shall have no duty to prepare a new
Appraisal or internal valuation, unless such reliance would not be in accordance
with the Servicing Standard; provided, further, that if the Special Servicer is
required to obtain an Appraisal of a Mortgaged Property after receipt of the
notice described in clause (ii) of the definition of Appraisal Event, such
Appraisal will be obtained no later than 60 days after receipt of such notice
and an internal valuation will be obtained no later than 60 days after receipt
of such notice. Notwithstanding the foregoing, an Appraisal shall not be
required so long as a guaranty or surety bond that is rated at least "BBB-" (or
its equivalent) by a nationally recognized statistical rating organization, or
debt service reserve or a letter of credit is available and has the ability to
pay off the then outstanding Principal Balance of the Mortgage Loan in full,
except to the extent that the Special Servicer, in accordance with the Servicing
Standard, determines that obtaining an Appraisal is in the best interests of the
Certificateholders. Such Appraisal or valuation shall be conducted in accordance
with the definition of "market value" as set forth in 12 C.F.R. (Section) 225.62
and shall be updated at least annually to the extent such Mortgage Loan remains
a Required Appraisal Loan. The cost of any such Appraisal or valuation, if not
performed by the Special Servicer, shall be an expense of the Trust (and any
related B Note) and may be paid from REO Income or, to the extent collections
from such related Mortgage Loan, B Note, Loan Pair or Mortgaged Property does
not cover the expense, such unpaid expense shall be, subject to Section 4.4
hereof, advanced by the Master Servicer at the request of the Special Servicer
or by the Special Servicer pursuant to Section 4.6 in which event it shall be
treated as a Servicing Advance. The Master Servicer, based on the Appraisal or
internal valuation provided to it by the Special Servicer, shall calculate any
Appraisal Reduction. The Master Servicer shall calculate or recalculate the
Appraisal Reduction for any Mortgage Loan, the B Note and the Loan Pair based on
updated Appraisals or internal valuations provided from time to time to it by
the Special Servicer and report such amount to the Trustee. Notwithstanding the
foregoing, the terms of this Section 6.9 shall not be applicable to any
Non-Serviced Mortgage Loan if the applicable Non-Serviced Mortgage Loan Special
Servicer shall have performed such obligations with respect to such Mortgage
Loan pursuant to the terms of the related Non-Serviced Mortgage Loan Pooling and
Servicing Agreement.

     SECTION 6.10 COMPLIANCE WITH WITHHOLDING REQUIREMENTS. Notwithstanding any
other provision of this Agreement to the contrary, the Paying Agent on behalf of
the Trustee shall comply with all federal withholding requirements with respect
to payments to

                                     -159-

<PAGE>

Certificateholders of interest, original issue discount, or other
amounts that the Paying Agent reasonably believes are applicable under the Code.
The consent of Certificateholders shall not be required for any such withholding
and any amount so withheld shall be regarded as distributed to the related
Certificateholders for purposes of this Agreement. In the event the Paying Agent
withholds any amount from payments made to any Certificateholder pursuant to
federal withholding requirements, the Paying Agent shall indicate to such
Certificateholder the amount withheld.

     SECTION 6.11 PREPAYMENT PREMIUMS. Any Prepayment Premium collected with
respect to a Mortgage Loan (but not a B Note or the WestShore Plaza Companion
Loan, which Prepayment Premium is payable to the holder of the related B Note or
the holder of the WestShore Plaza Companion Loan, as applicable) during any
particular Collection Period will be deemed distributed to the Trustee by the
Paying Agent on the following Distribution Date as follows: (i) first, the
Paying Agent shall be deemed to distribute to the Trustee, as holder of the
Kimball Lane Loan REMIC Regular Interest any Prepayment Premiums collected on or
with respect to the Kimball Lane Loan; (ii) second, the Paying Agent shall be
deemed to distribute to the Trustee, as holder of the REMIC I Regular Interest
to which such Majority Mortgage Loan or Kimball Lane Loan REMIC Regular Interest
relates, any Prepayment Premiums collected on or with respect to such Majority
Mortgage Loan or Kimball Lane Loan REMIC Regular Interest; and (iii) third, the
Paying Agent shall be deemed to distribute to the Trustee, as holder of the
REMIC II Regular Interests, any Prepayment Premiums deemed distributed to the
REMIC I Regular Interests, and shall be deemed to distribute such Prepayment
Premiums to the REMIC II Regular Interest then entitled to distributions of
principal from the Principal Distribution Amount (or, if more than one Class of
REMIC II Regular Interests is then entitled to distributions of principal from
the Principal Distribution Amount, such Prepayment Premiums shall be deemed
distributed among such Classes pro rata in accordance with the relevant amounts
of entitlements to distributions of principal). Following such deemed
distributions or the deposit of Kimball Lane Yield Maintenance Amounts into the
Kimball Lane Sub-account pursuant to Section 5.2(a)(I)(xi), the Holders of the
respective Classes of Principal Balance Certificates, other than the Class H,
Class J, Class K, Class L, Class M, Class N and Class O Certificates, then
entitled to distributions of principal from the Principal Distribution Amount
for such Distribution Date, will be entitled to, and the Paying Agent on behalf
of the Trustee will pay to such Holder(s), an amount equal to, in the case of
each such Class (or in the case of any Kimball Lane Yield Maintenance Amounts,
only to the Holders of the Class A-1 Certificates), the product of (a) a
fraction, the numerator of which is the amount distributed as principal to the
holders of that Class on that Distribution Date, and the denominator of which is
the total amount distributed as principal to the holders of all Classes of
Certificates on that Distribution Date, (b) the Base Interest Fraction for the
related Principal Prepayment and that Class of Certificates and (c) the
aggregate amount of Prepayment Premiums (or Kimball Lane Yield Maintenance
Amounts, if applicable) collected during the related Collection Period. Any
portion of such Prepayment Premium (or Kimball Lane Yield Maintenance Amounts,
if applicable) that is not so distributed to the Holders of such Principal
Balance Certificates will be distributed to the Holders of the Class X
Certificates. On any Distribution Date on or before the Distribution Date in
October 2007, 70% of the Prepayment Premium (or Kimball Lane Yield Maintenance
Amounts, if applicable) that is not so distributed to the Holders of such
Principal Balance Certificates will be distributed to the Holders of the Class
X-1 Certificates and 30% of the Prepayment Premium (or Kimball Lane Yield
Maintenance Amounts, if applicable) that is not so distributed to the Holders of
such Principal Balance Certificates will be distributed to the Holders of the
Class X-2

                                     -150-

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Certificates. After the Distribution Date in October 2007, any portion
of such Prepayment Premium that is not so distributed to the Holders of such
Principal Balance Certificates will be distributed to the Holders of the Class
X-1 Certificates. The Trustee shall not be responsible for the Paying Agent's
failure to comply with any withholding requirements.

                                  ARTICLE VII

       CONCERNING THE TRUSTEE, THE FISCAL AGENT, THE PAYING AGENT AND THE
                            LUXEMBOURG PAYING AGENT

     SECTION 7.1 DUTIES OF THE TRUSTEE, THE FISCAL AGENT AND THE PAYING AGENT.

     (a) The Trustee, the Fiscal Agent and the Paying Agent each shall undertake
to perform only those duties as are specifically set forth in this Agreement and
no implied covenants or obligations shall be read into this Agreement against
the Trustee, the Fiscal Agent or the Paying Agent. Any permissive right of the
Trustee, the Fiscal Agent or the Paying Agent provided for in this Agreement
shall not be construed as a duty of the Trustee, the Fiscal Agent or the Paying
Agent. The Trustee, the Fiscal Agent and the Paying Agent each shall exercise
such of the rights and powers vested in it by this Agreement and following the
occurrence and during the continuation of any Event of Default hereunder, the
Trustee and Fiscal Agent and the Paying Agent each shall use the same degree of
care and skill in its exercise as a prudent Person would exercise or use under
the circumstances in the conduct of such Person's own affairs.

     (b) The Trustee, the Fiscal Agent or the Paying Agent, as applicable, upon
receipt of all resolutions, certificates, statements, opinions, reports,
documents, orders or other instruments furnished to the Trustee, the Fiscal
Agent or the Paying Agent , as the case may be, which are specifically required
to be furnished pursuant to any provision of this Agreement, shall examine them
to determine whether they on their face conform to the requirements of this
Agreement; provided that the Trustee, the Fiscal Agent or the Paying Agent, as
the case may be, shall not be responsible for the accuracy or content of any
such resolution, certificate, statement, opinion, report, document, order or
other instrument furnished by the Master Servicer or any other Person to it
pursuant to this Agreement. If any such instrument is found on its face not to
conform to the requirements of this Agreement, the Trustee or the Paying Agent
shall request the providing party to correct the instrument and if not so
corrected, the Trustee shall inform the Certificateholders.

     (c) Neither the Trustee, the Fiscal Agent nor the Paying Agent nor any of
their respective directors, officers, employees, agents or Controlling Persons
shall have any liability to the Trust or the Certificateholders arising out of
or in connection with this Agreement, except for their respective negligence or
willful misconduct. No provision of this Agreement shall be construed to relieve
the Trustee, the Fiscal Agent, the Paying Agent or any of their respective
directors, officers, employees, agents or Controlling Persons from liability for
their own negligent action, their own negligent failure to act or their own
willful misconduct or bad faith; provided that:

         (i) neither the Trustee, the Fiscal Agent nor the Paying Agent nor any
of their respective directors, officers, employees, agents or Controlling
Persons shall be personally liable with respect to any action taken, suffered or
omitted to be taken by it in its

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reasonable business judgment in accordance with this Agreement or at the
direction of Holders of Certificates evidencing not less than a majority of the
outstanding Certificate Balance of the Certificates;

         (ii) no provision of this Agreement shall require either the Trustee,
the Fiscal Agent or the Paying Agent to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it;

         (iii) neither the Trustee, the Fiscal Agent nor the Paying Agent nor
any of their respective directors, officers, employees, agents or Controlling
Persons shall be responsible for any act or omission of the Master Servicer, the
Special Servicer, the Depositor or either Seller, or for the acts or omissions
of each other, including, without limitation, in connection with actions taken
pursuant to this Agreement;

         (iv) the execution by the Trustee or the Paying Agent of any forms or
plans of liquidation in connection with any REMIC Pool shall not constitute a
representation by the Trustee or the Paying Agent as to the adequacy of such
form or plan of liquidation;

         (v) none of the Trustee, the Fiscal Agent nor the Paying Agent shall be
under any obligation to appear in, prosecute or defend any legal action which is
not incidental to its duties as Trustee, the Fiscal Agent or the Paying Agent,
as applicable in accordance with this Agreement. In such event, all legal
expense and costs of such action shall be expenses and costs of the Trust, and
the Trustee, the Paying Agent and the Fiscal Agent shall be entitled to be
reimbursed therefor from the Certificate Account pursuant to Section 5.2(a)(vi);
and

         (vi) neither the Trustee, the Fiscal Agent nor the Paying Agent shall
be charged with knowledge of any failure by the Master Servicer or the Special
Servicer or by each other to comply with its obligations under this Agreement or
any act, failure, or breach of any Person upon the occurrence of which the
Trustee, the Fiscal Agent or the Paying Agent may be required to act, unless a
Responsible Officer of the Trustee, the Fiscal Agent or the Paying Agent, as the
case may be, obtains actual knowledge of such failure.

     (d) For so long as the Certificates are listed on the Luxembourg Stock
Exchange, the Depositor shall cause the continuing obligations under the listing
rules for the Luxembourg Stock Exchange to be complied with in respect of the
Certificates. The Trustee, the Fiscal Agent and the Paying Agent shall not be
liable for a failure in compliance with such continuing obligations under the
listing rules of the Luxembourg Stock Exchange if such failure is caused by the
negligence or willful misconduct of the Luxembourg Paying Agent.

     SECTION 7.2 CERTAIN MATTERS AFFECTING THE TRUSTEE, THE FISCAL AGENT AND THE
PAYING AGENT.

     (a) Except as otherwise provided in Section 7.1:

         (i) the Trustee, the Fiscal Agent and the Paying Agent each may
request, and may rely and shall be protected in acting or refraining from acting
upon any

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resolution, Officer's Certificate, certificate of auditors or any other
certificate, statement, instrument, opinion, report, notice, request, consent,
order, appraisal, bond or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;

         (ii) the Trustee, the Fiscal Agent and the Paying Agent each may
consult with counsel and the advice of such counsel and any Opinion of Counsel
shall be full and complete authorization and protection in respect of any action
taken or suffered or omitted by it hereunder in good faith and in accordance
with such advice or Opinion of Counsel;

         (iii) neither the Trustee nor the Fiscal Agent nor the Paying Agent nor
any of their respective directors, officers, employees, agents or Controlling
Persons shall be personally liable for any action taken, suffered or omitted by
such Person in its reasonable business judgment and reasonably believed by it to
be authorized or within the discretion or rights or powers conferred upon it by
this Agreement;

         (iv) the Trustee and the Paying Agent shall not be under any obligation
to exercise any remedies after default as specified in this Agreement or to
institute, conduct or defend any litigation hereunder or relating hereto or make
any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request, consent,
order, approval, bond or other paper or document (provided the same appears
regular on its face), unless requested in writing to do so by Holders of at
least 25% of the Aggregate Certificate Balance of the Certificates then
outstanding provided that, if the payment within a reasonable time to the
Trustee or the Paying Agent, as applicable, of the costs, expenses or
liabilities likely to be incurred by it in connection with the foregoing is, in
the opinion of such Person not reasonably assured to such Person by the security
afforded to it by the terms of this Agreement, such Person may require
reasonable indemnity against such expense or liability or payment of such
estimated expenses as a condition to proceeding. The reasonable expenses of the
Trustee or the Paying Agent, as applicable, shall be paid by the
Certificateholders requesting such examination;

         (v) the Trustee, the Fiscal Agent and the Paying Agent each may execute
any of the trusts or powers hereunder or perform any duties hereunder either
directly or by or through agents or attorneys, which agents or attorneys shall
have any or all of the rights, powers, duties and obligations of the Trustee,
the Fiscal Agent and the Paying Agent conferred on them by such appointment;
provided that each of the Trustee, the Fiscal Agent and the Paying Agent, as the
case may be, shall continue to be responsible for its duties and obligations
hereunder and shall not be liable for the actions or omissions of the Master
Servicer, the Special Servicer, the Depositor or the actions or omissions of
each other;

         (vi) neither the Trustee nor the Fiscal Agent nor the Paying Agent
shall be required to obtain a deficiency judgment against a Mortgagor;

         (vii) neither the Trustee nor the Fiscal Agent nor the Paying Agent
shall be required to expend its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such liability is not assured to it;

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         (viii) neither the Trustee nor the Fiscal Agent nor the Paying Agent
shall be liable for any loss on any investment of funds pursuant to this
Agreement;

         (ix) unless otherwise specifically required by law, neither the Trustee
nor the Fiscal Agent nor the Paying Agent shall be required to post any surety
or bond of any kind in connection with the execution or performance of its
duties hereunder; and

         (x) except as specifically provided hereunder in connection with the
performance of its specific duties, neither the Trustee nor the Fiscal Agent nor
the Paying Agent shall be responsible for any act or omission of the Master
Servicer, the Special Servicer, the Depositor or of each other.

     (b) Following the Closing Date, the Trustee shall not accept any
contribution of assets to the Trust not specifically contemplated by this
Agreement unless the Trustee shall have received a Nondisqualification Opinion
at the expense of the Person desiring to contribute such assets with respect to
such contribution.

     (c) All rights of action under this Agreement or under any of the
Certificates, enforceable by the Trustee, may be enforced by it without the
possession of any of the Certificates, or the production thereof at the trial or
any proceeding relating thereto, and any such suit, action or proceeding
instituted by the Trustee shall be brought in its name for the benefit of all
the Holders of such Certificates, subject to the provisions of this Agreement.

     (d) The Trustee shall timely pay, from its own funds, the amount of any and
all federal, state and local taxes imposed on the Trust or its assets or
transactions including, without limitation, (A) "prohibited transaction" penalty
taxes as defined in Section 860F of the Code, if, when and as the same shall be
due and payable, (B) any tax on contributions to a REMIC after the Closing Date
imposed by Section 860G(d) of the Code and (C) any tax on "net income from
foreclosure property" as defined in Section 860G(c) of the Code, but only if
such taxes arise out of a breach by the Trustee of its obligations hereunder,
which breach constitutes negligence or willful misconduct of the Trustee.

     (e) The Paying Agent shall timely pay, from its own funds, the amount of
any and all federal, state and local taxes imposed on the Trust or its assets or
transactions including, without limitation, (A) "prohibited transaction" penalty
taxes as defined in Section 860F of the Code, if, when and as the same shall be
due and payable, (B) any tax on contributions to a REMIC after the Closing Date
imposed by Section 860G(d) of the Code and (C) any tax on "net income from
foreclosure property" as defined in Section 860G(c) of the Code, but only if
such taxes arise out of a breach by the Paying Agent of its obligations
hereunder, which breach constitutes negligence or willful misconduct of the
Paying Agent.

     SECTION 7.3 THE TRUSTEE, THE FISCAL AGENT AND THE PAYING AGENT NOT LIABLE
FOR CERTIFICATES OR INTERESTS OR MORTGAGE LOANS. The Trustee, the Fiscal Agent
and the Paying Agent each makes no representations as to the validity or
sufficiency of this Agreement, the information contained in the Private
Placement Memorandum, the Preliminary Prospectus Supplement, the Final
Prospectus Supplement or Prospectus for the REMIC III Certificates or Residual
Certificates (other than the Certificate of Authentication on the Certificates
if the Paying Agent is the Authenticating Agent) or of any Mortgage Loan,
Assignment of Mortgage or

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related document save that (i) each of the Trustee, the Fiscal Agent and the
Paying Agent represents that, assuming due execution and delivery by the other
parties hereto, this Agreement has been duly authorized, executed and delivered
by it and constitutes its valid and binding obligation, enforceable against it
in accordance with its terms except that such enforceability may be subject to
(A) applicable bankruptcy and insolvency laws and other similar laws affecting
the enforcement of the rights of creditors generally, and (B) general principles
of equity regardless of whether such enforcement is considered in a proceeding
in equity or at law and (ii) the Trustee represents that, assuming due execution
and delivery by the other parties hereto, this Agreement has been duly
authorized, executed and delivered by it and constitutes its valid and binding
obligation, enforceable against it in accordance with its terms except that such
enforceability may be subject to (A) applicable bankruptcy and insolvency laws
and other similar laws affecting the enforcement of the rights of creditors
generally, and (B) general principles of equity regardless of whether such
enforcement is considered in a proceeding in equity or at law. None of the
Trustee, the Fiscal Agent or the Paying Agent shall be accountable for the use
or application by the Depositor or the Master Servicer or the Special Servicer
or by each other of any of the Certificates or any of the proceeds of such
Certificates, or for the use or application by the Depositor or the Master
Servicer or the Special Servicer or by each other of funds paid in consideration
of the assignment of the Mortgage Loans to the Trust or deposited into the
Distribution Account or any other fund or account maintained with respect to the
Certificates or any account maintained pursuant to this Agreement or for
investment of any such amounts. No recourse shall be had for any claim based on
any provisions of this Agreement, the Private Placement Memorandum, the
Preliminary Prospectus Supplement, the Final Prospectus Supplement, the
Prospectus or the Certificates (except with respect to the Trustee and Fiscal
Agent to the extent of information furnished by the Trustee and the Fiscal Agent
under the caption entitled "DESCRIPTION OF THE OFFERED CERTIFICATES-- The
Trustee and the Fiscal Agent" and with respect to the Paying Agent, to the
extent of information furnished by the Paying Agent under the caption
"DESCRIPTION OF THE OFFERED CERTIFICATES-- Paying Agent, Certificate Registrar
and Authenticating Agent" each in the Preliminary Prospectus Supplement and the
Final Prospectus Supplement), the Mortgage Loans or the assignment thereof
against the Trustee, the Fiscal Agent or the Paying Agent in such Person's
individual capacity and any such claim shall be asserted solely against the
Trust or any indemnitor who shall furnish indemnity as provided herein. Neither
the Trustee nor the Fiscal Agent nor the Paying Agent shall be liable for any
action or failure of any action by the Depositor or the Master Servicer or the
Special Servicer or by each other hereunder. Neither the Trustee nor the Fiscal
Agent nor the Paying Agent shall at any time have any responsibility or
liability for or with respect to the legality, validity or enforceability of the
Mortgages or the Mortgage Loans, or the perfection and priority of the Mortgages
or the maintenance of any such perfection and priority, or for or with respect
to the efficacy of the Trust or its ability to generate the payments to be
distributed to Certificateholders under this Agreement, including, without
limitation, the existence, condition and ownership of any Mortgaged Property;
the existence and enforceability of any hazard insurance thereon; the validity
of the assignment of the Mortgage Loans to the Trust or of any intervening
assignment; the completeness of the Mortgage Loans; the performance or
enforcement of the Mortgage Loans (other than if the Trustee shall assume the
duties of the Master Servicer); the compliance by the Depositor, each Seller,
the Mortgagor or the Master Servicer or the Special Servicer or by each other
with any warranty or representation made under this Agreement or in any related
document or the accuracy of any such warranty or representation made under this
Agreement or in any related document prior to

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the receipt by a Responsible Officer of the Trustee of notice or other discovery
of any non-compliance therewith or any breach thereof; any investment of monies
by or at the direction of the Master Servicer or the Special Servicer or any
loss resulting therefrom; the failure of the Master Servicer or any Sub-Servicer
or the Special Servicer to act or perform any duties required of it on behalf of
the Trustee hereunder; or any action by the Trustee taken at the instruction of
the Master Servicer or the Special Servicer.

     SECTION 7.4 THE TRUSTEE, THE FISCAL AGENT AND THE PAYING AGENT MAY OWN
CERTIFICATES. Each of the Trustee, the Fiscal Agent and the Paying Agent in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights it would have if it were not the Trustee, the Fiscal Agent
or the Paying Agent, as the case may be.

     SECTION 7.5 ELIGIBILITY REQUIREMENTS FOR THE TRUSTEE, THE FISCAL AGENT AND
THE PAYING AGENT. The Trustee hereunder shall at all times be (i) an institution
insured by the FDIC, (ii) a corporation, national bank or national banking
association authorized to exercise corporate trust powers, having a combined
capital and surplus of not less than $50,000,000 and subject to supervision or
examination by federal or state authority, and (iii) an institution whose
short-term debt obligations are at all times rated not less than "Prime-1" by
Moody's and whose long-term senior unsecured debt is at all times rated not less
than "AA-" by Fitch (or "A+" by Fitch if the Trustee's short-term unsecured debt
is rated at least "F-1" by Fitch) and "Aa3" by Moody's, provided, that if the
Fiscal Agent is rated at least "Aa3" by Moody's and "AA-" by Fitch (or "A+" by
Fitch if the Fiscal Agent's short-term unsecured debt is rated at least "F-1" by
Fitch), the Fiscal Agent also has a short-term rating of at least "F-1+" by
Fitch), then the Trustee must be rated not less than "A3" by Moody's and "A-" by
Fitch, or otherwise acceptable to the Rating Agencies as evidenced by a Rating
Agency Confirmation. If such corporation, national bank or national banking
association publishes reports of condition at least annually, pursuant to law or
to the requirements of the aforesaid supervising or examining authority, then,
for the purposes of this Section, the combined capital and surplus of such
corporation, national bank or national banking association shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. In case at any time the Trustee shall cease to be
eligible in accordance with provisions of this Section, the Trustee or the
Fiscal Agent shall resign immediately in the manner and with the effect
specified in Section 7.6.

     (b) The Paying Agent shall be either a bank or trust company or otherwise
authorized under law to exercise corporate trust powers and shall be rated at
least "A2" by Moody's and "A" by Fitch, unless and to the extent Rating Agency
Confirmation is obtained.

     SECTION 7.6 RESIGNATION AND REMOVAL OF THE TRUSTEE, THE FISCAL AGENT OR THE
PAYING AGENT.

     (a) The Trustee, the Fiscal Agent or the Paying Agent may at any time
resign and be discharged from the trusts hereby created by giving written notice
thereof to the Depositor, the Master Servicer and the Rating Agencies; provided
that such resignation shall not be effective until its successor shall have
accepted the appointment. Upon receiving such notice of resignation, the
Depositor will promptly appoint a successor trustee, fiscal agent or paying
agent, as the case may be, except in the case of the initial Trustee or Fiscal
Agent, in which case

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both shall be so replaced but may be replaced under this paragraph sequentially,
by written instrument, one copy of which instrument shall be delivered to the
resigning Trustee or the Fiscal Agent, one copy to the successor trustee and one
copy to each of the Master Servicer, the Paying Agent and the Rating Agencies.
If no successor trustee, fiscal agent or paying agent shall have been so
appointed, as the case may be, and shall have accepted appointment within 30
days after the giving of such notice of resignation, the resigning Trustee, the
Fiscal Agent or the Paying Agent, as the case may be, may petition any court of
competent jurisdiction for the appointment of a successor trustee, fiscal agent
or paying agent, as the case may be. It shall be a condition to the appointment
of a successor trustee or fiscal agent that such entity satisfies the
eligibility requirements set forth in Section 7.5.

     (b) If at any time (i) the Trustee shall cease to be eligible in accordance
with the provisions of Section 7.5 and shall fail to resign after written
request therefor by the Depositor, (ii) the Trustee shall become incapable of
acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the
Trustee or of its property shall be appointed, or any public officer shall take
charge or control of the Trustee or of its property or affairs for the purpose
of rehabilitation, conservation or liquidation, (iii) a tax is imposed or
threatened with respect to the Trust or any REMIC Pool by any state in which the
Trustee or the Trust held by the Trustee is located solely because of the
location of the Trustee in such state; provided, however, that, if the Trustee
agrees to indemnify the Trust for such taxes, it shall not be removed pursuant
to this clause (iii), (iv) the continuation of the Trustee as such would result
in a downgrade, qualification or withdrawal of the rating by the Rating Agencies
of any Class of Certificates with a rating as evidenced in writing by the Rating
Agencies or (v) with respect with the initial Trustee, a Fiscal Agent
Termination Event has occurred unless the Trustee has satisfied the ratings
required by clause (iii) of Section 7.5, then the Depositor may remove such
Trustee and appoint a successor trustee by written instrument, one copy of which
instrument shall be delivered to the Trustee so removed, one copy to the
successor trustee and one copy to each of the Master Servicer and the Rating
Agencies. In the case of removal under clauses (i), (ii), (iii) and (iv) above,
the Trustee shall bear all such costs of transfer. Such succession shall take
effect after a successor trustee has been appointed. In the case of the removal
of the initial Trustee, the Depositor shall also remove the Fiscal Agent. In
this case, the procedures and liability for costs of such removal shall be the
same as they are stated in subsection (c) with respect to the Fiscal Agent.

     (c) If at any time (i) the Fiscal Agent shall cease to be eligible in
accordance with the provisions of Section 7.5 and shall fail to resign after
written request therefor by the Depositor, or (ii) a Fiscal Agent Termination
Event has occurred, then the Depositor shall send a written notice of
termination to the Fiscal Agent (which notice shall specify the reason for such
termination) and remove such Fiscal Agent and appoint a successor Fiscal Agent
by written instrument, one copy of which instrument shall be delivered to the
Fiscal Agent so removed, one copy to the successor Fiscal Agent, and one copy to
each of the Trustee, the Master Servicer and the Rating Agencies. In all such
cases, the Fiscal Agent shall bear all costs of transfer to a successor Fiscal
Agent, such succession only to take effect after a successor Fiscal Agent has
been appointed. In the case of the initial Fiscal Agent, the Depositor may, but
is not required to, also remove the Trustee. In this case, the procedures and
liability for costs of such removal shall be the same as they are stated in
subsection (b) with respect to the Trustee.

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     (d) If at any time (i) the Paying Agent shall cease to be eligible in
accordance with the provisions of Section 7.5(b) and shall fail to resign after
written request therefor by the Depositor, (ii) the Paying Agent shall become
incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver
of the Paying Agent or of its property shall be appointed, or any public officer
shall take charge or control of the Paying Agent or of its property or affairs
for the purpose of rehabilitation, conservation or liquidation, (iii) a tax is
imposed or threatened with respect to the Trust or any REMIC Pool by any state
in which the Paying Agent is located solely because of the location of the
Paying Agent in such state; provided, however, that, if the Paying Agent agrees
to indemnify the Trust for such taxes, it shall not be removed pursuant to this
clause (iii), or (iv) the continuation of the Paying Agent as such would result
in a downgrade, qualification or withdrawal, as applicable, of the rating by any
Rating Agency of any Class of Certificates with a rating as evidenced in writing
by the Rating Agencies, then the Depositor or the Trustee shall send a written
notice of termination to the Paying Agent (which notice shall specify the reason
for such termination) and remove such Paying Agent and the Depositor shall
appoint a successor Paying Agent by written instrument, one copy of which
instrument shall be delivered to the Paying Agent so removed, one copy to the
successor Paying Agent, and one copy to each of the Trustee, the Master Servicer
and the Rating Agencies. In all such cases, the Paying Agent shall bear all
costs of transfer to a successor Paying Agent, such succession only to take
effect after a successor Paying Agent has been appointed.

     (e) The Holders of more than 50% of the Aggregate Certificate Balance of
the Certificates then outstanding may for cause upon 30 days' written notice to
the Trustee, the Fiscal Agent or the Paying Agent, as the case may be, and to
the Depositor remove the Trustee, the Fiscal Agent or the Paying Agent, as the
case may be, by such written instrument, signed by such Holders or their
attorney-in-fact duly authorized, one copy of which instrument shall be
delivered to the Depositor and one copy to the Trustee, the Fiscal Agent or the
Paying Agent, as the case may be, so removed; the Depositor shall thereupon use
its best efforts to appoint a successor Trustee, Fiscal Agent or Paying Agent,
as the case may be, in accordance with this Section.

     (f) Any resignation or removal of the Trustee, the Fiscal Agent or the
Paying Agent, as the case may be, and appointment of a successor trustee, fiscal
agent or paying agent pursuant to any of the provisions of this Section shall
become effective upon acceptance of appointment by the successor trustee, fiscal
agent or paying agent, as the case may be, as provided in Section 7.7. Upon any
succession of the Trustee, the Fiscal Agent or the Paying Agent under this
Agreement, the predecessor Trustee, Fiscal Agent or Paying Agent, as the case
may be, shall be entitled to the payment of compensation and reimbursement
agreed to under this Agreement for services rendered and expenses incurred. The
Trustee, the Fiscal Agent or the Paying Agent shall not be liable for any action
or omission of any successor Trustee, Fiscal Agent or Paying Agent, as the case
may be.

     SECTION 7.7 SUCCESSOR TRUSTEE, FISCAL AGENT OR PAYING AGENT.

     (a) Any successor Trustee, Fiscal Agent or Paying Agent appointed as
provided in Section 7.6 shall execute, acknowledge and deliver to the Depositor
and to its predecessor Trustee, Fiscal Agent or Paying Agent, as the case may
be, an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor Trustee, Fiscal Agent or Paying Agent,
as the case may be, shall become effective and such

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successor Trustee, Fiscal Agent or Paying Agent, as the case may be, without any
further act, deed or conveyance, shall become fully vested with all the rights,
powers, duties and obligations of its predecessor hereunder, with like effect as
if originally named as Trustee, Fiscal Agent or Paying Agent herein. The
predecessor Trustee, Fiscal Agent or Paying Agent shall deliver (at such
predecessor's own expense) to the successor Trustee, Fiscal Agent or Paying
Agent all Mortgage Files and documents and statements related to the Mortgage
Files held by it hereunder, and the predecessor Trustee shall duly assign,
transfer, deliver and pay over (at such predecessor's own expense) to the
successor Trustee, the entire Trust, together with all instruments of transfer
and assignment or other documents properly executed necessary to effect such
transfer. The predecessor Trustee, Fiscal Agent or Paying Agent, as the case may
be, shall also deliver all records or copies thereof maintained by the
predecessor Trustee, Fiscal Agent or Paying Agent in the administration hereof
as may be reasonably requested by the successor Trustee, Fiscal Agent or Paying
Agent, as applicable, and shall thereupon be discharged from all duties and
responsibilities under this Agreement. In addition, the Depositor and the
predecessor Trustee, Fiscal Agent or Paying Agent shall execute and deliver such
other instruments and do such other things as may reasonably be required to more
fully and certainly vest and confirm in the successor Trustee, Fiscal Agent or
Paying Agent, as the case may be, all such rights, powers, duties and
obligations. Anything herein to the contrary notwithstanding, in no event shall
the combined fees payable to a successor Trustee exceed the Trustee Fee.

     (b) No successor Trustee, Fiscal Agent or Paying Agent shall accept
appointment as provided in this Section unless at the time of such appointment
such successor Trustee, Fiscal Agent or Paying Agent, as the case may be, shall
be eligible under the provisions of Section 7.5.

     (c) Upon acceptance of appointment by a successor Trustee, Fiscal Agent or
Paying Agent as provided in this Section, the successor Trustee, Fiscal Agent or
Paying Agent shall mail notice of the succession of such Trustee, Fiscal Agent
or Paying Agent hereunder to all Holders of Certificates at their addresses as
shown in the Certificate Register and to the Rating Agencies. The expenses of
such mailing shall be borne by the successor Trustee, Fiscal Agent or Paying
Agent. If the successor Trustee, Fiscal Agent or Paying Agent fails to mail such
notice within 10 days after acceptance of appointment by the successor Trustee,
Fiscal Agent or Paying Agent, the Master Servicer shall cause such notice to be
mailed at the expense of the successor Trustee, Fiscal Agent or Paying Agent, as
applicable.

     SECTION 7.8 MERGER OR CONSOLIDATION OF TRUSTEE, FISCAL AGENT OR PAYING
AGENT. Any Person into which the Trustee, Fiscal Agent or Paying Agent may be
merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which such Trustee,
Fiscal Agent or Paying Agent shall be a party, or any Persons succeeding to the
business of such Trustee, Fiscal Agent or Paying Agent, shall be the successor
of such Trustee, Fiscal Agent or Paying Agent, as the case may be, hereunder, as
applicable, provided that such Person shall be eligible under the provisions of
Section 7.5, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding.

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     SECTION 7.9 APPOINTMENT OF CO-TRUSTEE, SEPARATE TRUSTEE, AGENTS OR
CUSTODIAN.

     (a) Notwithstanding any other provisions hereof, at any time, the Trustee,
the Depositor or, in the case of the Trust, the Certificateholders evidencing
more than 50% of the Aggregate Certificate Balance of the Certificates then
outstanding shall each have the power from time to time to appoint one or more
Persons to act either as co-trustees jointly with the Trustee or as separate
trustees, or as custodians, for the purpose of holding title to, foreclosing or
otherwise taking action with respect to any Mortgage Loan outside the state
where the Trustee has its principal place of business where such separate
trustee or co-trustee is necessary or advisable (or the Trustee is advised by
the Master Servicer or Special Servicer that such separate trustee or co-trustee
is necessary or advisable) under the laws of any state in which a property
securing a Mortgage Loan is located or for the purpose of otherwise conforming
to any legal requirement, restriction or condition in any state in which a
property securing a Mortgage Loan is located or in any state in which any
portion of the Trust is located. The separate trustees, co-trustees, or
custodians so appointed shall be trustees or custodians for the benefit of all
the Certificateholders, shall have such powers, rights and remedies as shall be
specified in the instrument of appointment and shall be deemed to have accepted
the provisions of this Agreement; provided that no such appointment shall, or
shall be deemed to, constitute the appointee an agent of the Trustee; provided,
further that the Trustee shall be liable for the actions of any co-trustee or
separate trustee appointed by it and shall have no liability for the actions of
any co-trustee or separate trustee appointed by the Depositor or the
Certificateholders pursuant to this paragraph.

     (b) The Trustee or the Paying Agent, as the case may be, may from time to
time appoint one or more independent third-party agents to perform all or any
portion of its administrative duties hereunder (i.e., collection and
distribution of funds, preparation and dissemination of reports, monitoring
compliance, etc.). The Trustee or the Paying Agent, as the case may be, shall
supervise and oversee such agents appointed by it. The terms of any arrangement
or agreement between the Trustee or the Paying Agent, as the case may be, and
such agent, may be terminated, without cause and without the payment of any
termination fees in the event the Trustee or the Paying Agent, as the case may
be, is terminated in accordance with this Agreement. In addition, neither the
Trust nor the Certificateholders shall have any liability or direct obligation
to such agent. Notwithstanding the terms of any such agreement, the Trustee or
the Paying Agent, as the case may be, shall remain at all times obligated and
liable to the Trust and the Certificateholders for performing its duties
hereunder.

     (c) Every separate trustee, co-trustee, and custodian shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:

         (i) all powers, duties, obligations and rights conferred upon the
Trustee in respect of the receipt, custody and payment of moneys shall be
exercised solely by the Trustee;

         (ii) all other rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and exercised or
performed by the Trustee and such separate trustee, co-trustee, or custodian
jointly, except to the extent that under

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<PAGE>

any law of any jurisdiction in which any particular act or acts are to be
performed (whether as Trustee hereunder or as successor to the Master Servicer
hereunder) the Trustee shall be incompetent or unqualified to perform such act
or acts, in which event such rights, powers, duties and obligations, including
the holding of title to the Trust or any portion thereof in any such
jurisdiction, shall be exercised and performed by such separate trustee,
co-trustee, or custodian;

         (iii) no trustee or custodian hereunder shall be personally liable by
reason of any act or omission of any other trustee or custodian hereunder; and

         (iv) the Trustee or, in the case of the Trust, the Certificateholders
evidencing more than 50% of the Aggregate Principal Amount of the Certificates
then outstanding may at any time accept the resignation of or remove any
separate trustee, co-trustee or custodian, so appointed by it or them, if such
resignation or removal does not violate the other terms of this Agreement.

     (d) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee, co-trustee or custodian shall refer to this Agreement and the
conditions of this Article VII. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or property
specified in its instrument of appointment, either jointly with the Trustee or
separately, as may be provided therein, subject to all the provisions of this
Agreement, specifically including every provision of this Agreement relating to
the conduct of, affecting the liability of, or affording protection to, the
Trustee. Every such instrument shall be filed with the Trustee.

     (e) Any separate trustee, co-trustee or custodian may, at any time,
constitute the Trustee its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any lawful act under or in
respect of this Agreement on its behalf and in its name. If any separate
trustee, co-trustee or custodian shall die, become incapable of acting, resign
or be removed, all of its estates, properties, rights, remedies and trusts shall
vest in and be exercised by the Trustee, to the extent permitted by law, without
the appointment of a new or successor trustee.

     (f) No separate trustee, co-trustee or custodian hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
7.5 hereof and no notice to Certificateholders of the appointment of any
separate trustee, co-trustee or custodian hereunder shall be required.

     (g) The Trustee agrees to instruct the co-trustees, if any, to the extent
necessary to fulfill the Trustee's obligations hereunder.

     (h) The Trustee shall pay the reasonable compensation of the co-trustees,
separate trustees or custodians appointed by the Trustee pursuant to this
Section 7.9 to the extent, and in accordance with the standards, specified in
Section 7.12 hereof.

     (i) Subject to the consent of the Depositor, which consent shall not be
unreasonably withheld, the Trustee, at its sole cost and expense, may appoint at
any time a successor Custodian. Until such time as the Trustee appoints a
successor Custodian, the Trustee

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<PAGE>

shall be the Custodian hereunder. Upon the appointment of a successor
custodian, the Trustee and the Custodian shall enter into a custodial agreement.

     SECTION 7.10 AUTHENTICATING AGENTS.

     (a) The Paying Agent shall serve as the initial Authenticating Agent
hereunder for the purpose of executing and authenticating Certificates. Any
successor Authenticating Agent must be acceptable to the Depositor and must be a
corporation or national bank organized and doing business under the laws of the
United States of America or of any state and having a principal office and place
of business in the Borough of Manhattan in the City and State of New York,
having a combined capital and surplus of at least $50,000,000, authorized under
such laws to do a trust business and subject to supervision or examination by
federal or state authorities.

     (b) Any Person into which the Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which the Authenticating Agent shall be a
party, or any Person succeeding to the corporate agency business of the
Authenticating Agent, shall continue to be the Authenticating Agent without the
execution or filing of any paper or any further act on the part of the Trustee
or the Authenticating Agent.

     (c) The Authenticating Agent may at any time resign by giving at least 30
days' advance written notice of resignation to the Trustee and the Depositor.
The Trustee may at any time terminate the agency of the Authenticating Agent by
giving written notice of termination to the Authenticating Agent and the
Depositor; provided that the Trustee may not terminate the Paying Agent as
Authenticating Agent unless the Paying Agent shall be removed as Paying Agent
hereunder. Upon receiving a notice of resignation or upon such a termination, or
in case at any time the Authenticating Agent shall cease to be eligible in
accordance with the provisions of Section 7.10(a), the Trustee may appoint a
successor Authenticating Agent, shall give written notice of such appointment to
the Depositor and shall mail notice of such appointment to all Holders of
Certificates. Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers, duties
and responsibilities of its predecessor hereunder, with like effect as if
originally named as Authenticating Agent. No such Authenticating Agent shall be
appointed unless eligible under the provisions of Section 7.10(a). No
Authenticating Agent shall have responsibility or liability for any action taken
by it as such at the direction of the Trustee.

     SECTION 7.11 INDEMNIFICATION OF TRUSTEE, THE FISCAL AGENT AND THE PAYING
AGENT.

     (a) The Trustee, the Fiscal Agent, the Certificate Registrar and the Paying
Agent and each of its respective directors, officers, employees, agents and
Controlling Persons shall be entitled to indemnification from the Trust for any
and all claims, losses, penalties, fines, forfeitures, legal fees and related
costs, judgments and any other costs, liabilities, fees and expenses incurred in
connection with any legal action incurred without negligence or willful
misconduct on their respective part, arising out of, or in connection with this
Agreement, the Certificates and the acceptance or administration of the trusts
or duties created hereunder

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<PAGE>

(including, without limitation, any unanticipated loss, liability or expense
incurred in connection with any action or inaction of the Master Servicer, the
Special Servicer or the Depositor or of each other such Person hereunder but
only to the extent the Trustee, the Fiscal Agent, the Certificate Registrar or
the Paying Agent, as the case may be, is unable to recover within a reasonable
period of time such amount from such third party pursuant to this Agreement)
including the costs and expenses of defending themselves against any claim in
connection with the exercise or performance of any of their powers or duties
hereunder and the Trustee, the Fiscal Agent, the Certificate Registrar and the
Paying Agent and each of their respective directors, officers, employees, agents
and Controlling Persons shall be entitled to indemnification from the Trust for
any unanticipated loss, liability or expense incurred in connection with the
provision by the Trustee, the Fiscal Agent, the Certificate Registrar and the
Paying Agent of the reports required to be provided by it pursuant to this
Agreement; provided that:

         (i) with respect to any such claim, the Trustee, the Fiscal Agent, the
Certificate Registrar or the Paying Agent, as the case may be, shall have given
the Depositor, the Master Servicer, the Sellers, each other and the Holders of
the Certificates written notice thereof promptly after a Responsible Officer of
the Trustee, the Fiscal Agent, the Certificate Registrar or the Paying Agent, as
the case may be, shall have knowledge thereof; provided, however, that failure
to give such notice to the Depositor, Master Servicer, the Sellers, each other
and the Holders of Certificates shall not affect the Trustee's, Fiscal Agent's,
Certificate Registrar's or Paying Agent's, as the case may be, rights to
indemnification herein unless the Depositor's defense of such claim on behalf of
the Trust is materially prejudiced thereby;

         (ii) while maintaining control over its own defense, the Trustee, the
Fiscal Agent, the Certificate Registrar or the Paying Agent, as the case may be,
shall cooperate and consult fully with the Depositor in preparing such defense;
and

         (iii) notwithstanding anything to the contrary in this Section 7.11,
the Trust shall not be liable for settlement of any such claim by the Trustee,
the Fiscal Agent, the Certificate Registrar or the Paying Agent, as the case may
be, entered into without the prior consent of the Depositor, which consent shall
not be unreasonably withheld.

     (b) The provisions of this Section 7.11 shall survive any termination of
this Agreement and the resignation or removal of the Trustee, the Fiscal Agent,
the Certificate Registrar or the Paying Agent, as the case may be.

     (c) The Depositor shall indemnify and hold harmless the Trustee, the Fiscal
Agent, the Certificate Registrar or the Paying Agent, as the case may be, their
respective directors, officers, employees or agents and Controlling Persons from
and against any loss, claim, damage or liability, joint or several, and any
action in respect thereof, to which the Trustee, the Fiscal Agent, the
Certificate Registrar or the Paying Agent, as the case may be, their respective
directors, officers, employees or agents or Controlling Person may become
subject under the 1933 Act, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon any untrue statement or alleged untrue
statement of a material fact contained in the Private Placement Memorandum, the
Preliminary Prospectus Supplement, the Final Prospectus Supplement or the
Prospectus, or arises out of, or is based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein in light of the circumstances under which they were
made, not misleading and shall

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<PAGE>

reimburse the Trustee, the Fiscal Agent, the Certificate Registrar or the Paying
Agent, as the case may be, their respective directors, officers, employees,
agents or Controlling Person for any legal and other expenses reasonably
incurred by the Trustee, the Fiscal Agent, the Certificate Registrar or the
Paying Agent, as the case may be, or any such director, officer, employee, agent
or Controlling Person in investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action; provided, that the
Depositor shall not be liable in any such case to the extent that any such loss,
claim, damage, liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement or omission made in any such Private
Placement Memorandum, Preliminary Prospectus Supplement, Final Prospectus
Supplement or Prospectus in reliance upon and in conformity with written
information concerning the Trustee, the Fiscal Agent, the Certificate Registrar
or the Paying Agent, as the case may be, furnished to the Depositor by or on
behalf of such person specifically for inclusion therein. It is hereby expressly
agreed that the only written information provided by the Trustee, the Fiscal
Agent, the Certificate Registrar or the Paying Agent, as the case may be, for
inclusion in the Preliminary Prospectus Supplement and Final Prospectus
Supplement is set forth in the case of the Trustee in the second, fourth and
fifth sentences and in the case of the Fiscal Agent in the penultimate sentence
under the caption entitled "DESCRIPTION OF THE OFFERED CERTIFICATES--The Trustee
and the Fiscal Agent" and in the case of the Paying Agent, the third and fourth
sentences under the "DESCRIPTION OF THE OFFERED CERTIFICATES--The Paying Agent,
Certificate Registrar and the Authenticating Agent". The Trustee, the Fiscal
Agent, the Certificate Registrar or the Paying Agent, as the case may be, shall
immediately notify the Depositor and the Sellers if a claim is made by a third
party with respect to this Section 7.11(c) entitling such person, its directors,
officers, employees, agents or Controlling Person to indemnification hereunder,
whereupon the Depositor shall assume the defense of any such claim (with counsel
reasonably satisfactory to such person) and pay all expenses in connection
therewith, including counsel fees, and promptly pay, discharge and satisfy any
judgment or decree which may be entered against it or them in respect of such
claim. Any failure to so notify the Depositor shall not affect any rights the
Trustee, the Fiscal Agent, the Certificate Registrar or the Paying Agent, as the
case may be, their respective directors, officers, employees, agents or
Controlling Person may have to indemnification under this Section 7.11(c),
unless the Depositor's defense of such claim is materially prejudiced thereby.
The indemnification provided herein shall survive the termination of this
Agreement and the resignation or removal of the Trustee, the Fiscal Agent or the
Paying Agent. The Depositor shall not be indemnified by the Trust for any
expenses incurred by the Depositor arising from any violation or alleged
violation of the 1933 Act or 1934 Act by the Depositor.

     SECTION 7.12 FEES AND EXPENSES OF TRUSTEE, THE FISCAL AGENT AND THE PAYING
AGENT. The Trustee shall be entitled to receive the Trustee Fee (other than the
portion thereof constituting the Paying Agent Fee) and the Paying Agent shall be
entitled to receive the Paying Agent Fee, pursuant to Section 5.3(b)(ii) (which
shall not be limited by any provision of law with respect to the compensation of
a trustee of an express trust), for all services rendered by it in the execution
of the trusts hereby created and in the exercise and performance of any of the
powers and duties respectively, hereunder of the Trustee and the Paying Agent.
The Trustee, the Fiscal Agent and the Paying Agent shall also be entitled to
recover from the Trust all reasonable unanticipated expenses and disbursements
incurred or made by the Trustee, the Fiscal Agent and the Paying Agent in
accordance with any of the provisions of this Agreement (including the
reasonable compensation and the reasonable expenses and disbursements of its
counsel and other

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Persons not regularly in its employ), not including expenses incurred in the
ordinary course of performing its duties as Trustee, Fiscal Agent or Paying
Agent, respectively hereunder, and except any such expense, disbursement or
advance as may arise from the negligence or bad faith of such Person or which is
the responsibility of the Holders of the Certificates hereunder. The provisions
of this Section 7.12 shall survive any termination of this Agreement and the
resignation or removal of the Trustee, the Fiscal Agent or the Paying Agent.

     SECTION 7.13 COLLECTION OF MONEYS. Except as otherwise expressly provided
in this Agreement, the Trustee and the Paying Agent may demand payment or
delivery of, and shall receive and collect, all money and other property payable
to or receivable by the Trustee or the Paying Agent, as the case may be,
pursuant to this Agreement. The Trustee or the Paying Agent, as the case may be,
shall hold all such money and property received by it as part of the Trust and
shall distribute it as provided in this Agreement. If the Trustee or the Paying
Agent, as the case may be, shall not have timely received amounts to be remitted
with respect to the Mortgage Loans from the Master Servicer, the Trustee or the
Paying Agent, as the case may be, shall request the Master Servicer to make such
distribution as promptly as practicable or legally permitted. If the Trustee or
the Paying Agent, as the case may be, shall subsequently receive any such
amount, it may withdraw such request.

     SECTION 7.14 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR.

     (a) On and after the time the Master Servicer is terminated pursuant to
this Agreement, the Trustee shall be the successor in all respects to the Master
Servicer in its capacity under this Agreement and the transactions set forth or
provided for therein and shall have all the rights and powers and be subject to
all the responsibilities, duties and liabilities relating thereto and arising
thereafter placed on the Master Servicer by the terms and provisions of this
Agreement; provided that, any failure to perform such duties or responsibilities
caused by the Master Servicer's failure to provide required information shall
not be considered a default by the Trustee hereunder. In addition, the Trustee
shall have no liability relating to (i) the representations and warranties of
the Master Servicer contained in this Agreement or (ii) any obligation incurred
by the Master Servicer prior to its termination or resignation (including,
without limitation, the Master Servicer's obligation to repay losses resulting
from the investment of funds in any account established under this Agreement),
except any ongoing obligations to a Primary Servicer arising after the
termination of the Master Servicer from their servicing rights and obligations
under the applicable Primary Servicing Agreement. In the Trustee's capacity as
such successor, the Trustee shall have the same limitations on liability granted
to the Master Servicer in this Agreement. As compensation therefor, the Trustee
shall be entitled to receive all the compensation payable to the Master Servicer
set forth in this Agreement, including, without limitation, the Master Servicing
Fee.

     (b) Notwithstanding the above, the Trustee (A) may, if the Trustee is
unwilling to so act, or (B) shall, if it is unable to so act, appoint, or
petition a court of competent jurisdiction to appoint any established commercial
or multifamily mortgage finance institution, servicer or special servicer or
mortgage servicing institution having a net worth of not less than $15,000,000,
meeting such other standards for a successor servicer as are set forth in this
Agreement and with respect to which Rating Agency Confirmation is obtained, as
the successor to the Master Servicer hereunder in the assumption of all of the
responsibilities, duties or liabilities of a servicer as Master Servicer
hereunder. Pending any such appointment, the Trustee

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<PAGE>

shall act as the Master Servicer as hereinabove provided. Any entity designated
by the Trustee as successor Master Servicer may be an Affiliate of the Trustee;
provided that, such Affiliate must meet the standards for the Master Servicer as
set forth herein. In connection with such appointment and assumption, the
Trustee may make such arrangements for the compensation of such successor out of
payments on Mortgage Loans as it and such successor shall agree subject to
Section 8.10. The Trustee and such successor shall take such actions, consistent
with this Agreement as shall be necessary to effectuate any such succession. The
Master Servicer shall cooperate with the Trustee and any successor servicer in
effecting the termination of the Master Servicer's responsibilities and rights
under this Agreement, including, without limitation, notifying Mortgagors of the
assignment of the servicing function and providing the Trustee and successor
servicer all documents and records in its possession in electronic or other form
reasonably requested by the successor servicer to enable the successor servicer
to assume the Master Servicer's functions hereunder and the transfer to the
Trustee or such successor servicer of all amounts which shall at the time be or
should have been deposited by the Master Servicer in the Certificate Account and
any other account or fund maintained with respect to the Certificates or
thereafter be received by the Master Servicer with respect to the Mortgage
Loans. Neither the Trustee nor any other successor servicer shall be deemed to
be in default hereunder by reason of any failure to make, or any delay in
making, any distribution hereunder or any portion thereof caused by (i) the
failure of the Master Servicer to deliver, or any delay in delivering, cash,
documents or records to it, or (ii) restrictions imposed by any regulatory
authority having jurisdiction over the Master Servicer. The Trustee shall be
reimbursed for all of its out-of-pocket expenses incurred in connection with
obtaining such successor Master Servicer by the Trust within 30 days of the
Trustee's submission of an invoice with respect thereto, to the extent such
expenses have not been reimbursed by the Master Servicer as provided herein;
such expenses paid by the Trust shall be deemed to be an Additional Trust
Expense.

     (c) On and after the time the Special Servicer is terminated pursuant
to this Agreement, in accordance with Section 9.30, the Trustee shall be the
successor in all respects to the Special Servicer in its capacity under this
Agreement and the transactions set forth or provided for therein and shall have
all the rights and powers and be subject to all the responsibilities, duties and
liabilities relating thereto and arising thereafter placed on the Special
Servicer by the terms and provisions of this Agreement; provided that, any
failure to perform such duties or responsibilities caused by the Special
Servicer's failure to provide required information shall not be considered a
default by the Trustee hereunder. In addition, the Trustee shall have no
liability relating to (i) the representations and warranties of the Special
Servicer contained in this Agreement or (ii) any obligation incurred by the
Special Servicer prior to its termination or resignation. In the Trustee's
capacity as such successor, the Trustee shall have the same limitations on
liability granted to the Special Servicer in this Agreement. As compensation
therefor, the Trustee shall be entitled to receive all the compensation payable
to the Special Servicer set forth in this Agreement, including, without
limitation the Special Servicer Compensation (other than any Work-Out Fee
payable pursuant to Section 9.11).

     (d) Notwithstanding the above, the Trustee may, if the Trustee shall be
unwilling to so act, or shall, if it is unable to so act, appoint, or petition a
court of competent jurisdiction to appoint, any established commercial or
multifamily mortgage finance institution, special servicer or mortgage servicing
institution having a net worth of not less than $15,000,000, and meeting such
other standards for a successor Special Servicer as are set forth in Section
9.21, and with respect to which Rating Agency Confirmation is obtained, as the

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successor to the Special Servicer hereunder in the assumption of all of the
responsibilities, duties or liabilities of a special servicer as Special
Servicer hereunder. Pending any such appointment, the Trustee shall act as the
Special Servicer as hereinabove provided. Any entity designated by the Trustee
as successor Special Servicer may be an Affiliate of the Trustee; provided that,
such Affiliate must meet the standards for a successor Special Servicer set
forth herein. In connection with such appointment and assumption, the Trustee
may make such arrangements for the compensation of such successor out of
payments on Mortgage Loans as it and such successor shall agree; provided that
no such compensation shall be in excess of that permitted to the Special
Servicer under this Agreement. The Trustee and such successor shall take such
actions, consistent with this Agreement as shall be necessary to effectuate any
such succession. The Special Servicer shall cooperate with the Trustee and any
successor Special Servicer in effecting the termination of the Special
Servicer's responsibilities and rights under this Agreement, including, without
limitation, notifying Mortgagors of Specially Serviced Mortgage Loans of the
assignment of the special servicing function and providing the Trustee and
successor Special Servicer all documents and records in its possession in
electronic or other form reasonably requested by the successor Special Servicer
to enable the successor Special Servicer to assume the Special Servicer's
functions hereunder and the transfer to the Trustee or such successor Special
Servicer of all amounts which shall at the time be or should have been deposited
by the Special Servicer in the Certificate Account and any other account or fund
maintained with respect to the Certificates or thereafter be received by the
Special Servicer with respect to the Mortgage Loans. Neither the Trustee nor any
other successor Special Servicer shall be deemed to be in default hereunder by
reason of any failure to make, or any delay in making, any distribution
hereunder or any portion thereof caused by (i) the failure of the Special
Servicer to deliver, or any delay in delivering, cash, documents or records to
it, or (ii) restrictions imposed by any regulatory authority having jurisdiction
over the Special Servicer. The Trustee shall be reimbursed for all of its
out-of-pocket expenses incurred in connection with obtaining such successor
Special Servicer by the Trust within 30 days of submission of an invoice with
respect thereto but only to the extent such expenses have not been reimbursed by
the Special Servicer as provided herein; and such expenses paid by the Trust
shall be deemed to be an Additional Trust Expense.

     SECTION 7.15 NOTIFICATION TO HOLDERS. Upon termination of the Master
Servicer, the Paying Agent or the Special Servicer, or appointment of a
successor to the Master Servicer, the Paying Agent or the Special Servicer, the
Trustee shall promptly mail notice thereof by first class mail to the Rating
Agencies, the Operating Adviser, the Sellers and the Certificateholders at their
respective addresses appearing on the Certificate Register.

     SECTION 7.16 REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE, THE FISCAL
AGENT AND THE PAYING AGENT.

     (a) The Trustee hereby represents and warrants as of the date hereof that:

         (i) the Trustee is a national banking association, duly organized,
validly existing and in good standing under the laws governing its creation and
existence and has full power and authority to own its property, to carry on its
business as presently conducted, and to enter into and perform its obligations
under this Agreement;

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<PAGE>

         (ii) the execution and delivery by the Trustee of this Agreement have
been duly authorized by all necessary action on the part of the Trustee; neither
the execution and delivery of this Agreement, nor the consummation of the
transactions contemplated in this Agreement, nor compliance with the provisions
of this Agreement, will conflict with or result in a breach of, or constitute a
default under, (i) any of the provisions of any law, governmental rule,
regulation, judgment, decree or order binding on the Trustee or its properties
that would materially and adversely affect the Trustee's ability to perform its
obligations under this Agreement, (ii) the organizational documents of the
Trustee, or (iii) the terms of any material agreement or instrument to which the
Trustee is a party or by which it is bound; the Trustee is not in default with
respect to any order or decree of any court or any order, regulation or demand
of any federal, state, municipal or other governmental agency, which default
would materially and adversely affect its performance under this Agreement;

         (iii) the execution, delivery and performance by the Trustee of this
Agreement and the consummation of the transactions contemplated by this
Agreement do not require the consent, approval, authorization or order of, the
giving of notice to or the registration with any state, federal or other
governmental authority or agency, except such as has been or will be obtained,
given, effected or taken in order for the Trustee to perform its obligations
under this Agreement;

         (iv) this Agreement has been duly executed and delivered by the Trustee
and, assuming due authorization, execution and delivery by the other parties
hereto, constitutes a valid and binding obligation of the Trustee, enforceable
against the Trustee in accordance with its terms, subject, as to enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency, moratorium and
other similar laws affecting creditors' rights generally as from time to time in
effect, and to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law); and

         (v) no litigation is pending or, to the Trustee's knowledge,
threatened, against the Trustee that, either in one instance or in the
aggregate, would draw into question the validity of this Agreement, or which
would be likely to impair materially the ability of the Trustee to perform under
the terms of this Agreement.

     (b) The Fiscal Agent hereby represents and warrants as of the date hereof
that:

         (i) the Fiscal Agent is a foreign banking corporation duly organized,
validly existing and in good standing under the laws governing its creation and
existence and has full corporate power and authority to own its property, to
carry on its business as presently conducted, and to enter into and perform its
obligations under this Agreement;

         (ii) the execution and delivery by the Fiscal Agent of this Agreement
have been duly authorized by all necessary corporate action on the part of the
Fiscal Agent; neither the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated in this Agreement, nor compliance
with the provisions of this Agreement, will conflict with or result in a breach
of, or constitute a default under, (i) any of the provisions of any law,
governmental rule, regulation, judgment, decree or order binding on the Fiscal
Agent or its properties that would materially and adversely affect the Fiscal
Agent's ability to perform its obligations under this Agreement, (ii) the
organizational documents of the

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<PAGE>

Fiscal Agent, or (iii) the terms of any material agreement or instrument to
which the Fiscal Agent is a party or by which it is bound; the Fiscal Agent is
not in default with respect to any order or decree of any court or any order,
regulation or demand of any federal, state, municipal or other governmental
agency, which default would materially and adversely affect its performance
under this Agreement;

         (iii) the execution, delivery and performance by the Fiscal Agent of
this Agreement and the consummation of the transactions contemplated by this
Agreement do not require the consent, approval, authorization or order of, the
giving of notice to, or the registration with, any state, federal or other
governmental authority or agency, except such as has been obtained, given,
effected or taken prior to the date hereof;

         (iv) this Agreement has been duly executed and delivered by the Fiscal
Agent and, assuming due authorization, execution and delivery by the other
parties hereto, constitutes a valid and binding obligation of the Fiscal Agent,
enforceable against the Fiscal Agent in accordance with its terms, subject, as
to enforcement of remedies, to applicable bankruptcy, reorganization,
insolvency, moratorium and other similar laws affecting creditors' rights
generally as from time to time in effect, and to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law); and

         (v) no litigation is pending or, to the Fiscal Agent's knowledge,
threatened, against the Fiscal Agent that, either in any one instance or in the
aggregate, would draw into question the validity of this Agreement, or which
would be likely to impair materially the ability of the Fiscal Agent to perform
under the terms of this Agreement.

     (c) The Paying Agent hereby represents and warrants as of the date hereof
that:

         (i) the Paying Agent is a national banking association, duly organized,
validly existing and in good standing under the laws governing its creation and
existence and has full power and authority to own its property, to carry on its
business as presently conducted, and to enter into and perform its obligations
under this Agreement;

         (ii) the execution and delivery by the Paying Agent of this Agreement
have been duly authorized by all necessary action on the part of the Paying
Agent; neither the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated in this Agreement, nor compliance
with the provisions of this Agreement, will conflict with or result in a breach
of, or constitute a default under, (i) any of the provisions of any law,
governmental rule, regulation, judgment, decree or order binding on the Paying
Agent or its properties that would materially and adversely affect the Paying
Agent's ability to perform its obligations under this Agreement, (ii) the
organizational documents of the Paying Agent, or (iii) the terms of any material
agreement or instrument to which the Paying Agent is a party or by which it is
bound; the Paying Agent is not in default with respect to any order or decree of
any court or any order, regulation or demand of any federal, state, municipal or
other governmental agency, which default would materially and adversely affect
its performance under this Agreement;

                                     -179-

<PAGE>

         (iii) the execution, delivery and performance by the Paying Agent of
this Agreement and the consummation of the transactions contemplated by this
Agreement do not require the consent, approval, authorization or order of, the
giving of notice to or the registration with any state, federal or other
governmental authority or agency, except such as has been or will be obtained,
given, effected or taken in order for the Paying Agent to perform its
obligations under this Agreement;

         (iv) this Agreement has been duly executed and delivered by the Paying
Agent and, assuming due authorization, execution and delivery by the other
parties hereto, constitutes a valid and binding obligation of the Paying Agent,
enforceable against the Paying Agent in accordance with its terms, subject, as
to enforcement of remedies, to applicable bankruptcy, reorganization,
insolvency, moratorium and other similar laws affecting creditors' rights
generally as from time to time in effect, and to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law); and

         (v) there are no actions, suits or proceeding pending or, to the best
of the Paying Agent's knowledge, threatened, against the Paying Agent that,
either in one instance or in the aggregate, would draw into question the
validity of this Agreement, or which would be likely to impair materially the
ability of the Paying Agent to perform under the terms of this Agreement.

     SECTION 7.17 FIDELITY BOND AND ERRORS AND OMISSIONS INSURANCE POLICY
MAINTAINED BY THE TRUSTEE, THE FISCAL AGENT AND THE PAYING AGENT. Each of the
Trustee, the Fiscal Agent and the Paying Agent, at its own respective expense,
shall maintain in effect a Fidelity Bond and a Errors and Omissions Insurance
Policy. The Errors and Omissions Insurance Policy and Fidelity Bond shall be
issued by a Qualified Insurer in form and in amount customary for trustees,
fiscal agents or paying agents in similar transactions (unless the Trustee, the
Fiscal Agent or the Paying Agent, as the case may be, self insures as provided
below). In the event that any such Errors and Omissions Insurance Policy or
Fidelity Bond ceases to be in effect, the Trustee, the Fiscal Agent or the
Paying Agent, as the case may be, shall obtain a comparable replacement policy
or bond from an insurer or issuer meeting the requirements set forth above as of
the date of such replacement. So long as the long-term debt rating of the
Trustee, the Fiscal Agent or the Paying Agent, as the case may be, is not less
than "Baa1" as rated by Moody's, if rated by Moody's and "A" as rated by Fitch,
if rated by Fitch, respectively, the Trustee, the Fiscal Agent or the Paying
Agent, as the case may be, may self-insure for the Fidelity Bond and the Errors
and Omissions Insurance Policy.

     SECTION 7.18 APPOINTMENT OF LUXEMBOURG PAYING AGENT; NOTIFICATION TO
CERTIFICATEHOLDERS.

     (a) The Depositor shall maintain a paying agent in Luxembourg (the
"Luxembourg Paying Agent") for payments on the Certificates as well as a
transfer agent in Luxembourg (the "Luxembourg Transfer Agent") for so long as
such Certificates are listed on the Luxembourg Stock Exchange and the rules of
such exchange so require and the Depositor shall pay the reasonable fees of such
Luxembourg Paying Agent and Luxembourg Transfer Agent. The Depositor shall
appoint a successor Luxembourg Paying Agent if necessary. Except

                                     -180-

<PAGE>

as set forth in this Section 7.18(a), neither the Trustee nor the Paying Agent
shall have any responsibility for the actions or inactions of the Luxembourg
Paying Agent, including any failure of the Luxembourg Paying Agent to make
timely distributions to Certificateholders or beneficial owners (other than any
such failure resulting from the failure of the Paying Agent to timely remit
funds but only to the extent such failure is caused by the Paying Agent's
negligence or willful misconduct). The Certificate Registrar shall not be
responsible for transfers or exchanges requested at the office of the Luxembourg
Transfer Agent in Luxembourg until it receives written notice from such transfer
agent, together with the Certificates to be transferred or exchanged. The
Luxembourg Paying Agent shall each month download copies of all information made
available on the Paying Agent's internet website, print such information and
make it available to the Certificateholders upon request. The Luxembourg Paying
Agent shall not be the Paying Agent and the duties of the Luxembourg Paying
Agent hereunder shall be distinct from the duties of the Paying Agent.

     (b) For so long as the Certificates are listed on the Luxembourg Stock
Exchange and the rules of the Luxembourg Stock Exchange so require, the
Depositor undertakes to cause the Luxembourg Paying Agent to publish all notices
to Certificateholders in a daily newspaper of general circulation in Luxembourg.

     (c) For so long as any of the Certificates are listed on the Luxembourg
Stock Exchange and the rules of the Luxembourg Stock Exchange so require, the
Paying Agent shall make available or provide the following information on the
Paying Agent's internet website:

         (i) to Clearstream Bank, Euroclear Bank and the Luxembourg Paying Agent
promptly upon determination, the Pass-Through Rates for the related Interest
Accrual Period, the amount of principal and interest distributable on the
related Distribution Date for each Class of Certificates, per $1,000 initial
Certificate Balance or Notional Amount and the date each distribution will be
made;

         (ii) to the Luxembourg Paying Agent on each Distribution Date, the
Certificate Balance or Notional Amount of the Certificates;

         (iii) to the Luxembourg Paying Agent promptly following availability,
each report, certificate or statement required to be delivered to the Luxembourg
Paying Agent pursuant to Section 5.4;

         (iv) to the Luxembourg Paying Agent promptly following receipt thereof,
all notices and reports regarding any termination of the Trustee or Paying Agent
or appointment of a successor to the Trustee or Paying Agent; and

         (v) to the Luxembourg Paying Agent promptly following receipt thereof,
all notices and reports regarding any occurrence of an Event of Default.

     Information provided, as set forth above, by the Paying Agent to the
Luxembourg Paying Agent shall be supplied by the Luxembourg Paying Agent to the
Luxembourg Stock Exchange. Such information shall be made available to the
Certificateholders at the main office of the Luxembourg Paying Agent.

                                     -181-
<PAGE>

     None of the Certificates will be listed on the Luxembourg Stock Exchange or
any other stock exchange.

                                  ARTICLE VIII

                 ADMINISTRATION AND SERVICING OF MORTGAGE LOANS

     SECTION 8.1 SERVICING STANDARD; SERVICING DUTIES.

     (a) Subject to the express provisions of this Agreement, for and on behalf
of the Trust and for the benefit of the Certificateholders as a whole, and,
solely as it relates to any A/B Mortgage Loan and the Loan Pair, for the benefit
of the holder of the related B Note and the WestShore Plaza Companion Loan, the
Master Servicer shall service and administer the Mortgage Loans, any B Note and
the WestShore Plaza Companion Loan in accordance with the Servicing Standard and
the terms of this Agreement (subject to the servicing of any Non-Serviced
Mortgage Loan by the applicable Non-Serviced Mortgage Loan Master Servicer and
the applicable Non-Serviced Mortgage Loan Special Servicer in accordance with
the related Pooling and Servicing Agreement). Certain of the provisions of this
Article VIII make explicit reference to their applicability to Mortgage Loans,
any B Note and the WestShore Plaza Companion Loan; notwithstanding such explicit
references, references to "Mortgage Loans" contained in this Article VIII,
unless otherwise specified, shall be construed to refer also to such B Note and
the WestShore Plaza Companion Loan (but any other terms that are defined in
Article I and used in this Article VIII shall be construed according to such
definitions without regard to this sentence).

     In connection with such servicing and administration, the Master Servicer
shall seek to maximize the timely recovery of principal and interest on the
Mortgage Notes in the best economic interests of the Certificateholders as a
whole (or, in the case of any A/B Mortgage Loan or the Loan Pair, the
Certificateholders and the holder of the related B Note and the WestShore Plaza
Companion Loan, all taken as a collective whole); provided, however, that
nothing herein contained shall be construed as an express or implied guarantee
by the Master Servicer of the collectability of payments on the Mortgage Loans
or shall be construed as impairing or adversely affecting any rights or benefits
specifically provided by this Agreement to the Master Servicer, including with
respect to Master Servicing Fees or the right to be reimbursed for Advances.

     (b) The Master Servicer, in the case of an event specified in clause (x) of
this subclause (b), and the Special Servicer, in the case of an event specified
in clause (y) of this subclause (b), shall each send a written notice to the
other and to the Trustee and the Paying Agent, the Operating Adviser, each
Seller and, in the case of an A/B Mortgage Loan, the holder of the related B
Note and, in the case of the Loan Pair, the holder of the WestShore Plaza
Companion Loan, within two Business Days after becoming aware (x) that a
Servicing Transfer Event has occurred with respect to a Mortgage Loan or (y)
that a Mortgage Loan has become a Rehabilitated Mortgage Loan, which notice
shall identify the applicable Mortgage Loan and, in the case of an event
specified in clause (x) of this subclause (b) above, the Servicing Transfer
Event that occurred.

                                     -182-

<PAGE>

     (c) With respect to each Mortgage Loan that is subject to an Environmental
Insurance Policy, for as long as it is not a Specially Serviced Mortgage Loan,
if the Master Servicer has actual knowledge of any event giving rise to a claim
under an Environmental Insurance Policy, the Master Servicer or the applicable
Primary Servicer shall notify the Special Servicer to such effect and the Master
Servicer shall take reasonable actions as are in accordance with the Servicing
Standard and the terms and conditions of such Environmental Insurance Policy to
make a claim thereunder and achieve the payment of all amounts to which the
Trust is entitled thereunder. Any legal fees or other out-of-pocket costs
incurred in accordance with the Servicing Standard in connection with any such
claim shall be paid by, and reimbursable to, the Master Servicer or the Special
Servicer as a Servicing Advance.

     (d) In connection with any extension of the Maturity Date of a Mortgage
Loan, the Master Servicer shall give prompt written notice of such extension to
the insurer under the Environmental Insurance Policy and shall execute such
documents as are reasonably required by such insurer to procure an extension of
such policy (if available).

     SECTION 8.2 FIDELITY BOND AND ERRORS AND OMISSIONS INSURANCE POLICY
MAINTAINED BY THE MASTER SERVICER. The Master Servicer, at its expense, shall
maintain in effect a Servicer Fidelity Bond and a Servicer Errors and Omissions
Insurance Policy. The Servicer Errors and Omissions Insurance Policy and
Servicer Fidelity Bond shall be issued by a Qualified Insurer (unless the Master
Servicer self insures as provided below) and be in form and amount consistent
with the Servicing Standard. In the event that any such Servicer Errors and
Omissions Insurance Policy or Servicer Fidelity Bond ceases to be in effect, the
Master Servicer shall obtain a comparable replacement policy or bond from an
insurer or issuer meeting the requirements set forth above as of the date of
such replacement. So long as the long-term rating of the Master Servicer is not
in any event less than "Baa1" as rated by Moody's and "A" as rated by Fitch,
respectively, the Master Servicer may self-insure for the Servicer Fidelity Bond
and the Servicer Errors and Omissions Insurance Policy.

     SECTION 8.3 MASTER SERVICER'S GENERAL POWER AND DUTIES.

     (a) The Master Servicer shall service and administer the Mortgage Loans and
shall, subject to Sections 8.7, 8.18, 8.19, 8.27 and Article XII hereof and as
otherwise provided herein and by the Code, have full power and authority to do
any and all things which it may deem necessary or desirable in connection with
such servicing and administration in accordance with the Servicing Standard. To
the extent consistent with the foregoing and subject to any express limitations
and provisions set forth in this Agreement (and, in the case of any A/B Mortgage
Loan and the Loan Pair, subject to the applicable Intercreditor Agreement or
Loan Pair Intercreditor Agreement and, in the case of any Non-Serviced Mortgage
Loan, subject to the servicing of such Non-Serviced Mortgage Loan by the
applicable Non-Serviced Mortgage Loan Master Servicer and the applicable
Non-Serviced Mortgage Loan Special Servicer, as applicable), such power and
authority shall include, without limitation, the right, subject to the terms
hereof, (A) to execute and deliver, on behalf of the Certificateholders (and in
connection with any B Note, the holder of the B Note and, in connection with the
Loan Pair, the holder of the WestShore Plaza Companion Loan) and the Trustee,
customary consents or waivers and other instruments and documents (including,
without limitation, estoppel certificates, financing statements, continuation
statements, title endorsements and reports and other documents and instruments
necessary to preserve and maintain the lien on the related Mortgaged Property
and

                                     -183-

<PAGE>

related collateral), (B) to consent to assignments and assumptions or
substitutions, and transfers of interest of any Mortgagor, in each case subject
to and in accordance with the terms of the related Mortgage Loan and Section
8.7, (C) to collect any Insurance Proceeds, (D) subject to Section 8.7, to
consent to any subordinate financings to be secured by any related Mortgaged
Property to the extent that such consent is required pursuant to the terms of
the related Mortgage or which otherwise is required, and, subject to Section
8.7, to consent to any mezzanine debt to the extent such consent is required
pursuant to the terms of the related Mortgage; (E) to consent to the application
of any proceeds of insurance policies or condemnation awards to the restoration
of the related Mortgaged Property or otherwise and to administer and monitor the
application of such proceeds and awards in accordance with the terms of the
Mortgage Loan as the Master Servicer deems reasonable under the circumstances,
(F) to execute and deliver, on behalf of the Certificateholders (and, if
applicable, the holders of the B Note and the WestShore Plaza Companion Loan)
and the Trustee, documents relating to the management, operation, maintenance,
repair, leasing and marketing of the related Mortgaged Properties, including
agreements and requests by the Mortgagor with respect to modifications of the
standards of operation and management of the Mortgaged Properties or the
replacement of asset managers, (G) to consent to any operation or action under a
Mortgage Loan that is contemplated or permitted under a Mortgage or other
documents evidencing or securing the applicable Mortgage Loan (either as a
matter of right or upon satisfaction of specified conditions), (H) to obtain,
release, waive or modify any term other than a Money Term of a Mortgage Loan and
related documents subject to and to the extent permitted by Section 8.18, (I) to
exercise all rights, powers and privileges granted or provided to the holder of
the Mortgage Notes, the WestShore Plaza Companion Loan and any B Note under the
terms of the Mortgage, including all rights of consent or approval thereunder,
subject to Sections 8.7 and 8.18 of this Agreement, (J) to enter into lease
subordination agreements, non-disturbance and attornment agreements or other
leasing or rental arrangements which may be requested by the Mortgagor or the
Mortgagor's tenants, (K) to join the Mortgagor in granting, modifying or
releasing any easements, covenants, conditions, restrictions, equitable
servitudes, or land use or zoning requirements with respect to the Mortgaged
Properties to the extent such does not adversely affect the value of the related
Mortgage Loan or Mortgaged Property, (L) to execute and deliver, on behalf of
itself, the Trustee, the Trust (and, if applicable, the holders of the B Note
and the WestShore Plaza Companion Loan) or any of them, any and all instruments
of satisfaction or cancellation, or of partial or full release or discharge and
all other comparable instruments, with respect to the Mortgage Loans and with
respect to the Mortgaged Properties, and (M) hold in accordance with the terms
of any Mortgage Loan and this Agreement, Defeasance Collateral. The foregoing
clauses (A) through (M) are referred to collectively as "Master Servicer Consent
Matters." Notwithstanding the above, the Master Servicer shall have no power to
(i) waive any Prepayment Premiums (including any Kimball Lane Yield Maintenance
Amounts) or (ii) consent to any modification of a Money Term of a Mortgage Loan.
Nothing contained in this Agreement shall limit the ability of the Master
Servicer to lend money to (to the extent not secured, in whole or in part, by
any Mortgaged Property), accept deposits from and otherwise generally engage in
any kind of business or dealings with any Mortgagor as though the Master
Servicer was not a party to this Agreement or to the transactions contemplated
hereby; provided, however, that this sentence shall not modify the Servicing
Standard.

     (b) The Master Servicer shall not be obligated to service and administer
the Mortgage Loans which have become and continue to be Specially Serviced
Mortgage Loans, except as specifically provided herein. The Master Servicer
shall be required to make all

                                     -184-

<PAGE>

calculations and prepare all reports required hereunder with respect to such
Specially Serviced Mortgage Loans (other than calculations and reports expressly
required to be made by the Special Servicer hereunder) as if no Servicing
Transfer Event had occurred and shall continue to collect all Scheduled
Payments, make Servicing Advances as set forth herein, make P&I Advances as set
forth herein and render such incidental services with respect to such Specially
Serviced Mortgage Loans, all as are specifically provided for herein, but shall
have no other servicing or other duties with respect to such Specially Serviced
Mortgage Loans. The Master Servicer shall give notice within three Business Days
to the Special Servicer of any collections it receives from any Specially
Serviced Mortgage Loans, subject to changes agreed upon from time to time by the
Special Servicer and the Master Servicer. The Special Servicer shall instruct
within one Business Day after receiving such notice the Master Servicer on how
to apply such funds. The Master Servicer within one Business Day after receiving
such instructions shall apply such funds in accordance with the Special
Servicer's instructions. Each Mortgage Loan that becomes a Specially Serviced
Mortgage Loan shall continue as such until such Mortgage Loan becomes a
Rehabilitated Mortgage Loan. The Master Servicer shall not be required to
initiate extraordinary collection procedures or legal proceedings with respect
to any Mortgage Loan or to undertake any pre-foreclosure procedures.

     (c) Concurrently with the execution of this Agreement, the Trustee shall
sign the Power of Attorney attached hereto as Exhibit S-1. The Master Servicer,
shall promptly notify the Trustee of the execution and delivery of any document
on behalf of the Trustee under such Power-of-Attorney. From time to time until
the termination of the Trust, upon receipt of additional unexecuted powers of
attorney from the Master Servicer or the Special Servicer, the Trustee shall
execute and return to the Master Servicer, the Special Servicer or any Primary
Servicer any additional powers of attorney and other documents necessary or
appropriate to enable the Master Servicer and the Special Servicer to service
and administer the Mortgage Loans including, without limitation, documents
relating to the management, operation, maintenance, repair, leasing or marketing
of the Mortgaged Properties. The Master Servicer shall indemnify the Trustee for
any costs, liabilities and expenses (including attorneys' fees) incurred by the
Trustee in connection with the intentional or negligent misuse of such power of
attorney by the Master Servicer. Notwithstanding anything contained herein to
the contrary, neither the Master Servicer nor the Special Servicer shall without
the Trustee's written consent: (i) initiate any action, suit or proceeding
solely under the Trustee's name without indicating the Master Servicer's or
Special Servicer's, as applicable, representative capacity, or (ii) knowingly
take any action that causes the Trustee to be registered to do business in any
state, provided, however, that the preceding clause (i) shall not apply to the
initiation of actions relating to a Mortgage Loan that the Master Servicer or
the Special Servicer, as the case may be, is servicing pursuant to its
respective duties herein (in which case the Master Servicer or the Special
Servicer, as the case may be, shall give three (3) Business Days prior notice to
the Trustee of the initiation of such action). The limitations of the preceding
clause shall not be construed to limit any duty or obligation imposed on the
Trustee under any other provision of this Agreement.

     (d) The Master Servicer shall make efforts consistent with the Servicing
Standard and the terms of this Agreement to collect all payments called for
under the terms and provisions of the applicable Mortgage Loans (other than
Specially Serviced Mortgage Loans or REO Properties).

                                     -185-
<PAGE>

     (e) The Master Servicer (or any Primary Servicer on its behalf) shall
segregate and hold all funds collected and received pursuant to any Mortgage
Loan (other than any Non-Serviced Mortgage Loan) constituting Escrow Amounts
separate and apart from any of its own funds and general assets and shall
establish and maintain one or more segregated custodial accounts (each, an
"Escrow Account") into which all Escrow Amounts shall be deposited within one
(1) Business Day after receipt. Each Escrow Account shall be an Eligible
Account, except with respect to Mortgage Loans identified on Schedule VI for
which Escrow Accounts shall be transferred to Eligible Accounts at the earliest
date permitted under the related Mortgage Loan documents. The Master Servicer
shall also deposit into each Escrow Account any amounts representing losses on
Eligible Investments pursuant to the immediately succeeding paragraph and any
Insurance Proceeds or Liquidation Proceeds which are required to be applied to
the restoration or repair of any Mortgaged Property pursuant to the related
Mortgage Loan. Each Escrow Account shall be maintained in accordance with the
requirements of the related Mortgage Loan and in accordance with the Servicing
Standard. Withdrawals from an Escrow Account may be made only:

         (i) to effect timely payments of items constituting Escrow Amounts for
the related Mortgage Loan;

         (ii) to transfer funds to the Certificate Account (or any sub-account
thereof) to reimburse the Master Servicer for any Advance relating to Escrow
Amounts, but only from amounts received with respect to the related Mortgage
Loan which represent late collections of Escrow Amounts thereunder;

         (iii) for application to the restoration or repair of the related
Mortgaged Property in accordance with the related Mortgage Loan and the
Servicing Standard;

         (iv) to clear and terminate such Escrow Account upon the termination of
this Agreement or pay-off of the related Mortgage Loan;

         (v) to pay from time to time to the related Mortgagor any interest or
investment income earned on funds deposited in the Escrow Account if such income
is required to be paid to the related Mortgagor under applicable law or by the
terms of the Mortgage Loan, or otherwise to the Master Servicer; and

         (vi) to remove any funds deposited in a Escrow Account that were not
required to be deposited therein or to refund amounts to the Mortgagors
determined to be overages.

     Subject to the immediately succeeding sentence, (i) the Master Servicer may
direct any depository institution or trust company in which the Escrow Accounts
are maintained to invest the funds held therein in one or more Eligible
Investments; provided, however, that such funds shall be either (x) immediately
available or (y) available in accordance with a schedule which will permit the
Master Servicer to meet the payment obligations for which the Escrow Account was
established; (ii) the Master Servicer shall be entitled to all income and gain
realized from any such investment of funds as additional servicing compensation;
and (iii) the Master Servicer shall deposit from its own funds in the applicable
Escrow Account the amount of any loss incurred in respect of any such investment
of funds immediately upon the realization

                                     -186-

<PAGE>

of such loss. The Master Servicer shall not direct the investment of funds held
in any Escrow Account and retain the income and gain realized therefrom if the
terms of the related Mortgage Loan or applicable law permit the Mortgagor to be
entitled to the income and gain realized from the investment of funds deposited
therein, and the Master Servicer shall not be required to invest amounts on
deposit in Escrow Accounts in Eligible Investments or Eligible Accounts to the
extent that the Master Servicer is required by either law or under the terms of
any related Mortgage Loan to deposit or invest (or the Mortgagor is entitled to
direct the deposit or investment of) such amounts in another type of investments
or accounts. In the event the Master Servicer is not entitled to direct the
investment of such funds, (1) the Master Servicer shall direct the depository
institution or trust company in which such Escrow Accounts are maintained to
invest the funds held therein in accordance with the Mortgagor's written
investment instructions, if the terms of the related Mortgage Loan or applicable
law require the Master Servicer to invest such funds in accordance with the
Mortgagor's directions; and (2) in the absence of appropriate written
instructions from the Mortgagor, the Master Servicer shall have no obligation
to, but may be entitled to, direct the investment of such funds; provided,
however, that in either event (i) such funds shall be either (y) immediately
available or (z) available in accordance with a schedule which will permit the
Master Servicer to meet the payment obligations for which the Escrow Account was
established, and (ii) the Master Servicer shall have no liability for any loss
in investments of such funds that are invested pursuant to written instructions
from the Mortgagor.

     (f) The relationship of each of the Master Servicer and the Special
Servicer to the Trustee and the Paying Agent and to each other under this
Agreement is intended by the parties to be that of an independent contractor and
not of a joint venturer, partner or agent.

     (g) With respect to each Mortgage Loan, if required by the terms of the
related Mortgage Loan, any Lock-Box Agreement or similar agreement, the Master
Servicer shall establish and maintain, in accordance with the Servicing
Standard, one or more lock-box, cash management or similar accounts ("Lock-Box
Accounts") to be held outside the Trust and maintained by the Master Servicer in
accordance with the terms of the related Mortgage. No Lock-Box Account is
required to be an Eligible Account, unless otherwise required pursuant to the
related Mortgage Loan documents. The Master Servicer shall apply the funds
deposited in such accounts in accordance with terms of the related Mortgage Loan
documents, any Lock-Box Agreement and in accordance with the Servicing Standard.

     (h) The Master Servicer or any Primary Servicer on its behalf shall process
all defeasances of Mortgage Loans in accordance with the terms of the Mortgage
Loan documents, and shall be entitled to any fees paid relating thereto. The
Master Servicer shall not permit defeasance (or partial defeasance if permitted
under the Mortgage Loan) of any Mortgage Loan on or before the second
anniversary of the Closing Date unless such defeasance will not result in an
Adverse REMIC Event and the Master Servicer has received an opinion of counsel
to such effect and all items in the following sentence have been satisfied.
Subsequent to the second anniversary of the Closing Date, the Master Servicer,
in connection with the defeasance of a Mortgage Loan shall require (to the
extent it is not inconsistent with the Servicing Standard) that: (i) the
defeasance collateral consists of U.S. Treasury obligations, (ii) the Master
Servicer has determined that the defeasance will not result in an Adverse REMIC
Event, (iii) either (A) the related Mortgagor designates a Single-Purpose Entity
(if the Mortgagor no longer complies) to own the Defeasance Collateral (subject
to customary qualifications) or (B) the Master Servicer

                                     -187-

<PAGE>

has established a Single-Purpose Entity to hold all Defeasance Collateral
relating to the Defeasance Loans, (iv) the Master Servicer has requested and
received from the Mortgagor (A) an opinion of counsel that the Trustee will have
a perfected, first priority security interest in such Defeasance Collateral and
(B) written confirmation from a firm of independent accountants stating that
payments made on such Defeasance Collateral in accordance with the terms thereof
will be sufficient to pay the subject Mortgage Loan (or the defeased portion
thereof in connection with a partial defeasance) in full on or before its
Maturity Date (or, in the case of the ARD Loan, on or before its Anticipated
Repayment Date) and to timely pay each subsequent Scheduled Payment, (v) (A) a
Rating Agency Confirmation is received if the Mortgage Loan (together with any
other Mortgage Loan with which it is cross-collateralized) has a Principal
Balance greater than the lesser of $20,000,000 and 5% of the Aggregate
Certificate Balance, unless such Rating Agency has waived in writing such Rating
Agency Confirmation requirement or (B) if the Mortgage Loan is less than or
equal to both of the amounts set forth in clause (A), either a Notice and
Certification in the form attached hereto as Exhibit Z or a Rating Agency
Confirmation is received from Fitch and (vi) a Rating Agency Confirmation is
received if the Mortgage Loan is one of the ten largest Mortgage Loans, by
Principal Balance. Any customary and reasonable out-of-pocket expense incurred
by the Master Servicer pursuant to this Section 8.3(h) shall be paid by the
Mortgagor of the Defeasance Loan pursuant to the related Mortgage, Mortgage Note
or other pertinent document, if so allowed by the terms of such documents.

     The parties hereto acknowledge that if the payments described in paragraph
39 of Exhibit 2 to the Mortgage Loan Purchase Agreements regarding the
obligation of a Mortgagor to pay the reasonable costs and expenses associated
with a defeasance of the related Mortgage Loan are insufficient to reimburse the
Trust, including, but not limited to, rating agency fees, then the sole
obligation of the related Seller shall be to pay an amount equal to such
insufficiency or expense to the extent the related Mortgagor is not required to
pay such amount. Promptly upon receipt of notice of such insufficiency or unpaid
expense, the Master Servicer shall request the related Seller to make such
payment by deposit to the Certificate Account.

     In the case of a Specially Serviced Mortgage Loan, the Master Servicer
shall process any defeasance of such Specially Serviced Mortgage Loan in
accordance with the original terms of the respective Mortgage Loan documents
following a request by the Special Servicer that the Master Servicer do so,
which request shall be accompanied by a waiver of any condition of defeasance
that an "event of default" under such Specially Serviced Mortgage Loan not have
occurred or be continuing, and the Master Servicer shall be entitled to any fees
paid relating to such defeasance. If such "event of default" is on account of an
uncured payment default, the Special Servicer will process the defeasance of
such Specially Serviced Mortgage Loan, and the Special Servicer shall be
entitled to any fees paid relating to such defeasance.

     (i) The Master Servicer shall, as to each Mortgage Loan which is secured by
the interest of the related Mortgagor under a ground lease, confirm whether or
not on or prior to the date that is thirty (30) days after the Closing Date, the
Seller has notified the related ground lessor of the transfer of such Mortgage
Loan to the Trust pursuant to this Agreement and informed such ground lessor
that any notices of default under the related Ground Lease should thereafter be
forwarded to the Master Servicer (as evidenced by delivery of a copy thereof to
the Master Servicer). The Master Servicer shall promptly notify the ground
lessor if the Seller has failed to do so by the thirtieth day after the Closing
Date.

                                     -188-

<PAGE>

     (j) Pursuant to the related Intercreditor Agreement, the owner of any B
Note has agreed that the Master Servicer and the Special Servicer are authorized
and obligated to service and administer the B Note pursuant to this Agreement.
The Master Servicer shall be entitled, during any period when the A Note and B
Note under any A/B Mortgage Loan do not constitute Specially Serviced Mortgage
Loans, to exercise the rights and powers granted under the related Intercreditor
Agreement to the "Note A Holder" and/or the "Servicer" referred to therein. For
the avoidance of doubt, the parties acknowledge that neither the Master Servicer
nor the Special Servicer shall be entitled or required to exercise the rights
and powers granted to any "Note B Holder" as defined under the related
Intercreditor Agreement.

     (k) Pursuant to the applicable Non-Serviced Mortgage Loan Intercreditor
Agreement, the owner of any Non-Serviced Mortgage Loan has agreed that such
owner's rights in, to and under such Non-Serviced Mortgage Loan are subject to
the servicing and all other rights of the applicable Non-Serviced Mortgage Loan
Master Servicer and the applicable Non-Serviced Mortgage Loan Special Servicer,
and the applicable Non-Serviced Mortgage Loan Master Servicer and the applicable
Non-Serviced Mortgage Loan Special Servicer are authorized and obligated to
service and administer such Non-Serviced Mortgage Loan pursuant to the related
Non-Serviced Mortgage Loan Pooling and Servicing Agreement. Notwithstanding
anything herein to the contrary, the parties hereto acknowledge and agree that
the Master Servicer's obligations and responsibilities hereunder and the Master
Servicer's authority with respect to any Non-Serviced Mortgage Loan are limited
by and subject to the terms of the related Non-Serviced Mortgage Loan
Intercreditor Agreement and the rights of the applicable Non-Serviced Mortgage
Loan Master Servicer and the applicable Non-Serviced Mortgage Loan Special
Servicer with respect thereto under the related Non-Serviced Mortgage Loan
Pooling and Servicing Agreement. The Master Servicer shall use reasonable best
efforts consistent with the Servicing Standard to monitor the servicing of any
Non-Serviced Mortgage Loan by the applicable Non-Serviced Mortgage Loan Master
Servicer and the applicable Non-Serviced Mortgage Loan Special Servicer pursuant
to the related Non-Serviced Mortgage Loan Pooling and Servicing Agreement and
shall enforce the rights of the Trustee (as holder of the Non-Serviced Mortgage
Loans) under the related Non-Serviced Mortgage Loan Pooling and Servicing
Agreement and the related Non-Serviced Mortgage Loan Intercreditor Agreement.
The Master Servicer shall take such actions as it shall deem reasonably
necessary to facilitate the servicing of any Non-Serviced Mortgage Loan by the
applicable Non-Serviced Mortgage Loan Master Servicer and the applicable
Non-Serviced Mortgage Loan Special Servicer including, but not limited to,
delivering appropriate Requests for Release to the Trustee and Custodian (if
any) in order to deliver any portion of the related Mortgage File to the
applicable Non-Serviced Mortgage Loan Master Servicer or applicable Non-Serviced
Mortgage Loan Special Servicer under the related Non-Serviced Mortgage Loan
Pooling and Servicing Agreement.

     (l) Pursuant to the Loan Pair Intercreditor Agreement, the owner of the
WestShore Plaza Companion Loan has agreed that the Master Servicer and the
Special Servicer are authorized and obligated to service and administer the
WestShore Plaza Companion Loan pursuant to this Agreement. The Master Servicer,
the Special Servicer, the Trustee and the Fiscal Agent are authorized and
directed to execute and deliver to the holder of the WestShore Plaza Companion
Loan a letter agreement dated as of the Closing Date setting forth provisions as
to, among other things, the timing of remittances, advances and reports relating
to the WestShore Plaza Companion Loan, and references herein to the Loan Pair
Intercreditor Agreement shall be construed to refer to such Loan Pair
Intercreditor Agreement and such letter agreement taken

                                     -189-

<PAGE>

together. To the extent that the Master Servicer, the Special Servicer, the
Trustee and/or the Fiscal Agent have duties and obligations under any such
letter agreement, each successor master servicer, successor special servicer,
successor trustee and/or successor fiscal agent, respectively, under this
Agreement shall perform such duties and satisfy such obligations.

     SECTION 8.4 PRIMARY SERVICING AND SUB-SERVICING.

     (a) The parties hereto (A) acknowledge that the Master Servicer has
delegated certain of its obligations and assigned certain of its rights under
this Agreement to each of the Primary Servicers pursuant to the applicable
Primary Servicing Agreements; and (B) agree: (1) in addition to those
obligations specifically delegated by the Master Servicer to each Primary
Servicer under the applicable Primary Servicing Agreement, each Primary Servicer
shall also perform the Master Servicer's obligations set forth in Section 2.1(d)
of this Agreement as such Section relates to the Mortgage Loans serviced by it;
(2) in addition to those rights specifically granted by the Master Servicer to
each Primary Servicer under the applicable Primary Servicing Agreement, those
rights set forth in Section 8.24 hereof accruing to the benefit of the Master
Servicer shall also accrue to the benefit of each Primary Servicer; (3) any
indemnification or release from liability set forth in this Agreement accruing
to the benefit of the Master Servicer shall also, to the extent applicable,
benefit each Primary Servicer; and (4) for each notice, certification, report,
schedule, statement or other type of writing that a party hereto is obligated to
deliver to the Master Servicer, such party shall deliver to each Primary
Servicer a copy of such notice, certification, report, schedule, statement or
other type of writing at the time and in the same manner that any of the
foregoing is required to be delivered to the Master Servicer. Notwithstanding
the provisions of any Primary Servicing Agreement or any other provisions of
this Agreement, the Master Servicer shall remain obligated and liable to the
Trustee, the Paying Agent, the Special Servicer, the Certificateholders, the
holder of the WestShore Plaza Companion Loan and the holder of any B Note for
servicing and administering of the Mortgage Loans and the WestShore Plaza
Companion Loan in accordance with the provisions of this Agreement to the same
extent as if the Master Servicer was alone servicing and administering the
Mortgage Loans and the WestShore Plaza Companion Loan. The Master Servicer or
applicable Primary Servicer shall supervise, administer, monitor, enforce and
oversee the servicing of the applicable Mortgage Loans by any Sub-Servicer
appointed by it. The terms of any arrangement or agreement between the Master
Servicer or applicable Primary Servicer and a Sub-Servicer shall provide that
such agreement or arrangement may be terminated, without cause and without the
payment of any termination fees, by the Trustee in the event such Master
Servicer or applicable Primary Servicer is terminated in accordance with this
Agreement or the applicable Primary Servicing Agreement. In addition, none of
the Trustee, the Paying Agent, the Certificateholders, the holder of the
WestShore Plaza Companion Loan or the holder of any B Note shall have any direct
obligation or liability (including, without limitation, indemnification
obligations) with respect to any Sub-Servicer. The Master Servicer or applicable
Primary Servicer shall pay the costs of enforcement against any of its
Sub-Servicers at its own expense, but shall be reimbursed therefor only (i) from
a general recovery resulting from such enforcement only to the extent that such
recovery exceeds all amounts due in respect of the related Mortgage Loans or
(ii) from a specific recovery of costs, expenses or attorneys fees against the
party against whom such enforcement is directed. Notwithstanding the provisions
of any primary servicing agreement or sub-servicing agreement, any of the
provisions of this Agreement relating to agreements or arrangements between the
Master Servicer or applicable Primary Servicer or a Sub-Servicer, or reference
to actions taken through a Sub-Servicer or

                                     -190-

<PAGE>

otherwise, the Master Servicer or applicable Primary Servicer shall remain
obligated and liable to the Trustee, the Paying Agent, the Special Servicer and
the Certificateholders for the servicing and administering of the applicable
Mortgage Loans and the WestShore Plaza Companion Loan in accordance with (and
subject to the limitations contained within) the provisions of this Agreement or
the applicable Primary Servicing Agreement without diminution of such obligation
or liability by virtue of indemnification from a Sub-Servicer and to the same
extent and under the same terms and conditions as if the Master Servicer or
applicable Primary Servicer alone were servicing and administering the Mortgage
Loans.

     (b) Subject to the limitations of subsection (a), the Master Servicer and
either Primary Servicer may appoint one or more sub-servicers (each, a
"Sub-Servicer") to perform all or any portion of its duties hereunder for the
benefit of the Trustee and the Certificateholders, provided, however, that any
decision or recommendation involving the exercise of a Primary Servicer's
discretion as a "lender" under any loan document with respect to a Mortgage Loan
shall be exercised only by the Primary Servicer and may not be delegated to a
Sub-Servicer.

     The Master Servicer shall enter into the Primary Servicing Agreements with
each of the Primary Servicers and shall not terminate such agreements except in
accordance with the terms thereof. To the extent consistent with the rights of
the Primary Servicers under this Agreement and the related Primary Servicing
Agreement, but not in limitation of any other rights granted to the Primary
Servicers in this Agreement and/or in each of the Primary Servicing Agreements,
the Primary Servicers shall have all of the rights and obligations of a
Sub-Servicer set forth herein.

     Notwithstanding any other provision set forth in this Agreement to the
contrary, (i) each Primary Servicer's rights and obligations under its
respective Primary Servicing Agreement shall expressly survive a termination of
the Master Servicer's servicing rights under this Agreement; provided that the
applicable Primary Servicing Agreement has not been terminated in accordance
with its provisions; (ii) any successor Master Servicer, including, without
limitation, the Trustee (if it assumes the servicing obligations of the Master
Servicer) shall be deemed to automatically assume and agree to each of the then
current Primary Servicing Agreements without further action upon becoming the
successor Master Servicer and (iii) this Agreement may not be modified in any
manner which would increase the obligations or limit the rights of a Primary
Servicer hereunder and/or under the applicable Primary Servicing Agreement,
without the prior written consent of such Primary Servicer (which consent shall
not be unreasonably withheld).

     If a task, right or obligation of Master Servicer is delegated to a Primary
Servicer under a Primary Servicing Agreement, and such task, right or obligation
involves or requires the consent of the Special Servicer, then the Special
Servicer shall accept the performance of such task, right or obligation by such
Primary Servicer in accordance with the terms of this Agreement (including
without limitation any time periods for consent or deemed consent to be observed
by the Special Servicer) as if Master Servicer were performing it.

     Notwithstanding any provision of this Agreement, each of the parties hereto
acknowledges and agrees that the Special Servicer is neither a party to any
Primary Servicing Agreement, nor is it bound by any provision of any Primary
Servicing Agreement. The Special

                                     -191-

<PAGE>

Servicer hereby acknowledges the delegation of rights and duties hereunder by
the Master Servicer pursuant to the provisions of any Primary Servicing
Agreement.

     SECTION 8.5 SERVICERS MAY OWN CERTIFICATES. The Master Servicer and any
Primary Servicer and any agent of the Master Servicer or Primary Servicer in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights it would have if it were not the Master Servicer or such
agent. Any such interest of the Master Servicer or any Primary Servicer or such
agent in the Certificates shall not be taken into account when evaluating
whether actions of the Master Servicer are consistent with its obligations in
accordance with the Servicing Standard regardless of whether such actions may
have the effect of benefiting the Class or Classes of Certificates owned by the
Master Servicer.

     SECTION 8.6 MAINTENANCE OF HAZARD INSURANCE, OTHER INSURANCE, TAXES AND
OTHER. Subject to the limitations set forth below, the Master Servicer shall use
reasonable efforts consistent with the Servicing Standard to cause the related
Mortgagor to maintain for each Mortgage Loan (other than any REO Mortgage Loan)
(A) a Standard Hazard Insurance Policy (that, if the terms of the related
Mortgage Loan documents and the related Mortgage so require, contains no
exclusion for damages due to any Act or Acts of Terrorism, as defined in the
Terrorism Risk Insurance Act of 2002) and which does not provide for reduction
due to depreciation in an amount that is at least equal to the lesser of (i) the
full replacement cost of improvements securing such Mortgage Loan or (ii) the
outstanding Principal Balance of such Mortgage Loan, any related B Note or the
WestShore Plaza Companion Loan, but, in any event, in an amount sufficient to
avoid the application of any co-insurance clause and (B) any other insurance
coverage for a Mortgage Loan which the related Mortgagor is required to maintain
under the related Mortgage, provided the Master Servicer shall not be required
to maintain earthquake insurance on any Mortgaged Property unless such insurance
was required at origination and is available at commercially reasonable rates;
provided, however, that the Special Servicer shall have the right, but not the
duty, to obtain, at the Trust's expense, earthquake insurance on any Mortgaged
Property securing a Specially Serviced Mortgage Loan or an REO Property so long
as such insurance is available at commercially reasonable rates. If the related
Mortgagor does not maintain the insurance set forth in clauses (A) and (B)
above, then the Master Servicer shall cause to be maintained such insurance with
a Qualified Insurer. The Master Servicer shall be deemed to have satisfied its
Servicing Standard if the Mortgagor maintains, or the Master Servicer shall have
otherwise caused to be obtained, a Standard Hazard Insurance Policy that is in
compliance with the related Mortgage Loan documents, and, if required by such
Mortgage Loan documents, the Mortgagor pays, or the Master Servicer shall have
otherwise caused to be paid, the premium required by the related insurance
provider that is necessary to avoid an exclusion in such policy against "acts of
terrorism" as defined by the Terrorism Risk Insurance Act of 2002.

     Each Standard Hazard Insurance Policy maintained with respect to any
Mortgaged Property that is not an REO Property shall contain, or have an
accompanying endorsement that contains, a standard mortgagee clause. If the
improvements on the Mortgaged Property are located in a designated special flood
hazard area by the Federal Emergency Management Agency in the Federal Register,
as amended from time to time (to the extent permitted under the related Mortgage
Loan or as required by law), the Master Servicer (with respect to any Mortgaged
Property that is not an REO Property) shall cause flood insurance to be

                                     -192-

<PAGE>

maintained. Such flood insurance shall be in an amount equal to the lesser of
(i) the unpaid principal balance of the related Mortgage Loan or (ii) the
maximum amount of such insurance available for the related Mortgaged Property
under the national flood insurance program, if the area in which the
improvements on the Mortgaged Property are located is participating in such
program. Any amounts collected by the Master Servicer under any such policies
(other than amounts to be applied to the restoration or repair of the related
Mortgaged Property or property thus acquired or amounts released to the
Mortgagor in accordance with the terms of the applicable Mortgage Loan) shall be
deposited in the Certificate Account.

     Any cost (such as insurance premiums and insurance broker fees but not
internal costs and expenses of obtaining such insurance) incurred by the Master
Servicer in maintaining any insurance pursuant to this Section 8.6 shall not,
for the purpose of calculating monthly distributions to the Certificateholders
or remittances to the Paying Agent for their benefit, be added to the Principal
Balance of the Mortgage Loan, notwithstanding that the terms of the Mortgage
Loan permit such cost to be added to the outstanding Principal Balance thereof.
Such costs shall be paid as a Servicing Advance by the Master Servicer, subject
to Section 4.4 hereof.

     Notwithstanding the above, the Master Servicer shall have no obligation
beyond using its reasonable efforts consistent with the Servicing Standard to
enforce such insurance requirements. Furthermore, the Master Servicer shall not
be required in any event to cause the Mortgagor to maintain or itself obtain
insurance coverage beyond what is available on commercially reasonable terms at
a cost customarily acceptable (in each case, as determined by the Master
Servicer, which shall be entitled to rely, at its sole expense, on insurance
consultants in making such determination, consistent with the Servicing
Standard) and consistent with the Servicing Standard; provided, that the Master
Servicer shall be obligated to cause the Mortgagor to maintain or itself obtain
insurance against property damage resulting from terrorism or similar acts if
the terms of the related Mortgage Loan documents and the related Mortgage so
require unless the Master Servicer determines that (i) such insurance is not
available at any rate or (ii) such insurance is not available at commercially
reasonable rates and such hazards are not at the time commonly insured against
for properties similar to the related Mortgaged Property and located in or
around the region in which such related Mortgaged Property is located; provided,
that such determination must be made by the Master Servicer not less frequently
(but need not be made more frequently) than annually, but in any event, shall be
made on the approximate date on (but not later than sixty (60) days thereafter)
which the Master Servicer receives notice of the renewal, replacement or
cancellation of coverage (as evidenced by the related insurance policy or
insurance certificate). Notwithstanding the limitation set forth in the
preceding sentence, if the related Mortgage Loan documents and the related
Mortgage require the Mortgagor to maintain insurance against property damage
resulting from terrorism or similar acts, the Master Servicer shall prior to
availing itself of any limitation described in that sentence with respect to any
Mortgage Loan (or any component loan of an A/B Mortgage Loan) that has a
principal balance in excess of $2,500,000, obtain the approval or disapproval of
the Special Servicer and the Operating Adviser (subject to the last paragraph of
Section 9.39). The Master Servicer shall be entitled to rely on the
determination of the Special Servicer made in connection with such approval or
disapproval. The Special Servicer shall decide whether to withhold or grant such
approval in accordance with the Servicing Standard. If any such approval has not
been expressly denied within seven (7) Business Days of receipt by the Special
Servicer and Operating Adviser from the Master Servicer of the Master Servicer's
determination and analysis and all information

                                     -193-

<PAGE>

reasonably requested by the Special Servicer and reasonably available to the
Master Servicer in order to make an informed decision, such approval shall be
deemed to have been granted.

     The Master Servicer shall conclusively be deemed to have satisfied its
obligations as set forth in this Section 8.6 either (i) if the Master Servicer
shall have obtained and maintained a master force placed or blanket insurance
policy insuring against hazard losses on all of the applicable Mortgage Loans,
the WestShore Plaza Companion Loan and any B Note serviced by it, it being
understood and agreed that such policy may contain a deductible clause on terms
substantially equivalent to those commercially available and maintained by
comparable servicers consistent with the Servicing Standard, and provided that
such policy is issued by a Qualified Insurer or (ii) if the Master Servicer,
provided that its long-term rating is not less than "A2" by Moody's and "A" by
Fitch, self-insures for its obligations as set forth in the first paragraph of
this Section 8.6. In the event that the Master Servicer shall cause any Mortgage
Loan to be covered by such a master force placed or blanket insurance policy,
the incremental cost of such insurance allocable to such Mortgage Loan (i.e.,
other than any minimum or standby premium payable for such policy whether or not
any Mortgage Loan is then covered thereby), if not borne by the related
Mortgagor, shall be paid by the Master Servicer as a Servicing Advance. If such
policy contains a deductible clause, the Master Servicer shall, if there shall
not have been maintained on the related Mortgaged Property a policy complying
with this Section 8.6 and there shall have been a loss that would have been
covered by such policy, deposit in the Certificate Account the amount not
otherwise payable under such master force placed or blanket insurance policy
because of such deductible clause to the extent that such deductible exceeds (i)
the deductible under the related Mortgage Loan or (ii) if there is no deductible
limitation required under the Mortgage Loan, the deductible amount with respect
to insurance policies generally available on properties similar to the related
Mortgaged Property which is consistent with the Servicing Standard, and deliver
to the Trustee an Officer's Certificate describing the calculation of such
amount. In connection with its activities as administrator and servicer of the
Mortgage Loans, the WestShore Plaza Companion Loan and any B Note, the Master
Servicer agrees to present, on its behalf and on behalf of the Trustee and the
holders of the WestShore Plaza Companion Loan or any B Note, claims under any
such master force placed or blanket insurance policy.

     With respect to each Mortgage Loan, the Master Servicer shall maintain
accurate records with respect to each related Mortgaged Property reflecting the
status of taxes, assessments and other similar items that are or may become a
lien on the related Mortgaged Property and the status of insurance premiums
payable with respect thereto. From time to time, the Master Servicer (other than
with respect to REO Mortgage Loans) shall (i) obtain all bills for the payment
of such items (including renewal premiums), and (ii) except in the case of
Mortgage Loans under which Escrow Amounts are not held by the Master Servicer,
effect payment of all such bills, taxes and other assessments with respect to
such Mortgaged Properties prior to the applicable penalty or termination date,
in each case employing for such purpose Escrow Amounts as allowed under the
terms of the related Mortgage Loan. If a Mortgagor fails to make any such
payment on a timely basis or collections from the Mortgagor are insufficient to
pay any such item before the applicable penalty or termination date, the Master
Servicer in accordance with the Servicing Standard shall use its reasonable
efforts to pay as a Servicing Advance the amount necessary to effect the payment
of any such item prior to such penalty or termination date, subject to Section
4.4 hereof. No costs incurred by the Master Servicer, the Trustee or the Fiscal
Agent as the case may be, in effecting the payment of taxes and assessments on
the

                                     -194-

<PAGE>

Mortgaged Properties and related insurance premiums and ground rents shall, for
the purpose of calculating distributions to Certificateholders, be added to the
Principal Balance of the Mortgage Loans, notwithstanding that the terms of such
Mortgage Loans permit such costs to be added to the outstanding Principal
Balances of such Mortgage Loans.

     SECTION 8.7 ENFORCEMENT OF DUE-ON-SALE CLAUSES; ASSUMPTION AGREEMENTS;
DUE-ON-ENCUMBRANCE CLAUSE.

     (a) In the event the Master Servicer receives a request from a Mortgagor
(or other obligor) pursuant to the provisions of any Mortgage Loan, the
WestShore Plaza Companion Loan or any B Note (other than a Specially Serviced
Mortgage Loan) that expressly permits, subject to any conditions set forth in
the Mortgage Loan documents, the assignment of the related Mortgaged Property
to, and assumption of such Mortgage Loan, the WestShore Plaza Companion Loan or
B Note by, another Person, the Master Servicer shall obtain relevant information
for purposes of evaluating such request. For the purpose of the foregoing
sentence, the term `expressly permits' shall include outright permission to
assign, permission to assign upon satisfaction of certain conditions or
prohibition against assignment except upon the satisfaction of stated
conditions. If the Master Servicer recommends to approve such assignment, the
Master Servicer shall provide to the Special Servicer (and solely with respect
to any A/B Mortgage Loan, the holder of the B Note) a copy of such
recommendation and the materials upon which such recommendation is based (which
information shall consist of the information to be included in the Assignment
and Assumption Submission to Special Servicer, in the form attached hereto as
Exhibit U) and (A) the Special Servicer shall have the right hereunder to grant
or withhold consent to any such request for such assignment and assumption in
accordance with the terms of the Mortgage Loan, the WestShore Plaza Companion
Loan or B Note and this Agreement, and the Special Servicer shall not
unreasonably withhold such consent and any such decision of the Special Servicer
shall be in accordance with the Servicing Standard, (B) failure of the Special
Servicer to notify the Master Servicer in writing, within five (5) Business Days
following the Master Servicer's delivery of the recommendation described above
and the complete Assignment and Assumption Submission to Special Servicer on
which the recommendation is based, of its determination to grant or withhold
such consent shall be deemed to constitute a grant of such consent and (C) the
Master Servicer shall not permit any such assignment or assumption unless (i) it
has received the written consent of the Special Servicer or such consent has
been deemed to have been granted as described in the preceding sentence and (ii)
with respect to any A/B Mortgage Loan, the Master Servicer has obtained the
approval of the holder of the related B Note, to the extent provided for in the
related Intercreditor Agreement, and in accordance with any procedures therefor
set forth in Section 9.40. The Special Servicer hereby acknowledges the
delegation of rights and duties hereunder by the Master Servicer pursuant to the
provisions of each Primary Servicing Agreement. If the Special Servicer
withholds consent pursuant to the provisions of this Agreement, it shall provide
the Master Servicer or any applicable Primary Servicer with a written statement
and a verbal explanation as to its reasoning and analysis. Upon consent or
deemed consent by the Special Servicer to such proposed assignment and
assumption, the Master Servicer shall process such request of the related
Mortgagor (or other obligor) and shall be authorized to enter into an assignment
and assumption or substitution agreement with the Person to whom the related
Mortgaged Property has been or is proposed to be conveyed, and/or release the
original Mortgagor, the WestShore Plaza Companion Loan or B Note from liability
under the related Mortgage Loan, the WestShore

                                     -195-

<PAGE>

Plaza Companion Loan or the related B Note and substitute as obligor thereunder
the Person to whom the related Mortgaged Property has been or is proposed to be
conveyed; provided, however, that the Master Servicer shall not enter into any
such agreement to the extent that any terms thereof would result in an Adverse
REMIC Event or create any lien on a Mortgaged Property that is senior to, or on
parity with, the lien of the related Mortgage. To the extent permitted by
applicable law, the Master Servicer shall not enter into such an assumption or
substitution agreement unless the credit status of the prospective new Mortgagor
(or other obligor) is in conformity to the terms of the related Mortgage Loan, B
Note or the WestShore Plaza Companion Loan documents. In making its
recommendation, the Master Servicer shall evaluate such conformity in accordance
with the Servicing Standard. The Master Servicer shall notify the Trustee, the
Paying Agent and the Special Servicer of any assignment and assumption or
substitution agreement executed pursuant to this Section 8.7(a). The Master
Servicer shall be entitled to (as additional servicing compensation) 50% of any
assumption fee collected from a Mortgagor in connection with an assignment and
assumption or substitution of a non-Specially Serviced Mortgage Loan executed
pursuant to this Section 8.7(a) and the Special Servicer shall be entitled to
(as additional special servicing compensation) the other 50% of such fee.

     Notwithstanding the foregoing, the Special Servicer acknowledges that the
Master Servicer has delegated certain tasks, rights and obligations to the
Primary Servicers with respect to Post Closing Requests (as defined in the
Primary Servicing Agreement) pursuant to Section 8.4 of this Agreement. The
Primary Servicing Agreements classify certain Post Closing Requests as Category
1 Requests (as defined in the Primary Servicing Agreement), in which each
Primary Servicer has certain authority to evaluate and process such requests in
accordance with this Agreement, the applicable Primary Servicing Agreement and
applicable Mortgage Loan documents.

     With respect to a Category 1 Request that involves a condition, term or
provision that requires, or specifies a standard of, consent or approval of the
applicable Mortgagee under the Mortgage Loan documents, the Primary Servicing
Agreements provide for the determination of materiality of such condition, term
or provision requiring approval or consent by the Master Servicer or the Primary
Servicer and the referral of such condition, term or provision to a Special
Servicer for consent in accordance with the terms of the Primary Servicing
Agreements upon a determination of materiality. The Special Servicer
acknowledges such provisions. Nothing in this Agreement, however, shall grant
the Primary Servicers greater authority, discretion or delegated rights over
Post Closing Requests than are set forth in the Primary Servicing Agreements.

     Neither the Master Servicer nor the Special Servicer shall have any
liability, and shall be indemnified by the Trust for any liability to the
Mortgagor or the proposed assignee, for any delay in responding to requests for
assumption, if the same shall occur as a result of the failure of the Rating
Agencies, or any of them, to respond to such request in a reasonable period of
time.

     (b) Other than with respect to the assignment and assumptions referred to
in subsection (a) above, if any Mortgage Loan that is not a Specially Serviced
Mortgage Loan contains a provision in the nature of a "due-on-sale" clause,
which by its terms (i) provides that such Mortgage Loan shall (or may at the
mortgagee's option) become due and payable upon the sale or other transfer of an
interest in the related Mortgaged Property or ownership interest in the

                                     -196-

<PAGE>

related Mortgagor, or (ii) provides that such Mortgage Loan may not be assumed,
or ownership interests in the related Mortgagor may not be transferred, without
the consent of the related mortgagee in connection with any such sale or other
transfer, then, the Master Servicer shall review and make a determination to
either (i) enforce such due-on-sale clause or (ii) if in the best economic
interest of the Trust, waive the effect of such provision, such waiver to be
processed in the same manner as in Section 8.7(a); provided, however, that if
the Principal Balance of such Mortgage Loan (together with any other Mortgage
Loan with which it is cross-collateralized) at such time equals or exceeds 5% of
the Aggregate Certificate Balance or exceeds $35,000,000 or is one of the then
current top 10 loans (by Principal Balance) in the pool, then prior to waiving
the effect of such provision, the Master Servicer shall obtain Rating Agency
Confirmation (including with respect to any securities which are rated by a
Rating Agency evidencing direct beneficial interests in the A Notes and any B
Note) regarding such waiver. In connection with the request for such consent,
the Master Servicer shall prepare and deliver to Moody's and Fitch a memorandum
outlining its analysis and recommendation in accordance with the Servicing
Standard, together with copies of all relevant documentation. The Master
Servicer shall promptly forward copies of the assignment and assumption
documents relating to any Mortgage Loan to the Special Servicer, the Paying
Agent and the Trustee, and the Master Servicer shall promptly thereafter forward
such documents to the Rating Agencies. The Special Servicer and the Master
Servicer shall each be entitled to (as additional compensation) 50% of any fee
collected from a Mortgagor in connection with the granting or withholding such
consent (other than any such fee payable in connection with any Non-Serviced
Mortgage Loan).

     (c) The Master Servicer shall have the right to consent to any transfers of
an interest of a Mortgagor, to the extent such transfer is to a party or entity
specifically named or described under the terms of the related Mortgage Loan,
including any consent to transfer to any subsidiary or affiliate of Mortgagor or
to a person acquiring less than a majority interest in the Mortgagor; provided,
however, that if (i) the Principal Balance of such Mortgage Loan (together with
any other Mortgage Loan with which it is cross-collateralized) at such time
equals or exceeds 5% of the Aggregate Certificate Balance or is one of the then
current top 10 loans (by Principal Balance) in the pool, and (ii) the transfer
is of an interest in the Mortgagor greater than 49%, then prior to consenting,
the Master Servicer shall obtain a Rating Agency Confirmation regarding such
consent, the costs of which to be payable by the related Mortgagor to the extent
provided for in the Mortgage Loan documents. The Master Servicer shall be
entitled to collect and receive from Mortgagors any customary fees in connection
with such transfers of interest as additional servicing compensation.

     (d) The Trustee for the benefit of the Certificateholders, the holder of
the WestShore Plaza Companion Loan and the holder of any B Note shall execute
any necessary instruments in the form presented to it by the Master Servicer
(pursuant to subsection (a)) or the Special Servicer (pursuant to subsection
(b)) for such assignments and assumptions agreements. Upon the closing of the
transactions contemplated by such documents, the Master Servicer or the Special
Servicer, as the case may be, shall cause the originals of the assignment and
assumption agreement, the release (if any), or the modification or supplement to
the Mortgage Loan to be delivered to the Trustee except to the extent such
documents have been submitted to the recording office, in which event the Master
Servicer shall promptly deliver copies of such documents to the Trustee and the
Special Servicer.

                                     -197-

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     (e) If any Mortgage Loan (other than a Specially Serviced Mortgage Loan)
which contains a provision in the nature of a "due-on-encumbrance" clause, which
by its terms:

         (i) provides that such Mortgage Loan shall (or may at the mortgagee's
option) become due and payable upon the creation of any additional lien or other
encumbrance on the related Mortgaged Property or a lien on an ownership interest
in the Mortgagor; or

         (ii) requires the consent of the Mortgagee to the creation of any such
additional lien or other encumbrance on the related Mortgaged Property or a lien
on an ownership interest in the Mortgagor,

then, as long as such Mortgage Loan is included in the Trust, the Master
Servicer, on behalf of the Trustee as the Mortgagee of record, shall exercise
(or, subject to Section 8.18, waive its right to exercise) any right it may have
with respect to such Mortgage Loan (x) to accelerate the payments thereon, or
(y) to withhold its consent to the creation of any such additional lien or other
encumbrance, in a manner consistent with the Servicing Standard, the following
paragraph and Section 8.18 hereof. The Master Servicer shall not waive the
effect of such provision without first obtaining Rating Agency Confirmation
(including with respect to any securities which are rated by a Rating Agency
evidencing direct beneficial interests in the A Notes and any B Note) regarding
such waiver and complying with the provisions of the next succeeding paragraph;
provided, however, that such Rating Agency Confirmation shall only be required
if the applicable Mortgage Loan (x) represents 2% or more of the Principal
Balance of all of the Mortgage Loans held by the Trust or is one of the 10
largest Mortgage Loans based on Principal Balance and (y) such Mortgage Loan has
a Loan-to-Value Ratio (which includes Junior Indebtedness, if any) that is
greater than or equal to 85% and a Debt Service Coverage Ratio (which includes
debt service on Junior Indebtedness, if any) that is less than 1.2x.

     Without limiting the generality of the preceding paragraph, in the event
that the Master Servicer receives a request for a waiver of any "due-on-
encumbrance" clause, the Master Servicer shall obtain relevant information for
purposes of evaluating such request for a waiver. If the Master Servicer
recommends to waive such clause, the Master Servicer shall provide to the
Special Servicer a copy of such recommendation and the materials upon which such
recommendation is based (which information shall consist of the information to
be included in the Additional Lien, Monetary Encumbrance and Mezzanine Financing
Submission Package to the Special Servicer, in the form attached hereto as
Exhibit V) and (A) the Special Servicer shall have the right hereunder to grant
or withhold consent to any such request in accordance with the terms of the
Mortgage Loan and this Agreement, and the Special Servicer shall not
unreasonably withhold such consent and any such decision of the Special Servicer
shall be in accordance with the Servicing Standard, (B) failure of the Special
Servicer to notify the Master Servicer in writing, within five (5) Business Days
following the Master Servicer's delivery of the recommendation described above
and the complete Additional Lien, Monetary Encumbrance and Mezzanine Financing
Submission Package to the Special Servicer on which the recommendation is based,
of its determination to grant or withhold such consent shall be deemed to
constitute a grant of such consent and (C) the Master Servicer shall not permit
any such waiver unless it has received the written consent of the Special
Servicer or such consent has been deemed to have been granted as described in
the preceding sentence. If the Special Servicer withholds consent pursuant to
the foregoing provisions, it shall provide the Master Servicer with a written
statement

                                     -198-

<PAGE>

and a verbal explanation as to its reasoning and analysis. Upon
consent or deemed consent by the Special Servicer to such proposed waiver, the
Master Servicer shall process such request of the related Mortgagor subject to
the other requirements set forth above.

     The parties hereto acknowledge that, if the payments described in paragraph
39 of Exhibit 2 to the Mortgage Loan Purchase Agreements regarding the
obligation of a Mortgagor to pay the reasonable costs and expenses of obtaining
any Rating Agency Confirmation in connection with an assumption of the related
Mortgage Loan are insufficient to reimburse the Trust, then it shall be the sole
obligation of the related Seller to pay an amount equal to such insufficiency to
the extent the related Mortgagor is not required to pay them. Promptly upon
receipt of notice of such insufficiency, the Master Servicer or the Special
Servicer, as applicable, shall request the related Seller to make such payment
by deposit to the Certificate Account. The Master Servicer may not waive such
payment by the Mortgagor and shall use its reasonable efforts to collect such
amounts from the Mortgagor to the extent the related mortgage loan documents
require the related Mortgagor to pay such amounts.

     SECTION 8.8 TRUSTEE TO COOPERATE; RELEASE OF TRUSTEE MORTGAGE FILES. Upon
the payment in full of any Mortgage Loan, the complete defeasance of a Mortgage
Loan, satisfaction or discharge in full of any Specially Serviced Mortgage Loan,
the purchase of an A Note by the holder of a B Note pursuant to the related
Intercreditor Agreement, or the receipt by the Master Servicer of a notification
that payment in full (or such payment, if any, in connection with the
satisfaction and discharge in full of any Specially Serviced Mortgage Loan) will
be escrowed in a manner customary for such purposes, and upon notification by
the Master Servicer in the form of a certification (which certification shall
include a statement to the effect that all amounts received or to be received in
connection with such payment which are required to be deposited in the
Certificate Account have been or will be so deposited) of a Servicing Officer
and a request for release of the Trustee Mortgage File in the form of Exhibit C
hereto the Trustee shall promptly release the related Trustee Mortgage File to
the Master Servicer and the Trustee shall execute and deliver to the Master
Servicer the deed of reconveyance or release, satisfaction or assignment of
mortgage or such instrument releasing the lien of the Mortgage, as directed by
the Master Servicer together with the Mortgage Note with written evidence of
cancellation thereon. The provisions of the immediately preceding sentence shall
not, in any manner, limit or impair the right of the Master Servicer to execute
and deliver, on behalf of the Trustee, the Certificateholders, the holder of the
WestShore Plaza Companion Loan, the holder of any B Note or any of them, any and
all instruments of satisfaction, cancellation or assignment without recourse,
representation or warranty, or of partial or full release or discharge and all
other comparable instruments, with respect to the Mortgage Loans, the WestShore
Plaza Companion Loan or any B Note, and with respect to the Mortgaged Properties
held for the benefit of the Certificateholders, the holder of the WestShore
Plaza Companion Loan and the holder of any B Note. No expenses incurred in
connection with any instrument of satisfaction or deed of reconveyance shall be
chargeable to the Distribution Account but shall be paid by the Master Servicer
except to the extent that such expenses are paid by the related Mortgagor in a
manner consistent with the terms of the related Mortgage and applicable law.
From time to time and as shall be appropriate for the servicing of any Mortgage
Loan, including for such purpose, collection under any policy of flood
insurance, any Servicer Fidelity Bond or Errors and Omissions Policy, or for the
purposes of effecting a partial or total release of any Mortgaged Property from
the lien of the Mortgage or the making of any corrections to the Mortgage Note
or the Mortgage or any of the other documents included in the Trustee Mortgage
File, the Trustee

                                     -199-

<PAGE>

shall, upon request of the Master Servicer and the delivery to the Trustee of a
Request for Release signed by a Servicing Officer, in the form of Exhibit C
hereto, release the Trustee Mortgage File to the Master Servicer or the Special
Servicer, as the case may be.

     SECTION 8.9 DOCUMENTS, RECORDS AND FUNDS IN POSSESSION OF MASTER SERVICER
TO BE HELD FOR THE TRUSTEE FOR THE BENEFIT OF THE CERTIFICATEHOLDERS.

     Notwithstanding any other provisions of this Agreement, the Master Servicer
shall transmit to the Trustee, to the extent required by this Agreement, all
documents and instruments coming into the possession of the Master Servicer from
time to time and shall account fully to the Trustee and the Paying Agent for any
funds received or otherwise collected thereby, including Liquidation Proceeds or
Insurance Proceeds in respect of any Mortgage Loan. All Servicer Mortgage Files
and funds collected or held by, or under the control of, the Master Servicer in
respect of any Mortgage Loans (or any B Note or the WestShore Plaza Companion
Loan), whether from the collection of principal and interest payments or from
Liquidation Proceeds or Insurance Proceeds, including any funds on deposit in
the Certificate Account (or any A/B Loan Custodial Account or the WestShore
Plaza Companion Loan Custodial Account), shall be held by the Master Servicer
for and on behalf of the Trustee and the Certificateholders (or the holder of
any B Note or the WestShore Plaza Companion Loan, as applicable) and shall be
and remain the sole and exclusive property of the Trustee, subject to the
applicable provisions of this Agreement. The Master Servicer agrees that it
shall not create, incur or subject any Servicer Mortgage Files or Trustee
Mortgage File or any funds that are deposited in the Certificate Account or any
Escrow Account, or any funds that otherwise are or may become due or payable to
the Trustee or the Paying Agent, to any claim, lien, security interest,
judgment, levy, writ of attachment or other encumbrance, or assert by legal
action or otherwise any claim or right of setoff against any Servicer Mortgage
Files or Trustee Mortgage File or any funds collected on, or in connection with,
a Mortgage Loan, except, however, that the Master Servicer shall be entitled to
receive from any such funds any amounts that are properly due and payable to the
Master Servicer under this Agreement.

     SECTION 8.10 SERVICING COMPENSATION.

     (a) As compensation for its activities hereunder, the Master Servicer shall
be entitled to the Master Servicing Fee, which shall be payable by the Trust
from amounts held in the Certificate Account (and from the related A/B Loan
Custodial Account to the extent related solely to a B Note and from the
WestShore Plaza Companion Loan Custodial Account to the extent related solely to
the WestShore Plaza Companion Loan) or otherwise collected from the Mortgage
Loans as provided in Section 5.2. The Master Servicer shall be required to pay
to each Primary Servicer its related Primary Servicing Fees, which shall be
payable by the Trust from amounts as provided in Section 5.1(c), unless retained
by the Primary Servicers from amounts transferred to the Master Servicer in
accordance with the terms of the Primary Servicing Agreements. The Master
Servicer shall be required to pay to the holders of the rights to the Excess
Servicing Fees, the Excess Servicing Fees, which shall be payable by the Trust
as provided in Section 5.1(c), unless otherwise retained by the holders of such
rights. Notwithstanding anything herein to the contrary, if any of the holders
of the right to receive Excess Servicing Fees resigns or is no longer Master
Servicer or Primary Servicer, as applicable, for any reason, it will continue to
have the right to receive its portion of the Excess Servicing

                                     -200-

<PAGE>

Fee, and any of the holders of the right to receive Excess Servicing Fees shall
have the right to assign its portion of the Excess Servicing Fee, whether or not
it is then acting as Master Servicer or Primary Servicer hereunder. The Master
Servicer shall also be entitled to the Primary Servicing Fee, which shall be
payable by the Trust from amounts held in the Certificate Account (or a
sub-account thereof) or otherwise collected from the Mortgage Loans as provided
in Section 5.2, provided that the Primary Servicing Fee payable to the Master
Servicer shall only be collected from the Mortgage Loans set forth on Schedule
III and Schedule V, except as provided in Section 8.28(b).

     (b) Additional servicing compensation in the form of assumption fees,
extension fees, servicing fees, default interest (excluding default interest
allocable to any B Note if the holder of the B Note has cured the related
default pursuant to the terms of the related Intercreditor Agreement) payable at
a rate above the Mortgage Rate (net of any amount used to pay Advance Interest),
Modification Fees, forbearance fees, Late Fees (net of Advance Interest)
(excluding Late Fees allocable to any B Note if the holder of the B Note has
cured the related default pursuant to the terms of the related Intercreditor
Agreement) or other usual and customary charges and fees actually received from
Mortgagors shall be retained by the Master Servicer, provided that the Master
Servicer shall be entitled to (i) receive 50% of assumption fees collected on
Mortgage Loans as provided in Section 8.7(a), (ii) Modification Fees as provided
in Section 8.18 hereof, and (iii) 100% of any extension fees collected from the
related Mortgagor in connection with the extension of the Maturity Date of any
Mortgage Loan as provided in Section 8.18; provided, however, that the Master
Servicer shall not be entitled to any such fees in connection with any Specially
Serviced Mortgage Loans or any Non-Serviced Mortgage Loan. If the Master
Servicer collects any amount payable to the Special Servicer hereunder in
connection with an REO Mortgage Loan or Specially Serviced Mortgage Loan, the
Master Servicer shall promptly remit such amount to the Special Servicer as
provided in Section 5.2. The Master Servicer shall be required to pay all
applicable expenses incurred by it in connection with its servicing activities
hereunder.

     (c) Notwithstanding any other provision herein, with respect to any
Distribution Date, the Master Servicing Fee for each monthly period relating to
such Distribution Date (together with any investment income earned prior to such
Distribution Date on Principal Prepayments as to which Prepayment Interest
Shortfalls were incurred with respect to such Distribution Date) shall be
reduced by an amount equal to the Compensating Interest (if any) relating to
Mortgage Loans which are not Specially Serviced Mortgage Loans for such
Determination Date.

     (d) The Master Servicer shall also be entitled to additional servicing
compensation of (i) an amount equal to the excess, if any, of the aggregate
Prepayment Interest Excess relating to Mortgage Loans which are not Specially
Serviced Mortgage Loans for each Distribution Date over the aggregate Prepayment
Interest Shortfalls for such Mortgage Loans for such Distribution Date, (ii)
interest or other income earned on deposits in the Certificate Account and the
Distribution Account (but only to the extent of the net investment earnings, if
any, with respect to each such account), and, (iii) to the extent not required
to be paid to any Mortgagor under applicable law, any interest or other income
earned on deposits in the Escrow Accounts.

                                     -201-

<PAGE>

     SECTION 8.11 MASTER SERVICER REPORTS; ACCOUNT STATEMENTS.

     (a) For each Distribution Date, (i) the Master Servicer shall deliver to
the Paying Agent, (or with respect to the WestShore Plaza Companion Loan, to the
holder thereof or its servicer), no later than 1:00 p.m., New York City time, on
the related Report Date, the Master Servicer Remittance Report with respect to
such Distribution Date including any information regarding prepayments made
pursuant to Section 5.2(b) and (ii) the Master Servicer shall report to the
Paying Agent on the related Advance Report Date, the amount of the P&I Advance,
if any, to be made by the Master Servicer on the related Master Servicer
Remittance Date. The Special Servicer is required to provide all applicable
information relating to Specially Serviced Mortgage Loans in order for the
Master Servicer to satisfy its duties in this Section 8.11. The Master Servicer
Remittance Report shall be updated no later than 2:00 p.m. on the second
Business Day prior to the Distribution Date to reflect any payment on a Mortgage
Loan, the WestShore Plaza Companion Loan or a B Note for which the Scheduled
Payment is paid on a Due Date (or within its grace period) that occurs after the
end of the related Collection Period.

     (b) The Master Servicer shall deliver to the Trustee, the Paying Agent and
the Special Servicer within 30 days following each Distribution Date a statement
setting forth the status of the Certificate Account as of the close of business
on such Distribution Date showing, for the period covered by such statement, the
aggregate of deposits in or withdrawals from the Certificate Account, and shall
deliver to each holder of a B Note and the WestShore Plaza Companion Loan within
30 days following each Distribution Date a statement setting forth the status of
the related A/B Loan Custodial Account and the WestShore Plaza Companion Loan
Custodial Account, as of the close of business on such Distribution Date
showing, for the period covered by such statement, the aggregate of transfers in
and transfers from or deposits in or withdrawals from such A/B Loan Custodial
Account or WestShore Plaza Companion Loan Custodial Account, as applicable.

     (c) The Master Servicer shall promptly inform the Special Servicer of the
name, account number, location and other necessary information concerning the
Certificate Account in order to permit the Special Servicer to make deposits
therein.

     (d) Reserved

     (e) The Master Servicer shall deliver a copy of any reports or information
delivered to the Trustee or the Paying Agent pursuant to subsection (a) or
subsection (b) of this Section 8.11 to the Depositor, the Special Servicer, the
Operating Adviser and each Rating Agency, in each case upon request by such
Person and only to the extent such reports and information are not otherwise
required to be delivered to such Person under any provision of this Agreement.

     (f) Notwithstanding any provision of this Agreement to the contrary, the
Master Servicer shall not have any obligation (other than to the Special
Servicer and, to the extent provided in the last sentence of Section 8.14, the
Operating Adviser) to deliver any statement, notice or report that is then made
available on the Master Servicer's or the Paying Agent's internet website,
provided that it has notified all parties entitled to delivery of such reports,
by electronic mail or other notice provided in this Agreement, to the effect
that such

                                     -202-

<PAGE>

statements, notices or reports shall thereafter be made available on such
website from time to time.

     (g) The Master Servicer shall deliver or cause to be delivered to the
Paying Agent, and the holder of the WestShore Plaza Companion Loan (in respect
of the WestShore Plaza Companion Loan) the following CMSA Reports with respect
to the Mortgage Loans (and, if applicable, the related REO Properties and, to
the extent received from the applicable Non-Serviced Mortgage Loan Master
Servicer, any Non-Serviced Mortgage Loan) providing the required information as
of the related Determination Date upon the following schedule: (i) a Comparative
Financial Status Report and the CMSA Financial File (it being understood that
the Primary Servicers are required to deliver the CMSA Financial File only
quarterly) not later than each Report Date, commencing in December 2003; (ii) a
CMSA Operating Statement Analysis Report and an NOI Adjustment Worksheet in
accordance with Section 8.14 of this Agreement; (iii) a Servicer Watch List in
accordance with and subject to the terms of Section 8.11(h) on each Report Date,
commencing in December 2003; (iv) a Loan Set-Up File (with respect to the
initial Distribution Date only) not later than the Report Date in November 2003;
(v) a Loan Periodic Update File not later than each Report Date commencing in
November 2003 (which Loan Periodic Update File shall be accompanied by a Monthly
Additional Report on Recoveries and Reimbursements); (vi) a Property File not
later than each Report Date, commencing in December 2003; (vii) a Delinquent
Loan Status Report on each Report Date, commencing in December 2003; (viii) an
Historical Loan Modification Report not later than each Report Date, commencing
in December 2003, (ix) an Historical Liquidation Report not later than each
Report Date, commencing in December 2003; and (x) an REO Status Report on each
Report Date, commencing in December 2003. The information that pertains to
Specially Serviced Mortgage Loans and REO Properties reflected in such reports
shall be based solely upon the reports delivered by the Special Servicer to the
Master Servicer in writing and on a computer readable medium reasonably
acceptable to the Master Servicer and the Special Servicer one (1) Business Day
after the Determination Date prior to the related Master Servicer Remittance
Date in the form required under Section 9.32. The Master Servicer's
responsibilities under this Section 8.11(g) with respect to REO Mortgage Loans
and Specially Serviced Mortgage Loans shall be subject to the satisfaction of
the Special Servicer's obligations under Section 9.32. The reporting obligations
of the Master Servicer in connection with any A/B Mortgage Loan shall be
construed to refer only to such information regarding the A/B Mortgage Loan (and
its related Mortgaged Property) and by reference to the related A Note only, but
whenever the Master Servicer remits funds to the holder of the related B Note,
it shall thereupon deliver to such holder a remittance report identifying the
amounts in such remittance.

     (h) For each Distribution Date, the Master Servicer shall deliver to the
Paying Agent (and solely with respect to any A/B Mortgage Loan, the holder of
the related B Note and solely with respect to the Loan Pair, the holder of the
WestShore Plaza Companion Loan), not later than the related Report Date, a
Servicer Watch List. The Master Servicer shall list any Mortgage Loan on the
Servicer Watch List as to which any of the events specified in the CMSA Watch
List published by the CMSA for industry use has occurred.

     (i) If the Master Servicer delivers a notice of drawing to effect a drawing
on any letter of credit or debt service reserve account under which the Trust
has rights as the holder of any Mortgage Loan for purposes other than payment or
reimbursement of amounts contemplated in and by a reserve or escrow agreement
(other than after a default under an

                                     -203-

<PAGE>

applicable Mortgage Loan or B Note), the Master Servicer shall, within five (5)
Business Days following its receipt of the proceeds of such drawing, deliver
notice thereof to the Special Servicer, the Operating Adviser and the Paying
Agent, which notice shall set forth (i) the unpaid Principal Balance of such
Mortgage Loan or B Note immediately before and immediately after the drawing,
and (ii) a brief description of the circumstances that in the Master Servicer's
good faith and reasonable judgment entitled the Master Servicer to make such
drawing.

     (j) The Master Servicer, the Special Servicer, the Trustee and the Paying
Agent, as applicable, but not any of the Primary Servicers, shall prepare and
deliver (or make available on their respective websites) to the Operating
Adviser the reports and information described in Exhibit BB (to the extent not
otherwise delivered pursuant to this Agreement) in the form and format and
within the time frame set forth therein.

     (k) If the Operating Adviser and the Special Servicer are Affiliates of one
another, a report delivered to one of them by the Master Servicer need not also
be delivered to the other of them.

     SECTION 8.12 ANNUAL STATEMENT AS TO COMPLIANCE. The Master Servicer shall
deliver to the Depositor, the Paying Agent, the Luxembourg Paying Agent and the
Trustee on or before March 15 of each year (or March 14 if a leap year),
commencing in March 2004, an Officer's Certificate stating, as to the signer
thereof, that (A) a review of the activities of the Master Servicer during the
preceding calendar year or portion thereof and of the performance of the Master
Servicer under this Agreement has been made under such officer's supervision and
(B) to the best of such officer's knowledge, based on such review, the Master
Servicer has fulfilled all its obligations under this Agreement in all material
respects throughout such year, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to such
officer and the nature and status thereof. The Master Servicer shall forward a
copy of each such statement to the Rating Agencies and the Operating Adviser.
Promptly after receipt of such Officer's Certificate, the Depositor shall review
the Officer's Certificate and, if applicable, consult with the Master Servicer
as to the nature of any defaults by the Master Servicer in the fulfillment of
any of the Master Servicer's obligations hereunder.

     SECTION 8.13 ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING REPORT. On or
before noon (Eastern Time) on March 15 of each year (or March 14 if a leap
year), commencing in March 2004, the Master Servicer at its expense shall cause
a firm of nationally recognized independent public accountants (which may also
render other services to the Master Servicer) and that is a member of the
American Institute of Certified Public Accountants to furnish a statement to the
Trustee, the Paying Agent, the Luxembourg Paying Agent and the Depositor, with a
copy to the Rating Agencies, to the effect that (i) it has obtained a letter of
representation regarding certain matters from the management of the Master
Servicer, which includes an assertion that the Master Servicer has complied with
certain minimum mortgage loan servicing standards (to the extent applicable to
commercial and multifamily mortgage loans), identified in the Uniform Single
Attestation Program for Mortgage Bankers established by the Mortgage Bankers
Association of America, with respect to the servicing of commercial and
multifamily mortgage loans during the most recently completed calendar year and
(ii) on the basis of an examination conducted by such firm in accordance with
standards established by the American Institute of Certified Public Accountants,
such representation is fairly stated in all material respects, subject to such
exceptions and other qualifications that may be appropriate. In

                                     -204-

<PAGE>

rendering its report such firm may rely, as to matters relating to the direct
servicing of commercial and multifamily mortgage loans by Primary Servicers or
Sub-Servicers, upon comparable reports of firms of independent certified public
accountants rendered on the basis of examinations conducted in accordance with
the same standards (rendered within one year of such report) with respect to
those Primary Servicers or Sub-Servicers. Promptly after receipt of such report,
the Depositor shall review the report and, if applicable, consult with the
Master Servicer as to the nature of any defaults by the Master Servicer in the
fulfillment of any of the Master Servicer's obligations hereunder.

     SECTION 8.14 CMSA OPERATING STATEMENT ANALYSIS REPORTS REGARDING THE
MORTGAGED PROPERTIES. Within 105 calendar days after the end of each of the
first three calendar quarters (in each year) for the trailing or quarterly
information received, commencing in the quarter ending on March 31, 2004, the
Master Servicer (in the case of Mortgage Loans that are not Specially Serviced
Mortgage Loans) or the Special Servicer (in the case of Specially Serviced
Mortgage Loans) shall deliver to the Paying Agent and the Operating Adviser a
CMSA Operating Statement Analysis Report and a CMSA Financial File for each
Mortgaged Property (in electronic format), prepared using the non-normalized
quarterly and normalized year-end operating statements and rent rolls received
from the related Mortgagor. Not later than the Report Date occurring in June of
each year, beginning in 2004 for year-end 2003, the Master Servicer (in the case
of Mortgage Loans that are not Specially Serviced Mortgage Loans) or the Special
Servicer (in the case of Specially Serviced Mortgage Loans) shall deliver to the
Paying Agent and the Operating Adviser a CMSA Operating Statement Analysis
Report, a CMSA Financial File and an NOI Adjustment Worksheet for each Mortgage
Loan (in electronic format), based on the most recently available year-end
financial statements and most recently available rent rolls of each applicable
Mortgagor (to the extent provided to the Master Servicer by or on behalf of each
Mortgagor, or, in the case of Specially Serviced Mortgaged Loans, as provided to
the Special Servicer, which Special Servicer shall forward such information to
the Master Servicer on or before May 31 of each such year), containing such
information and analyses for each Mortgage Loan provided for in the respective
forms of CMSA Operating Statement Analysis Report, CMSA Financial File and an
NOI Adjustment Worksheet as would customarily be included in accordance with the
Servicing Standard including, without limitation, Debt Service Coverage Ratios
and income, subject, in the case of any Non-Serviced Mortgage Loan, to the
receipt of such report from the applicable Non-Serviced Mortgage Loan Master
Servicer or the applicable Non-Serviced Mortgage Loan Special Servicer. The
Master Servicer shall make reasonable efforts, consistent with the Servicing
Standard, to obtain such reports from the applicable Non-Serviced Mortgage Loan
Master Servicer or the applicable Non-Serviced Mortgage Loan Special Servicer.
In addition, the Master Servicer shall deliver to the Operating Adviser, and
upon request the Master Servicer shall make available to the Rating Agencies,
the Special Servicer, the Paying Agent, the Trustee and the holder of the
WestShore Plaza Companion Loan, within 30 days following receipt thereof by the
Master Servicer, copies of any annual, monthly or quarterly financial statements
and rent rolls collected with respect to the Mortgaged Properties. As and to the
extent reasonably requested by the Special Servicer, the Master Servicer shall
make inquiry of any Mortgagor with respect to such information or as regards the
performance of the related Mortgaged Property in general. The Paying Agent shall
provide or make available electronically at no cost to the Certificateholders or
Certificate Owners, the Rating Agencies, the Operating Adviser, the Depositor,
the Placement Agents, the Underwriters, and solely as it relates to any A/B
Mortgage Loan, to the holder of the related B

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Note and solely as it relates to the Loan Pair, to the holder of the WestShore
Plaza Companion Loan, the CMSA Operating Statement Analysis Reports, CMSA
Financial Files and NOI Adjustment Worksheets described above pursuant to
Section 5.4(a). The Master Servicer (but not the Primary Servicer under the
Primary Servicing Agreement) shall electronically deliver the CMSA Operating
Statement Analysis Report, the operating statements, rent rolls, property
inspections and NOI Adjustment Worksheet for each Mortgage Loan to the Operating
Adviser using the ARCap Naming Convention.

     SECTION 8.15 OTHER AVAILABLE INFORMATION AND CERTAIN RIGHTS OF THE MASTER
SERVICER.

     (a) Subject to paragraphs (b), (c) and (d) below, the Paying Agent shall
make available at its Corporate Trust Office, during normal business hours, upon
reasonable advance written notice for review by any Certificateholder, any
Certificate Owner, any Seller, any Primary Servicer, any Placement Agent, any
Underwriter, each Rating Agency, the Paying Agent or the Depositor (and the
holder of a B Note, if it relates to a B Note and the holder of the WestShore
Plaza Companion Loan, if it relates to the WestShore Plaza Companion Loan),
originals or copies of, among other things, the following items: (i) this
Agreement and any amendments thereto, (ii) all final and released CMSA Operating
Statement Analysis Reports and the Master Servicer Remittance Reports, (iii) all
Officer's Certificates (including Officer's Certificates evidencing any
determination of Nonrecoverable Advances) delivered to the Trustee and the
Paying Agent since the Closing Date, (iv) all accountants' reports delivered to
the Trustee and the Paying Agent since the Closing Date, (v) any and all
modifications, waivers and amendments of the terms of a Mortgage Loan entered
into by the Master Servicer and/or the Special Servicer and (vi) any and all
Officers' Certificates (and attachments thereto) delivered to the Trustee and
the Paying Agent to support the Master Servicer's determination that any Advance
was not or, if made, would not be, recoverable. The Trustee and the Paying Agent
will be permitted to require payment of a sum to be paid by the requesting party
(other than the Rating Agencies, the Trustee, the Paying Agent, any Placement
Agent or any Underwriter) sufficient to cover the reasonable costs and expenses
of making such information available.

     (b) Subject to the restrictions described below, the Master Servicer shall
afford the Rating Agencies, the Depositor, the Trustee, the Paying Agent, the
Special Servicer, the Primary Servicer, the Sellers, the Placement Agents, the
Underwriters, the Operating Adviser, any Certificateholder, any holder of the
WestShore Plaza Companion Loan, any holder of a B Note or any Certificate Owner,
upon reasonable notice and during normal business hours, reasonable access to
all information referred to in Section 8.15(a) and any additional relevant,
non-attorney-client-privileged records and documentation regarding the
applicable Mortgage Loans, REO Property and all accounts, insurance policies and
other relevant matters relating to this Agreement (which access may occur by
means of the availability of information on the Master Servicer's or the Paying
Agent's internet website), and access to Servicing Officers of the Master
Servicer responsible for its obligations hereunder. Copies of information or
access will be provided to Certificateholders and each Certificate Owner
providing satisfactory evidence of ownership of Certificates or beneficial
ownership of a Certificate, as the case may be, which may include a
certification. Copies (or computer diskettes or other digital or electronic
copies of such information if reasonably available in lieu of paper copies) of
any and all of the foregoing items shall be made available by the Master
Servicer upon request; provided, however, that the Master

                                     -206-

<PAGE>

Servicer shall be permitted to require payment by the requesting party (other
than the Depositor, the Trustee, the Paying Agent, the Special Servicer, the
Operating Adviser, any Placement Agent, any Underwriter, or any Rating Agency)
of a sum sufficient to cover the reasonable expenses actually incurred by the
Master Servicer of providing access or copies (including electronic or digital
copies) of any such information requested in accordance with the preceding
sentence.

     (c) Nothing herein shall be deemed to require the Master Servicer to
confirm, represent or warrant the accuracy of (or to be liable or responsible
for) any other Person's information or report. Notwithstanding the above, the
Master Servicer shall not have any liability to the Depositor, the Trustee, the
Fiscal Agent, the Paying Agent, the Special Servicer, any Non-Serviced Mortgage
Loan Master Servicer, any Non-Serviced Mortgage Loan Special Servicer, any
Certificateholder, any Certificate Owner, any holder of the WestShore Plaza
Companion Loan, any holder of a B Note, any Placement Agent, any Underwriter,
any Rating Agency or any other Person to whom it delivers information pursuant
to this Section 8.15 or any other provision of this Agreement for federal, state
or other applicable securities law violations relating to the disclosure of such
information. In the event any Person brings any claims relating to or arising
from the foregoing against the Master Servicer (or any employee, attorney,
officer, director or agent thereof), the Trust (from amounts held in any account
(including (x) with respect to any such claims relating to the WestShore Plaza
Companion Loan, from amounts held in the WestShore Plaza Companion Loan
Custodial Account and (y) with respect to any such claims relating to a B Note,
from amounts held in the related A/B Loan Custodial Account) or otherwise) shall
hold harmless and indemnify the Master Servicer from any loss or expense
(including attorney fees) relating to or arising from such claims.

     (d) The Master Servicer shall produce the reports required of it under this
Agreement; provided, however, that the Master Servicer shall not be required to
produce any ad hoc non-standard written reports with respect to such Mortgage
Loans. In the event the Master Servicer elects to provide such non-standard
reports, it may require the Person requesting such report (other than a Rating
Agency) to pay a reasonable fee to cover the costs of the preparation thereof.
Notwithstanding anything to the contrary herein, as a condition to the Master
Servicer making any report or information available upon request to any Person
other than the parties hereto, the Master Servicer may require that the
recipient of such information acknowledge that the Master Servicer may
contemporaneously provide such information to the Depositor, the Trustee, the
Fiscal Agent, the Paying Agent, the Special Servicer, the Primary Servicer, the
Sellers, any Placement Agent, any Underwriter, any Rating Agency and/or the
Certificateholders, the holder of the WestShore Plaza Companion Loan, the holder
of a B Note or Certificate Owners. Any transmittal of information by the Master
Servicer to any Person other than the Trustee, the Paying Agent, the Master
Servicer, the Special Servicer, the Rating Agencies, the Operating Adviser or
the Depositor may be accompanied by a letter from the Master Servicer containing
the following provision:

                  "By receiving the information set forth herein, you hereby
         acknowledge and agree that the United States securities laws restrict
         any person who possesses material, non-public information regarding the
         Trust which issued Bear Stearns Commercial Mortgage Securities Inc.,
         Commercial Mortgage Pass-Through Certificates, Series 2003-TOP12 from
         purchasing or selling such Certificates in circumstances where the
         other party to the transaction is not also in possession of

                                     -207-

<PAGE>

         such information. You also acknowledge and agree that such information
         is being provided to you for the purpose of, and such information may
         be used only in connection with, evaluation by you or another
         Certificateholder, Certificate Owner or prospective purchaser of such
         Certificates or beneficial interest therein."

     (e) The Master Servicer may, at its discretion, make available by
electronic media and bulletin board service certain information and may make
available by electronic media or bulletin board service (in addition to making
such information available as provided herein) any reports or information
required by this Agreement that the Master Servicer is required to provide to
any of the Rating Agencies, the Depositor and anyone the Depositor reasonably
designates.

     (f) The Master Servicer shall cooperate in providing the Rating Agencies
with such other pertinent information relating to the Mortgage Loans as is or
should be in their respective possession as the Rating Agencies may reasonably
request

     SECTION 8.16 RULE 144A INFORMATION. For as long as any of the Certificates
are "restricted securities" within the meaning of Rule 144A under the Securities
Act, the Master Servicer agrees to provide to the Paying Agent or the Luxembourg
Paying Agent, as applicable, for delivery to any Holder thereof, any Certificate
Owner therein and to any prospective purchaser of the Certificates or beneficial
interest therein reasonably designated by the Paying Agent or the Luxembourg
Paying Agent, as applicable, upon the request of such Certificateholder, such
Certificate Owner, the Paying Agent or the Luxembourg Paying Agent, as
applicable, subject to this Section 8.16 and the provisions of Sections 5.4 and
8.15, any information prepared by the Master Servicer that is required to be
provided to such holder or prospective purchaser to satisfy the condition set
forth in Rule 144A(d)(4) under the Securities Act, including, without
limitation, copies of the reports and information described in Sections 8.15(a)
and (b).

     Any recipient of information provided pursuant to this Section 8.16 shall
agree that such information shall not be disclosed or used for any purpose other
than the evaluation of the Certificates by such Person and the Master Servicer
shall be permitted to use the letter referred to in Section 8.15(d). Unless the
Master Servicer chooses to deliver the information directly, the Depositor, the
Placement Agents, the Underwriters, the Paying Agent or the Luxembourg Paying
Agent shall be responsible for the physical delivery of the information
requested pursuant to this Section 8.16. As a condition to the Master Servicer
making any report or information available upon request to any Person other than
the parties hereto, the Master Servicer may require that the recipient of such
information acknowledge that the Master Servicer may contemporaneously provide
such information to the Depositor, the Trustee, the Paying Agent, the Luxembourg
Paying Agent, the Placement Agents, the Underwriters, any Rating Agency and/or
the Certificateholders and Certificate Owners. The Master Servicer will be
permitted to require payment of a sum to be paid by the requesting party (other
than the Rating Agencies, the Trustee, the Paying Agent, the Placement Agents or
the Underwriters) sufficient to cover the reasonable costs and expenses of
making such information available.

     SECTION 8.17 INSPECTIONS. The Master Servicer shall, at its own expense,
inspect or cause to be inspected each Mortgaged Property other than Mortgaged
Properties

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related to Specially Serviced Mortgage Loans and Non-Serviced Mortgage Loans,
every calendar year beginning in 2004, or every second calendar year beginning
in 2004 if the Principal Balance of the related Mortgage Loan or Loan Pair is
less than $2,000,000; provided that the Master Servicer shall, at the expense of
the Trust, inspect or cause to be inspected each Mortgaged Property related to a
Mortgage Loan that has a Debt Service Coverage Ratio that falls below 1.0x and;
provided further, that with respect to any Mortgage Loan or the Loan Pair that
has a Principal Balance of less than $2,000,000 and has been placed on the
Servicer Watch List, the Master Servicer shall, at the expense of the Trust and
at request of the Controlling Class, inspect or cause to be inspected the
related Mortgaged Property every calendar year beginning in 2004 so long as such
Mortgage Loan or Loan Pair continues to be on the Servicer Watch List; provided,
if such Mortgage Loan or Loan Pair is no longer on the Servicer Watch List at
the time the inspection was scheduled, no such inspection shall be required. The
Master Servicer shall prepare an Inspection Report relating to each inspection.
The Master Servicer shall promptly forward the applicable Inspection Report to
the Rating Agencies, the Placement Agents, the Underwriters, the Depositor, the
Trustee, the Paying Agent, the Operating Adviser, the Special Servicer, solely
as it relates to the Loan Pair, to the holder of the WestShore Plaza Companion
Loan, and solely as it relates to any A/B Mortgage Loan, to the holder of the
related B Note, and upon request, to any Certificateholder, any Certificate
Owner, any Seller and any Primary Servicer. The Special Servicer shall have the
right to inspect or cause to be inspected (at its own expense) every calendar
year any Mortgaged Property related to a Mortgage Loan that is not a Specially
Serviced Mortgage Loan, provided that the Special Servicer notifies the Master
Servicer prior to such inspection.

     SECTION 8.18 MODIFICATIONS, WAIVERS, AMENDMENTS, EXTENSIONS AND CONSENTS.

     Subject to the limitations of Section 12.3 hereof, the Master
Servicer shall have the following powers:

     (a) (i) The Master Servicer in accordance with the Servicing Standard may
agree to any modification, waiver, amendment or consent of or relating to any
term (including, without limitation, Master Servicer Consent Matters set forth
in Section 8.3(a) hereof) other than a Money Term of a Mortgage Loan, the
WestShore Plaza Companion Loan or a B Note that is not a Specially Serviced
Mortgage Loan, provided that such amendment would not result in an Adverse REMIC
Event; and provided, further that if any consent relates to a release of a
letter of credit relating to any Mortgage Loan (other than letters of credit or
portions thereof released upon satisfaction of conditions specified in the
related agreements), then (i) the Master Servicer shall notify the Special
Servicer of any Mortgagor's request to release such letter of credit which the
Master Servicer recommends to release, and (ii) if the terms of the related
Mortgage Loan do not require the Master Servicer to approve such release, then
the Special Servicer shall within five Business Days provide notice to the
Master Servicer as to whether the Master Servicer should approve the release
(and the failure of the Special Servicer to give the Master Servicer such notice
shall automatically be deemed to be an approval by the Special Servicer that the
Master Servicer should grant such release). Notwithstanding the preceding
sentence, if the Master Servicer recommends to approve such modification,
waiver, amendment or consent which is not a Master Servicer Consent Matter
(including, without limitation, any waiver of any requirement that the Mortgagor
post additional reserves or a letter of credit upon the failure of the Mortgagor
to satisfy conditions specified in the Mortgage Loan documents), the

                                     -209-

<PAGE>

Master Servicer shall provide to the Special Servicer a copy of the Master
Servicer's recommendation and the relevant information obtained or prepared by
the Master Servicer in connection therewith; provided, that (A) the Special
Servicer shall have the right hereunder to grant or withhold consent to any such
proposed modification, waiver, amendment or consent, and such consent of the
Special Servicer shall not be unreasonably withheld, consistent with the
Servicing Standard, (B) failure of the Special Servicer to notify the Master
Servicer, within five Business Days following the Master Servicer's delivery of
the recommendation described above, of its determination to grant or withhold
such consent shall be deemed to constitute a grant of such consent and (C) the
Master Servicer shall not enter into any such proposed modification, waiver,
amendment or consent unless it has received the written consent of the Special
Servicer or such consent has been deemed to have been granted as described
above. Notwithstanding anything in this Agreement to the contrary, the Master
Servicer shall not be required to obtain or request the consent of the Special
Servicer in connection with any modification, waiver or amendment, or granting
its consent to transactions, under one or more of the Mortgage Loans that in
each case the Master Servicer has determined (in accordance with the Servicing
Standard) is immaterial. In any event, the Master Servicer shall promptly notify
the Special Servicer of any material modification, waiver, amendment or consent
executed by the Master Servicer pursuant to this Section 8.18(a)(i) and provide
to the Special Servicer a copy thereof. Notwithstanding the foregoing provisions
of this Section 8.18, if the Mortgage Loan documents require a Mortgagor to pay
a fee for an assumption, modification, waiver, amendment or consent that would
be due or partially due to the Special Servicer, then the Master Servicer shall
not waive the portion of such fee due to the Special Servicer without the
Special Servicer's approval.

     Notwithstanding the foregoing, the Special Servicer acknowledges that the
Master Servicer has delegated certain tasks, rights and obligations to the
Primary Servicer with respects to Post Closing Requests (as defined in the
Primary Servicing Agreement) pursuant to Section 8.4 of this Agreement. The
Primary Servicing Agreements classify certain Post Closing Requests as Category
1 Requests (as defined in the Primary Servicing Agreements), in which each
Primary Servicer has certain authority to evaluate and process such requests in
accordance with this Agreement, the applicable Primary Servicing Agreement and
applicable Mortgage Loan documents.

     With respect to a Category 1 Request that involves a condition, term or
provision that requires, or specifies a standard of, consent or approval of the
applicable Mortgagee under the Mortgage Loan documents, the Primary Servicing
Agreements provide for determination of materiality of such condition, term or
provision requiring approval or consent by the Master Servicer or the Primary
Servicer and the referral of such condition, term or provision to the Special
Servicer for consent in accordance with the terms of the Primary Servicing
Agreements upon a determination of materiality. The Special Servicer
acknowledges such provisions. Nothing in this Agreement, however, shall grant
the Primary Servicers greater authority, discretion or delegated rights over
Post Closing Requests than are set forth in the Primary Servicing Agreements.

     (ii) The Master Servicer may, without the consent of the Special Servicer,
extend the maturity date of any Balloon Mortgage Loan that is not a Specially
Serviced Mortgage Loan to a date that is not more than 60 days following the
original Maturity Date, if in the Master Servicer's sole judgment exercised in
good faith (and evidenced by an Officer's

                                     -210-

<PAGE>

Certificate), a default in the payment of the Balloon Payment is reasonably
foreseeable and such extension is reasonably likely to produce a greater
recovery to the Holders and the holders of the related B Note and the WestShore
Plaza Companion Loan (as a collective whole) on a net present value basis than
liquidation of such Mortgage Loan and the Mortgagor has obtained an executed
written commitment (subject only to satisfaction of conditions set forth
therein) for refinancing of the Mortgage Loan or purchase of the related
Mortgaged Property. The Master Servicer shall process all such extensions and
shall be entitled to (as additional servicing compensation) 100% of any
extension fees collected from a Mortgagor with respect to any such extension.

     (b) The Master Servicer may require, in its discretion (unless prohibited
or otherwise provided in the Mortgage Loan documents), as a condition to
granting any request by a Mortgagor for any consent, modification, waiver or
amendment, that such Mortgagor pay to the Master Servicer a reasonable and
customary modification fee to the extent permitted by law; provided that the
collection of such fee shall not be permitted if collection of such fee would
cause a "significant modification" (within the meaning of Treasury Regulation
Section 1.860G-2(b) of the Mortgage Loan). The Master Servicer shall be entitled
to (as additional servicing compensation) 100% of any Modification Fees
collected from a Mortgagor in connection with a consent, waiver, modification or
amendment of a non-Specially Serviced Mortgage Loan executed or granted pursuant
to Section 8.3 or this Section 8.18. The Master Servicer may charge the
Mortgagor for any costs and expenses (including attorneys' fees and rating
agency fees) incurred by the Master Servicer or the Special Servicer (which
amounts shall be reimbursed to the Special Servicer) in connection with any
request for a modification, waiver or amendment. The Master Servicer agrees to
use its best reasonable efforts in accordance with the Servicing Standard to
collect such costs, expenses and fees from the Mortgagor, provided that the
failure or inability of the Mortgagor to pay any such costs and expenses shall
not impair the right of the Master Servicer to cause such costs and expenses
(but not including any modification fee), and interest thereon at the Advance
Rate, to be paid or reimbursed by the Trust as a Servicing Advance (to the
extent not paid by the Mortgagor). If the Master Servicer believes that the
costs and expenses (including attorneys' fees) to be incurred by the Master
Servicer in connection with any request for a modification, waiver or amendment
will result in a payment or reimbursement by the Trust, then the Master Servicer
shall notify the Special Servicer.

     (c) The Master Servicer shall notify the Trustee, the Paying Agent, the
Operating Adviser and the Special Servicer of any modification, waiver or
amendment of any term of any Mortgage Loan permitted by it under this Section
and the date thereof, and shall deliver to the Trustee for deposit in the
related Mortgage File, an original counterpart of the agreement relating to such
modification, waiver or amendment, promptly following the execution thereof
except to the extent such documents have been submitted to the applicable
recording office, in which event the Master Servicer shall promptly deliver
copies of such documents to the Trustee. The Master Servicer shall not agree to
any modification, waiver, or amendment of any Money Term of a Mortgage Loan or
any term of a Specially Serviced Mortgage Loan. The Master Servicer shall notify
the holder of the B Note and the WestShore Plaza Companion Loan of any
modification of the monthly payments of an A/B Mortgage Loan or the Loan Pair,
as the case may be, and such monthly payments shall be allocated in accordance
with the related Intercreditor Agreement or Loan Pair Intercreditor Agreement,
as applicable.

                                     -211-

<PAGE>

     (d) If the Mortgage Loan documents relating to a Mortgage Loan provide for
certain conditions to be satisfied prior to the Master Servicer releasing
additional collateral for the Mortgage Loan (e.g., the release, reduction or
termination of reserves or letters of credit or the establishment of reserves),
then the Master Servicer shall be permitted to waive any such condition without
obtaining the consent of the Special Servicer, provided that (1) the aggregate
amount of the related releases or establishments is no greater than the smaller
of 10% of the outstanding unpaid Principal Balance or $75,000 or (2) the
condition to be waived is deemed to be non-material in accordance with the
Servicing Standard. Notwithstanding the foregoing, without the Special
Servicer's consent or except as provided in the specific Mortgage Loan
documents, the Master Servicer shall not waive: (1) a requirement for any such
additional collateral to exist, or (2) a lock box requirement.

     (e) Neither the Master Servicer nor any Primary Servicer will be required
to obtain a Rating Agency Confirmation in connection with this Agreement unless
the terms of this Agreement specifically requires the Master Servicer to do so,
and if so required by the terms of this Agreement, the Master Servicer and any
Primary Servicer shall not be permitted to waive (i) the Rating Agency
Confirmation requirement or (ii) the obligation of a Mortgagor to pay all or any
portion of any fee payable in connection with obtaining the Rating Agency
Confirmation.

     SECTION 8.19 SPECIALLY SERVICED MORTGAGE LOANS.

     (a) The Master Servicer shall send a written notice to the Special
Servicer, the Operating Adviser, the Rating Agencies, the Paying Agent, the
Trustee and solely as it relates to any A/B Mortgage Loan, to the holder of the
related B Note and solely as it relates to the Loan Pair, to the holder of the
WestShore Plaza Companion Loan, within two Business Days after becoming aware of
a Servicing Transfer Event with respect to a Mortgage Loan, which notice shall
identify the related Mortgage Loan and set forth in reasonable detail the nature
and relevant facts of such Servicing Transfer Event and whether such Mortgage
Loan is covered by an Environmental Insurance Policy (and for purposes of
stating whether such Mortgage Loan is covered by an Environmental Insurance
Policy the Master Servicer may rely on Schedule XVII attached hereto) and,
except for the Rating Agencies, the Paying Agent and the Trustee, shall be
accompanied by a copy of the Servicer Mortgage File. The Special Servicer shall
not be liable for its failure to deliver the notice set forth in Section 9.36(a)
if such failure is caused by its failure to receive the written notice set forth
above.

     (b) Prior to the transfer of the servicing of any Specially Serviced
Mortgage Loan to the Special Servicer, the Master Servicer shall notify the
related Mortgagor of such transfer in accordance with the Servicing Standard
(the form and substance of such notice shall be reasonably satisfactory to the
Special Servicer).

     (c) Any calculations or reports prepared by the Master Servicer to the
extent they relate to Specially Serviced Mortgage Loans shall be based on
information supplied to the Master Servicer in writing by the Special Servicer
as provided hereby. The Master Servicer shall have no duty to investigate or
confirm the accuracy of any information provided to it by the Special Servicer
and shall have no liability for the inaccuracy of any of its reports due to the
inaccuracy of the information provided by the Special Servicer.

                                     -212-

<PAGE>

     (d) On or prior to each Distribution Date, the Master Servicer shall
provide to the Special Servicer, in order for the Special Servicer to comply
with its obligations under this Agreement, such information (and in the form and
medium) as the Special Servicer may reasonably request in writing from time to
time, provided that (i) the Master Servicer shall not be required to produce any
ad hoc reports or incur any unusual expense or effort in connection therewith
and (ii) if the Master Servicer elects to provide such ad hoc reports, it may
require the Special Servicer to pay a reasonable fee to cover the costs of the
preparation thereof.

     SECTION 8.20 REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE MASTER
SERVICER.

     (a) The Master Servicer hereby represents and warrants to and covenants
with the Trustee and the Paying Agent, as of the date hereof:

         (i) the Master Servicer is duly organized, validly existing and in good
standing as a national banking association under the laws of the United States,
and shall be and thereafter remain, in compliance with the laws of each State in
which any Mortgaged Property is located to the extent necessary to perform its
obligations under this Agreement, except where the failure to so qualify or
comply would not adversely affect the Master Servicer's ability to perform its
obligations hereunder in accordance with the terms of this Agreement;

         (ii) the Master Servicer has the full power and authority to execute,
deliver, perform, and to enter into and consummate all transactions and
obligations contemplated by this Agreement. The Master Servicer has duly and
validly authorized the execution, delivery and performance of this Agreement and
this Agreement has been duly executed and delivered by the Master Servicer; and
this Agreement, assuming the due authorization, execution and delivery thereof
by the Depositor, the Trustee, the Fiscal Agent, the Paying Agent and the
Special Servicer, evidences the valid and binding obligation of the Master
Servicer enforceable against the Master Servicer in accordance with its terms
subject, as to enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium, receivership and other similar laws
affecting creditors' rights generally as from time to time in effect, and to
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law);

         (iii) the execution and delivery of this Agreement, the consummation of
the transactions contemplated hereby, and the fulfillment of or compliance with
the terms and conditions of this Agreement will not (1) result in a breach of
any term or provision of its charter or by-laws or (2) conflict with, result in
a breach, violation or acceleration of, or result in a default under, the terms
of any other material agreement or instrument to which it is a party or by which
it may be bound, or any law, governmental rule, regulation, or judgment, decree
or order applicable to it of any court, regulatory body, administrative agency
or governmental body having jurisdiction over it, which materially and adversely
affects its ability to perform its obligations under this Agreement;

         (iv) no litigation is pending or, to the Master Servicer's knowledge,
threatened, against it, that would materially and adversely affect the
execution, delivery or

                                     -213-

<PAGE>

enforceability of this Agreement or its ability to service the Mortgage Loans
or to perform any of its other obligations hereunder in accordance with the
terms hereof;

         (v) no consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by it of, or compliance by it with, this Agreement, or the
consummation of the transactions contemplated hereby, or if any such consent,
approval, authorization or order is required, it has obtained the same or will
obtain the same prior to the time necessary to perform its obligations under
this Agreement, and, except to the extent in the case of performance, that its
failure to be qualified as a foreign corporation or licensed in one or more
states is not necessary for the performance by it of its obligations hereunder;
and

         (vi) the performance of the services by the Master Servicer
contemplated by this Agreement are in the ordinary course of business of the
Master Servicer and the Master Servicer possesses all licenses, permits and
other authorizations necessary to perform its duties hereunder.

     (b) It is understood that the representations and warranties set forth in
this Section 8.20 shall survive the execution and delivery of this Agreement.

     (c) Any cause of action against the Master Servicer arising out of the
breach of any representations and warranties made in this Section shall accrue
upon the giving of written notice to the Master Servicer by any of the Trustee
or the Master Servicer. The Master Servicer shall give prompt notice to the
Trustee, the Depositor, the Primary Servicers and the Special Servicer of the
occurrence, or the failure to occur, of any event that, with notice or the
passage of time or both, would cause any representation or warranty in this
Section to be untrue or inaccurate in any respect.

     SECTION 8.21 MERGER OR CONSOLIDATION. Any Person into which the Master
Servicer may be merged or consolidated, or any Person resulting from any merger,
conversion, other change in form or consolidation to which the Master Servicer
shall be a party, or any Person succeeding to the business of the Master
Servicer, shall be the successor of the Master Servicer hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto; provided, however, that each of the Rating Agencies provides a
Rating Agency Confirmation. If the conditions to the provisions in the foregoing
sentence are not met, the Trustee may terminate the Master Servicer's servicing
of the Mortgage Loans pursuant hereto, such termination to be effected in the
manner set forth in Sections 8.28 and 8.29.

     SECTION 8.22 RESIGNATION OF MASTER SERVICER.

     (a) Except as otherwise provided in Section 8.22(b) hereof, the Master
Servicer shall not resign from the obligations and duties hereby imposed on it
unless it determines that the Master Servicer's duties hereunder are no longer
permissible under applicable law or are in material conflict by reason of
applicable law with any other activities carried on by it. Any such
determination permitting the resignation of the Master Servicer shall be
evidenced by an Opinion of Counsel to such effect delivered to the Trustee. No
such resignation shall become effective until a successor servicer designated by
the Trustee, with the consent of the Depositor and the Paying Agent, shall have
assumed the Master Servicer's

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responsibilities and obligations under this Agreement and Rating Agency
Confirmation (including with respect to any securities rated by a Rating Agency
evidencing interests in the A Notes and any B Note) shall have been obtained.
Notice of such resignation shall be given promptly by the Master Servicer to the
Trustee.

     (b) The Master Servicer may resign from the obligations and duties imposed
on it, upon 30 days notice to the Trustee and the Paying Agent, provided that
(i) a successor servicer (w) is available, (x) has assets of at least
$15,000,000, (y) is willing to assume the obligations, responsibilities, and
covenants to be performed hereunder by the Master Servicer on substantially the
same terms and conditions, and for not more than equivalent compensation to that
herein provided and (z) assumes all obligations under the Primary Servicing
Agreements; (ii) the Master Servicer bears all costs associated with its
resignation and the transfer of servicing; and (iii) Rating Agency Confirmation
is obtained with respect to such servicing transfer, as evidenced by a letter
delivered to the Trustee by each Rating Agency.

     SECTION 8.23 ASSIGNMENT OR DELEGATION OF DUTIES BY MASTER SERVICER. The
Master Servicer shall have the right without the prior written consent of the
Trustee to (A) delegate or subcontract with or authorize or appoint anyone, or
delegate certain duties to other professionals such as attorneys and appraisers,
as an agent of the Master Servicer (as provided in Section 8.4) to perform and
carry out any duties, covenants or obligations to be performed and carried out
by the Master Servicer hereunder or (B) assign and delegate all of its duties
hereunder; provided, however, that with respect to clause (B), (i) the Master
Servicer gives the Depositor, the Special Servicer, the Primary Servicers, the
holder of the B Note (only if such assignment/delegation relates to the related
A/B Mortgage Loan), the holder of the WestShore Plaza Companion Loan (only if
such assignment/delegation relates to the Loan Pair) and the Trustee notice of
such assignment and delegation; (ii) such purchaser or transferee accepting such
assignment and delegation executes and delivers to the Depositor and the Trustee
an agreement accepting such assignment, which contains an assumption by such
Person of the rights, powers, duties, responsibilities, obligations and
liabilities of the Master Servicer, with like effect as if originally named as a
party to this Agreement and the Primary Servicing Agreements; (iii) the
purchaser or transferee has assets in excess of $15,000,000; (iv) such
assignment and delegation is the subject of a Rating Agency Confirmation; and
(v) the Depositor consents to such assignment and delegation, such consent not
be unreasonably withheld. In the case of any such assignment and delegation in
accordance with the requirements of subclause (B) of this Section, the Master
Servicer shall be released from its obligations under this Agreement, except
that the Master Servicer shall remain liable for all liabilities and obligations
incurred by it as the Master Servicer hereunder prior to the satisfaction of the
conditions to such assignment set forth in the preceding sentence.
Notwithstanding the above, the Master Servicer may appoint the Primary Servicer
and Sub-Servicers in accordance with Section 8.4 hereof.

     SECTION 8.24 LIMITATION ON LIABILITY OF THE MASTER SERVICER AND OTHERS.

     (a) Neither the Master Servicer nor any of the directors, officers,
employees or agents of the Master Servicer shall be under any liability to the
holders of the Certificates, the Depositor, the Trustee, the Fiscal Agent, the
Paying Agent, the Placement Agents, the Underwriters, the holder of the
WestShore Plaza Companion Loan, the holder of any B Note or the Special Servicer
for any action taken or for refraining from the taking of any action in good
faith, or using reasonable business judgment, consistent with the Servicing
Standard; provided

                                     -215-

<PAGE>

that this provision shall not protect the Master Servicer or any such person
against any breach of a representation or warranty contained herein or any
liability which would otherwise be imposed by reason of willful misfeasance, bad
faith or negligence in its performance of duties under the Agreement or by
reason of negligent disregard of obligations and duties hereunder. The Master
Servicer and any director, officer, employee or agent of the Master Servicer may
rely in good faith on any document of any kind prima facie properly executed and
submitted by any Person (including, without limitation, the Special Servicer)
respecting any matters arising hereunder. The Master Servicer shall not be under
any obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties to service the Mortgage Loans in accordance with this
Agreement; provided that the Master Servicer may in its sole discretion
undertake any such action which it may reasonably deem necessary or desirable in
order to protect the interests of the Certificateholders and the Trustee in the
Mortgage Loans, the interests of the holder of any B Note or the interests of
the holder of the WestShore Plaza Companion Loan (subject to the Special
Servicer's servicing of Specially Serviced Mortgage Loans as contemplated
herein), or shall undertake any such action if instructed to do so by the
Trustee. In such event, all legal expenses and costs of such action shall be
expenses and costs of the Trust, and the Master Servicer shall be entitled to be
reimbursed therefor as Servicing Advances as provided by Section 5.2, subject to
the provisions of Section 4.4 hereof.

     (b) In addition, the Master Servicer shall have no liability with respect
to, and shall be entitled to conclusively rely on as to the truth of the
statements and the correctness of the opinions expressed in any certificates or
opinions furnished to the Master Servicer and conforming to the requirements of
this Agreement. Subject to the Servicing Standard, the Master Servicer shall
have the right to rely on information provided to it by the Special Servicer and
Mortgagors, and will have no duty to investigate or verify the accuracy thereof.
Neither the Master Servicer, nor any director, officer, employee, agent or
Affiliate, shall be personally liable for any error of judgment made in good
faith by any officer, unless it shall be proved that the Master Servicer or such
officer was negligent in ascertaining the pertinent facts. Neither the Master
Servicer nor any director, officer, employee, agent or Affiliate, shall be
personally liable for any action taken, suffered or omitted by it in good faith
and believed by it to be authorized or within the discretion, rights or powers
conferred upon it by this Agreement.

     (c) The Master Servicer shall not be obligated to incur any liabilities,
costs, charges, fees or other expenses which relate to or arise from any breach
of any representation, warranty or covenant made by the Depositor, the Special
Servicer, the Paying Agent, Trustee or the Fiscal Agent in this Agreement. The
Trust shall indemnify and hold harmless the Master Servicer from any and all
claims, liabilities, costs, charges, fees or other expenses which relate to or
arise from any such breach of representation, warranty or covenant to the extent
the Master Servicer is unable to recover such amounts from the Person in breach.

     (d) Except as otherwise specifically provided
herein:

         (i) the Master Servicer may rely, and shall be protected in acting or
refraining from acting upon, any resolution, officer's certificate, certificate
of auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, financial statement, agreement, appraisal, bond
or other document (in electronic or paper format) reasonably believed or in good
faith believed by it to be genuine and to have been signed or presented by the
proper party or parties;

                                     -216-

<PAGE>

         (ii) the Master Servicer may consult with counsel, and any written
advice or Opinion of Counsel shall be full and complete authorization and
protection with respect to any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such advice or Opinion of
Counsel;

         (iii) the Master Servicer shall not be personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion, rights or powers conferred upon it by this
Agreement; and

         (iv) the Master Servicer, in preparing any reports hereunder, may rely,
and shall be protected in acting or refraining from acting upon any information
(financial or other), statement, certificate, document, agreement, covenant,
notice, request or other paper reasonably believed by it to be genuine and
provided by any Mortgagor or manager of a Mortgaged Property.

     (e) The Master Servicer and any director, officer, employee or agent of the
Master Servicer shall be indemnified by the Trustee, the Fiscal Agent, the
Paying Agent and the Special Servicer, as the case may be, and held harmless
against any loss, liability or expense including reasonable attorneys' fees
incurred in connection with any legal action relating to the Trustee's, Fiscal
Agent's, the Paying Agent's or the Special Servicer's, as the case may be,
respective willful misfeasance, bad faith or negligence in the performance of
its respective duties hereunder or by reason of negligent disregard of its
respective duties hereunder, other than any loss, liability or expense incurred
by reason of willful misfeasance, bad faith or negligence in the performance of
any of the Master Servicer's duties hereunder or by reason of negligent
disregard of the Master Servicer's obligations and duties hereunder. The Master
Servicer shall immediately notify the Trustee, the Paying Agent and the Special
Servicer if a claim is made by a third party with respect to this Agreement or
the Mortgage Loans entitling the Master Servicer to indemnification hereunder,
whereupon the Trustee, the Paying Agent, or the Special Servicer, in each case,
to the extent the claim is related to its respective willful misfeasance, bad
faith or negligence, may assume the defense of any such claim (with counsel
reasonably satisfactory to the Master Servicer) and pay all expenses in
connection therewith, including counsel fees, and promptly pay, discharge and
satisfy any judgment or decree which may be entered against it or them in
respect of such claim. Any failure to so notify the Trustee, the Paying Agent
and the Special Servicer shall not affect any rights that the Master Servicer
may have to indemnification under this Agreement or otherwise, unless the
Trustee's, the Paying Agent's or the Special Servicer's defense of such claim is
materially prejudiced thereby. Such indemnity shall survive the termination of
this Agreement or the resignation or removal of the Master Servicer hereunder.
Any payment hereunder made by the Trustee, the Paying Agent, the Fiscal Agent or
the Special Servicer pursuant to this paragraph to the Master Servicer shall be
paid from the Trustee's, the Paying Agent's, Fiscal Agent's or Special
Servicer's own funds, without reimbursement from the Trust therefor except to
the extent achieved through subrogation as provided in this Agreement. Any
expenses incurred or indemnification payments made by the Trustee, the Paying
Agent, the Fiscal Agent or the Special Servicer shall be reimbursed by the party
so paid, if a court of competent jurisdiction makes a final judgment that the
conduct of the Trustee, the Paying Agent, the Fiscal Agent or the Special
Servicer, as the case may be, was (x) not culpable or (y) found to not have
acted with willful misfeasance, bad faith or negligence.

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     SECTION 8.25 INDEMNIFICATION; THIRD-PARTY CLAIMS.

     (a) The Master Servicer and any director, officer, employee or agent of the
Master Servicer (the "Master Servicer Indemnified Parties") shall be indemnified
and held harmless by the Trust out of collections on, and other proceeds of, the
Mortgage Loans, the WestShore Plaza Companion Loan and any B Notes, as provided
in the following paragraph, against any and all claims, losses, penalties,
fines, forfeitures, legal fees and related costs, judgments and any other costs,
liabilities, fees and expenses (collectively, "Master Servicer Losses") incurred
in connection with any legal action relating to this Agreement, any Mortgage
Loans, the WestShore Plaza Companion Loan, any B Notes, any REO Property or the
Certificates or any exercise of any right under this Agreement reasonably
requiring the use of counsel or the incurring of expenses other than any loss,
liability or expense incurred by reason of the Master Servicer's willful
misfeasance, bad faith or negligence in the performance of duties hereunder.

     Except as provided in the following sentence, indemnification for Master
Servicer Losses described in the preceding paragraph (including in the case of
such Master Servicer Losses that relate primarily to the administration of the
Trust, to any REMIC formed hereunder or to any determination respecting the
amount, payment or avoidance of any tax under the REMIC provisions of the Code
or the actual payment of any REMIC tax or expense) shall be paid out of
collections on, and other proceeds of, the Mortgage Loans as a whole but not out
of collections on, or other proceeds of, the WestShore Plaza Companion Loan or
any B Note. In the case of any such Master Servicer Losses that do not relate
primarily to the administration of the Trust, to any REMIC formed hereunder or
to any determination respecting the amount, payment or avoidance of any tax
under the REMIC provisions of the Code or the actual payment of any REMIC tax or
expense:

     (1) if such Master Servicer Losses relate to the Loan Pair, then such
indemnification shall be paid (x) first, out of collections on, and other
proceeds of, such WestShore Plaza Pari Passu Loan and the WestShore Plaza
Companion Loan, in the relative proportions provided for in the applicable
Intercreditor Agreement and (y) if the collections and proceeds described in
subclause (x) of this clause (1) are not sufficient to so indemnify the Master
Servicer Indemnified Parties on a current basis, then the balance of such
indemnification shall be paid out of collections on, and other proceeds of, the
Mortgage Loans as a whole; and

     (2) if such Master Servicer Losses relate to any A/B Mortgage
Loan, then such indemnification shall be paid (x) first, if and to the extent
permitted under the applicable Intercreditor Agreement, out of collections on,
and other proceeds of, the B Note or B Notes related to such A/B Mortgage Loan,
(y) if the collections and proceeds described in subclause (x) of this clause
(2) are not sufficient to so indemnify the Master Servicer Indemnified Parties
on a current basis, then the balance of such indemnification shall be paid out
of collections on, and other proceeds of, the WestShore Plaza Pari Passu Loan
and the WestShore Plaza Companion Loan, in the relative proportions provided for
in the Loan Pair Intercreditor Agreement and (z) if the aggregate collections
and proceeds described in subclauses (x) and (y) of this clause (2) are not
sufficient to so indemnify the Master Servicer Indemnified Parties on a current
basis, then the balance of such indemnification shall be paid out of collections
on, and other proceeds of, the Mortgage Loans as a whole.

                                     -218-
<PAGE>

     The Master Servicer shall assume the defense of any such claim (with
counsel reasonably satisfactory to the Master Servicer) and out of the Trust pay
all expenses in connection therewith, including counsel fees, and out of the
Trust promptly pay, discharge and satisfy any judgment or decree which may be
entered against it or them in respect of such claim. The indemnification
provided herein shall survive the termination of this Agreement. The Trustee,
the Paying Agent or the Master Servicer shall promptly make from the Certificate
Account (and, if and to the extent that the amount due shall be paid from
collections on, and other proceeds of, the WestShore Plaza Companion Loan or any
B Note, as described above, out of the WestShore Plaza Companion Loan Custodial
Account or the related A/B Loan Custodial Account) any payments certified by the
Master Servicer to the Trustee and the Paying Agent as required to be made to
the Master Servicer pursuant to this Section 8.25.

     (b) The Master Servicer agrees to indemnify the Trustee, the Fiscal Agent,
the Special Servicer, the Trust, the Depositor, the Paying Agent, and any
director, officer, employee, agent or Controlling Person thereof, and hold them
harmless against any and all claims, losses, penalties, fines, forfeitures,
legal fees and related costs, judgments, and any other costs, liabilities, fees
and expenses that the Trustee, the Fiscal Agent, the Special Servicer, the
Depositor, the Paying Agent and the Trust may sustain arising from or as a
result of the willful misfeasance, bad faith or negligence in the performance of
any of the Master Servicer's duties hereunder or by reason of negligent
disregard of the Master Servicer's obligations and duties hereunder (including a
breach of such obligations a substantial motive of which is to obtain an
economic advantage from being released from such obligations), and if in any
such situation the Master Servicer is replaced, the parties hereto agree that
the amount of such claims, losses, penalties, fines, legal fees and related
costs, judgments, and other costs, liabilities, fees and expenses shall at least
equal the incremental costs, if any, of retaining a successor servicer. The
Trustee, the Fiscal Agent, the Special Servicer, the Paying Agent or the
Depositor, as applicable, shall immediately notify the Master Servicer if a
claim is made by any Person with respect to this Agreement or the Mortgage Loans
entitling the Trustee, the Fiscal Agent, the Depositor, the Special Servicer,
the Paying Agent or the Trust to indemnification under this Section 8.25(b),
whereupon the Master Servicer shall assume the defense of any such claim (with
counsel reasonably satisfactory to the Trustee, the Fiscal Agent, the Special
Servicer, the Paying Agent or the Depositor, as applicable) and pay all expenses
in connection therewith, including counsel fees, and promptly pay, discharge and
satisfy any judgment or decree which may be entered against it or them in
respect of such claim. Any failure to so notify the Master Servicer shall not
affect any rights the Trustee, the Fiscal Agent, the Special Servicer, the
Depositor, the Paying Agent or the Trust may have to indemnification under this
Agreement or otherwise, unless the Master Servicer's defense of such claim is
materially prejudiced thereby. The indemnification provided herein shall survive
the termination of this Agreement and the resignation or termination of the
Master Servicer, the Fiscal Agent, the Special Servicer, the Paying Agent and
the Trustee. Any expenses incurred or indemnification payments made by the
Master Servicer shall be reimbursed by the party so paid, if a court of
competent jurisdiction makes a final, non-appealable judgment that the conduct
of the Master Servicer was not culpable or that the Master Servicer did not act
with willful misfeasance, bad faith or negligence.

     (c) Each Primary Servicer and any director, officer, employee or agent
thereof shall be indemnified by the Trust and held harmless against any and all
claims, losses, penalties, fines, forfeitures, legal fees and related costs,
judgments and any other costs, liabilities, fees and expenses incurred in
connection with any legal action relating to this Agreement, its related

                                     -219-

<PAGE>

Primary Servicing Agreement (but only if, and to the extent that, the Master
Servicer would have been entitled to indemnification therefor under this
Agreement if it were directly servicing the Mortgage Loan), any Mortgage Loans,
any REO Property or the Certificates or any exercise of any right under this
Agreement or its related Primary Servicing Agreement (limited as set forth
above) reasonably requiring the use of counsel or the incurring of expenses
other than any loss, liability or expense incurred by reason of a Primary
Servicer's willful misfeasance, bad faith or negligence in the performance of
duties thereunder. The applicable Primary Servicer shall assume the defense of
any such claim (with counsel reasonably satisfactory to the applicable Primary
Servicer) and out of the Trust pay all expenses in connection therewith,
including counsel fees, and out of the Trust promptly pay, discharge and satisfy
any judgment or decree which may be entered against it or them in respect of
such claim. The indemnification provided herein shall survive the termination of
this Agreement and the related Primary Servicing Agreement. The Trustee, the
Paying Agent or the Master Servicer shall promptly make from the Certificate
Account any payments certified by a Primary Servicer to the Trustee and the
Paying Agent as required to be made to such Primary Servicer pursuant to this
Section 8.25.

     (d) Any Non-Serviced Mortgage Loan Master Servicer and any director,
officer, employee or agent of such Non-Serviced Mortgage Loan Master Servicer
shall be indemnified by the Trust and held harmless against the Trust's pro rata
share of any and all claims, losses, penalties, fines, forfeitures, legal fees
and related costs, judgments and any other costs, liabilities, fees and expenses
incurred in connection with any legal action relating to any Non-Serviced
Mortgage Loan Pooling and Servicing Agreement and this Agreement, and relating
to any Non-Serviced Mortgage Loan (but excluding any such losses allocable to
the related Non-Serviced Mortgage Loan Companion Loans), reasonably requiring
the use of counsel or the incurring of expenses other than any losses incurred
by reason of any Non-Serviced Mortgage Loan Master Servicer's willful
misfeasance, bad faith or negligence in the performance of its duties under the
related Non-Serviced Mortgage Loan Pooling and Servicing Agreement.

     (e) Each Primary Servicer agrees to indemnify the Trustee, the Fiscal
Agent, the Special Servicer, the Trust, the Depositor, the Paying Agent, and any
director, officer, employee, agent or Controlling Person thereof, and hold them
harmless against any and all claims, losses, penalties, fines, forfeitures,
legal fees and related costs, judgments, and any other costs, liabilities, fees
and expenses that the Trustee, the Fiscal Agent, the Special Servicer, the
Depositor, the Paying Agent and the Trust may sustain arising from or as a
result of the willful misfeasance, bad faith or negligence in the performance of
any of the applicable Primary Servicer's duties under this Agreement, its
related Primary Servicing Agreement or by reason of negligent disregard of the
applicable Primary Servicer's obligations and duties thereunder (including a
breach of such obligations a substantial motive of which is to obtain an
economic advantage from being released from such obligations), and if in any
such situation the applicable Primary Servicer is replaced, the parties hereto
agree that the amount of such claims, losses, penalties, fines, legal fees and
related costs, judgments, and other costs, liabilities, fees and expenses shall
at least equal the incremental costs, if any, of retaining a successor primary
servicer. The Trustee, the Fiscal Agent, the Special Servicer, the Paying Agent
or the Depositor, as applicable, shall immediately notify the applicable Primary
Servicer if a claim is made by any Person with respect to this Agreement, the
related Primary Servicing Agreement or the Mortgage Loans entitling the Trustee,
the Fiscal Agent, the Depositor, the Special Servicer, the Paying Agent or the
Trust to indemnification under this Section 8.25(d), whereupon the applicable

                                     -220-

<PAGE>

Primary Servicer shall assume the defense of any such claim (with counsel
reasonably satisfactory to the Trustee, the Fiscal Agent, the Special Servicer,
the Paying Agent or the Depositor, as applicable) and pay all expenses in
connection therewith, including counsel fees, and promptly pay, discharge and
satisfy any judgment or decree which may be entered against it or them in
respect of such claim. Any failure to so notify the applicable Primary Servicer
shall not affect any rights the Trustee, the Fiscal Agent, the Special Servicer,
the Depositor, the Paying Agent or the Trust may have to indemnification under
this Agreement, the related Primary Servicing Agreement or otherwise, unless the
Primary Servicer's defense of such claim is materially prejudiced thereby. The
indemnification provided herein shall survive the termination of this Agreement
and the Primary Servicing Agreement and the resignation or termination of the
Master Servicer, the Fiscal Agent, the Special Servicer, the Paying Agent and
the Trustee. Any expenses incurred or indemnification payments made by a Primary
Servicer shall be reimbursed by the party so paid, if a court of competent
jurisdiction makes a final, non-appealable judgment that the conduct of such
Primary Servicer was not culpable or that such Primary Servicer did not act with
willful misfeasance, bad faith or negligence.

     SECTION 8.26 EXCHANGE ACT REPORTING

     (a) The Master Servicer, the Special Servicer, the Paying Agent, the
Trustee and the Fiscal Agent shall reasonably cooperate with the Depositor in
connection with the Trust's satisfaction of its reporting requirements under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). Within 15 days
after each Distribution Date, the Paying Agent shall prepare, execute and file
on behalf of the Trust any Forms 8-K customary for similar securities as
required by the Exchange Act and the rules and regulations of the Securities and
Exchange Commission (the "Commission") thereunder; provided that the Depositor
shall file the initial Form 8-K in connection with the issuance of the
Certificates. The Paying Agent shall file each Form 8-K with a copy of the
related Monthly Certificateholders Report attached thereto. If the Depositor
directs that any other attachments are to be filed with any Form 8-K, such
attachments shall be delivered to the Paying Agent in EDGAR-compatible form or
as otherwise agreed upon by the Paying Agent and the Depositor, at the
Depositor's expense, and any necessary conversion to EDGAR-compatible format
will be at the Depositor's expense. Prior to March 30th of each year (or such
earlier date as may be required by the Exchange Act and the rules and
regulations of the Commission), the Paying Agent shall prepare and file on
behalf of the Trust a Form 10-K, in substance as required by applicable law or
applicable interpretations thereof of the staff of the Commission. Such Form
10-K shall include as exhibits each annual statement of compliance described
under Sections 8.12 and 9.18 and each accountant's report described under
Sections 8.13 and 9.19, in each case to the extent they have been timely
delivered to the Paying Agent. If they are not so timely delivered, the Paying
Agent shall file an amended Form 10-K including such documents as exhibits
reasonably promptly after they are delivered to the Paying Agent. Each Form 10-K
shall also include any Sarbanes-Oxley Certification required to be included
therewith, as described in paragraph (b) of this Section 8.26. Neither the
Paying Agent nor the Master Servicer shall have any liability with respect to
any failure to properly prepare, execute or file such periodic reports resulting
from the Master Servicer's or the Paying Agent's inability or failure to obtain
any information not resulting from its own negligence, bad faith or willful
misconduct. Prior to January 30 of the first year in which the Paying Agent is
able to do so under applicable law, the Paying Agent shall file a Form 15
relating to the automatic suspension of reporting in respect of the Trust under
the Exchange Act.

                                     -221-

<PAGE>

     (b) The Form 10-K shall include any certification (the "Sarbanes-Oxley
Certification") required to be included therewith pursuant to the Sarbanes-Oxley
Act of 2002 and the rules and regulations of the Commission promulgated
thereunder (including any interpretations thereof by the Commission's staff) and
a copy of such Sarbanes-Oxley Certification shall be provided to the Rating
Agencies. The Special Servicer and the Paying Agent (each, a "Performing Party")
shall provide to the Person who signs the Sarbanes-Oxley Certification (the
"Certifying Person") a certification (each, a "Performance Certification"), in
the form attached hereto as Exhibit CC, on which the Certifying Person, the
entity for which the Certifying Person acts as an officer (if the Certifying
Person is an individual), and such entity's officers, directors and Affiliates
(collectively with the Certifying Person, "Certification Parties") can rely. The
Master Servicer shall serve as the Certifying Person on behalf of the Trust. In
addition, if the Performing Party is the Special Servicer, such Performing Party
shall execute a reasonable reliance certificate to enable the Certification
Parties to rely upon each annual statement of compliance provided pursuant to
Section 9.18, and shall include a certification that each such annual statement
of compliance discloses any deficiencies or defaults described to the certified
public accountants of such Performing Party to enable such accountants to render
the certificate provided for in Section 9.19. In the event any Performing Party
is terminated or resigns pursuant to the terms of this Agreement, such
Performing Party shall provide a Performance Certification to the Certifying
Person pursuant to this Section 8.26(b) with respect to the period of time it
was subject to this Agreement.

     (c) Each Performing Party shall indemnify and hold harmless each
Certification Party from and against any losses, damages, penalties, fines,
forfeitures, reasonable and necessary legal fees and related costs, judgments
and other costs and expenses incurred by such Certification Party arising out of
(i) an actual breach by the applicable Performing Party of its obligations under
this Section 8.26 or (ii) negligence, bad faith or willful misconduct on the
part of the Performing Party in the performance of such obligations.

     (d) Nothing contained in this Section 8.26 shall be construed to require
any party to this Agreement other than the Master Servicer, or any of such
party's officers, to execute any Form 10-K or any Sarbanes-Oxley Certification.
The failure of any party to this Agreement other than the Master Servicer, or
any of such party's officers, to execute any Form 10-K or any Sarbanes-Oxley
Certification shall not be regarded as a breach by such party of any of its
obligations under this Agreement. This Section 8.26 may be amended by the
parties hereto pursuant to Section 13.3 for purposes of complying with the
Sarbanes-Oxley Act of 2002 or for purposes of designating the Certifying Person
without any Opinions of Counsel, Officer's Certificates, Rating Agency
Confirmations or the consent of any Certificateholder, notwithstanding anything
to the contrary contained in this Agreement.

     SECTION 8.27 COMPLIANCE WITH REMIC PROVISIONS. The Master Servicer shall
act in accordance with this Agreement and the REMIC Provisions and related
provisions of the Code in order to create or maintain the status of the REMICs
created hereby as REMICs under the Code. The Master Servicer shall take no
action or cause any REMIC Pool to take any action that could (i) endanger the
status of any REMIC Pool as a REMIC under the Code or (ii) result in the
imposition of a tax upon any REMIC Pool (including, but not limited to, the tax
on prohibited transactions as defined in Code Section 860F(a)(2) or on
prohibited contributions pursuant to Section 860G(d)) unless the Trustee shall
have received a Nondisqualification Opinion (at the expense of the party seeking
to take such action) to the effect that the

                                     -222-

<PAGE>

contemplated action will not endanger such status or result in the imposition of
such tax. The Master Servicer shall comply with the provisions of Article XII
hereof.

     SECTION 8.28 TERMINATION. The obligations and responsibilities of the
Master Servicer created hereby (other than the obligation of the Master Servicer
to make payments to the Paying Agent as set forth in Section 8.29 and the
obligations of the Master Servicer to the Trustee, the Paying Agent, the Fiscal
Agent, the Special Servicer and the Trust) shall terminate (i) on the date which
is the later of (A) the final payment or other liquidation of the last Mortgage
Loan remaining outstanding (and final distribution to the Certificateholders) or
(B) the disposition of all REO Property (and final distribution to the
Certificateholders), (ii) if an Event of Default described in clauses
8.28(a)(iii), (iv), (viii), (ix) or (x) has occurred, 60 days following the date
on which the Trustee or Depositor gives written notice to the Master Servicer
that the Master Servicer is terminated or (iii) if an Event of Default described
in clauses 8.28(a)(i), (ii), (v), (vi) or (vii) has occurred, immediately upon
the date on which the Trustee or the Depositor gives written notice to the
Master Servicer that the Master Servicer is terminated. After any Event of
Default, the Trustee (i) may elect to terminate the Master Servicer by providing
such notice, and (ii) shall provide such notice if holders of Certificates
representing more than 25% of the Aggregate Certificate Balance of all
Certificates so direct the Trustee.

     (a) "Event of Default," wherever used herein, means any one of the
following events:

         (i) any failure by the Master Servicer to remit to the Paying Agent or
otherwise make any payment required to be remitted by the Master Servicer under
the terms of this Agreement, including any required Advances; or

         (ii) any failure by the Master Servicer to make a required deposit to
the Certificate Account which continues unremedied for one Business Day
following the date on which such deposit was first required to be made; or

         (iii) any failure on the part of the Master Servicer duly to observe or
perform in any material respect any other of the duties, covenants or agreements
on the part of the Master Servicer contained in this Agreement which continues
unremedied for a period of 30 days after the date on which written notice of
such failure, requiring the same to be remedied, shall have been given to the
Master Servicer by the Depositor or the Trustee; provided, however, that if the
Master Servicer certifies to the Trustee and the Depositor that the Master
Servicer is in good faith attempting to remedy such failure, such cure period
will be extended to the extent necessary to permit the Master Servicer to cure
such failure; provided, further that such cure period may not exceed 90 days; or

         (iv) any breach of the representations and warranties contained in
Section 8.20 hereof that materially and adversely affects the interest of any
holder of any Class of Certificates and that continues unremedied for a period
of 30 days after the date on which notice of such breach, requiring the same to
be remedied, shall have been given to the Master Servicer by the Depositor or
the Trustee, provided, however, that if the Master Servicer certifies to the
Trustee and the Depositor that the Master Servicer is in good faith attempting
to remedy such breach, such cure period will be extended to the extent necessary
to permit the Master Servicer to cure such breach; provided, further that such
cure period may not exceed 90 days; or

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         (v) a decree or order of a court or agency or supervisory authority
having jurisdiction in the premises in an involuntary case under any present or
future federal or state bankruptcy, insolvency or similar law for the
appointment of a conservator, receiver, liquidator, trustee or similar official
in any bankruptcy, insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against the Master Servicer and such decree or
order shall have remained in force undischarged or unstayed for a period of 60
days; or

         (vi) the Master Servicer shall consent to the appointment of a
conservator, receiver, liquidator, trustee or similar official in any
bankruptcy, insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to the Master Servicer or of
or relating to all or substantially all of its property; or

         (vii) the Master Servicer shall admit in writing its inability to pay
its debts generally as they become due, file a petition to take advantage of any
applicable bankruptcy, insolvency or reorganization statute, make an assignment
for the benefit of its creditors, voluntarily suspend payment of its
obligations, or take any corporate action in furtherance of the foregoing; or

         (viii) the Master Servicer receives actual knowledge that Moody's has
(i) qualified, downgraded or withdrawn its rating or ratings of one or more
Classes of Certificates, or (ii) placed one or more Classes of Certificates on
"watch status" in contemplation of a rating downgrade or withdrawal (and such
"watch status" placement shall not have been withdrawn by Moody's within 60 days
of the date that the Master Servicer obtained such actual knowledge) and, in the
case of either of clauses (i) or (ii), citing servicing concerns with the Master
Servicer as the sole or material factor in such rating action.

         (ix) the Trustee shall receive notice from Fitch to the effect that the
continuation of the Master Servicer in such capacity would result in the
downgrade, qualification or withdrawal of any rating then assigned by Fitch to
any Class of Certificates; or

         (x) the Master Servicer has been downgraded to a servicer rating level
below "CMS3" (or its equivalent) by Fitch.

     (b) Notwithstanding the foregoing, if the Event of Default of the Master
Servicer occurs primarily by reason of the occurrence of a "Primary Servicing
Default" (as hereinafter defined) (that is, it would not have occurred but for
(a) the occurrence of such Primary Servicing Default and (b) the Master Servicer
failure to cause the cure of such event) and the Trustee (or the Trustee at the
direction of the Certificateholders pursuant to Section 8.28 hereof) elects to
terminate the Master Servicer, then Wells Fargo Bank, National Association shall
have the right to elect that the successor Master Servicer, upon its succession,
enter into a primary servicing agreement with Wells Fargo Bank, National
Association with respect to all Mortgage Loans as to which that Primary
Servicing Default occurred, so long as the initial Master Servicer has a
commercial loan master servicer rating of at least "CMS3" (or its equivalent) by
Fitch or a commercial loan primary servicer rating of at least "CPS3" (or its
equivalent) by Fitch, and such agreement shall be substantially in the form of
Exhibit G-1 hereto (but as if Wells Fargo Bank, National Association were the
Primary Servicer or Sub-Servicer thereunder and with applicable servicing fees
and excess fees as specified on the Mortgage Loan

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<PAGE>

Schedule); and, in the case of an agreement in the form of Exhibit G-1,
thereupon Wells Fargo Bank, National Association shall be deemed to have been
granted the rights and deemed to have assumed the obligations granted to or
imposed on "Primary Servicers" hereunder as to such Mortgage Loans (and under
such Primary Servicing Agreement). For purposes of the preceding sentence, a
"Primary Servicing Default" means an "event of default" of the related Primary
Servicer under the related Primary Servicing Agreement of either Principal
Global Investors, LLC or JHREF. If the Master Servicer is terminated based upon
an Event of Default set forth in clause (i) (as to the obligation to make P&I
Advances), (viii), (ix) or (x) of Section 8.28(a), then the Master Servicer
shall have the right to enter into a primary servicing agreement with the
successor Master Servicer with respect to all Mortgage Loans that are not then
subject to a Primary Servicing Agreement, so long as the terminated Master
Servicer is on the approved list of commercial mortgage loan servicers
maintained by Fitch.

     SECTION 8.29 PROCEDURE UPON TERMINATION.

     (a) Notice of any termination pursuant to clause (i) of Section 8.28(a),
specifying the Master Servicer Remittance Date upon which the final transfer by
the Master Servicer to the Paying Agent shall be made, shall be given promptly
in writing by the Master Servicer to the Paying Agent no later than the later of
(i) five Business Days after the final payment or other liquidation of the last
Mortgage Loan or (ii) the sixth day of the month of such final distribution.
Upon any such termination, the duties of the Master Servicer (other than the
obligation of the Master Servicer to pay to the Paying Agent the amounts
remaining in the Certificate Account as set forth below and the obligations of
the Master Servicer to the Trustee and the Trust and the Fiscal Agent as
provided herein) shall terminate and the Master Servicer shall transfer to the
Paying Agent the amounts remaining in the Certificate Account (and any
sub-account) after making the withdrawals permitted to be made pursuant to
Section 5.2 and shall thereafter terminate the Certificate Account and any other
account or fund maintained with respect to the Mortgage Loans.

     (b) On the date specified in a written notice of termination given to the
Master Servicer pursuant to clause (ii) of Section 8.28(a), or on the date on
which a written notice of termination is given to the Master Servicer pursuant
to clause (iii) of Section 8.28(a) all authority, power and rights of the Master
Servicer under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall terminate (except for any rights relating to unpaid servicing
compensation or unreimbursed Advances or, if the terminated Master Servicer is
Wells Fargo Bank, National Association, its rights to the Excess Servicing Fee);
provided that in no event shall the termination of the Master Servicer be
effective until a successor servicer shall have succeeded the Master Servicer as
successor servicer, subject to approval by the Rating Agencies, notified the
Master Servicer of such designation and such successor servicer shall have
assumed the Master Servicer's obligations and responsibilities hereunder and
under the Primary Servicing Agreement, as set forth in an agreement
substantially in the form hereof, with respect to the Mortgage Loans and, in the
circumstances set forth in the last sentence of Section 8.28(b), entered into a
new primary servicing agreement with the predecessor Master Servicer in
substantially the same form as Exhibit AA attached hereto. Except as provided in
the next sentence, the Trustee may not succeed the Master Servicer as servicer
until and unless it has satisfied the provisions that would apply to a Person
succeeding to the business of the Master Servicer pursuant to Section 8.22(b)
hereof. Notwithstanding the foregoing sentence, in the event that the Master
Servicer is terminated as a result of an event described in Section

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8.28(a)(v), 8.28(a)(vi) or 8.28(a)(vii), the Trustee shall act as successor
servicer immediately upon delivery of a notice of termination to the Master
Servicer and shall use commercially reasonable efforts within 90 days of
assuming the duties of the Master Servicer, either to satisfy the conditions of
Section 8.22(b) hereof or to transfer the duties of the Master Servicer to a
successor servicer who has satisfied such conditions. The Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the Master
Servicer, as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Mortgage Loans and
related documents or otherwise. The Master Servicer agrees to cooperate with the
Trustee, the Paying Agent and the Fiscal Agent in effecting the termination of
the Master Servicer's responsibilities and rights hereunder as Master Servicer
including, without limitation, notifying Mortgagors of the assignment of the
servicing function and providing the Trustee all documents and records in
electronic or other form reasonably requested by it to enable the successor
servicer designated by the Trustee to assume the Master Servicer's functions
hereunder and to effect the transfer to such successor for administration by it
of all amounts which shall at the time be or should have been deposited by the
Master Servicer in the Certificate Account and any other account or fund
maintained or thereafter received with respect to the Mortgage Loans.

     (c) If the Master Servicer receives a written notice of termination
pursuant to clause (ii) of Section 8.28(a) relating solely to an Event of
Default set forth in clause (viii), (ix) or (x) of Section 8.28(a), and if the
Master Servicer provides the Trustee with the appropriate "request for proposal"
materials within five Business Days after receipt of such written notice of
termination, then the Trustee shall promptly thereafter (using such "request for
proposal" materials provided by the Master Servicer) solicit good faith bids for
the rights to service the Mortgage Loans under this Agreement from at least
three but no more than five Qualified Bidders or, if three Qualified Bidders
cannot be located, then from as many persons as the Trustee can determine are
Qualified Bidders. At the Trustee's request, the Master Servicer shall supply
the Trustee with the names of Persons from whom to solicit such bids. In no
event shall the Trustee be responsible if less than three Qualified Bidders
submit bids for the right to service the Mortgage Loans under this Agreement.

     (d) Each bid proposal shall require any Successful Bidder, as a condition
of its bid, to enter into this Agreement as successor Master Servicer, and to
agree to be bound by the terms hereof and the terms of the Primary Servicing
Agreement, not later than 30 days after termination of the Master Servicer
hereunder. The Trustee shall select the Qualified Bidder with the highest cash
bid (or such other Qualified Bidder as the Master Servicer may direct) (the
"Successful Bidder") to act as successor Master Servicer hereunder. The Trustee
shall direct the Successful Bidder to enter into this Agreement as successor
Master Servicer pursuant to the terms hereof, and in connection therewith to
deliver the amount of the Successful Bidder's cash bid to the Trustee by wire
transfer of immediately available funds to an account specified by the Trustee
no later than 10:00 a.m. New York City time on the date specified for the
assignment and assumption of the servicing rights hereunder.

     (e) Upon the assignment and acceptance of the servicing rights hereunder to
and by the Successful Bidder and receipt of such cash bid, the Trustee shall
remit or cause to be remitted to the terminated Master Servicer the amount of
such cash bid received from the Successful Bidder (net of all out-of-pocket
expenses incurred in connection with obtaining such

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bid and transferring servicing) by wire transfer of immediately available funds
to an account specified by the terminated Master Servicer no later than 1:00
p.m. New York City time on the date specified for the assignment and assumption
of the servicing rights hereunder.

     (f) If the Successful Bidder has not entered into this Agreement as
successor Master Servicer within 30 days after the termination of the Master
Servicer hereunder or no Successful Bidder was identified within such 30-day
period, the Trustee shall have no further obligations under Section 8.29(c) and
may act or may select another successor to act as Master Servicer hereunder in
accordance with Section 8.29(b).

     (g) Notwithstanding anything to the contrary in this Section 8.29, the
successor master servicer must assume all of the obligations of the terminated
Master Servicer under the Primary Servicing Agreement as a condition precedent
to its becoming Master Servicer hereunder.

     For purposes of the foregoing provisions of Section 8.29(c), the phrase
"rights to service" shall be construed to exclude those servicing rights and
duties as to which Wells Fargo Bank, National Association has made an election
for the execution of a primary servicing agreement as contemplated by Section
8.28(b).

     SECTION 8.30 Operating Adviser Contact with Master Servicer and Special
Servicer.

     No less often than on a monthly basis or as agreed upon by the Master
Servicer and the Operating Adviser, each of the Master Servicer and the Special
Servicer shall, without charge, make a Servicing Officer available to answer
questions from the Operating Adviser regarding the performance and servicing of
the Mortgage Loans and/or REO Properties for which the Master Servicer or the
Special Servicer, as the case may be, is responsible. Each Primary Servicer
shall make a Servicing Officer available on any such call to answer questions
from the Operating Adviser regarding the Mortgage Loans and/or REO Properties
that it services.

                                   ARTICLE IX

     ADMINISTRATION AND SERVICING OF SPECIALLY SERVICED MORTGAGE LOANS BY
            SPECIAL SERVICER

     SECTION 9.1 DUTIES OF SPECIAL SERVICER.

     (a) Subject to the express provisions of this Agreement, for and on behalf
of the Trust and for the benefit of the Certificateholders as a whole, and,
solely as it relates to any A/B Mortgage Loan, for the benefit of the holder of
the related B Note and, solely as it relates to the Loan Pair, for the benefit
of the holder of the WestShore Plaza Companion Loan, the Special Servicer shall
service the Specially Serviced Mortgage Loans and manage the related REO
Properties in accordance with the provisions of this Agreement and the Servicing
Standard. Certain of the provisions of this Article IX make explicit reference
to their applicability to Mortgage Loans, the WestShore Plaza Companion Loan and
any B Note; notwithstanding such explicit references, references in this Article
IX to "Mortgage Loans" shall be construed, unless

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otherwise specified, to refer also to such B Note and such WestShore Plaza
Companion Loan (but any other terms that are defined in Article I and used in
this Article IX shall be construed according to such definitions without regard
to this sentence).

     (b) The Special Servicer shall cooperate with the Master Servicer and
provide the Master Servicer with the information reasonably requested by the
Master Servicer, in writing, to the extent required to allow the Master Servicer
to perform its servicing obligations with respect to the Specially Serviced
Mortgage Loans hereunder; provided, however, that (i) the Special Servicer shall
not be required to produce any ad hoc reports or incur any unusual expense or
effort in connection therewith and (ii) if the Special Servicer elects to
provide such ad hoc reports, the Special Servicer may require the Master
Servicer to pay a reasonable fee to cover the costs of the preparation thereof.
The Special Servicer's obligations with respect to the servicing of any
Specially Serviced Mortgage Loan and any related REO Properties shall terminate
when such Specially Serviced Mortgage Loan has become a Rehabilitated Mortgage
Loan, unless and until another Servicing Transfer Event with respect to such
Rehabilitated Mortgage Loan occurs.

     (c) The Special Servicer shall send a written notice to the Master
Servicer, the Operating Adviser and the Paying Agent within two Business Days
after becoming aware that a Mortgage Loan has become a Rehabilitated Mortgage
Loan, which notice shall identify the applicable Mortgage Loan. Upon the receipt
of such notice by the Master Servicer and the Paying Agent, such Mortgage Loan
shall become a Rehabilitated Mortgage Loan and will be serviced by the Master
Servicer.

     (d) Upon the occurrence of a Servicing Transfer Event with respect to a
Mortgage Loan and upon the reasonable request of the Special Servicer, the
Master Servicer shall mark its records for such Mortgage Loan to cause any
monthly statements for amounts due on such Mortgage Loan to be sent thereafter
to the Special Servicer rather than the related Mortgagor. Upon receipt of any
such monthly statement, the Special Servicer shall, within two Business Days,
advise the Master Servicer of any changes to be made, and return the monthly
statement to the Master Servicer. The Master Servicer shall thereafter promptly
send the corrected monthly statement to the Mortgagor. If a Mortgage Loan
becomes a Rehabilitated Mortgage Loan, the Master Servicer shall send the
monthly statement to the Mortgagor as it did before such Mortgage Loan became a
Specially Serviced Mortgage Loan.

     (e) All amounts collected by the Master Servicer with respect to a
Specially Serviced Mortgage Loan (other than a Mortgage Loan that has become an
REO Mortgage Loan and a Specially Serviced Mortgage Loan that is a B Note or the
WestShore Plaza Companion Loan) shall be deposited in the Certificate Account,
and all amounts collected by the Master Servicer with respect to a Specially
Serviced Mortgage Loan that is a B Note shall be deposited in the related A/B
Loan Custodial Account and all amounts collected by the Master Servicer with
respect to a Specially Serviced Mortgage Loan that is the WestShore Plaza
Companion Loan shall be deposited in the WestShore Plaza Companion Loan
Custodial Account. The Master Servicer shall within three Business Days after
receipt of any such payment, notify the Special Servicer of the receipt of such
payment and the amount thereof. The Special Servicer shall, within one Business
Day thereafter, instruct the Master Servicer in writing how to apply such
payment (with the application of such payments to be made in accordance with the
related Mortgage Loan documents (including the related Intercreditor Agreement,
if any) or in accordance with this Agreement, as applicable).

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<PAGE>

     (f) After the occurrence of any Servicing Transfer Event with respect to
any one or more Mortgage Loans that are the subject of any Environmental
Insurance Policy, (i) the Special Servicer shall monitor the dates by which any
claim must be made or action must be taken under such Environmental Insurance
Policy to achieve the payment of all amounts thereunder to which the Trust is
entitled in the event the Special Servicer has actual knowledge of any event
giving rise to a claim under such Environmental Insurance Policy (an "Insured
Environmental Event") and (ii) if the Special Servicer has actual knowledge of
an Insured Environmental Event with respect to such Mortgage Loan, the Special
Servicer shall take reasonable actions as are in accordance with the Servicing
Standard and the terms and conditions of the related Environmental Insurance
Policy to make a claim thereunder and achieve the payment of all amounts to
which the Trust is entitled thereunder. Any legal fees or other out-of-pocket
costs incurred in accordance with the Servicing Standard in connection with any
such claim shall be paid by, and reimbursable to, the Master Servicer (of if
applicable, the Special Servicer) as a Servicing Advance. All extraordinary
expenses (but not ordinary and routine or anticipated expenses) incurred by the
Special Servicer in fulfilling its obligations under this Section 9.1 shall be
paid by the Trust.

     SECTION 9.2 FIDELITY BOND AND ERRORS AND OMISSIONS INSURANCE POLICY OF
SPECIAL SERVICER. The Special Servicer, at its expense, shall maintain in effect
a Servicer Fidelity Bond and a Servicer Errors and Omissions Insurance Policy.
The Servicer Errors and Omissions Insurance Policy and Servicer Fidelity Bond
shall be issued by a Qualified Insurer (unless the Special Servicer self insures
as provided below) and be in form and amount consistent with the Servicing
Standard. In the event that any such Servicer Errors and Omissions Insurance
Policy or Servicer Fidelity Bond ceases to be in effect, the Special Servicer
shall obtain a comparable replacement policy or bond from an insurer or issuer
meeting the requirements set forth above as of the date of such replacement. So
long as the long-term rating of the Special Servicer is not less than two rating
categories (ignoring pluses or minuses) lower than the highest rating of the
Certificates, but in any event not less than "Aa2" as rated by Moody's and "A"
as rated by Fitch, the Special Servicer may self-insure for the Servicer
Fidelity Bond and the Servicer Error and Omissions Insurance Policy.

     SECTION 9.3 SUB-SERVICERS. The Special Servicer shall have the right to use
a Sub-Servicer on the same terms and conditions as those set forth in Section
8.4 for a Sub-Servicer of the Master Servicer. The Special Servicer shall notify
the Master Servicer, Trustee and solely as it relates to any A/B Mortgage Loan,
the holder of the related B Note, and solely as it relates to the Loan Pair, the
holder of the WestShore Plaza Companion Loan, of the appointment of any
Sub-Servicer of the Special Servicer.

     SECTION 9.4 SPECIAL SERVICER GENERAL POWERS AND DUTIES.

     (a) Subject to the other terms and provisions of this Agreement (and, in
the case of any Non-Serviced Mortgage Loan, subject to the servicing of such
Non-Serviced Mortgage Loan by the applicable Non-Serviced Mortgage Loan Master
Servicer and the applicable Non-Serviced Mortgage Loan Special Servicer), the
Special Servicer is hereby authorized and empowered when the Special Servicer
believes it appropriate in accordance with the Servicing Standard, to take any
and all the actions with respect to Specially Serviced Mortgage Loans which the
Master Servicer may perform as set forth in Section 8.3(a), including

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(i) to execute and deliver, on behalf of itself or the Trust (or holder of a B
Note or the WestShore Plaza Companion Loan, as applicable), any and all
instruments of satisfaction or cancellation, or of partial or full release or
discharge and all other comparable instruments, with respect to the Specially
Serviced Mortgage Loans and with respect to the related REO Properties and (ii)
to effectuate foreclosure or other conversion of the ownership of any REO
Property securing a Mortgage Loan. The Trustee shall execute on the Closing Date
a Power of Attorney in the form of Exhibit S-2 hereto and shall furnish the
Special Servicer from time to time, upon request, with any additional powers of
attorney of the Trust, empowering the Special Servicer to take such actions as
it determines to be reasonably necessary to comply with its servicing,
administrative and management duties hereunder, and the Trustee shall execute
and deliver or cause to be executed and delivered such other documents as a
Special Servicing Officer may request, that are necessary or appropriate to
enable the Special Servicer to service, administer and manage the Specially
Serviced Mortgage Loans and carry out its duties hereunder, in each case as the
Special Servicer determines is in accordance with the Servicing Standard and the
terms of this Agreement; provided, that, prior to initiating any proceedings in
any court of law or equity (but not defending any proceedings in any court of
law or equity) or instituting any proceeding to foreclose on any Mortgaged
Property in the name of the Trust in any state, the Special Servicer shall
notify the Trustee in writing and not institute or initiate any such proceedings
for a period of five Business Days from the date of its delivery of such notice
to the Trustee, unless the Special Servicer reasonably believes that such action
should be taken in less than five Business Days to preserve the property of the
Trust for the benefit of Certificateholders, and the Trustee may within five
Business Days of its receipt of such notice advise the Special Servicer that it
has received an Opinion of Counsel (the cost of which shall be an expense of the
Trust) from an attorney duly licensed to practice law in the state where the
related Mortgaged Property or REO Property is located, that it is likely that
the laws of the state in which said action is to be taken either prohibit such
action if taken in the name of the Trust or that the Trust would be adversely
affected under the "doing business" or tax laws of such state if such action is
taken in its name; provided, further, that the Special Servicer shall not be
liable to the extent that it relies on the advice provided in such Opinion of
Counsel. Upon receipt of any such advice from the Trustee, the Special Servicer
shall take such action in the name of such Person or Persons, in trust for the
Trust (or holder of a B Note or the WestShore Plaza Companion Loan, if
applicable), as shall be consistent with the Opinion of Counsel obtained by the
Trustee. Such Person or Persons shall acknowledge in writing that such action is
being taken by the Special Servicer in the name of the Trust (or holder of a B
Note or the WestShore Plaza Companion Loan, if applicable). In the performance
of its duties hereunder, the Special Servicer shall be an independent contractor
and shall not, except in those instances where it is, after notice to the
Trustee as provided above, taking action in the name of the Trust (or holder of
a B Note or the WestShore Plaza Companion Loan, if applicable), be deemed to be
the agent of the Trust (or holder of a B Note or the WestShore Plaza Companion
Loan, as applicable). The Special Servicer shall indemnify the Trustee for any
loss, liability or reasonable expense (including attorneys' fees) incurred by
the Trustee or any director, officer, employee, agent or Controlling Person of
it or its affiliates in connection with any negligent or intentional misuse of
the foregoing powers of attorney furnished to the Special Servicer by the
Trustee. Such indemnification shall survive the resignation or termination of
the Special Servicer hereunder, the resignation or termination of the Trustee
and the termination of this Agreement. The Special Servicer shall not have any
responsibility or liability for any act or omission of the Trustee, the Master
Servicer or the Depositor that is not attributable to the failure of the Special
Servicer to perform its obligations

                                     -230-

<PAGE>

hereunder. The Special Servicer may conclusively rely on any advice of counsel
rendered in a Nondisqualification Opinion.

     (b) In servicing and administering the Specially Serviced Mortgage Loans
and managing any related REO Properties, the Special Servicer shall employ
procedures consistent with the Servicing Standard. The Special Servicer shall
conduct, or cause to be conducted, inspections, at its own expense, of the
Mortgaged Properties relating to Specially Serviced Mortgage Loans at such times
and in such manner as shall be consistent with the Servicing Standard; provided,
that the Special Servicer shall conduct, or cause to be conducted, inspections
of the Mortgaged Properties relating to Specially Serviced Mortgage Loans at
least once during each twelve-month period that ends on June 30 of any calendar
year (commencing with the twelve-month period ending June 30, 2004); provided
further that the Special Servicer shall, at the expense of the Trust, inspect or
cause to be inspected each Mortgaged Property related to a Mortgage Loan that is
delinquent for sixty (60) days in the payment of any amounts due under such
Mortgage Loan. The Special Servicer shall provide to the Master Servicer (who
shall provide, solely as it relates to any A/B Mortgage Loan, to the holder of
the related B Note, and solely as it relates to the Loan Pair, to the holder of
the WestShore Plaza Companion Loan) and the Operating Adviser copies of the
Inspection Reports relating to such inspections as soon as practicable after the
completion of any inspection.

     (c) Pursuant to the Loan Pair Intercreditor Agreement, the owner of the
WestShore Plaza Companion Loan has agreed that the Master Servicer and the
Special Servicer are authorized and obligated to service and administer such
WestShore Plaza Companion Loan pursuant to this Agreement.

     (d) Pursuant to the Loan Pair Intercreditor Agreement, each owner of the
WestShore Plaza Companion Loan has agreed that the Master Servicer and the
Special Servicer are authorized and obligated to service and administer such
WestShore Plaza Companion Loan pursuant to this Agreement. Notwithstanding
anything herein to the contrary, the parties hereto acknowledge and agree that
the Special Servicer's obligations and responsibilities hereunder and the
Special Servicer's authority with respect to the WestShore Plaza Pari Passu Loan
are limited by and subject to the terms of the Loan Pair Intercreditor
Agreement.

     (e) Pursuant to the applicable Non-Serviced Mortgage Loan Intercreditor
Agreement, the owners of a Non-Serviced Mortgage Loan have agreed that such
owner's rights in, to and under such Non-Serviced Mortgage Loan are subject to
the servicing and all other rights of the applicable Non-Serviced Mortgage Loan
Master Servicer and the applicable Non-Serviced Mortgage Loan Special Servicer
and such Non-Serviced Mortgage Loan Master Servicer and Non-Serviced Mortgage
Loan Special Servicer are authorized and obligated to service and administer
such Non-Serviced Mortgage Loan pursuant to the related Non-Serviced Mortgage
Loan Pooling and Servicing Agreement. Notwithstanding anything herein to the
contrary, the parties hereto acknowledge and agree that the Special Servicer's
obligations and responsibilities hereunder and the Special Servicer's authority
with respect to any Non-Serviced Mortgage Loan are limited by and subject to the
terms of the applicable Non-Serviced Mortgage Loan Intercreditor Agreement and
the rights of the applicable Non-Serviced Mortgage Loan Master Servicer and the
applicable Non-Serviced Mortgage Loan Special Servicer with respect thereto
under the related Non-Serviced Mortgage Loan Pooling and Servicing Agreement.
The Special Servicer shall take such actions as it shall deem reasonably
necessary to facilitate the

                                     -231-

<PAGE>

servicing of any Non-Serviced Mortgage Loan by the applicable Non-Serviced
Mortgage Loan Master Servicer and the applicable Non-Serviced Mortgage Loan
Special Servicer including, but not limited to, delivering appropriate Requests
for Release to the Trustee and Custodian (if any) in order to deliver any
portion of the related Mortgage File to the applicable Non-Serviced Mortgage
Loan Master Servicer or applicable Non-Serviced Mortgage Loan Special Servicer
under the related Non-Serviced Mortgage Loan Pooling and Servicing Agreement.

     SECTION 9.5 "DUE-ON-SALE" CLAUSES; ASSIGNMENT AND ASSUMPTION AGREEMENTS;
MODIFICATIONS OF SPECIALLY SERVICED MORTGAGE LOANS; DUE-ON-ENCUMBRANCE CLAUSES.

     Subject to the limitations of Section 12.3, the Special Servicer shall have
the following duties and rights:

     (a) If any Specially Serviced Mortgage Loan contains a provision in the
nature of a "due-on-sale" clause, which by its terms:

         (i) provides that such Specially Serviced Mortgage Loan shall (or may
at the Mortgagee's option) become due and payable upon the sale or other
transfer of an interest in the related Mortgaged Property or ownership interest
in the related Mortgagor, or

         (ii) provides that such Specially Serviced Mortgage Loan may not be
assumed, or ownership interests in the related Mortgagor may not be transferred,
without the consent of the related mortgagee in connection with any such sale or
other transfer,

then, the Special Servicer, on behalf of the Trust, shall, after consultation
with the Operating Adviser and in accordance with the REMIC Provisions, take
such actions as it deems to be in the best economic interest of the Trust in
accordance with the Servicing Standard, and may waive or enforce any due-on-sale
clause contained in the related Mortgage Note or Mortgage; provided, however,
that if the Principal Balance of such Mortgage Loan at such time equals or
exceeds 5% of the Aggregate Certificate Balance or exceeds $35,000,000 or is one
of the then current top 10 loans (by Principal Balance) in the pool, then prior
to waiving the effect of such provision, the Special Servicer shall obtain
Rating Agency Confirmation regarding such waiver. In connection with the request
for such consent, the Special Servicer shall prepare and deliver to Moody's and
Fitch a memorandum outlining its analysis and recommendation in accordance with
the Servicing Standard, together with copies of all relevant documentation. The
Special Servicer shall also prepare and provide Moody's and Fitch with such
memorandum and documentation for all transfer, assumption and encumbrance
consents granted for Mortgage Loans below the threshold set forth above, but for
which the Special Servicer's decision will be sufficient and a Rating Agency
Confirmation is not required. As to any Mortgage Loan that is not a Specially
Serviced Mortgage Loan and contains a provision in the nature of a "due-on-sale"
clause, the Special Servicer shall have the rights and duties set forth in
Section 8.7(b). The Special Servicer shall be entitled to 100% of all assumption
fees in connection with Specially Serviced Mortgage Loans.

     After notice to the Operating Adviser, the Special Servicer is also
authorized to take or enter into an assignment and assumption agreement from or
with the Person to whom such property has been or is about to be conveyed,
and/or to release the original Mortgagor from

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liability upon the Specially Serviced Mortgage Loan and substitute the new
Mortgagor as obligor thereon; provided, that except as otherwise permitted by
Section 9.5(c), any such assignment and assumption or substitution agreement
shall contain no terms that could result in an Adverse REMIC Event. To the
extent permitted by law, the Special Servicer shall enter into an assumption or
substitution agreement that is required under the related Mortgage Loan
documents (either as a matter of right or upon satisfaction of specified
conditions) and shall otherwise enter into any assumption or substitution
agreement only if the credit status of the prospective new mortgagor and the
underwriting of the new mortgagor is in compliance with the Special Servicer's
regular commercial mortgage origination or servicing standards and criteria. The
Special Servicer shall notify the Master Servicer of any such assignment and
assumption or substitution agreement and the Special Servicer shall forward to
the Trustee the original of such agreement, which original shall be added by the
Trustee to the related Mortgage File and shall, for all purposes, be considered
a part of such Mortgage File to the same extent as all other documents and
instruments constituting a part thereof.

     (b) In connection with any assignment and assumption of a Specially
Serviced Mortgage Loan, in no event shall the Special Servicer consent to the
creation of any lien on a Mortgaged Property that is senior to, or on a parity
with, the lien of the related Mortgage. Nothing in this Section 9.5 shall
constitute a waiver of the Trustee's right, as the mortgagee of record, to
receive notice of any assignment and assumption of a Specially Serviced Mortgage
Loan, any sale or other transfer of the related Mortgaged Property or the
creation of any lien or other encumbrance with respect to such Mortgaged
Property.

     (c) Subject to the Servicing Standard and Sections 9.39 and 9.40, and the
rights and duties of the Master Servicer under Section 8.18, the Special
Servicer may enter into any modification, waiver or amendment (including,
without limitation, the substitution or release of collateral or the pledge of
additional collateral) of the terms of any Specially Serviced Mortgage Loan,
including any modification, waiver or amendment to (i) reduce the amounts owing
under any Specially Serviced Mortgage Loan by forgiving principal, accrued
interest and/or any Prepayment Premium, (ii) reduce the amount of the Scheduled
Payment on any Specially Serviced Mortgage Loan, including by way of a reduction
in the related Mortgage Rate, (iii) forbear in the enforcement of any right
granted under any Mortgage Note or Mortgage relating to a Specially Serviced
Mortgage Loan, (iv) extend the Maturity Date of any Specially Serviced Mortgage
Loan and/or (v) accept a principal prepayment on any Specially Serviced Mortgage
Loan during any period during which voluntary Principal Prepayments are
prohibited, provided, in the case of any such modification, waiver or amendment,
that (A) the related Mortgagor is in default with respect to the Specially
Serviced Mortgage Loan or, in the reasonable judgment of the Special Servicer,
such default is reasonably foreseeable, (B) in the reasonable judgment of the
Special Servicer, such modification, waiver or amendment would increase the
recovery on the Specially Serviced Mortgage Loan to Certificateholders, the
holder of the WestShore Plaza Companion Loan and the holder of the related B
Note (as a collective whole) on a net present value basis (the relevant
discounting of amounts that will be distributable to Certificateholders, the
holder of the WestShore Plaza Companion Loan and the holder of the related B
Note (as a collective whole) to be performed at the related Mortgage Rate (or,
in the case of an A/B Mortgage Loan, such discounting to be performed at the
weighted average of the Mortgage Rate and the stated mortgage rate on the B
Note), (C) such modification, waiver or amendment would not cause an Adverse
REMIC Event (including with respect to any securities evidencing interests in
any A Note or any B Note) to occur or adversely affect the tax status of

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the B Note Trust, and (D) if notice to the Operating Adviser of such
modification, waiver or amendment is required pursuant to Section 9.39, the
Special Servicer has made such notice. The Special Servicer, with respect to any
B Note and the WestShore Plaza Companion Loan that is a Specially Serviced
Mortgage Loan, shall notify the holder of the B Note and the WestShore Plaza
Companion Loan, as applicable, of any modification of the monthly payments of an
A/B Mortgage Loan or the Loan Pair, as the case may be, and such monthly
payments shall be allocated in accordance with the related Intercreditor
Agreement or Loan Pair Intercreditor Agreement, as applicable.

     In no event, however, shall the Special Servicer (i) extend the Maturity
Date of a Specially Serviced Mortgage Loan beyond a date that is two years prior
to the Rated Final Distribution Date or (ii) if the Specially Serviced Mortgage
Loan is secured by a ground lease, extend the Maturity Date of such Specially
Serviced Mortgage Loan unless the Special Servicer gives due consideration to
the remaining term of such ground lease. The Special Servicer shall not extend
the Maturity Date of any Mortgage Loan secured by a Mortgaged Property covered
by a group secured creditor impaired property environmental insurance policy for
more than five years beyond such Mortgage Loan's Maturity Date unless a new
Phase I Environmental Report indicates that there is no environmental condition
or the Mortgagor obtains, at its expense, an extension of such policy on the
same terms and conditions to cover the period through five years past the
extended Maturity Date, provided that, (i) if such Mortgage Loan is secured by a
ground lease, the Special Servicer shall give due consideration to the remaining
term of the ground lease and (ii) in no case shall the Maturity Date of any such
Mortgage Loan be extended past a date that is two years prior to the Rated Final
Distribution Date.

     The determination of the Special Servicer contemplated by clause (B) of the
proviso to the first paragraph of this Section 9.5(c) shall be evidenced by an
Officer's Certificate certifying the information in the proviso to the first
paragraph under this subsection (c).

     (d) In the event the Special Servicer intends to permit a Mortgagor to
substitute collateral for all or any portion of a Mortgaged Property pursuant to
Section 9.5(c) or pledge additional collateral for the Mortgage Loan pursuant to
Section 9.5(c), if the security interest of the Trust, the holder of the
WestShore Plaza Companion Loan or the holder of any B Note in such collateral
would be perfected by possession, or if such collateral requires special care or
protection, then prior to agreeing to such substitution or addition of
collateral, the Special Servicer shall make arrangements for such possession,
care or protection, and prior to agreeing to such substitution or addition of
collateral (or such arrangement for possession, care or protection) shall obtain
the prior written consent of the Trustee with respect thereto (which consent
shall not be unreasonably withheld, delayed or conditioned); provided, however,
that the Trustee shall not be required (but has the option) to consent to any
substitution or addition of collateral or to hold any such collateral which will
require the Trustee to undertake any additional duties or obligations or incur
any additional expense. Notwithstanding the foregoing, the Special Servicer will
not permit a Mortgagor to substitute collateral for any portion of the Mortgaged
Property pursuant to Section 9.5(c) unless it shall have received a Rating
Agency Confirmation in connection therewith, the costs of which to be payable by
the related Mortgagor to the extent provided for in the Mortgage Loan documents.
If the Mortgagor is not required to pay for the Rating Agency Confirmation, then
such expense will be paid by the Trust. The parties hereto acknowledge that if
the Trust incurs any Additional Trust Expense associated solely with the release
of collateral that is not required to be paid by a Mortgagor pursuant to the
related

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Mortgage Loan documents (and such Additional Trust Expense is not paid by the
Mortgagor), including, but not limited to, rating agency fees, then the sole
obligation of the related Seller shall be to pay an amount equal to such expense
to the extent the related Mortgagor is not required to pay them. Promptly upon
receipt of notice of such unpaid expense, regarding a Specially Serviced
Mortgage Loan, the Special Servicer shall request the related Seller to make
such payment by deposit to the Certificate Account.

     (e) The Special Servicer will promptly deliver to the Master Servicer, the
Operating Adviser, the Trustee, the Paying Agent, the Rating Agencies (and,
solely with respect to an A/B Mortgage Loan) a notice, specifying any such
assignments and assumptions, modifications, waivers or amendments, such notice
identifying the affected Specially Serviced Mortgage Loan. Such notice shall set
forth the reasons for such waiver, modification, or amendment (including, but
not limited to, information such as related income and expense statements, rent
rolls, occupancy status, property inspections, and an internal or external
appraisal performed in accordance with MAI standards and methodologies (and, if
done externally, the cost of such appraisal shall be recoverable as a Servicing
Advance subject to the provisions of Section 4.4 hereof)). The Special Servicer
shall also deliver to the Trustee (or the Custodian), for deposit in the related
Mortgage File, an original counterpart of the agreement relating to such
modification, waiver or amendment promptly following the execution thereof.

     (f) No fee described in this Section shall be collected by the Special
Servicer from the Mortgagor (or on behalf of the Mortgagor) in conjunction with
any consent or any modification, waiver or amendment of the Mortgage Loan if the
collection of such fee would cause such consent, modification, waiver or
amendment to be a "significant modification" of the Mortgage Note within the
meaning of Treasury Regulation (Section) 1.860G-2(b). Subject to the foregoing,
the Special Servicer shall use its reasonable efforts, in accordance with the
Servicing Standard, to collect any modification fees and other expenses
connected with a permitted modification of a Mortgage Loan from the Mortgagor.
The inability of the Mortgagor to pay any costs and expenses of a proposed
modification shall not impair the right of the Special Servicer, the Master
Servicer or the Trustee to be reimbursed by the Trust for such expenses
(including any cost and expense associated with the Opinion of Counsel referred
to in this Section).

     (g) The Special Servicer shall cooperate with the Master Servicer (as
provided in Section 8.7) in connection with assignments and assumptions of
Mortgage Loans that are not Specially Serviced Mortgage Loans, and shall be
entitled to receive 50% of any assumption fee paid by the related Mortgagor in
connection with an assignment and assumption executed pursuant to Section 8.7(a)
and 50% of any assumption fee paid by the related Mortgagor in connection with
an assignment and assumption executed pursuant to Section 8.7(b). The Special
Servicer shall be entitled to 100% of any assumption fee received in connection
with a Specially Serviced Mortgage Loan.

     (h) Notwithstanding anything herein to the contrary, (i) the Special
Servicer shall not have any right or obligation to consult with or to seek
and/or obtain consent or approval from the Operating Adviser prior to acting,
and provisions of this Agreement requiring such shall be of no effect, if the
Operating Adviser resigns or is removed, during the period following such
resignation or removal until a replacement is elected and (ii) no advice,
direction or objection from or by the Operating Adviser, as contemplated by this
Agreement, may (and the Special Servicer shall ignore and act without regard to
any such advice, direction or objection that the

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<PAGE>

Special Servicer has determined, in its reasonable good faith judgment would)
(A) require or cause the Special Servicer to violate applicable law, the terms
of any Mortgage Loan, any provision of this Agreement or the REMIC Provisions,
including the Special Servicer's obligation to act in accordance with the
Servicing Standard, (B) result in an Adverse REMIC Event with respect to any
REMIC Pool, (C) expose the Trust, the Depositor, the Master Servicer, the
Special Servicer, the Fiscal Agent, the Paying Agent or the Trustee, or any of
their respective Affiliates, officers, directors, employees or agents, to any
material claim, suit or liability, or (D) materially expand the scope of the
Special Servicer's responsibilities under this Agreement.

     (i) If any Specially Serviced Mortgage Loan which contains a provision in
the nature of a "due-on-encumbrance" clause, which by its terms:

         (i) provides that such Mortgage Loan shall (or may at the mortgagee's
option) become due and payable upon the creation of any additional lien or other
encumbrance on the related Mortgaged Property or a lien on an ownership interest
in the Mortgagor; or

         (ii) requires the consent of the mortgagee to the creation of any such
additional lien or other encumbrance on the related Mortgaged Property or a lien
on an ownership interest in the Mortgagor,

then, for so long as such Mortgage Loan is included in the Trust, the Special
Servicer, on behalf of the Trustee as the mortgagee of record, shall exercise
(or, subject to Section 9.5, waive its right to exercise) any right it may have
with respect to such Mortgage Loan (x) to accelerate the payments thereon, or
(y) to withhold its consent to the creation of any such additional lien or other
encumbrance, in a manner consistent with the Servicing Standard. Prior to
waiving the effect of such provision with respect to a Mortgage Loan, the
Special Servicer shall obtain Rating Agency Confirmation regarding such waiver;
provided, however, that such Rating Agency Confirmation shall only be required
if the applicable Mortgage Loan (x) represents 2% or more of the Principal
Balance of all of the Mortgage Loans held by the Trust or is one of the 10
largest Mortgage Loans based on Principal Balance and (y) such Mortgage Loan has
a Loan-to-Value Ratio (which includes Junior Indebtedness and any other loans
secured by the related Mortgaged Property, if any) that is greater than or equal
to 85% and a Debt Service Coverage Ratio (which includes debt service on Junior
Indebtedness and any other loans secured by the related Mortgaged Property, if
any) that is less than 1.2x.

     SECTION 9.6 RELEASE OF MORTGAGE FILES.

     (a) Upon becoming aware of the payment in full of any Specially Serviced
Mortgage Loan, or the receipt by the Special Servicer of a notification that
payment in full will be escrowed in a manner customary for such purposes, or the
complete defeasance of a Mortgage Loan, the Special Servicer will immediately
notify the Master Servicer. The Special Servicer shall determine, in accordance
with the Servicing Standard, whether an instrument of satisfaction shall be
delivered and, if the Special Servicer determines that such instrument should be
delivered, the Special Servicer shall deliver written approval of such delivery
to the Master Servicer.

     (b) From time to time and as appropriate for the servicing or foreclosure
of any Specially Serviced Mortgage Loan or the management of the related REO
Property and in

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<PAGE>

accordance with the Servicing Standard, the Trustee shall execute or cause to be
executed such documents as shall be prepared and furnished to the Trustee by a
Special Servicing Officer (in form reasonably acceptable to the Trustee) and as
are necessary for such purposes. The Trustee or Custodian shall, upon request of
the Special Servicer and delivery to the Trustee or Custodian of a request for
release signed by a Special Servicing Officer substantially in the form of
Exhibit C, release the related Mortgage File to the Special Servicer. After the
transfer of servicing with respect to any Specially Serviced Mortgage Loan to
the Special Servicer, in accordance with the Servicing Standard, the Master
Servicer shall notify, in writing, the Mortgagor under each Specially Serviced
Mortgage Loan transferred to the Special Servicer, of such transfer.

     (c) The Special Servicer shall send notification in writing, to the Master
Servicer to request any documents and instruments in the possession of the
Master Servicer related to any Specially Serviced Mortgage Loan.

     (d) The Special Servicer shall, with respect to any Rehabilitated Mortgage
Loan, release to the Master Servicer all documents and instruments in the
possession of the Special Servicer related to such Rehabilitated Mortgage Loan.
Prior to the transfer of servicing with respect to any Rehabilitated Mortgage
Loan to the Master Servicer in accordance with the Servicing Standard, the
Special Servicer shall notify, in writing, each Mortgagor under each
Rehabilitated Mortgage Loan of such transfer.

     SECTION 9.7 DOCUMENTS, RECORDS AND FUNDS IN POSSESSION OF SPECIAL SERVICER
TO BE HELD FOR THE TRUSTEE.

     (a) The Special Servicer shall transmit to the Trustee or Custodian such
documents and instruments coming into the possession of the Special Servicer as
from time to time are required by the terms hereof to be delivered to the
Trustee. Any funds received by the Special Servicer in respect of any Specially
Serviced Mortgage Loan or any REO Property or which otherwise are collected by
the Special Servicer as Liquidation Proceeds, Condemnation Proceeds or Insurance
Proceeds in respect of any Specially Serviced Mortgage Loan or any REO Property
shall be transmitted to the Master Servicer within one Business Day of receipt
to the Certificate Account, except that if such amounts relate to REO Income,
they shall be deposited in the REO Account. The Special Servicer shall provide
access to information and documentation regarding the Specially Serviced
Mortgage Loans to the Trustee, the Master Servicer, the Fiscal Agent, the Paying
Agent, the Operating Adviser and their respective agents and accountants at any
time upon reasonable written request and during normal business hours, provided
that the Special Servicer shall not be required to take any action or provide
any information that the Special Servicer determines will result in any material
cost or expense to which it is not entitled to reimbursement hereunder or will
result in any material liability for which it is not indemnified hereunder;
provided further that the Trustee and the Paying Agent shall be entitled to
receive from the Special Servicer all such information as the Trustee and the
Paying Agent shall reasonably require to perform their respective duties
hereunder. In fulfilling such a request, the Special Servicer shall not be
responsible for determining whether such information is sufficient for the
Trustee's, the Master Servicer's, the Fiscal Agent's, the Paying Agent's or the
Operating Adviser's purposes.

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<PAGE>

     (b) The Special Servicer hereby acknowledges that the Trust (and/or the
holder of the related B Note, if an A/B Mortgage Loan is involved and/or the
holder of the WestShore Plaza Companion Loan, if the Loan Pair is involved) owns
the Specially Serviced Mortgage Loans and all Mortgage Files representing such
Specially Serviced Mortgage Loans and all funds now or hereafter held by, or
under the control of, the Special Servicer that are collected by the Special
Servicer in connection with the Specially Serviced Mortgage Loans (but excluding
any Special Servicer Compensation and all other amounts to which the Special
Servicer is entitled hereunder); and the Special Servicer agrees that all
documents or instruments constituting part of the Mortgage Files, and such funds
relating to the Specially Serviced Mortgage Loans which come into the possession
or custody of, or which are subject to the control of, the Special Servicer,
shall be held by the Special Servicer for and on behalf of the Trust (or the
holder of the related B Note, if an A/B Mortgage Loan is involved or the holder
of the WestShore Plaza Companion Loan, if the Loan Pair is involved).

     (c) The Special Servicer also agrees that it shall not create, incur or
subject any Specially Serviced Mortgage Loans, or any funds that are required to
be deposited in any REO Account to any claim, lien, security interest, judgment,
levy, writ of attachment or other encumbrance, nor assert by legal action or
otherwise any claim or right of setoff against any Specially Serviced Mortgage
Loan or any funds, collected on, or in connection with, a Specially Serviced
Mortgage Loan.

     SECTION 9.8 REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SPECIAL
SERVICER.

     (a) The Special Servicer hereby represents and warrants to and covenants
with the Trustee, as of the Closing Date:

         (i) the Special Servicer is duly organized, validly existing and in
good standing as a corporation under the laws of the State of Delaware, and
shall be in compliance with the laws of each State in which any Mortgaged
Property (including any REO Property) which is, or is related to a Specially
Serviced Mortgage Loan is located to the extent necessary to perform its
obligations under this Agreement, except where the failure to so qualify or
comply would not adversely affect the Special Servicer's ability to perform its
obligations hereunder in accordance with the terms of this Agreement;

         (ii) the Special Servicer has the full power and authority to execute,
deliver, perform, and to enter into and consummate all transactions and
obligations contemplated by this Agreement. The Special Servicer has duly and
validly authorized the execution, delivery and performance by it of this
Agreement and this Agreement has been duly executed and delivered by the Special
Servicer; and this Agreement, assuming the due authorization, execution and
delivery thereof by the Depositor, the Trustee, the Fiscal Agent, the Paying
Agent and the Master Servicer, evidences the valid and binding obligation of the
Special Servicer enforceable against the Special Servicer in accordance with its
terms subject, as to enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium, receivership and other similar laws
affecting creditors' rights generally as from time to time in effect, and to
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law);

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         (iii) the execution and delivery of this Agreement by the Special
Servicer, the consummation by the Special Servicer of the transactions
contemplated hereby, and the fulfillment of or compliance by the Special
Servicer with the terms and conditions of this Agreement will not (1) result in
a breach of any term or provision of its charter or by-laws or (2) conflict
with, result in a breach, violation or acceleration of, or result in a default
under, the terms of any other material agreement or instrument to which it is a
party or by which it may be bound, or any law, governmental rule, regulation, or
judgment, decree or order applicable to it of any court, regulatory body,
administrative agency or governmental body having jurisdiction over it, which
materially and adversely affects its ability to perform its obligations under
this Agreement;

         (iv) no litigation is pending or, to the best of the Special Servicer's
knowledge, threatened, against it, the outcome of which, in the Special
Servicer's reasonable judgment, could reasonably be expected to materially and
adversely affect the execution, delivery or enforceability of this Agreement or
its ability to service the Mortgage Loans or to perform any of its other
obligations hereunder in accordance with the terms hereof; and

         (v) no consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by it of, or compliance by it with, this Agreement, or the
consummation of the transactions contemplated hereby, or if any such consent,
approval, authorization or order is required, it has obtained the same or will
obtain the same prior to the time necessary to perform its obligations under
this Agreement, and, except to the extent in the case of performance, that its
failure to be qualified as a foreign corporation or licensed in one or more
states is not necessary for the performance by it of its obligations hereunder.

     (b) It is understood that the representations and warranties set forth in
this Section 9.8 shall survive the execution and delivery of this Agreement.

     (c) Any cause of action against the Special Servicer arising out of the
breach of any representations and warranties made in this Section shall accrue
upon the giving of written notice to the Special Servicer by any of the Trustee,
the Master Servicer, the Paying Agent or the Fiscal Agent. The Special Servicer
shall give prompt notice to the Trustee, the Fiscal Agent, the Paying Agent, the
Depositor, the Operating Adviser and the Master Servicer of the occurrence, or
the failure to occur, of any event that, with notice, or the passage of time or
both, would cause any representation or warranty in this Section to be untrue or
inaccurate in any respect.

     SECTION 9.9 STANDARD HAZARD, FLOOD AND COMPREHENSIVE GENERAL LIABILITY
INSURANCE POLICIES.

     (a) For all REO Property, the Special Servicer shall use reasonable
efforts, consistent with the Servicing Standard, to maintain with a Qualified
Insurer (A) a Standard Hazard Insurance Policy (that, if the terms of the
related Mortgage Loan documents and the related Mortgage so require, contains no
exclusion as to any Act or Acts of Terrorism, as defined in the Terrorism Risk
Insurance Act of 2002) which does not provide for reduction due to depreciation
in an amount which is not less than the full replacement cost of the
improvements of

                                     -239-

<PAGE>

such REO Property or in an amount not less than the unpaid Principal Balance
plus all unpaid interest and the cumulative amount of Servicing Advances (plus
Advance Interest) made with respect to such Mortgage Loan, any related B Note
and the WestShore Plaza Companion Loan, whichever is less, but, in any event, in
an amount sufficient to avoid the application of any co-insurance clause and (B)
any other insurance coverage for such REO Property which the related Mortgagor
was required to maintain for the related Mortgaged Property under the related
Mortgage, subject, as to earthquake insurance, to the second sentence following
this sentence. If the improvements to the Mortgaged Property are in an area
identified in the Federal Register by the Federal Emergency Management Agency as
having special flood hazards (and such flood insurance has been made available),
the Special Servicer shall maintain a flood insurance policy meeting the
requirements of the current guidelines of the Federal Insurance Administration
in an amount representing coverage equal to the lesser of the then outstanding
Principal Balance of the Specially Serviced Mortgage Loan and unpaid Advances
(plus Advance Interest) and the maximum insurance coverage required under such
current guidelines. It is understood and agreed that the Special Servicer has no
obligation to obtain earthquake or other additional insurance on REO Property,
except as required by law or, with respect to insurance other than earthquake
insurance, as set forth in clause (B) of the first sentence of this Section
9.9(a) and, nevertheless, at its sole option and at the Trust's expense, it (if
required at origination and is available at commercially reasonable rates) may
obtain such earthquake insurance. The Special Servicer shall use its reasonable
efforts, consistent with the Servicing Standard, to obtain a comprehensive
general liability insurance policy for all REO Properties. The Special Servicer
shall, to the extent available at commercially reasonable rates (as determined
by the Special Servicer in accordance with the Servicing Standard) and to the
extent consistent with the Servicing Standard, use its reasonable efforts to
maintain a Rent Loss Policy covering revenues for a period of at least twelve
months and a comprehensive general liability policy with coverage comparable to
prudent lending requirements in an amount not less than $1 million per
occurrence. All applicable policies required to be maintained by the Special
Servicer pursuant to this Section 9.9(a) shall name the Trustee as loss payee
and be endorsed with a standard mortgagee clause. The costs of such insurance
shall be a Servicing Advance, subject to the provisions of Section 4.4 hereof.

     (b) Any amounts collected by the Special Servicer under any insurance
policies maintained pursuant to this Section 9.9 (other than amounts to be
applied to the restoration or repair of the REO Property) shall be deposited
into the applicable REO Account. Any cost incurred in maintaining the insurance
required hereby for any REO Property shall be a Servicing Advance, subject to
the provisions of Section 4.4 hereof.

     (c) Notwithstanding the above, the Special Servicer shall not be required
in any event to maintain or obtain insurance coverage beyond what is reasonably
available at a cost customarily acceptable and consistent with the Servicing
Standard; provided that, the Special Servicer will be required to maintain
insurance against property damages resulting from terrorism or similar acts if
the terms of the related Mortgage Loan documents so require unless the Special
Servicer determines that (i) such insurance is not available at any rate or (ii)
such insurance is not available at commercially reasonable rates and such
hazards are not at the time commonly insured against for properties similar to
the related Mortgaged Property and located in or around the region in which such
related Mortgaged Property is located. The Special Servicer shall notify the
Trustee of any such determination.

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<PAGE>

     (d) The Special Servicer shall conclusively be deemed to have satisfied its
obligations as set forth in this Section 9.9 either (i) if the Special Servicer
shall have obtained and maintained a master force placed or blanket insurance
policy insuring against hazard losses on all of the applicable Mortgage Loans,
the WestShore Plaza Companion Loan and any B Note serviced by it, it being
understood and agreed that such policy may contain a deductible clause on terms
substantially equivalent to those commercially available and maintained by
comparable servicers consistent with the Servicing Standard, and provided that
such policy is issued by a Qualified Insurer with a minimum claims paying
ability rating of at least "A2" by Moody's and "A" by Fitch or otherwise
approved by the Rating Agencies or (ii) if the Special Servicer, provided that
the rating of such Person's long-term debt is not less than "A2" by Moody's and
"A" by Fitch self-insures for its obligations as set forth in the first
paragraph of this Section 9.9. In the event that the Special Servicer shall
cause any Mortgage Loan, the WestShore Plaza Companion Loan and B Note to be
covered by such a master force placed or blanket insurance policy, the
incremental cost of such insurance allocable to such Mortgage Loan, WestShore
Plaza Companion Loan and B Note (i.e., other than any minimum or standby premium
payable for such policy whether or not any Mortgage Loan is then covered
thereby), if not borne by the related Mortgagor, shall be paid by the Special
Servicer as a Servicing Advance, subject to the provisions of Section 4.4
hereof. If such policy contains a deductible clause, the Special Servicer shall,
if there shall not have been maintained on the related Mortgaged Property a
policy complying with this Section 9.9 and there shall have been a loss that
would have been covered by such policy, deposit in the Certificate Account the
amount not otherwise payable under such master force placed or blanket insurance
policy because of such deductible clause to the extent that such deductible
exceeds (i) the deductible under the related Mortgage Loan or A/B Mortgage Loan
or (ii) if there is no deductible limitation required under the Mortgage Loan or
A/B Mortgage Loan, the deductible amount with respect to insurance policies
generally available on properties similar to the related Mortgaged Property
which is consistent with the Servicing Standard, and deliver to the Trustee an
Officer's Certificate describing the calculation of such amount. In connection
with its activities as administrator and servicer of the Mortgage Loans, the
WestShore Plaza Companion Loan and any B Note, the Special Servicer agrees to
present, on its behalf and on behalf of the Trustee, claims under any such
master force placed or blanket insurance policy.

     SECTION 9.10 PRESENTMENT OF CLAIMS AND COLLECTION OF PROCEEDS. The Special
Servicer will prepare and present or cause to be prepared and presented on
behalf of the Trustee all claims under the Insurance Policies with respect to
REO Property, and take such actions (including the negotiation, settlement,
compromise or enforcement of the insured's claim) as shall be necessary to
recover under such policies. Any proceeds disbursed to the Special Servicer in
respect of such policies shall be promptly remitted to the Certificate Account,
upon receipt, except for any amounts realized that are to be applied to the
repair or restoration of the applicable REO Property in accordance with the
Servicing Standard. Any extraordinary expenses (but not ordinary and routine or
anticipated expenses) incurred by the Special Servicer in fulfilling its
obligations under this Section 9.10 shall be paid by the Trust.

SECTION 9.11 COMPENSATION TO THE SPECIAL SERVICER.

     (a) As compensation for its activities hereunder, the Special Servicer
shall be entitled to (i) the Special Servicing Fee, (ii) the Liquidation Fee and
(iii) the Work-Out Fee. Such amounts, if any, collected by the Special Servicer
from the related Mortgagor shall be

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transferred by the Special Servicer to the Master Servicer within one Business
Day of receipt thereof, and deposited by the Master Servicer in the Certificate
Account. The Special Servicer shall be entitled to receive a Liquidation Fee
from the Liquidation Proceeds received in connection with a final disposition of
a Specially Serviced Mortgage Loan or REO Property in whole or in part (whether
arising pursuant to a sale, condemnation or otherwise). With respect to each REO
Mortgage Loan that is a successor to a Mortgage Loan secured by two or more
Mortgaged Properties, the reference to "REO Property" in the preceding sentence
shall be construed on a property-by-property basis to refer separately to the
acquired real property that is a successor to each of such Mortgaged Properties,
thereby entitling the Special Servicer to a Liquidation Fee from the Liquidation
Proceeds received in connection with a final disposition of, and Condemnation
Proceeds received in connection with, each such acquired property as the
Liquidation Proceeds related to that property are received. The Special Servicer
shall also be entitled to additional special servicing compensation of an amount
equal to the excess, if any, of the aggregate Prepayment Interest Excess
relating to Mortgage Loans which are Specially Serviced Mortgage Loans which
have received voluntary Principal Prepayments not from Liquidation Proceeds or
from modifications of Specially Serviced Mortgage Loans for each Distribution
Date over the aggregate Prepayment Interest Shortfalls for such Mortgage Loans
for such Distribution Date. If the Special Servicer resigns or is terminated for
any reason, it shall retain the right to receive any Work-Out Fees payable on
Mortgage Loans that became Rehabilitated Mortgage Loans while it acted as
Special Servicer and remained Rehabilitated Mortgage Loans at the time of such
resignation or termination for so long as such Mortgage Loan remains a
Rehabilitated Mortgage Loan.

     (b) The Special Servicer shall be entitled to cause the Master Servicer to
withdraw (i) from the Certificate Account, the Special Servicer Compensation in
respect of each Mortgage Loan (but not a B Note), (ii) from the WestShore Plaza
Companion Loan Custodial Account, the Special Servicer Compensation to the
extent related solely to the WestShore Plaza Companion Loan and (iii) from any
A/B Loan Custodial Account, the Special Servicer Compensation to the extent
related solely to the related B Note, in the time and manner set forth in
Section 5.2 of this Agreement. The Special Servicer shall be required to pay all
expenses incurred by it in connection with its servicing activities hereunder
and shall not be entitled to reimbursement therefor except as expressly provided
in this Agreement.

     (c) Additional Special Servicer Compensation in the form of net interest or
income on any REO Account, assumption fees, extension fees, servicing fees,
Modification Fees, forbearance fees, Late Fees and default interest (net of
amounts used to pay Advance Interest) or other usual and customary charges and
fees actually received from the Mortgagor in connection with any Specially
Serviced Mortgage Loan shall be retained by the Special Servicer, to the extent
not required to be deposited in the Certificate Account pursuant to the terms of
this Agreement (other than any such fees payable in connection with any
Non-Serviced Mortgage Loan). The Special Servicer shall also be permitted to
receive 50% of all assumption fees collected with respect to Mortgage Loans that
are not Specially Serviced Mortgage Loans as provided in Section 8.7(a) and 100%
of all assumption fees collected with respect to Mortgage Loans that are
Specially Serviced Mortgage Loans as provided in Section 9.5(a) (other than any
such fees payable in connection with any Non-Serviced Mortgage Loan). To the
extent any component of Special Servicer Compensation is in respect of amounts
usually and customarily paid by Mortgagors, the Special Servicer shall use
reasonable good faith efforts to collect such amounts from the related
Mortgagor, and to the extent so collected, in full or in part, the Special

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Servicer shall not be entitled to compensation for the portion so collected
therefor hereunder out of the Trust.

     SECTION 9.12 REALIZATION UPON DEFAULTED MORTGAGE LOANS.

     (a) The Special Servicer, in accordance with the Servicing Standard and
subject to Section 9.4(a) and Section 9.36, shall use its reasonable efforts to
foreclose upon, repossess or otherwise comparably convert the ownership of
Mortgaged Properties securing such of the Specially Serviced Mortgage Loans as
come into and continue in default and as to which no satisfactory arrangements
can be made for collection of delinquent payments of such Mortgage Loan, the
sale of such Mortgage Loan in accordance with this Agreement or the modification
of such Mortgage Loan in accordance with this Agreement. In connection with such
foreclosure or other conversion of ownership, the Special Servicer shall follow
the Servicing Standard. The foregoing is subject to the proviso that the Special
Servicer shall not request that the Master Servicer make a Servicing Advance for
Liquidation Expenses that would be a Nonrecoverable Advance unless the Special
Servicer determines that such Servicing Advance is in the best interest of the
Certificateholders.

     (b) The Special Servicer shall not acquire any personal property relating
to any Specially Serviced Mortgage Loan pursuant hereto unless either:

         (i) such personal property is incidental to real property (within the
meaning of Section 856(e)(1) of the Code) so acquired by the Special Servicer;
or

         (ii) the Special Servicer shall have received a Nondisqualification
Opinion (the cost of which shall be reimbursed by the Trust) to the effect that
the holding of such personal property by any REMIC Pool will not cause the
imposition of a tax on any REMIC Pool under the Code or cause any REMIC Pool to
fail to qualify as a REMIC.

     (c) Notwithstanding anything to the contrary in this Agreement, the Special
Servicer shall not, on behalf of the Trust, obtain title to a Mortgaged Property
as a result of or in lieu of foreclosure or otherwise, and shall not otherwise
acquire possession of, or take any other action with respect to, any Mortgaged
Property, if, as a result of any such action the Trust, or any trust that holds
the WestShore Plaza Companion Loan would be considered to hold title to, to be a
"mortgagee-in-possession" of, or to be an "owner" or "operator" of such
Mortgaged Property within the meaning of CERCLA, or any applicable comparable
federal, state or local law, or a "discharger" or "responsible party"
thereunder, unless the Special Servicer has also previously determined in
accordance with the Servicing Standard, based on a Phase I Environmental Report
prepared by a Person (who may be an employee or affiliate of the Master Servicer
or the Special Servicer) who regularly conducts environmental site assessments
in accordance with the standards of FNMA in the case of multi-family mortgage
loans and customary servicing practices in the case of commercial loans for
environmental assessments, which report shall be delivered to the Trustee, that:

         (i) such Mortgaged Property is in compliance with applicable
Environmental Laws or, if not, after consultation with an environmental expert
that taking such actions as are necessary to bring the Mortgaged Property in
compliance therewith is reasonably likely to produce a greater recovery on a net
present value basis than not taking such actions;

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         (ii) taking such actions as are necessary to bring the Mortgaged
Property in compliance with applicable Environmental Laws is reasonably likely
to produce a greater recovery on a net present value basis than pursuing a claim
under the Environmental Insurance Policy; and

         (iii) there are no circumstances or conditions present or threatened at
such Mortgaged Property relating to the use, management, disposal or release of
any hazardous substances, hazardous materials, hazardous wastes, or
petroleum-based materials for which investigation, testing, monitoring, removal,
clean-up or remediation could be required under any federal, state or local law
or regulation, or that, if any such materials are present for which such action
could be required, after consultation with an environmental expert taking such
actions with respect to the affected Mortgaged Property is reasonably likely to
produce a greater recovery on a net present value basis than not taking such
actions (after taking into account the projected costs of such actions);
provided, however, that such compliance pursuant to clause (i) and (ii) above or
the taking of such action pursuant to this clause (iii) shall only be required
to the extent that the cost thereof is a Servicing Advance of the Master
Servicer or the Special Servicer pursuant to this Agreement, subject to the
provisions of Section 4.4 hereof.

     (d) The cost of the Phase I Environmental Report contemplated by Section
9.12(c) may be treated as a Liquidation Expense, or in the event the related
Specially Serviced Mortgage Loan is not liquidated and a Final Recovery
Determination has been made with respect to such Specially Serviced Mortgage
Loan, the Master Servicer shall treat such cost as a Servicing Advance subject
to the provisions of Section 4.4 hereof; provided that, in the latter event, the
Special Servicer shall use its good faith reasonable business efforts to recover
such cost from the Mortgagor in connection with the curing of the default under
the Specially Serviced Mortgage Loan.

     (e) If the Special Servicer determines, pursuant to
Section 9.12(c), that taking such actions as are necessary to bring any
Mortgaged Property into compliance with applicable Environmental Laws, or taking
such actions with respect to the containment, removal, clean-up or remediation
of hazardous substances, hazardous materials, hazardous wastes, or
petroleum-based materials affecting any such Mortgaged Property, is not
reasonably likely to produce a greater recovery on a net present value basis
than not taking such actions (after taking into account the projected costs of
such actions) or than not pursuing a claim under the Environmental Insurance
Policy, then the Special Servicer shall take such action as it deems to be in
the best economic interest of the Trust (and the holder of the related B Note if
in connection with an A/B Mortgage Loan and the holder of the WestShore Plaza
Companion Loan if in connection with the Loan Pair, taken as a collective
whole), including, without limitation, releasing the lien of the related
Mortgage. If the Special Servicer determines that a material possibility exists
that Liquidation Expenses with respect to Mortgaged Property (taking into
account the cost of bringing it into compliance with applicable Environmental
Laws) would exceed the Principal Balance of the related Mortgage Loan, the
Special Servicer shall not attempt to bring such Mortgaged Property into
compliance and shall not acquire title to such Mortgaged Property unless it has
received the written consent of the Trustee to such action.

     (f) The Special Servicer shall have the right to determine, in accordance
with the Servicing Standard, the advisability of maintaining any action with
respect to any Specially

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Serviced Mortgage Loan, including, without limitation, any action to obtain a
deficiency judgment with respect to any Specially Serviced Mortgage Loan.

     SECTION 9.13 FORECLOSURE. In the event that the Trust obtains, through
foreclosure on a Mortgage or otherwise, the right to receive title to a
Mortgaged Property, the Special Servicer, as its agent, shall direct the
appropriate party to deliver title to the REO Property to the Trustee or its
nominee.

     The Special Servicer may consult with counsel to determine when an
Acquisition Date shall be deemed to occur under the REMIC Provisions with
respect to the Mortgaged Property, the expense of such consultation being
treated as a Servicing Advance related to the foreclosure, subject to the
provisions of Section 4.4 hereof. The Special Servicer, on behalf of the Trust
(and the holder of the related B Note if in connection with an A/B Mortgage Loan
and the holder of the WestShore Plaza Companion Loan if in connection with the
Loan Pair), shall sell the REO Property expeditiously, but in any event within
the time period, and subject to the conditions, set forth in Section 9.15.
Subject to Section 9.15, the Special Servicer shall manage, conserve, protect
and operate the REO Property for the holders of beneficial interests in the
Trust (and the holder of the related B Note if in connection with an A/B
Mortgage Loan and the holder of the WestShore Plaza Companion Loan if in
connection with the Loan Pair) solely for the purpose of its prompt disposition
and sale.

     SECTION 9.14 OPERATION OF REO PROPERTY

     (a) The Special Servicer shall segregate and hold all funds collected and
received in connection with the operation of each REO Property separate and
apart from its own funds and general assets and shall establish and maintain
with respect to each REO Property one or more accounts held in trust for the
benefit of the Certificateholders (and the holder of the related B Note if in
connection with an A/B Mortgage Loan and the holder of the WestShore Plaza
Companion Loan if in connection with the Loan Pair) in the name of "LaSalle Bank
National Association, as Trustee for the Holders of Bear Stearns Commercial
Mortgage Securities Inc. Commercial Mortgage Pass-Through Certificates Series
2003-TOP12, the holder of the WestShore Plaza Companion Loan and the holder of
any B Note as their interests may appear [name of Property Account]" (each, an
"REO Account"), which shall be an Eligible Account. Amounts in any REO Account
shall be invested in Eligible Investments. The Special Servicer shall deposit
all funds received with respect to an REO Property in the applicable REO Account
within two days of receipt. The Special Servicer shall account separately for
funds received or expended with respect to each REO Property. All funds in each
REO Account may be invested only in Eligible Investments. The Special Servicer
shall notify the Trustee and the Master Servicer in writing of the location and
account number of each REO Account and shall notify the Trustee prior to any
subsequent change thereof.

     (b) On or before each Special Servicer Remittance Date, the Special
Servicer shall withdraw from each REO Account and deposit in the Certificate
Account, the REO Income received or collected during the Collection Period
immediately preceding such Special Servicer Remittance Date on or with respect
to the related REO Properties and reinvestment income thereon; provided,
however, that (i) the Special Servicer may retain in such REO Account such
portion of such proceeds and collections as may be necessary to maintain in the
REO Account sufficient funds for the proper operation, management and
maintenance of the related REO

                                     -245-

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Property, including, without limitation, the creation of reasonable reserves for
repairs, replacements, and necessary capital improvements and other related
expenses. The Special Servicer shall notify the Master Servicer of all such
deposits (and the REO Properties to which the deposits relate) made into the
Certificate Account and (ii) the Special Servicer shall be entitled to withdraw
from the REO Account and pay itself as additional Special Servicing Compensation
any interest or net reinvestment income earned on funds deposited in the REO
Account. The amount of any losses incurred in respect of any such investments
shall be for the account of the Special Servicer which shall deposit the amount
of such loss (to the extent not offset by income from other investments) in the
REO Account, out of its own funds immediately as realized. If the Special
Servicer deposits in any REO Account any amount not required to be deposited
therein, it may at any time withdraw such amount from the REO Account, any
provision herein to the contrary notwithstanding.

     (c) If the Trust acquires the Mortgaged Property, the Special Servicer
shall have full power and authority, in consultation with the Operating Adviser,
and subject to the specific requirements and prohibitions of this Agreement and
any applicable consultation rights of the holder of the related B Note relating
to an A/B Mortgage Loan, to do any and all things in connection therewith as are
consistent with the Servicing Standard, subject to the REMIC Provisions, and in
such manner as the Special Servicer deems to be in the best interest of the
Trust (and in the case of any A/B Mortgage Loan, the holder of the related B
Note and the Trust as a collective whole and in the case of the Loan Pair, the
holder of the WestShore Plaza Companion Loan and the Trust as a collective
whole), and, consistent therewith, may advance from its own funds to pay for the
following items (which amounts shall be reimbursed by the Master Servicer or the
Trust subject to Sections 4.4 in accordance with Section 4.6(e)), to the extent
such amounts cannot be paid from REO Income:

         (i) all insurance premiums due and payable in respect of such REO
Property;

         (ii) all real estate taxes and assessments in respect of such REO
Property that could result or have resulted in the imposition of a lien thereon;
and

         (iii) all costs and expenses necessary to maintain, operate, lease and
sell such REO Property (other than capital expenditures).

     (d) The Special Servicer may, and to the extent necessary to (i) preserve
the status of the REO Property as "foreclosure property" under the REMIC
Provisions or (ii) avoid the imposition of a tax on "income from nonpermitted
assets" within the meaning of the REMIC Provisions, shall contract with any
Independent Contractor for the operation and management of the REO Property,
provided that:

         (i) the terms and conditions of any such contract shall not be
inconsistent herewith;

         (ii) the terms of such contract shall be consistent with the provisions
of Section 856 of the Code and Treasury Regulation Section 1.856-4(b)(5);

         (iii) only to the extent consistent with (ii) above, any such contract
shall require, or shall be administered to require, that the Independent
Contractor (A) pay all

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costs and expenses incurred in connection with the operation and management of
such Mortgaged Property underlying the REO Property and (B) deposit on a daily
basis all amounts payable to the Trust in accordance with the contract between
the Trust and the Independent Contractor in an Eligible Account;

         (iv) none of the provisions of this Section 9.14 relating to any such
contract or to actions taken through any such Independent Contractor shall be
deemed to relieve the Special Servicer of any of its duties and obligations to
the Trustee with respect to the operation and management of any such REO
Property;

         (v) if the Independent Contractor is an Affiliate of the Special
Servicer, the consent of the Operating Adviser and a Nondisqualification Opinion
must be obtained; and

         (vi) the Special Servicer shall be obligated with respect thereto to
the same extent as if it alone were performing all duties and obligations in
connection with the operation and management of such REO Property.

     The Special Servicer shall be entitled to enter into any agreement with any
Independent Contractor performing services for the Trust (and, if applicable,
the holder of a B Note or the WestShore Plaza Companion Loan) pursuant to this
subsection (d) for indemnification of the Special Servicer by such Independent
Contractor, and nothing in this Agreement shall be deemed to limit or modify
such indemnification. All fees of the Independent Contractor (other than fees
paid for performing services within the ordinary duties of a Special Servicer
which shall be paid by the Special Servicer) shall be paid from the income
derived from the REO Property. To the extent that the income from the REO
Property is insufficient, such fees shall be advanced by the Master Servicer or
the Special Servicer as a Servicing Advance, subject to the provisions of
Section 4.4 and Section 4.6(e) hereof.

     (e) Notwithstanding any other provision of this Agreement, the Special
Servicer shall not rent, lease, or otherwise earn income on behalf of the Trust
or the beneficial owners thereof with respect to REO Property which might cause
the REO Property to fail to qualify as "foreclosure property" within the meaning
of Section 860G(a)(8) of the Code (without giving effect to the final sentence
thereof) or result in the receipt by any REMIC of any "income from nonpermitted
assets" within the meaning of Section 860F(a)(2) of the Code or any "net income
from foreclosure property" which is subject to tax under the REMIC Provisions
unless (i) the Trustee and the Special Servicer have received an Opinion of
Counsel (at the Trust's sole expense) to the effect that, under the REMIC
Provisions and any relevant proposed legislation, any income generated for the
Kimball Lane Loan REMIC or REMIC I by the REO Property would not result in the
imposition of a tax upon the Kimball Lane Loan REMIC or REMIC I or (ii) in
accordance with the Servicing Standard, the Special Servicer determines the
income or earnings with respect to such REO Property will offset any tax under
the REMIC Provisions relating to such income or earnings and will maximize the
net recovery from the REO Property to the Certificateholders. The Special
Servicer shall notify the Trustee, the Paying Agent and the Master Servicer of
any election by it to incur such tax, and the Special Servicer (i) shall hold in
escrow in an Eligible Account an amount equal to the tax payable thereby from
revenues collected from the related REO Property, (ii) provide the Paying Agent
with all information for the Paying Agent to file the necessary tax returns in
connection therewith and (iii) upon request

                                     -247-
<PAGE>
from the Paying Agent, pay from such account to the Paying Agent the
amount of the applicable tax. The Paying Agent shall file the applicable tax
returns based on the information supplied by the Special Servicer and pay the
applicable tax from the amounts collected by the Special Servicer.

     Subject to, and without limiting the generality of the foregoing, the
Special Servicer, on behalf of the Trust, shall not:

         (i) permit the Trust to enter into, renew or extend any New Lease with
respect to the REO Property, if the New Lease by its terms will give rise to any
income that does not constitute Rents from Real Property;

         (ii) permit any amount to be received or accrued under any New Lease
other than amounts that will constitute Rents from Real Property;

         (iii) authorize or permit any construction on the REO Property, other
than the completion of a building or other improvement thereon, and then only if
more than ten percent of the construction of such building or other improvement
was completed before default on the Mortgage Loan became imminent, all within
the meaning of Section 856(e)(4)(B) of the Code; or

         (iv) Directly Operate, other than through an Independent Contractor, or
allow any other Person to Directly Operate, other than through an Independent
Contractor, the REO Property on any date more than 90 days after the Acquisition
Date; unless, in any such case, the Special Servicer has requested and received
an Opinion of Counsel at the Trust's sole expense to the effect that such action
will not cause such REO Property to fail to qualify as "foreclosure property"
within the meaning of Section 860G(a)(8) of the Code (without giving effect to
the final sentence thereof) at any time that it is held by the applicable REMIC
Pool, in which case the Special Servicer may take such actions as are specified
in such Opinion of Counsel.

     SECTION 9.15 SALE OF REO PROPERTY.

     (a) In the event that title to any REO Property is acquired by the Trust in
respect of any Specially Serviced Mortgage Loan, the deed or certificate of sale
shall be issued to the Trust, the Trustee or to its nominees. The Special
Servicer, after notice to the Operating Adviser, shall use its reasonable best
efforts to sell any REO Property as soon as practicable consistent with the
objective of maximizing proceeds for all Certificateholders (and with respect to
the WestShore Plaza Companion Loan or a B Note, for the holders of such loans,
as a collective whole), but in no event later than the end of the third calendar
year following the end of the year of its acquisition, and in any event prior to
the Rated Final Distribution Date or earlier to the extent necessary to comply
with REMIC provisions, unless (i) the Trustee, on behalf of the applicable REMIC
Pool, has been granted an extension of time (an "Extension") (which extension
shall be applied for at least 60 days prior to the expiration of the period
specified above) by the Internal Revenue Service to sell such REO Property (a
copy of which shall be delivered to the Paying Agent upon request), in which
case the Special Servicer shall continue to attempt to sell the REO Property for
its fair market value for such period longer than the period specified above as
such Extension permits or (ii) the Special Servicer seeks and subsequently

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receives, at the expense of the Trust, a Nondisqualification Opinion, addressed
to the Trustee and the Special Servicer, to the effect that the holding by the
Trust of such REO Property subsequent to the period specified above after its
acquisition will not result in the imposition of taxes on "prohibited
transactions" of a REMIC, as defined in Section 860F(a)(2) of the Code, or cause
any REMIC to fail to qualify as a REMIC at any time that any Certificates are
outstanding. If the Trustee has not received an Extension or such Opinion of
Counsel and the Special Servicer is not able to sell such REO Property within
the period specified above, or if an Extension has been granted and the Special
Servicer is unable to sell such REO Property within the extended time period,
the Special Servicer shall, after consultation with the Operating Adviser,
before the end of such period or extended period, as the case may be, auction
the REO Property to the highest bidder (which may be the Special Servicer) in
accordance with the Servicing Standard; provided, however, that no Interested
Person shall be permitted to purchase the REO Property at a price less than the
Purchase Price; and provided, further that if the Special Servicer intends to
bid on any REO Property, (i) the Special Servicer shall notify the Trustee of
such intent, (ii) the Trustee shall promptly obtain, at the expense of the Trust
an Appraisal of such REO Property (or internal valuation in accordance with the
procedures specified in Section 6.9) and (iii) the Special Servicer shall not
bid less than the fair market value set forth in such Appraisal. Neither any
Seller nor the Depositor may purchase REO Property at a price in excess of the
fair market value thereof.

     (b) Within 30 days of the sale of the REO Property, the Special Servicer
shall provide to the Trustee, the Paying Agent and the Master Servicer (and the
holder of the related B Note, if any, if in connection with an A/B Mortgage Loan
and the holder of the WestShore Plaza Companion Loan, if in connection with the
Loan Pair) a statement of accounting for such REO Property, including without
limitation, (i) the Acquisition Date for the REO Property, (ii) the date of
disposition of the REO Property, (iii) the sale price and related selling and
other expenses, (iv) accrued interest (including interest deemed to have
accrued) on the Specially Serviced Mortgage Loan to which the REO Property
related, calculated from the Acquisition Date to the disposition date, (v) final
property operating statements, and (vi) such other information as the Trustee or
the Paying Agent (and the holder of the related B Note, if any, if in connection
with an A/B Mortgage Loan and the holder of the WestShore Plaza Companion Loan,
if in connection with the Loan Pair) may reasonably request in writing.

     (c) The Liquidation Proceeds from the final
disposition of the REO Property shall be deposited in the Certificate Account
within one Business Day of receipt.

     (d) The Special Servicer shall provide the necessary information to the
Master Servicer and the Paying Agent to allow the Master Servicer to prepare,
deliver and file reports of foreclosure and abandonment in accordance with
Section 6050J and Section 6050P, if required, of the Code with respect to such
REO Property and shall deliver such information with respect thereto as the
Master Servicer or the Paying Agent may request in writing.

     SECTION 9.16 REALIZATION ON COLLATERAL SECURITY. In connection with the
enforcement of the rights of the Trust to any property securing any Specially
Serviced Mortgage Loan other than the related Mortgaged Property, the Special
Servicer shall consult with counsel to determine how best to enforce such rights
in a manner consistent with the REMIC Provisions and shall not, based on a
Nondisqualification Opinion addressed to the Special Servicer and the Trustee
(the cost of which shall be an expense of the Trust) take any action that could
result in

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the failure of any REMIC Pool to qualify as a REMIC while any Certificates are
outstanding, unless such action has been approved by a vote of 100% of each
Class of Certificateholders (including the Class R-I, Class R-II, Class R-III
and Class R-K Certificateholders).

     SECTION 9.17 RESERVED

     SECTION 9.18 ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE. The Special
Servicer shall deliver to the Paying Agent and the Master Servicer on or before
noon (Eastern Time) on March 15 of each calendar year (or March 14 if a leap
year), commencing in March 2004, an Officer's Certificate stating, as to the
signer thereof, that (A) a review of the activities of the Special Servicer
during the preceding calendar year or portion thereof and of the performance of
the Special Servicer under this Agreement has been made under such officer's
supervision and (B) to the best of such officer's knowledge, based on such
review, the Special Servicer has fulfilled all its obligations under this
Agreement in all material respects throughout such year, or, if there has been a
default in the fulfillment of any such obligation, specifying each such default
known to such officer and the nature and status thereof. The Special Servicer
shall deliver such Officer's Certificate to the Depositor and the Trustee by
April 7 of each calendar year. The Special Servicer shall forward a copy of each
such statement to the Rating Agencies. The Paying Agent shall forward a copy of
each such statement to the Luxembourg Paying Agent. Promptly after receipt of
such Officer's Certificate, the Depositor shall review the Officer's Certificate
and, if applicable, consult with the Special Servicer as to the nature of any
defaults by the Special Servicer in the fulfillment of any of the Special
Servicer's obligations hereunder.

     SECTION 9.19 ANNUAL INDEPENDENT ACCOUNTANTS' SERVICING REPORT. On or before
noon (Eastern Time) on March 15 of each calendar year (or March 14 if a leap
year), beginning with March 2004, the Special Servicer at its expense shall
cause a nationally recognized firm of Independent public accountants (who may
also render other services to the Special Servicer, as applicable) to furnish to
the Paying Agent and the Master Servicer (in electronic format) a statement to
the effect that (a) such firm has examined certain documents and records
relating to the servicing of the Mortgage Loans under this Agreement or the
servicing of mortgage loans similar to the Mortgage Loans under substantially
similar agreements for the preceding calendar year and (b) the assertion by
management of the Special Servicer, that it maintained an effective internal
control system over the servicing of such mortgage loans is fairly stated in all
material respects, based upon established criteria, which statement meets the
standards applicable to accountant's reports intended for general distribution;
provided that each of the Master Servicer and the Special Servicer shall not be
required to cause the delivery of such statement until April 15 in any given
year so long as it has received written confirmation from the Depositor that a
Report on Form 10-K is not required to be filed in respect of the Trust Fund for
the preceding calendar year. The Special Servicer shall deliver such statement
to the Depositor, each Rating Agency, the Trustee, and, upon request, the
Operating Adviser by April 7 of each calendar year (or by April 30 of each
calendar year if the statement is not required to be delivered until April 15).
The Paying Agent shall promptly deliver such statement to the Luxembourg Paying
Agent. Promptly after receipt of such report, the Depositor shall review the
report and, if applicable, consult with the Special Servicer as to the nature of
any defaults by the Special Servicer in the fulfillment of any of the Special
Servicer's obligations hereunder.

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     SECTION 9.20 MERGER OR CONSOLIDATION. Any Person into which the Special
Servicer may be merged or consolidated, or any Person resulting from any merger,
conversion, other change in form or consolidation to which the Special Servicer
shall be a party, or any Person succeeding to the business of the Special
Servicer, shall be the successor of the Special Servicer hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto; provided, however, that each of the Rating Agencies provides a
Rating Agency Confirmation (including with respect to any securities rated by a
Rating Agency evidencing interests in the A Notes and any B Note). If the
conditions to the proviso in the foregoing sentence are not met, the Trustee may
terminate the Special Servicer's servicing of the Specially Serviced Mortgage
Loans pursuant hereto, such termination to be effected in the manner set forth
in Section 9.31.

     SECTION 9.21 RESIGNATION OF SPECIAL SERVICER.

     (a) Except as otherwise provided in this Section 9.21, the Special Servicer
shall not resign from the obligations and duties hereby imposed on it unless it
determines that the Special Servicer's duties hereunder are no longer
permissible under applicable law or are in material conflict by reason of
applicable law with any other activities carried on by it. Any such
determination permitting the resignation of the Special Servicer shall be
evidenced by an Opinion of Counsel to such effect delivered to the Master
Servicer, the Operating Adviser and the Trustee. No such resignation shall
become effective until a successor servicer designated by the Operating Adviser
and the Trustee shall have (i) satisfied the requirements that would apply
pursuant to Section 9.20 hereof if a merger of the Special Servicer had
occurred, (ii) assumed the Special Servicer's responsibilities and obligations
under this Agreement and (iii) Rating Agency Confirmation (including with
respect to any securities rated by a Rating Agency evidencing interests in the A
Notes and any B Note).shall have been obtained. Notice of such resignation shall
be given promptly by the Special Servicer to the Master Servicer and the
Trustee.

     (b) The Special Servicer may resign from the obligations and duties hereby
imposed on it, upon reasonable notice to the Trustee, provided that (i) a
successor Special Servicer is (x) available, (y) reasonably acceptable to the
Operating Adviser, the Depositor, and the Trustee, and (z) willing to assume the
obligations, responsibilities and covenants to be performed hereunder by the
Special Servicer on substantially the same terms and conditions, and for not
more than equivalent compensation as that herein provided, (ii) the successor
Special Servicer has assets of at least $15,000,000 and (iii) Rating Agency
Confirmation is obtained with respect to such resignation, as evidenced by a
letter from each Rating Agency delivered to the Trustee. Any costs of such
resignation and of obtaining a replacement Special Servicer shall be borne by
the Special Servicer and shall not be an expense of the Trust.

     (c) No such resignation under paragraph (b) above shall become effective
unless and until such successor Special Servicer enters into a servicing
agreement with the Trustee assuming the obligations and responsibilities of the
Special Servicer hereunder in form and substance reasonably satisfactory to the
Trustee.

     (d) Upon any resignation of the Special Servicer, it shall retain the right
to receive any and all Work-Out Fees payable in respect of Mortgage Loans, the
WestShore Plaza Companion Loan and any B Note that became Rehabilitated Mortgage
Loans during the period that it acted as Special Servicer and that were still
Rehabilitated Mortgage Loans at the time of

                                     -251-

<PAGE>

such resignation (and the successor Special Servicer shall not be entitled to
any portion of such Work-Out Fees), in each case until such time (if any) as
such Mortgage Loan, the WestShore Plaza Companion Loan or B Note again becomes a
Specially Serviced Mortgage Loan or are no longer included in the Trust.

     SECTION 9.22 ASSIGNMENT OR DELEGATION OF DUTIES BY SPECIAL SERVICER. The
Special Servicer shall have the right without the prior written consent of the
Trustee to (A) delegate or subcontract with or authorize or appoint anyone, or
delegate certain duties to other professionals such as attorneys and appraisers,
as an agent of the Special Servicer or Sub-Servicers (as provided in Section
9.3) to perform and carry out any duties, covenants or obligations to be
performed and carried out by the Special Servicer hereunder or (B) assign and
delegate all of its duties hereunder. In the case of any such assignment and
delegation in accordance with the requirements of clause (A) of this Section,
the Special Servicer shall not be released from its obligations under this
Agreement. In the case of any such assignment and delegation in accordance with
the requirements of clause (B) of this Section, the Special Servicer shall be
released from its obligations under this Agreement, except that the Special
Servicer shall remain liable for all liabilities and obligations incurred by it
as the Special Servicer hereunder prior to the satisfaction of the following
conditions: (i) the Special Servicer gives the Depositor, the Master Servicer,
the Primary Servicer and the Trustee notice of such assignment and delegation;
(ii) such purchaser or transferee accepting such assignment and delegation
executes and delivers to the Depositor and the Trustee an agreement accepting
such assignment, which contains an assumption by such Person of the rights,
powers, duties, responsibilities, obligations and liabilities of the Special
Servicer, with like effect as if originally named as a party to this Agreement;
(iii) the purchaser or transferee has assets in excess of $15,000,000; (iv) such
assignment and delegation is the subject of a Rating Agency Confirmation; and
(v) the Depositor consents to such assignment and delegation, such consent not
be unreasonably withheld. Notwithstanding the above, the Special Servicer may
appoint Sub-Servicers in accordance with Section 9.3 hereof.

     SECTION 9.23 LIMITATION ON LIABILITY OF THE SPECIAL SERVICER AND OTHERS.

     (a) Neither the Special Servicer nor any of the directors, officers,
employees or agents of the Special Servicer shall be under any liability to the
Certificateholders, the holder of any B Note, the holder of the WestShore Plaza
Companion Loan or the Trustee for any action taken or for refraining from the
taking of any action in good faith and using reasonable business judgment;
provided that this provision shall not protect the Special Servicer or any such
person against any breach of a representation or warranty contained herein or
any liability which would otherwise be imposed by reason of willful misfeasance,
bad faith or negligence in its performance of duties hereunder or by reason of
negligent disregard of obligations and duties hereunder. The Special Servicer
and any director, officer, employee or agent of the Special Servicer may rely in
good faith on any document of any kind prima facie properly executed and
submitted by any Person (including, without limitation, the information and
reports delivered by or at the direction of the Master Servicer or any director,
officer, employee or agent of the Master Servicer) respecting any matters
arising hereunder. The Special Servicer shall not be under any obligation to
appear in, prosecute or defend any legal action which is not incidental to its
duties to service the Specially Serviced Mortgage Loans in accordance with this
Agreement; provided that the Special Servicer may in its sole discretion
undertake any such action which it may reasonably deem necessary or desirable in
order to protect the interests of the

                                     -252-

<PAGE>

Certificateholders, the holder of any B Note, the holder of the WestShore Plaza
Companion Loan and the Trustee in the Specially Serviced Mortgage Loans, or
shall undertake any such action if instructed to do so by the Trustee. In such
event, all legal expenses and costs of such action (other than those that are
connected with the routine performance by the Special Servicer of its duties
hereunder) shall be expenses and costs of the Trust, and the Special Servicer
shall be entitled to be reimbursed therefor as a Servicing Advance, together
with interest thereon, as provided by Section 5.2 hereof. Notwithstanding any
term in this Agreement, the Special Servicer shall not be relieved from
liability to, or entitled to indemnification from, the Trust for any action
taken by it at the direction of the Operating Adviser which is in conflict with
the Servicing Standard.

     (b) In addition, the Special Servicer shall have no liability with respect
to, and shall be entitled to conclusively rely on as to the truth of the
statements and the correctness of the opinions expressed in any certificates or
opinions furnished to the Special Servicer and conforming to the requirements of
this Agreement. Neither the Special Servicer, nor any director, officer,
employee, agent or Affiliate, shall be personally liable for any error of
judgment made in good faith by any officer, unless it shall be proved that the
Special Servicer or such officer was negligent in ascertaining the pertinent
facts. Neither the Special Servicer, nor any director, officer, employee, agent
or Affiliate, shall be personally liable for any action taken, suffered or
omitted by it in good faith and believed by it to be authorized or within the
discretion, rights or powers conferred upon it by this Agreement. The Special
Servicer shall be entitled to rely on reports and information supplied to it by
the Master Servicer and the related Mortgagors and shall have no duty to
investigate or confirm the accuracy of any such report or information.

     (c) The Special Servicer shall not be obligated to incur any liabilities,
costs, charges, fees or other expenses which relate to or arise from any breach
of any representation, warranty or covenant made by the Depositor, the Master
Servicer, the Fiscal Agent or the Trustee in this Agreement. The Trust shall
indemnify and hold harmless the Special Servicer from any and all claims,
liabilities, costs, charges, fees or other expenses which relate to or arise
from any such breach of representation, warranty or covenant to the extent such
amounts are not recoverable from the party committing such breach.

     (d) Except as otherwise specifically provided herein:

         (i) the Special Servicer may rely, and shall be protected in acting or
refraining from acting upon, any resolution, officer's certificate, certificate
of auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond or other paper or document
believed or in good faith believed by it to be genuine and to have been signed
or presented by the proper party or parties;

         (ii) the Special Servicer may consult with counsel, and any written
advice or Opinion of Counsel shall be full and complete authorization and
protection with respect to any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such advice or Opinion of
Counsel;

         (iii) the Special Servicer shall not be personally liable for any
action taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion, rights or powers conferred upon it by this
Agreement; and

                                     -253-

<PAGE>

         (iv) the Special Servicer, in preparing any reports hereunder, may
rely, and shall be protected in acting or refraining from acting upon any
information (financial or other), statement, certificate, document, agreement,
covenant, notice, request or other paper reasonably believed or in good faith
believed by it to be genuine.

     (e) The Special Servicer and any director, officer, employee or agent of
the Special Servicer shall be indemnified by the Master Servicer, the Trustee,
the Paying Agent and the Fiscal Agent, as the case may be, and held harmless
against any loss, liability or expense including reasonable attorneys' fees
incurred in connection with any legal action relating to the Master Servicer's,
the Trustee's, the Paying Agent's or the Fiscal Agent's, as the case may be,
respective willful misfeasance, bad faith or negligence in the performance of
its respective duties hereunder or by reason of negligent disregard by such
Person of its respective duties hereunder, other than any loss, liability or
expense incurred by reason of willful misfeasance, bad faith or negligence in
the performance of any of the Special Servicer's duties hereunder or by reason
of negligent disregard of the Special Servicer's obligations and duties
hereunder. The Special Servicer shall promptly notify the Master Servicer, the
Trustee, the Paying Agent and the Fiscal Agent if a claim is made by a third
party entitling the Special Servicer to indemnification hereunder, whereupon the
Master Servicer, the Trustee or the Paying Agent, in each case, to the extent
the claim was made in connection with its willful misfeasance, bad faith or
negligence, shall assume the defense of any such claim (with counsel reasonably
satisfactory to the Special Servicer). Any failure to so notify the Master
Servicer, the Trustee or the Paying Agent shall not affect any rights the
Special Servicer may have to indemnification hereunder or otherwise, unless the
interest of the Master Servicer, the Trustee or the Paying Agent is materially
prejudiced thereby. The indemnification provided herein shall survive the
termination of this Agreement and the termination or resignation of the Special
Servicer. Such indemnity shall survive the termination of this Agreement or the
resignation or removal of the Special Servicer hereunder. Any payment hereunder
made by the Master Servicer, the Trustee, the Fiscal Agent or the Paying Agent,
as the case may be, pursuant to this paragraph to the Special Servicer shall be
paid from the Master Servicer's, the Trustee's, Fiscal Agent's or the Paying
Agent's, as the case may be, own funds, without reimbursement from the Trust
therefor, except achieved through subrogation as provided in this Agreement. Any
expenses incurred or indemnification payments made by the Trustee, the Paying
Agent, the Fiscal Agent or the Master Servicer shall be reimbursed by the party
so paid, if a court of competent jurisdiction makes a final judgment that the
conduct of the Trustee, the Paying Agent, the Fiscal Agent or the Master
Servicer, as the case may be, was (x) not culpable or (y) found to not have
acted with willful misfeasance, bad faith or negligence.

     SECTION 9.24 INDEMNIFICATION; THIRD-PARTY CLAIMS.

     (a) The Special Servicer and any director, officer, employee or agent of
the Special Servicer shall be indemnified and held harmless by the Trust, out of
the proceeds of the Mortgage Loans and the A/B Mortgage Loan (if and to the
extent that the matter relates to such A/B Mortgage Loan) against any and all
claims, losses, penalties, fines, forfeitures, legal fees and related costs,
judgments and any other costs, liabilities, fees and expenses incurred in
connection with any legal action relating to (i) this Agreement, and (ii) any
action taken by the Special Servicer in accordance with the instruction
delivered in writing to the Special Servicer by the Trustee or the Master
Servicer pursuant to any provision of this Agreement in each case and the
Special Servicer and each of its directors, officers, employees and agents shall
be entitled to

                                      -254-

<PAGE>

indemnification from the Trust for any loss, liability or expense (including
attorneys' fees) incurred in connection with the provision by the Special
Servicer of any information included by the Special Servicer in the report
required to be provided by the Special Servicer pursuant to this Agreement,
other than any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of duties hereunder or
by reason of negligent disregard of obligations and duties hereunder. The
Special Servicer shall assume the defense of any such claim (with counsel
reasonably satisfactory to the Special Servicer) and the Trust shall pay, from
amounts on deposit in the Certificate Account pursuant to Section 5.2, all
expenses in connection therewith, including counsel fees, and promptly pay,
discharge and satisfy any judgment or decree which may be entered against it or
them in respect of such claim. The indemnification provided herein shall survive
the termination of this Agreement and the termination or resignation of the
Special Servicer. Any expenses incurred or indemnification payments made by the
Trust shall be reimbursed by the Special Servicer, if a court of competent
jurisdiction makes a final, non-appealable judgment that the Special Servicer
was found to have acted with willful misfeasance, bad faith or negligence.
Notwithstanding the foregoing, if such loss, liability or expense relates
specifically to the WestShore Plaza Pari Passu Loan (or another Mortgage Loan
included in the Trust) or the WestShore Plaza Companion Loan, then such
indemnification shall be paid out of collections on, and other proceeds of, such
WestShore Plaza Pari Passu Loan, other Mortgage Loan or the WestShore Plaza
Companion Loan, as applicable and not out of proceeds of any related B Note. If
such loss, liability or expense relates to an A/B Mortgage Loan but does not
relate to the related A Note and does not relate primarily to the administration
of the Trust or any REMIC formed hereunder or to any determination respecting
the amount, payment or avoidance of any tax under the REMIC provisions of the
Code or the actual payment of any REMIC tax or expense, then such
indemnification shall be paid first out of collections on, and other proceeds
of, the related B Note until such point as such indemnification is paid in full
or a Final Recovery Determination has been made with respect to such B Note and
only then out of collections on, and other proceeds of, the related A Note.

     (b) The Special Servicer agrees to indemnify the Trust, and the Trustee,
the Fiscal Agent, the Depositor, the Master Servicer, the Paying Agent and any
director, officer, employee or agent or Controlling Person of the Trustee, the
Fiscal Agent, the Depositor and the Master Servicer, and hold them harmless
against any and all claims, losses, penalties, fines, forfeitures, legal fees
and related costs, judgments, and any other costs, liabilities, fees and
expenses that the Trust or the Trustee, the Fiscal Agent, the Depositor, the
Paying Agent or the Master Servicer may sustain arising from or as a result of
the willful misfeasance, bad faith or negligence in the performance of duties
hereunder or by reason of negligent disregard of obligations and duties
hereunder by the Special Servicer. The Trustee, the Fiscal Agent, the Depositor,
the Paying Agent or the Master Servicer shall immediately notify the Special
Servicer if a claim is made by a third party with respect to this Agreement or
the Specially Serviced Mortgage Loans entitling the Trust or the Trustee, the
Fiscal Agent, the Depositor, the Paying Agent or the Master Servicer, as the
case may be, to indemnification hereunder, whereupon the Special Servicer shall
assume the defense of any such claim (with counsel reasonably satisfactory to
the Trustee, the Fiscal Agent, the Depositor, the Paying Agent or the Master
Servicer, as the case may be) and pay all expenses in connection therewith,
including counsel fees, and promptly pay, discharge and satisfy any judgment or
decree which may be entered against it or them in respect of such claim. Any
failure to so notify the Special Servicer shall not affect any rights the Trust
or the Trustee, the Fiscal Agent, the Depositor, the Paying Agent or the Master
Servicer may have to indemnification under this Agreement or otherwise, unless
the

                                     -255-

<PAGE>

Special Servicer's defense of such claim is materially prejudiced thereby.
The indemnification provided herein shall survive the termination of this
Agreement and the termination or resignation of the Special Servicer, the Paying
Agent or the Trustee or Fiscal Agent. Any expenses incurred or indemnification
payments made by the Special Servicer shall be reimbursed by the party so paid,
if a court of competent jurisdiction makes a final, non-appealable judgment that
the conduct of the Special Servicer was not culpable or found to have acted with
willful misfeasance, bad faith or negligence.

     (c) The initial Special Servicer and the Depositor expressly agree that the
only information furnished by or on behalf of the Special Servicer for inclusion
in the Preliminary Prospectus Supplement and the Final Prospectus Supplement is
the information set forth in the paragraph under the caption "SERVICING OF THE
MORTGAGE LOANS - The Master Servicer and Special Servicer--Special Servicer" of
the Preliminary Prospectus Supplement and Final Prospectus Supplement.

     (d) Any Non-Serviced Mortgage Loan Special Servicer and any director,
officer, employee or agent of such Non-Serviced Mortgage Loan Special Servicer
shall be indemnified by the Trust and held harmless against the Trust's pro rata
share of any and all claims, losses, penalties, fines, forfeitures, legal fees
and related costs, judgments and any other costs, liabilities, fees and expenses
incurred in connection with any legal action relating to any Non-Serviced
Mortgage Loan Pooling and Servicing Agreement and this Agreement, and relating
to any Non-Serviced Mortgage Loan (but excluding any such losses allocable to
the related Non-Serviced Mortgage Loan Companion Loans), reasonably requiring
the use of counsel or the incurring of expenses other than any losses incurred
by reason of any Non-Serviced Mortgage Loan Special Servicer's willful
misfeasance, bad faith or negligence in the performance of its duties under the
related Non-Serviced Mortgage Loan Pooling and Servicing Agreement.

     SECTION 9.25 RESERVED

     SECTION 9.26 SPECIAL SERVICER MAY OWN CERTIFICATES. The Special Servicer or
any agent of the Special Servicer in its individual capacity or in any other
capacity may become the owner or pledgee of Certificates with the same rights as
it would have if they were not the Special Servicer or such agent. Any such
interest of the Special Servicer or such agent in the Certificates shall not be
taken into account when evaluating whether actions of the Special Servicer are
consistent with its obligations in accordance with the Servicing Standard
regardless of whether such actions may have the effect of benefiting the Class
or Classes of Certificates owned by the Special Servicer.

     SECTION 9.27 TAX REPORTING. The Special Servicer shall provide the
necessary information to the Master Servicer to allow the Master Servicer to
comply with the Mortgagor tax reporting requirements imposed by Sections 6050H,
6050J and 6050P of the Code with respect to any Specially Serviced Mortgage
Loan. The Special Servicer shall provide to the Master Servicer copies of any
such reports. The Master Servicer shall forward such reports to the Trustee and
the Paying Agent.

     SECTION 9.28 APPLICATION OF FUNDS RECEIVED. It is anticipated that the
Master Servicer will be collecting all payments with respect to the Mortgage
Loans, the WestShore

                                     -256-

<PAGE>

Plaza Companion Loan and any B Note (other than payments with respect to REO
Income). If, however, the Special Servicer should receive any payments with
respect to any Mortgage Loan (other than REO Income) it shall, within one
Business Day of receipt from the Mortgagor or otherwise of any amounts
attributable to payments with respect to or the sale of any Mortgage Loan or any
Specially Serviced Mortgage Loan, if any, (but not including REO Income, which
shall be deposited in the applicable REO Account as provided in Section 9.14
hereof), either, (i) forward such payment (endorsed, if applicable, to the order
of the Master Servicer), to the Master Servicer, or (ii) deposit such amounts,
or cause such amounts to be deposited, in the Certificate Account. The Special
Servicer shall notify the Master Servicer of each such amount received on or
before the date required for the making of such deposit or transfer, as the case
may be, indicating the Mortgage Loan or Specially Serviced Mortgage Loan to
which the amount is to be applied and the type of payment made by or on behalf
of the related Mortgagor.

     SECTION 9.29 COMPLIANCE WITH REMIC PROVISIONS. The Special Servicer shall
act in accordance with this Agreement and the provisions of the Code relating to
REMICs in order to create or maintain the status of any REMIC Pool as a REMIC
under the Code or, as appropriate, adopt a plan of complete liquidation. The
Special Servicer shall not take any action or cause any REMIC Pool to take any
action that would (i) endanger the status of any REMIC as a REMIC under the Code
or (ii) subject to Section 9.14(e), result in the imposition of a tax upon any
REMIC Pool (including, but not limited to, the tax on prohibited transactions as
defined in Code Section 860F(a)(2) or on prohibited contributions pursuant to
Section 860G(d)) unless the Master Servicer and the Trustee have received a
Nondisqualification Opinion (at the expense of the party seeking to take such
action) to the effect that the contemplated action will not endanger such status
or result in the imposition of such tax. The Special Servicer shall comply with
the provisions of Article XII hereof.

     SECTION 9.30 TERMINATION.

     (a) The obligations and responsibilities of the Special Servicer created
hereby (other than the obligation of the Special Servicer to make payments to
the Master Servicer as set forth in Section 9.28 and the obligations of the
Special Servicer pursuant to Sections 9.8 and 9.24 hereof) shall terminate on
the date which is the earliest of (i) the later of (A) the final payment or
other liquidation of the last Mortgage Loan remaining outstanding (and final
distribution to the Certificateholders) or, (B) the disposition of all REO
Property in respect of any Specially Serviced Mortgage Loan (and final
distribution to the Certificateholders), (ii) 60 days following the date on
which the Trustee or the Operating Adviser has given written notice to the
Special Servicer that the Special Servicer is terminated pursuant to Section
9.30(b) or 9.30(c), respectively, and (iii) the effective date of any
resignation of the Special Servicer effected pursuant to and in accordance with
Section 9.21. The obligations and responsibilities of the Special Servicer
created hereby with respect to the Loan Pair (other than the obligation of the
Special Servicer to make payments to the Master Servicer as set forth in Section
9.28, the obligations of the Special Servicer pursuant to Sections 9.8 and 9.24
hereof and obligations under this Agreement that survive termination) shall
terminate on the date that is 60 days following the date on which the Trustee
has given written notice to the Special Servicer that this Agreement is
terminated with respect to the Special Servicer's obligations with respect to
such Loan Pair pursuant to Section 9.30(d).

                                     -257-

<PAGE>

     (b) The Trustee may terminate the Special Servicer in the event that (i)
the Special Servicer has failed to remit any amount required to be remitted to
the Trustee, the Master Servicer, the Fiscal Agent, the Paying Agent or the
Depositor within one (1) Business Day following the date such amount was
required to have been remitted under the terms of this Agreement, (ii) the
Special Servicer has failed to deposit into any account any amount required to
be so deposited or remitted under the terms of this Agreement which failure
continues unremedied for one Business Day following the date on which such
deposit or remittance was first required to be made; (iii) the Special Servicer
has failed to duly observe or perform in any material respect any of the other
covenants or agreements of the Special Servicer set forth in this Agreement, and
the Special Servicer has failed to remedy such failure within thirty (30) days
after written notice of such failure, requiring the same to be remedied, shall
have been given to the Special Servicer by the Depositor or the Trustee;
provided, however, that if the Special Servicer certifies to the Trustee and the
Depositor that the Special Servicer is in good faith attempting to remedy such
failure, and the Certificateholders would not be affected thereby, such cure
period will be extended to the extent necessary to permit the Special Servicer
to cure such failure; provided, however, that such cure period may not exceed 90
days; (iv) the Special Servicer has made one or more false or misleading
representations or warranties herein that materially and adversely affects the
interest of any Class of Certificates, and has failed to cure such breach within
thirty (30) days after notice of such breach, requiring the same to be remedied,
shall have been given to the Special Servicer by the Depositor or the Trustee,
provided, however, that if the Special Servicer certifies to the Trustee and the
Depositor that the Special Servicer is in good faith attempting to remedy such
failure, such cure period may be extended to the extent necessary to permit the
Special Servicer to cure such failure; provided, however, that such cure period
may not exceed 90 days; (v) the Trustee shall receive notice from Fitch to the
effect that the continuation of the Special Servicer in such capacity would
result in the downgrade, qualification or withdrawal of any rating then assigned
by Fitch to any Class of Certificates; (vi) a decree or order of a court or
agency or supervisory authority having jurisdiction in the premises in an
involuntary case under any present or future federal or state bankruptcy,
insolvency or similar law for the appointment of a conservator, receiver,
liquidator, trustee or similar official in any bankruptcy, insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings, or for the winding-up or liquidation of its affairs, shall have
been entered against the Special Servicer and such decree or order shall have
remained in force undischarged or unstayed for a period of 60 days; (vii) the
Special Servicer shall consent to the appointment of a conservator, receiver,
liquidator, trustee or similar official in any bankruptcy, insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings relating to the Special Servicer or of or relating to all or
substantially all of its property; or (viii) the Special Servicer thereof shall
admit in writing its inability to pay its debts generally as they become due,
file a petition to take advantage of any applicable bankruptcy, insolvency or
reorganization statute, make an assignment for the benefit of its creditors,
voluntarily suspend payment of its obligations, or take any corporate action in
furtherance of the foregoing; or (ix) a Special Servicing Officer of the Special
Servicer receives actual knowledge that Moody's has (A) qualified, downgraded or
withdrawn its rating or ratings of one or more Classes of Certificates, or (B)
placed one or more Classes of Certificates on "watch status" in contemplation of
a rating downgrade or withdrawal (and such "watch status" placement shall not
have been withdrawn by Moody's within 60 days of the date that a Special
Servicing Officer of the Special Servicer obtained such actual knowledge) and,
in the case of either of clauses (A) or (B), citing servicing concerns with the
Special Servicer as the sole or material factor in such rating action. Such
termination shall be effective on the date after the

                                     -258-

<PAGE>

date of any of the above events that the Trustee specifies in a written notice
to the Special Servicer specifying the reason for such termination. The
Operating Adviser shall have the right to appoint a successor if the Trustee
terminates the Special Servicer.

     (c) The Operating Adviser shall have the right to direct the Trustee to
terminate the Special Servicer, provided that the Operating Adviser shall
appoint a successor Special Servicer who will (i) be reasonably satisfactory to
the Trustee and to the Depositor, and (ii) execute and deliver to the Trustee an
agreement, in form and substance reasonably satisfactory to the Trustee, whereby
the successor Special Servicer agrees to assume and perform punctually the
duties of the Special Servicer specified in this Agreement; and provided,
further, that the Trustee shall have received Rating Agency Confirmation
(including with respect to any securities rated by a Rating Agency evidencing
interests in the A Notes and any B Note) from each Rating Agency prior to the
termination of the Special Servicer. The Special Servicer shall not be
terminated pursuant to this subsection (c) until a successor Special Servicer
shall have been appointed. The Operating Adviser shall pay any costs and
expenses incurred by the Trust in connection with the removal and appointment of
a Special Servicer (unless such removal is based on any of the events or
circumstances set forth in Section 9.30(b)).

     SECTION 9.31 PROCEDURE UPON TERMINATION.

     (a) Notice of any termination pursuant to clause (i) of Section 9.30(a),
specifying the Distribution Date upon which the final distribution shall be
made, shall be given promptly by the Special Servicer to the Trustee and the
Paying Agent no later than the later of (i) five Business Days after the final
payment or other liquidation of the last Mortgage Loan or (ii) the sixth day of
the month in which the final Distribution Date will occur. Upon any such
termination, the rights and duties of the Special Servicer (other than the
rights and duties of the Special Servicer pursuant to Sections 9.8, 9.21, 9.23
and 9.24 hereof) shall terminate and the Special Servicer shall transfer to the
Master Servicer the amounts remaining in each REO Account and shall thereafter
terminate each REO Account and any other account or fund maintained with respect
to the Specially Serviced Mortgage Loans.

     (b) On the date specified in a written notice of termination given to the
Special Servicer pursuant to clause (ii) of Section 9.30(a), all authority,
power and rights of the Special Servicer under this Agreement, whether with
respect to the Specially Serviced Mortgage Loans or otherwise, shall terminate;
provided, that in no event shall the termination of the Special Servicer be
effective until the Trustee or other successor Special Servicer shall have
succeeded the Special Servicer as successor Special Servicer, notified the
Special Servicer of such designation, and such successor Special Servicer shall
have assumed the Special Servicer's obligations and responsibilities, as set
forth in an agreement substantially in the form hereof, with respect to the
Specially Serviced Mortgage Loans. The Trustee or other successor Special
Servicer may not succeed the Special Servicer as Special Servicer until and
unless it has satisfied the provisions that would apply to a Person succeeding
to the business of the Special Servicer pursuant to Section 9.20 hereof. The
Trustee is hereby authorized and empowered to execute and deliver, on behalf of
the Special Servicer, as attorney-in-fact or otherwise, any and all documents
and other instruments, and to do or accomplish all other acts or things
necessary or appropriate to effect the purposes of such notice of termination.
The Special Servicer agrees to cooperate with the Trustee and the Fiscal Agent
in effecting the termination of the Special Servicer's responsibilities and
rights hereunder as Special Servicer including, without limitation,

                                     -259-

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providing the Trustee all documents and records in electronic or other form
reasonably requested by it to enable the successor Special Servicer designated
by the Trustee to assume the Special Servicer's functions hereunder and to
effect the transfer to such successor for administration by it of all amounts
which shall at the time be or should have been deposited by the Special Servicer
in any REO Account and any other account or fund maintained or thereafter
received with respect to the Specially Serviced Mortgage Loans. On the date
specified in a written notice of termination given to the Special Servicer
pursuant to the second sentence of Section 9.30(a), all authority, power and
rights of the Special Servicer under this Agreement with respect to the
WestShore Plaza Pari Passu Loan, whether such Mortgage Loan is a Specially
Serviced Mortgage Loan or otherwise, shall terminate. The Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the Special
Servicer, as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination.

     (c) If the Special Servicer receives a written notice of termination
pursuant to clause (ii) of Section 9.30(a) relating solely to an event set forth
in Section 9.30(b)(v) or (ix), and if the Special Servicer provides the Trustee
with the appropriate "request for proposal" materials within five Business Days
after receipt of such written notice of termination, then the Trustee shall
promptly thereafter (using such "request for proposal" materials provided by the
Special Servicer) solicit good faith bids for the rights to be appointed as
Special Servicer under this Agreement from at least three but no more than five
Qualified Bidders or, if three Qualified Bidders cannot be located, then from as
many persons as the Trustee can determine are Qualified Bidders. At the
Trustee's request, the Special Servicer shall supply the Trustee with the names
of Persons from whom to solicit such bids. In no event shall the Trustee be
responsible if less than three Qualified Bidders submit bids for the right to
service the Mortgage Loans, the WestShore Plaza Companion Loan and any B Note
under this Agreement.

     (d) Each bid proposal shall require any Successful Bidder, as a condition
of its bid, to enter into this Agreement as successor Special Servicer, and to
agree to be bound by the terms hereof, not later than 30 days after termination
of the Special Servicer hereunder. The Trustee shall select the Qualified Bidder
with the highest cash bid (or such other Qualified Bidder as the Master Servicer
may direct) that is also acceptable to the Operating Adviser (the "Successful
Bidder") to act as successor Special Servicer hereunder. If no bidder is
acceptable to the Operating Adviser, the Operating Adviser shall appoint the
successor Special Servicer after consultation with the Controlling Class,
provided that the successor Special Servicer so appointed must be bound by the
terms of this Agreement and there must be delivered a Rating Agency Confirmation
(including with respect to any securities evidencing interests in the A Notes)
in connection with such appointment. The Trustee shall direct the Successful
Bidder to enter into this Agreement as successor Special Servicer pursuant to
the terms hereof not later than 30 days after the termination of the Special
Servicer hereunder, and in connection therewith to deliver the amount of the
Successful Bidder's cash bid to the Trustee by wire transfer of immediately
available funds to an account specified by the Trustee no later than 10:00 a.m.
New York City time on the date specified for the assignment and assumption of
the servicing rights hereunder.

     (e) Upon the assignment and acceptance of the servicing right hereunder to
and by the Successful Bidder and receipt of such cash bid, the Trustee shall
remit or cause to be remitted to the terminated Special Servicer the amount of
such cash bid received from the

                                     -260-

<PAGE>

Successful Bidder (net of out-of-pocket expenses incurred in connection with
obtaining such bid and transferring servicing) by wire transfer of immediately
available funds to an account specified by the terminated Special Servicer no
later than 1:00 p.m. New York City time on the date specified for the assignment
and assumption of the servicing rights hereunder.

     (f) If the Successful Bidder has not entered into this Agreement as
successor Special within 30 days after the termination of the Special Servicer
hereunder or no Successful Bidder was identified within such 30-day period, the
Trustee shall have no further obligations under Section 9.31(c) and may act or
may select another successor to act as Special Servicer hereunder in accordance
with Section 9.31(b).

     SECTION 9.32 CERTAIN SPECIAL SERVICER REPORTS.

     (a) The Special Servicer, for each Specially Serviced Mortgage Loan, shall
provide to the Master Servicer and the Paying Agent one (1) Business Day after
the Determination Date for each month, the CMSA Special Servicer Loan File in
such electronic format as is mutually acceptable to the Master Servicer and the
Special Servicer and in CMSA format. The Master Servicer and the Paying Agent
may use such reports or information contained therein to prepare its reports and
the Master Servicer may, at its option, forward such reports directly to the
Depositor and the Rating Agencies.

     (b) The Special Servicer shall maintain accurate records, prepared by a
Servicing Officer, of each Final Recovery Determination with respect to any
Mortgage Loan or REO Property and the basis thereof. Each Final Recovery
Determination shall be evidenced by an Officer's Certificate delivered to the
Trustee, the Operating Adviser, the Paying Agent and the Master Servicer no
later than the ten Business Day following such Final Recovery Determination.

     (c) The Special Servicer shall provide to the Master Servicer or the Paying
Agent at the reasonable request in writing of the Master Servicer or the Paying
Agent, any information in its possession with respect to the Specially Serviced
Mortgage Loans which the Master Servicer or Paying Agent, as the case may be,
shall require in order for the Master Servicer or the Paying Agent to comply
with its obligations under this Agreement; provided that the Special Servicer
shall not be required to take any action or provide any information that the
Special Servicer determines will result in any material cost or expense to which
it is not entitled to reimbursement hereunder or will result in any material
liability for which it is not indemnified hereunder. The Master Servicer shall
provide the Special Servicer at the request of the Special Servicer any
information in its possession with respect to the Mortgage Loans which the
Master Servicer shall require in order for the Special Servicer to comply with
its obligations under this Agreement.

     (d) Not later than 20 days after each Special Servicer Remittance Date, the
Special Servicer shall forward to the Master Servicer a statement setting forth
the status of each REO Account as of the close of business on such Special
Servicer Remittance Date, stating that all remittances required to be made by it
as required by this Agreement to be made by the Special Servicer have been made
(or, if any required distribution has not been made by the Special Servicer,
specifying the nature and status thereof) and showing, for the period from the
day following the preceding Special Servicer Remittance

                                     -261-

<PAGE>

Date to such Special Servicer Remittance Date, the aggregate of deposits into
and withdrawals from each REO Account for each category of deposit specified in
Section 5.1 of this Agreement and each category of withdrawal specified in
Section 5.2 of this Agreement.

     (e) The Special Servicer shall use reasonable efforts to obtain and, to the
extent obtained, to deliver electronically using the ARCap Naming Convention to
the Master Servicer, the Paying Agent, the Rating Agencies and the Operating
Adviser, on or before April 15 of each year, commencing with April 15, 2004, (i)
copies of the prior year operating statements and quarterly statements, if
available, for each Mortgaged Property underlying a Specially Serviced Mortgage
Loan or REO Property as of its fiscal year end, provided that either the related
Mortgage Note or Mortgage requires the Mortgagor to provide such information, or
if the related Mortgage Loan has become an REO Property, (ii) a copy of the most
recent rent roll available for each Mortgaged Property, and (iii) a table,
setting forth the Debt Service Coverage Ratio and occupancy with respect to each
Mortgaged Property covered by the operating statements delivered above;
provided, that, with respect to any Mortgage Loan that becomes a Specially
Serviced Mortgage Loan prior to April 15, 2004 and for which the items in clause
(i) and (ii) above have not been delivered, the Special Servicer shall use
reasonable efforts to obtain and, to the extent obtained, deliver such items to
the Master Servicer, the Paying Agent, the Rating Agencies and the Operating
Adviser as soon as possible after receipt of such items.

     (f) The Special Servicer shall deliver to the Master Servicer, the
Depositor, the Paying Agent and the Trustee all such other information with
respect to the Specially Serviced Mortgage Loans at such times and to such
extent as the Master Servicer, the Trustee, the Paying Agent or the Depositor
may from time to time reasonably request; provided, however, that the Special
Servicer shall not be required to produce any ad hoc non-standard written
reports with respect to such Mortgage Loans except if any Person (other than the
Paying Agent or the Trustee) requesting such report pays a reasonable fee to be
determined by the Special Servicer.

     (g) The Special Servicer shall deliver electronically using the ARCap
Naming Convention a written Inspection Report of each Specially Serviced
Mortgage Loan in accordance with Section 9.4(b) to the Operating Adviser.

     (h) The Special Servicer shall provide, as soon as practicable after a
Mortgage Loan becomes a Specially Serviced Mortgage Loan, to the Master Servicer
its estimate of the net recoverable amount to the Certificateholders (and the
holder of the B Note if in connection with an A/B Mortgage Loan and the holder
of the WestShore Plaza Companion Loan if in connection with the Loan Pair) and
anticipated expenses in connection therewith (and a general description of the
plan to achieve such recovery) of such Specially Serviced Mortgage Loan and
other information reasonably requested by the Master Servicer. The Special
Servicer shall update such information on a quarterly basis.

     SECTION 9.33 SPECIAL SERVICER TO COOPERATE WITH THE MASTER SERVICER AND
PAYING AGENT.

     (a) The Special Servicer shall furnish on a timely basis such reports,
certifications, and information as are reasonably requested by the Master
Servicer, the Trustee, the Paying Agent or any Primary Servicer to enable it to
perform its duties under this Agreement

                                     -262-

<PAGE>

or the Primary Servicing Agreement, as applicable; provided that no such request
shall (i) require or cause the Special Servicer to violate the Code, any
provision of this Agreement, including the Special Servicer's obligation to act
in accordance with the servicing standards set forth in this Agreement and to
maintain the REMIC status of any REMIC Pool or (ii) expose the Special Servicer,
the Trust, the Fiscal Agent, the Paying Agent or the Trustee to liability or
materially expand the scope of the Special Servicer's responsibilities under
this Agreement. In addition, the Special Servicer shall notify the Master
Servicer of all expenditures incurred by it with respect to the Specially
Serviced Mortgage Loans which are required to be made by the Master Servicer as
Servicing Advances as provided herein, subject to the provisions of Section 4.4
hereof. The Special Servicer shall also remit all invoices relating to Servicing
Advances promptly upon receipt of such invoices.

     (b) The Special Servicer shall from time to time make reports,
recommendations and analyses to the Operating Adviser with respect to the
following matters, the expense of which shall not be an expense of the Trust:

         (i) whether the foreclosure of a Mortgaged Property relating to a
Specially Serviced Mortgage Loan would be in the best economic interest of the
Trust;

         (ii) if the Special Servicer elects to proceed with a foreclosure,
whether a deficiency judgment should or should not be sought because the likely
recovery will or will not be sufficient to warrant the cost, time and exposure
of pursuing such judgment;

         (iii) whether the waiver or enforcement of any "due-on-sale" clause or
"due-on-encumbrance" clause contained in a Mortgage Loan or a Specially Serviced
Mortgage Loan is in the best economic interest of the Trust;

         (iv) in connection with entering into an assumption agreement from or
with a person to whom a Mortgaged Property securing a Specially Serviced
Mortgage Loan has been or is about to be conveyed, or to release the original
Mortgagor from liability upon a Specially Serviced Mortgage Loan and substitute
a new Mortgagor, and whether the credit status of the prospective new Mortgagor
is in compliance with the Special Servicer's regular commercial mortgage
origination or servicing standard;

         (v) in connection with the foreclosure on a Specially Serviced Mortgage
Loan secured by a Mortgaged Property which is not in compliance with CERCLA, or
any comparable environmental law, whether it is in the best economic interest of
the Trust to bring the Mortgaged Property into compliance therewith and an
estimate of the cost to do so; and

         (vi) with respect to any proposed modification (which shall include any
proposed release, substitution or addition of collateral), extension, waiver,
amendment, discounted payoff or sale of a Mortgage Loan, prepare a summary of
such proposed action and an analysis of whether or not such action is reasonably
likely to produce a greater recovery on a present value basis than liquidation
of such Mortgage Loan; such analysis shall specify the basis on which the
Special Servicer made such determination, including the status of any existing
material default or the grounds for concluding that a payment default is
imminent.

     SECTION 9.34 RESERVED

                                     -263-
<PAGE>

     SECTION 9.35 RESERVED

     SECTION 9.36 SALE OF DEFAULTED MORTGAGE LOANS.

     (a) The holder of Certificates evidencing the greatest percentage interest
in the Controlling Class, the Special Servicer and each Seller (other than Wells
Fargo Bank, National Association) as to those Mortgage Loans sold to the
Depositor by such Seller only (in such capacity, together with any assignee, the
"Option Holder") shall, in that order, have the right, at its option (the
"Option"), to purchase a Mortgage Loan (other than any Non-Serviced Mortgage
Loan) from the Trust at a price equal to the Option Purchase Price upon receipt
of notice from the Special Servicer that such Mortgage Loan has become at least
60 days delinquent as to any monthly debt service payment (or is delinquent as
to its Balloon Payment); provided, however, that with respect to an A Note, the
Option Holder's rights under this Section 9.36 are subject to the rights of the
holder of the related B Note to purchase the A Note pursuant to the terms of the
related Intercreditor Agreement. The Option is exercisable, subject to Section
2.3, from that date until terminated pursuant to clause (e) below, and during
that period the Option shall be exercisable in any month only during the period
from the 10th calendar day of such month through the 25th calendar day,
inclusive, of such month. The Trustee on behalf of the Trust shall be obligated
to sell such Mortgage Loan upon the exercise of the Option (whether exercised by
the original holder thereof or by a holder that acquired such Option by
assignment), but shall have no authority to sell such Mortgage Loan other than
in connection with the exercise of an Option (or in connection with a repurchase
of a Mortgage Loan under Article II, an optional termination pursuant to Section
10.1 or a qualified liquidation of a REMIC Pool) or if such Mortgage Loan is an
A Note, to the holder of the related B Note pursuant to the terms of the related
Intercreditor Agreement. Any Option Holder that exercises the Option shall be
required to purchase the applicable Mortgage Loan on the 4th Business Day after
such exercise. If any Option Holder desires to waive its right to exercise the
Option, then it shall so notify the Trustee in writing, and the Trustee shall
promptly notify the next party eligible to hold the Option set forth above of
its rights hereunder. Any of the parties eligible to hold the Option set forth
above may at any time notify the Trustee in writing of its desire to exercise
the Option, and the Trustee shall promptly notify (i) the current Option Holder
(and the other parties eligible to hold the Option) and (ii) solely with respect
to an Option to purchase an A Note, the holder of the related B Note, of such
party's desire to exercise the Option; provided that none of the Trustee, the
Master Servicer or the Special Servicer shall disclose the Option Purchase Price
to the holder of such related B Note. If the Option Holder neither (i) exercises
the Option nor (ii) surrenders its right to exercise the Option within 3
Business Days of its receipt of that notice, then the Option Holder's right to
exercise the Option shall lapse, and the Trustee shall promptly notify the next
party eligible to hold the Option (and the other parties eligible to hold the
Option) of its rights thereunder. The Certificate Registrar shall notify the
Trustee as to the identity of the holder of Certificates evidencing the greatest
percentage interest in the Controlling Class for purposes of determining an
Option Holder.

     (b) The purchase price in connection with the exercise of the Option (the
"Option Purchase Price") shall be an amount equal to the fair value of the
related Mortgage Loan, as determined by the Special Servicer. Prior to the
Special Servicer's determination of fair value referred to above, the fair value
of a Mortgage Loan shall be deemed to be an amount equal to the Purchase Price
plus (i) any prepayment penalty or yield maintenance charge then payable upon
the prepayment of such Mortgage Loan and (ii) the reasonable fees and expenses

                                     -264-

<PAGE>

of the Special Servicer, the Master Servicer and the Trustee incurred in
connection with the sale of the Mortgage Loan. The Special Servicer shall
determine the fair value of a Mortgage Loan on the later of (A) as soon as
reasonably practical upon the Mortgage Loan becoming 60 days delinquent or upon
the Balloon Payment becoming delinquent and (B) the date that is 75 days after
the Special Servicer's receipt of the Servicer Mortgage File relating to such
Mortgage Loan, and the Special Servicer shall promptly notify the Option Holder
(and the Trustee and each of the other parties set forth above that could become
the Option Holder) of (i) the Option Purchase Price and (ii) if such Mortgage
Loan is an A Note, that the A Note is subject to the terms of the related
Intercreditor Agreement and that any purchaser of the A Note will be subject to
such Intercreditor Agreement. The Special Servicer is required to recalculate
the fair value of the Mortgage Loan if there has been a material change in
circumstances or the Special Servicer has received new information (including,
without limitation, any cash bids received from the holder of the related B Note
in connection with an A Note), either of which has a material effect on the fair
value, provided that the Special Servicer shall be required to recalculate the
fair value of the Mortgage Loan if the time between the date of last
determination of the fair value of the Mortgage Loan and the date of the
exercise of the Option has exceeded 60 days. Upon any recalculation, the Special
Servicer shall be required to promptly notify in writing each Option Holder (and
the Trustee and each of the other parties set forth above that could become the
Option Holder) of the revised Option Purchase Price. Any such recalculation of
the fair value of the Mortgage Loan shall be deemed to renew the Option in its
original priority at the recalculated price with respect to any party as to
which the Option had previously expired or been waived, unless the Option has
previously been exercised by an Option Holder at a higher Option Purchase Price.
In determining fair value, the Special Servicer shall take into account, among
other factors, the results of any Appraisal or updated Appraisal that it or the
Master Servicer may have obtained in accordance with this Agreement within the
prior twelve months; any views on fair value expressed by Independent investors
in mortgage loans comparable to the Mortgage Loan (provided that the Special
Servicer shall not be obligated to solicit such views); the period and amount of
any delinquency on the affected Mortgage Loan; whether to the Special Servicer's
actual knowledge, the Mortgage Loan is in default to avoid a prepayment
restriction; the physical condition of the related Mortgaged Property; the state
of the local economy; the expected recoveries from the Mortgage Loan if the
Special Servicer were to pursue a workout or foreclosure strategy instead of the
Option being exercised; and the Trust's obligation to dispose of any REO
Property as soon as practicable consistent with the objective of maximizing
proceeds for all Certificateholders, but in no event later than the three-year
period (or such extended period) specified in Section 9.15. If the Mortgage Loan
as to which the Option relates is the WestShore Plaza Pari Passu Loan, then the
Option Holder, in connection with its exercise of such option, shall also be
required to purchase the WestShore Plaza Companion Loan. Pursuant to the related
Non-Serviced Mortgage Loan Pooling and Servicing Agreement, if the holder of the
option thereunder repurchases a Non-Serviced Mortgage Loan Companion Loan in
connection with its exercise of such option, then the holder of the option shall
also be required to purchase the related Non-Serviced Mortgage Loan.

     (c) Any Option relating to a Mortgage Loan shall be assignable to a third
party (including, without limitation, in connection with an A Note, the holder
of the related B Note and in connection with the WestShore Plaza Pari Passu
Loan, the holder of the WestShore Plaza Companion Loan) by the Option Holder at
its discretion at any time after its receipt of notice from the Special Servicer
that an Option is exercisable with respect to a specified Mortgage Loan, and
upon such assignment such third party shall have all of the rights granted to

                                     -265-

<PAGE>

the Option Holder hereunder in respect of the Option. Such assignment shall only
be effective upon written notice (together with a copy of the executed
assignment and assumption agreement) being delivered to the Trustee, the Master
Servicer and the Special Servicer, and none of such parties shall be obligated
to recognize any entity as an Option Holder absent such notice.

     (d) If the Special Servicer, the holder of Certificates representing the
greatest percentage interest in the Controlling Class or an Affiliate of either
thereof elects to exercise the Option, the Trustee shall be required to
determine whether the Option Purchase Price constitutes a fair price for the
Mortgage Loan. Upon request of the Special Servicer to make such a
determination, the Trustee will do so within a reasonable period of time (but in
no event more than 15 Business Days). In doing so, the Trustee may rely on the
opinion of an Appraisal or other expert in real estate matters selected by the
Trustee with reasonable care and retained by the Trustee at the expense of the
party exercising the Option. The Trustee may also rely on the most recent
Appraisal of the related Mortgaged Property that was prepared in accordance with
this Agreement. If the Trustee were to determine that the Option Purchase Price
does not constitute a fair price, then the Special Servicer shall redetermine
the fair value taking into account the objections of the Trustee.

     (e) The Option shall terminate, and shall not be exercisable as set forth
in clause (a) above (or if exercised, but the purchase of the related Mortgage
Loan has not yet occurred, shall terminate and be of no further force or effect)
if the Mortgage Loan to which it relates is no longer delinquent as set forth
above because the Mortgage Loan has (i) become a Rehabilitated Mortgage Loan,
(ii) been subject to a workout arrangement, (iii) been foreclosed upon or
otherwise resolved (including by a full or discounted pay-off) or (iv) been
purchased by the related Seller pursuant to Section 2.3. In addition, the Option
with respect to an A Note shall terminate upon the purchase of the A Note by the
holder of the related B Note pursuant to the related Intercreditor Agreement.

     (f) Unless and until an Option Holder exercises an Option, the Special
Servicer shall continue to service and administer the related Mortgage Loan in
accordance with the Servicing Standard and this Agreement, and shall pursue such
other resolution or recovery strategies, including workout or foreclosure, as is
consistent with this Agreement and the Servicing Standard.

     SECTION 9.37 OPERATING ADVISER; ELECTIONS.

     (a) In accordance with Section 9.37(c), the Certificateholders representing
more than 50% of the Certificate Balance of the Certificates of the then
Controlling Class may elect the Operating Adviser. The Operating Adviser shall
be elected for the purpose of receiving reports and information from the Special
Servicer in respect of the Specially Serviced Mortgage Loans.

     (b) The initial Operating Adviser is ARCap CMBS Fund REIT, Inc. The
Controlling Class shall give written notice to the Trustee, the Paying Agent and
the Master Servicer of the appointment of any subsequent Operating Adviser (in
order to receive notices hereunder). If a subsequent Operating Adviser is not so
appointed, an election of an Operating Adviser also shall be held. Notice of the
meeting of the Holders of the Controlling Class shall be mailed or delivered to
each Holder by the Paying Agent, not less than 10 nor more than 60 days

                                     -266-

<PAGE>

prior to the meeting. The notice shall state the place and the time of the
meeting, which may be held by telephone. A majority of Certificate Balance of
the Certificates of the then Controlling Class, present in person or represented
by proxy, shall constitute a quorum for the nomination of an Operating Adviser.
At the meeting, each Holder shall be entitled to nominate one Person to act as
Operating Adviser. The Paying Agent shall cause the election of the Operating
Adviser to be held as soon thereafter as is reasonably practicable.

     (c) Each Holder of the Certificates of the Controlling Class shall be
entitled to vote in each election of the Operating Adviser. The voting in each
election of the Operating Adviser shall be in writing mailed, telecopied,
delivered or sent by courier and actually received by the Paying Agent on or
prior to the date of such election. Immediately upon receipt by the Paying Agent
of votes (which have not been rescinded) from the Holders of Certificates
representing more than 50% of the Certificate Balance of the Certificates of the
then Controlling Class which are cast for a single Person, such Person shall be,
upon such Person's acceptance, the Operating Adviser. The Paying Agent shall
promptly notify the Trustee of the identity of the Operating Adviser. Until an
Operating Adviser is elected by Holders of Certificates representing more than
50% of the Certificate Balance of the Certificates of the then Controlling Class
or in the event that an Operating Adviser shall have resigned or been removed
and a successor Operating Adviser shall not have been elected, there shall be no
Operating Adviser.

     (d) The Operating Adviser may be removed at any time by the written vote,
copies of which must be delivered to the Paying Agent, of more than 50% of the
Certificate Balance of the Holders of the Certificates of the then Controlling
Class.

     (e) The Paying Agent shall act as judge of each election and, absent
manifest error, the determination of the results of any election by the Paying
Agent shall be conclusive. Notwithstanding any other provisions of this Section
9.37, the Paying Agent may make such reasonable regulations as it may deem
advisable for any election.

     (f) Notwithstanding any provision of this Section 9.37 or any other
provision of this Agreement to the contrary, at any time that the Special
Servicer has been elected as Operating Adviser or no Operating Adviser has been
elected, (i) the Special Servicer shall not be required to deliver notices or
information to, or obtain the consent or approval of, the Operating Adviser and
(ii) to the extent any Person other than the Special Servicer is otherwise
required hereunder to provide notices or information to, or obtain the consent
or approval of, the Operating Adviser, such Person shall be required to provide
such notices or information to, or obtain the consent or approval of, the
Special Servicer.

     SECTION 9.38 LIMITATION ON LIABILITY OF OPERATING ADVISER. The Operating
Adviser shall have no liability to the Trust, the holder of the WestShore Plaza
Companion Loan, the holder of any B Note or the Certificateholders for any
action taken, or for refraining from the taking of any action, in good faith and
using reasonable business judgment pursuant to this Agreement, or using
reasonable business judgment. By its acceptance of a Certificate, each
Certificateholder (and Certificate Owner) confirms its understanding that the
Operating Adviser may take actions that favor the interests of one or more
Classes of the Certificates over other Classes of the Certificates and that the
Operating Adviser may have special relationships and interests that conflict
with those of Holders of some Classes of the Certificates and each holder of the
WestShore Plaza Companion Loan and B Note (if any) and each Certificateholder
(and

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Certificate Owner) agrees to take no action against the Operating Adviser
based upon such special relationship or conflict.

     SECTION 9.39 DUTIES OF OPERATING ADVISER. The Operating Adviser may advise
the Special Servicer with respect to the following actions of the Special
Servicer and the Special Servicer will not be permitted to take any of the
following actions unless and until it has notified the Operating Adviser in
writing and such Operating Adviser has not objected in writing (i) within 5
Business Days of having been notified thereof in respect of actions relating to
non-Specially Serviced Mortgage Loans (which 5 Business Day period shall run
concurrently with the time periods set forth in the Primary Servicing Agreement
with respect to such actions) and (ii) within 10 Business Days of having been
notified thereof in respect of actions relating to Specially Serviced Mortgage
Loans and having been provided with all reasonably requested information with
respect thereto (it being understood and agreed that if such written objection
has not been received by the Special Servicer within such 5 Business Day or 10
Business Day period, as applicable, then the Operating Adviser's approval will
be deemed to have been given):

         (i) any foreclosure upon or comparable conversion (which may include
acquisition of an REO Property) of the ownership of properties securing such of
the Specially Serviced Mortgage Loans as come into and continue in default;

         (ii) any modification, amendment or waiver, or consent to modification,
amendment or waiver, of a Money Term of a Mortgage Loan or a modification
consisting of the extension of the original Maturity Date of a Mortgage Loan;

         (iii) any proposed sale of a Defaulted Mortgage Loan (other than upon
termination of the Trust pursuant to Article X);

         (iv) any determination to bring an REO Property into compliance with
Environmental Laws;

         (v) any release of or acceptance of substitute or additional collateral
for a Mortgage Loan that is not otherwise expressly provided for under the
Mortgage Loan documents;

         (vi) any acceptance of a discounted payoff;

         (vii) any waiver or consent to waiver of a "due-on-sale" or "due-on-
encumbrance" clause;

         (viii) any acceptance or consent to acceptance of an assumption
agreement releasing a Mortgagor from liability under a Mortgage Loan;

         (ix) any release of collateral for a Specially Serviced Mortgage Loan
(other than in accordance with the terms of or upon satisfaction of, such
Mortgage Loan);

         (x) any franchise changes or certain management company changes for
which the Special Servicer is required to consent;

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         (xi) releases of any Escrow Accounts, Reserve Accounts or Letters of
Credit that are not in compliance with the related Mortgage Loan documents; and

         (xii) any determination as to whether any type of property-level
insurance is required under the terms of any Mortgage Loan, is available at
commercially reasonable rates, is available for similar properties in the area
in which the related Mortgaged Property is located or any other determination or
exercise of discretion with respect to property-level insurance.

     Notwithstanding the foregoing, the Operating Adviser shall not be entitled
to the consultation rights described above in respect of any non-Specially
Serviced Mortgage Loan that has an unpaid Principal Balance of less than
$2,500,000.

     With respect to items (vii), (viii) and (ix), the Operating Adviser shall
be subject to the same time periods for advising the Special Servicer with
respect to any such matters as are afforded to the Special Servicer pursuant to
Section 8.7, which periods shall be co-terminous with those of Special Servicer.
In addition, the Operating Adviser may direct the Trustee to remove the Special
Servicer at any time upon the appointment and acceptance of such appointment by
a successor to the Special Servicer; provided that, prior to the effectiveness
of any such appointment, the Trustee and the Paying Agent shall have received
Rating Agency Confirmation from each Rating Agency. The Operating Adviser shall
pay any costs and expenses incurred by the Trust in connection with the removal
and appointment of a Special Servicer (unless such removal is based on any of
the events or circumstances set forth in Section 9.30(b)). The Trustee shall
notify the Paying Agent promptly upon its receipt of the direction set forth
above.

     Notwithstanding anything herein to the contrary, no advice, direction or
objection from the Operating Adviser, as contemplated by this Section 9.39, may
(and the Special Servicer shall ignore and act without regard to any such
advice, direction or objection that the Special Servicer has determined, in its
reasonable, good faith judgment, will) require or cause the Special Servicer to
violate any provision of this Agreement or the Mortgage Loans, including the
Special Servicer's obligation to act in accordance with the Servicing Standard.

     SECTION 9.40 RIGHTS OF THE HOLDER OF A B NOTE With respect to each A/B
Mortgage Loan (if any), the holder of the B Note shall have such consent rights
or consultation rights, during the specified time periods, as are set forth in
the related Intercreditor Agreement.

     Notwithstanding the foregoing, if the Master Servicer or Special Servicer,
as applicable, determines that immediate action is necessary to protect the
interest of the Certificateholders and the holder of the WestShore Plaza
Companion Loan (as a collective whole), then the Master Servicer or Special
Servicer, as applicable may take any such action without waiting for the
response of the holder of the B Note provided for in the related Intercreditor
Agreement.

     In addition, with respect to the A/B Mortgage Loan, to the extent provided
for in the related Intercreditor Agreement, the holder of the B Note may direct
the Master Servicer or Special Servicer, as applicable, to take, or to refrain
from taking, such actions as the holder of the B Note may deem advisable or as
to which provision is otherwise made herein. Upon reasonable

                                     -269-

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request, the Master Servicer or Special Servicer, as applicable, shall, with
respect to the A/B Mortgage Loan, provide the holder of the B Note with any
information in the Master Servicer's or Special Servicer's, as applicable,
possession with respect to such matters, including its reasons for determining
to take a proposed action.

     In the event that the holder of the B Note shall direct the Master Servicer
to take any action (other than those provided for in the related Intercreditor
Agreement), the Master Servicer shall be entitled to receive reimbursement from
collections on and other proceeds of the B Note for (i) its reasonable
out-of-pocket expenses incurred in taking such action and (ii) to the extent
that such action constitutes an extraordinary action not in the ordinary course
of administering and servicing such mortgage loan, other reasonable costs
incurred by the Master Servicer in taking such action. The Master Servicer shall
notify the holder of the B Note, prior to taking the related action, if the
Master Servicer anticipates that it will seek reimbursement therefor under the
preceding sentence, and of the estimated amount of such reimbursement, and shall
further notify the holder of the B Note if it intends to obtain actual
reimbursement in excess of the estimated amount.

     Notwithstanding anything herein to the contrary, no advice, direction or
objection from the holder of the B Note, as contemplated by this Section 9.40,
may (and the Master Servicer and Special Servicer, as applicable, shall ignore
and act without regard to any such advice, direction or objection that the
Master Servicer or Special Servicer, as applicable, has determined, in its
reasonable, good faith judgment, will) require or cause the Master Servicer or
Special Servicer to violate any provision of this Agreement or the Mortgage
Loans, including the Master Servicer's and Special Servicer's obligation to act
in accordance with the Servicing Standard.

                                   ARTICLE X

                      PURCHASE AND TERMINATION OF THE TRUST

     SECTION 10.1 TERMINATION OF TRUST UPON REPURCHASE OR LIQUIDATION OF ALL
MORTGAGE LOANS.

     (a) The obligations and responsibilities of the Trustee and the Paying
Agent created hereby (other than the obligation of the Paying Agent, to make
payments to the Class R-I Certificateholders, the Class R-II Certificateholders,
the Class R-III Certificateholders and the Class R-K Certificateholders as set
forth in Section 10.2 and other than the obligations in the nature of
information or tax reporting) shall terminate on the earliest of (i) the later
of (A) the final payment or other liquidation of the last Mortgage Loan
remaining in the Trust (and final distribution to the Certificateholders) and
(B) the disposition of all REO Property (and final distribution to the
Certificateholders) or (ii) the sale of the property held by the Trust in
accordance with Section 10.1(b) or (iii) the termination of the Trust pursuant
to Section 10.1(c) below; provided that in no event shall the Trust created
hereby continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of Joseph P. Kennedy, the late Ambassador of the
United States to the Court of St. James, living on the date hereof.

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     (b) The Master Servicer shall give the Trustee, the Luxembourg Paying Agent
and the Paying Agent notice of the date when the Aggregate Principal Balance of
the Mortgage Loans is less than or equal to one percent (1%) of the initial
Aggregate Principal Balance of the Mortgage Loans as of the Cut-Off Date. The
Paying Agent shall promptly forward such notice to the Trustee, the Depositor,
the Holder of a majority of the Controlling Class, the Master Servicer, the
Special Servicer and the Holders of the Class R-I Certificates; and the Holder
of a majority of the Controlling Class, the Master Servicer, the Special
Servicer and the Holders of the Class R-I Certificates, in such priority (and in
the case of the Class R-I Certificateholders, a majority of the Class R-I
Certificateholders), may purchase, in whole only, the Mortgage Loans and any
other property, if any, remaining in the Trust. If any party desires to exercise
such option, it will notify the Trustee who will notify any party with a prior
right to exercise such option. If any party that has been provided notice by the
Trustee (excluding the Depositor) notifies the Trustee within ten Business Days
after receiving notice of the proposed purchase that it wishes to purchase the
assets of the Trust, then such party (or, in the event that more than one of
such parties notifies the Trustee that it wishes to purchase the assets of the
Trust, the party with the first right to purchase the assets of the Trust) may
purchase the assets of the Trust in accordance with this Agreement. Upon the
Paying Agent's receipt of the Termination Price set forth below, the Trustee
shall promptly release or cause to be released to the Master Servicer for the
benefit of the Holder of the majority of the Class R-I Certificates, the Special
Servicer or the Master Servicer, as the case may be, the Mortgage Files
pertaining to the Mortgage Loans. The "Termination Price" shall equal 100% of
the aggregate Principal Balances of the Mortgage Loans (other than Mortgage
Loans as to which a Final Recovery Determination has been made) on the day of
such purchase plus accrued and unpaid interest thereon at the applicable
Mortgage Rates (or Mortgage Rates less the Master Servicing Fee Rate if the
Master Servicer is the purchaser), with respect to the Mortgage Loans to the Due
Date for each Mortgage Loan ending in the Collection Period with respect to
which such purchase occurs, plus unreimbursed Advances and interest on such
unreimbursed Advances at the Advance Rate, and the fair market value of any
other property remaining in the Kimball Lane Loan REMIC and REMIC I. The Trustee
shall consult with the Placement Agents and the Underwriters or their respective
successors, as advisers, in order for the Trustee to determine whether the fair
market value of the property constituting the Trust has been offered; provided
that, if any Placement Agent or any Underwriter or an Affiliate of the Placement
Agent or the Underwriters is exercising its right to purchase the Trust assets,
the Trustee shall consult with the Operating Adviser in order for the Trustee to
determine the fair market value, provided that the Operating Adviser is not an
Affiliate of the Class R-I Holder, the Special Servicer or the Master Servicer,
or the Trustee (the fees and expenses of which shall be paid for by buyer of the
property). As a condition to the purchase of the Trust pursuant to this Section
10.1(b), the Holder of the majority of the Class R-I Certificates, the Special
Servicer or the Master Servicer, as the case may be, must deliver to the Trustee
an Opinion of Counsel, which shall be at the expense of such Holders, the
Special Servicer or the Master Servicer, as the case may be, stating that such
termination will be a "qualified liquidation" under section 860F(a)(4) of the
Code. Such purchase shall be made in accordance with Section 10.3.

     (c) If at any time the Holders of the Class R-I Certificates own 100% of
the REMIC III Certificates such Holders may terminate the Kimball Lane Loan
REMIC and REMIC I (which will in turn result in the termination of REMIC II and
REMIC III) upon (i) the delivery to the Trustee and the Depositor of an Opinion
of Counsel (which opinion shall be at the expense of such Holders) stating that
such termination will be a "qualified liquidation" of each REMIC

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Pool under Section 860F of the Code, and (ii) the payment of any and all costs
associated with such termination. Such termination shall be made in accordance
with Section 10.3.

     (d) Upon the termination of the Trust, (i) any funds or other property held
by the Grantor Trust related to Excess Interest shall be distributed to the
Class O Certificateholders, on a pro rata basis, whether or not the respective
Certificate Balances thereof have been reduced to zero, and (ii) any funds or
other property held by the Grantor Trust related to the Kimball Lane Yield
Maintenance Amount shall be distributed to the Class A-1, Class X-1 and Class
X-2 Certificateholders to the extent of their entitlements that were not
previously distributed in accordance with Section 6.5A.

     (e) Upon the sale of the A Note relating to an A/B Mortgage Loan by the
Trust or the payment in full of such A Note, the related B Note shall no longer
be subject to this Agreement and shall no longer be serviced by the Master
Servicer or the Special Servicer.

     SECTION 10.2 PROCEDURE UPON TERMINATION OF TRUST.

     (a) Notice of any termination pursuant to the provisions of Section 10.1,
specifying the Distribution Date upon which the final distribution shall be
made, shall be given promptly by the Trustee by first class mail to the Paying
Agent, the Rating Agencies, the Class R-K, Class R-I, Class R-II and REMIC III
Certificateholders mailed no later than ten days prior to the date of such
termination. Such notice shall specify (A) the Distribution Date upon which
final distribution on the Class R-K, Class R-I, Class R-II and REMIC III
Certificates will be made, and upon presentation and surrender of the Class R-K,
Class R-I, Class R-II and REMIC III Certificates at the office or agency of the
Certificate Registrar therein specified, and (B) that the Record Date otherwise
applicable to such Distribution Date is not applicable, distribution being made
only upon presentation and surrender of the Class R-K, Class R-I, Class R-II and
REMIC III Certificates at the office or agency of the Certificate Registrar
therein specified. The Trustee shall give such notice to the Depositor and the
Certificate Registrar at the time such notice is given to Holders of the Class
R-K, Class R-I, Class R-II and REMIC III Certificates. Upon any such
termination, the duties of the Certificate Registrar with respect to the Class
R-K, Class R-I, Class R-II and REMIC III Certificates shall terminate and the
Trustee shall terminate, or request the Master Servicer and the Paying Agent to
terminate, the Certificate Account and the Distribution Account and any other
account or fund maintained with respect to the Certificates, subject to the
Paying Agent's obligation hereunder to hold all amounts payable to the Class
R-K, Class R-I, Class R-II and REMIC III Certificateholders in trust without
interest pending such payment.

     (b) In the event that all of the Holders do not surrender their
certificates evidencing the Class R-K, Class R-I, Class R-II and REMIC III
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, the Certificate Registrar shall give a
second written notice to the remaining Class R-K, Class R-I, Class R-II and
REMIC III Certificateholders to surrender their certificates evidencing the
Class R-K, Class R-I, Class R-II and REMIC III Certificates for cancellation and
receive the final distribution with respect thereto. If within one year after
the second notice any Class R-K, Class R-I, Class R-II and REMIC III
Certificates shall not have been surrendered for cancellation, the Certificate
Registrar may take appropriate steps to contact the remaining Class R-K, Class
R-I, Class R-II and REMIC III Certificateholders concerning surrender of such
certificates, and the

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cost thereof shall be paid out of the amounts distributable to such Holders. If
within two years after the second notice any such Class R-K, Class R-I, Class
R-II and REMIC III Certificates shall not have been surrendered for
cancellation, the Paying Agent shall, subject to applicable state law relating
to escheatment, hold all amounts distributable to such Holders for the benefit
of such Holders. No interest shall accrue on any amount held by the Trustee and
not distributed to a Class R-K, Class R-I, Class R-II or REMIC III
Certificateholder due to such Certificateholder's failure to surrender its
Certificate(s) for payment of the final distribution thereon in accordance with
this Section. Any money held by the Paying Agent pending distribution under this
Section 10.2 after 90 days after the adoption of a plan of complete liquidation
shall be deemed for tax purposes to have been distributed from the REMIC Pools
and shall be beneficially owned by the related Holder.

          SECTION 10.3 ADDITIONAL TRUST TERMINATION REQUIREMENTS.

     (a) The Trust and each REMIC shall be terminated in accordance with the
following additional requirements, unless at the request of the Master Servicer
or the Class R-I Certificateholders, as the case may be, the Trustee seeks, and
the Paying Agent subsequently receives an Opinion of Counsel (at the expense of
the Master Servicer or the Class R-I Certificateholders, as the case may be),
addressed to the Depositor, the Trustee and the Paying Agent to the effect that
the failure of the Trust to comply with the requirements of this Section 10.3
will not (i) result in the imposition of taxes on "prohibited transactions" on
any REMIC Pool under the REMIC Provisions or (ii) cause any REMIC Pool to fail
to qualify as a REMIC at any time that any Certificates are outstanding:

         (i) Within 89 days prior to the time of the making of the final payment
on the REMIC III Certificates, the Master Servicer shall prepare and the Trustee
(on behalf of the Kimball Lane Loan REMIC, REMIC I, REMIC II or REMIC III) shall
adopt a plan of complete liquidation of each such REMIC Pool, meeting the
requirements of a qualified liquidation under the REMIC Provisions, which plan
need not be in any special form and the date of which, in general, shall be the
date of the notice specified in Section 10.2(a) and shall be specified in a
statement attached to the federal income tax return of each REMIC Pool;

         (ii) At or after the date of adoption of such a plan of complete
liquidation and at or prior to the time of making of the final payment on the
REMIC III Certificates, the Trustee shall sell all of the assets of the Trust
for cash at the Termination Price; provided that if the Holders of the Class R-I
Certificates are purchasing the assets of the Trust, the amount to be paid by
such Holders may be paid net of the amount to be paid to such Holders as final
distributions on any Certificates held by such Holders;

         (iii) At the time of the making of the final payment on the
Certificates, the Paying Agent shall distribute or credit, or cause to be
distributed or credited, (A) to the Holders of the Class R-K Certificates all
assets of the Kimball Lane Loan REMIC remaining after such final payment of the
Kimball Lane Loan REMIC Regular Interest, (B) to the Holders of the Class R-I
Certificates all assets of REMIC I remaining after such final payment of the
REMIC I Regular Interests, (C) to the Holders of the Class R-II Certificates all
remaining assets of REMIC II after such final payment of the REMIC II Regular
Interests and (D) to the Holders of the Class R-III Certificates all remaining
assets of REMIC III (in each case other than cash retained to meet claims), and
the Trust shall terminate at that time; and

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         (iv) In no event may the final payment on the Kimball Lane Loan REMIC
Regular Interest, REMIC I Regular Interests, REMIC II Regular Interests or REMIC
Regular Certificates or the final distribution or credit to the Holders of the
Residual Certificates, respectively, be made after the 89th day from the date on
which the plan of complete liquidation is adopted.

     (b) By their acceptance of the Class R-I, Class R-II, Class R-III or Class
R-K Certificates, respectively, the Holders thereof hereby (i) authorize the
Trustee to take such action as may be necessary to adopt a plan of complete
liquidation of the REMIC Pool, and (ii) agree to take such other action as may
be necessary to adopt a plan of complete liquidation of the Trust upon the
written request of the Depositor, which authorization shall be binding upon all
successor Class R-I, Class R-II, Class R-III and Class R-K Certificateholders,
respectively.

                                   ARTICLE XI

                          RIGHTS OF CERTIFICATEHOLDERS

     SECTION 11.1 LIMITATION ON RIGHTS OF HOLDERS.

     (a) The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the Trust, nor entitle such Certificateholder's
legal representatives or heirs to claim an accounting or take any action or
proceeding in any court for a partition or winding up of the Trust, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.

     (b) Except as otherwise expressly provided herein, no Certificateholder,
solely by virtue of its status as a Certificateholder, shall have any right to
vote or in any manner otherwise control the Master Servicer or operation and
management of the Trust, or the obligations of the parties hereto, nor shall
anything herein set forth, or contained in the terms of the Certificates, be
construed so as to constitute the Certificateholders from time to time as
partners or members of an association, nor shall any Certificateholder be under
any liability to any third person by reason of any action taken by the parties
to this Agreement pursuant to any provision hereof.

     (c) No Certificateholder, solely by virtue of its status as
Certificateholder, shall have any right by virtue or by availing of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement unless the
Holders of Certificates evidencing not less than 50% of the Aggregate Principal
Amount of the Certificates then outstanding shall have made written request upon
the Trustee to institute such action, suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the cost, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for sixty days after its receipt
of such notice, request and offer of indemnity, shall have neglected or refused
to institute any such action, suit or proceeding and no direction inconsistent
with such written request has been given the Trustee during such sixty-day
period by such Certificateholders; it being understood and intended, and being
expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue or by availing of any
provision of this Agreement to affect,

                                     -274-

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disturb or prejudice the rights of the Holders of any other of such
Certificates, or to obtain or seek to obtain priority over or preference to any
other such Holder, or to enforce any right under this Agreement, except in the
manner herein provided and for the benefit of all Certificateholders. For the
protection and enforcement of the provisions of this Section, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.

     SECTION 11.2 ACCESS TO LIST OF HOLDERS.

     (a) If the Paying Agent is not acting as Certificate Registrar, the
Certificate Registrar will furnish or cause to be furnished to the Trustee and
the Paying Agent, within fifteen days after receipt by the Certificate Registrar
of a request by the Trustee or the Paying Agent, as the case may be, in writing,
a list, in such form as the Trustee or the Paying Agent, as the case may be, may
reasonably require, of the names and addresses of the Certificateholders of each
Class as of the most recent Record Date.

     (b) If the Depositor, the Operating Adviser, the Special Servicer, the
Master Servicer, the Trustee or three or more Holders (hereinafter referred to
as "applicants," with a single Person which (together with its Affiliates) is
the Holder of more than one Class of Certificates being viewed as a single
"applicant" for these purposes) apply in writing to the Paying Agent and such
application states that the applicants desire to communicate with other Holders
with respect to their rights under this Agreement or under the Certificates and
is accompanied by a copy of the communication which such applicants propose to
transmit, then the Paying Agent shall, within five Business Days after the
receipt of such application, send, at such Person's expense, the written
communication proffered by the applicants to all Certificateholders at their
addresses as they appear in the Certificate Register.

     (c) Every Holder, by receiving and holding a Certificate, agrees with the
Depositor, the Certificate Registrar, the Paying Agent, the Master Servicer and
the Trustee that neither the Depositor, the Certificate Registrar, the Paying
Agent, the Master Servicer nor the Trustee shall be held accountable by reason
of the disclosure of any such information as to the names and addresses of the
Certificateholders hereunder, regardless of the source from which such
information was derived.

     SECTION 11.3 ACTS OF HOLDERS OF CERTIFICATES.

     (a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Agreement to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by agent duly appointed in writing;
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is hereby expressly required, to the Depositor and the Paying Agent.
Such instrument or instruments (as the action embodies therein and evidenced
thereby) are herein sometimes referred to as an "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agents shall be sufficient for any purpose of this
Agreement and conclusive in favor of the Trustee, the Depositor and the Paying
Agent, if made in the manner provided in this Section. The Trustee

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agrees to promptly notify the Depositor of any such instrument or instruments
received by it, and to promptly forward copies of the same.

     (b) The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by
the certificate of any notary public or other officer authorized by law to take
acknowledgments or deeds, certifying that the individual signing such instrument
or writing acknowledged to such notary public or other officer the execution
thereof. Whenever such execution is by an officer of a corporation or a member
of a partnership on behalf of such corporation or partnership, such certificate
or affidavit shall also constitute sufficient proof of such officer's or
member's authority. The fact and date of the execution of any such instrument or
writing, or the authority of the individual executing the same, may also be
proved in any other manner which the Trustee deems sufficient.

     (c) The ownership of Certificates (notwithstanding any notation of
ownership or other writing thereon made by anyone other than the Trustee) shall
be proved by the Certificate Register, and neither the Trustee nor the Depositor
nor the Paying Agent shall be affected by any notice to the contrary.

     (d) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Holder of any Certificate shall bind every future Holder
of the same Certificate and the Holder of every Certificate issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof, in
respect of anything done, omitted or suffered to be done by the Trustee, the
Paying Agent or the Depositor in reliance thereon, whether or not notation of
such action is made upon such Certificate.

                                  ARTICLE XII

                     REMIC AND GRANTOR TRUST ADMINISTRATION

     The provisions of this Article XII shall apply to each REMIC Pool.

     SECTION 12.1 REMIC ADMINISTRATION.

     (a) An election will be made by the Paying Agent on behalf of the Trustee
to treat the segregated pool of assets consisting of the Kimball Lane Loan, such
amounts related to the Kimball Lane Loan as shall from time to time be held in
the Certificate Account, the Interest Reserve Account and the Distribution
Account, the related Insurance Policies and any related REO Properties as a
REMIC ("Kimball Lane Loan REMIC ") under the Code. Such election will be made on
Form 1066 or other appropriate federal tax or information return or any
appropriate state return for the taxable year ending on the last day of the
calendar year in which the Kimball Lane Loan REMIC Interests are issued. For
purposes of such election, the Kimball Lane Loan REMIC Regular Interests shall
each be designated as a Class of "regular interests" in the Kimball Lane Loan
REMIC and the Kimball Lane Loan REMIC Residual Interest shall be designated as
the sole Class of "residual interests" in the Kimball Lane Loan REMIC.

     An election will be made by the Paying Agent on behalf of the Trustee to
treat the segregated pool of assets consisting of the Majority Mortgage Loans,
the Kimball Lane Loan REMIC Regular Interest, such amounts related to the
Majority Mortgage Loans as shall from

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time to time be held in the Certificate Account and the Interest Reserve
Account, such amounts related to the Majority Mortgage Loans and the Kimball
Lane Loan REMIC Regular Interest as shall from time to time be held in the
Distribution Account (exclusive of the Excess Interest Sub-account and the
Kimball Lane Sub-account), the related Insurance Policies and any related REO
Properties as a REMIC ("REMIC I") under the Code, other than any portion of the
foregoing amounts allocable to a B Note or the WestShore Plaza Companion Loan.
Such election will be made on Form 1066 or other appropriate federal tax or
information return or any appropriate state return for the taxable year ending
on the last day of the calendar year in which the REMIC I Interests are issued.
For purposes of such election, the REMIC I Regular Interests shall each be
designated as a separate Class of "regular interests" in REMIC I and the REMIC I
Residual Interest shall be designated as the sole Class of "residual interests"
in REMIC I.

     An election will be made by the Paying Agent to treat the segregated pool
of assets consisting of the REMIC I Regular Interests as a REMIC ("REMIC II")
under the Code. Such election will be made on Form 1066 or other appropriate
federal tax or information return or any appropriate state return for the
taxable year ending on the last day of the calendar year in which the REMIC II
Interests are issued. For the purposes of such election, the REMIC II Regular
Interests shall be designated as the "regular interests" in REMIC II and the
Class R-II Certificates shall be designated as the sole Class of the "residual
interests" in REMIC II.

     An election will be made by the Paying Agent to treat the segregated pool
of assets consisting of the REMIC II Regular Interests as a REMIC ("REMIC III")
under the Code. Such election will be made on Form 1066 or other appropriate
federal tax or information return or any appropriate state return for the
taxable year ending on the last day of the calendar year in which the REMIC III
Certificates are issued. For purposes of such election, the Class A-1, Class
A-2, Class A-3, Class A-4, Class X-1 (each Class X-1 Certificate representing
multiple "regular interests" in REMIC III, as set forth in the Preliminary
Statement), Class X-2 (each Class X-2 Certificate representing multiple "regular
interests" in REMIC III, as set forth in the Preliminary Statement), Class B,
Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class K, Class L,
Class M, Class N and Class O Certificates (but other than the Class A-1, Class
X-1, Class X-2 and Class O Grantor Trust Interest) shall be designated as the
"regular interests" in REMIC III and the Class R-III Certificates shall be
designated as the sole Class of "residual interests" in REMIC III.

     The Trustee and the Paying Agent shall not permit the creation of any
"interests" (within the meaning of Section 860G of the Code) in any of the
REMICs other than the Kimball Lane Loan REMIC Regular Interest, REMIC I Regular
Interests, the REMIC II Regular Interests, the REMIC III Regular Interests and
the Residual Certificates.

     (b) The Closing Date is hereby designated as the "Startup Day" of each
REMIC Pool within the meaning of Section 860G(a)(9) of the Code.

     (c) The Paying Agent shall pay all routine tax related expenses (not
including any taxes, however denominated, including any additions to tax,
penalties and interest) of each REMIC Pool, excluding any professional fees or
extraordinary expenses related to audits or any administrative or judicial
proceedings with respect to each REMIC Pool that involve the Internal Revenue
Service or state tax authorities.

                                     -277-

<PAGE>

     (d) The Paying Agent shall cause to be prepared, signed, and timely filed
with the Internal Revenue Service, on behalf of each REMIC Pool, an application
for a taxpayer identification number for such REMIC Pool on Internal Revenue
Service Form SS-4. The Paying Agent, upon receipt from the Internal Revenue
Service of the Notice of Taxpayer Identification Number Assigned, shall promptly
forward a copy of such notice to the Depositor and the Master Servicer. The
Paying Agent shall prepare and file Form 8811 on behalf of each REMIC Pool and
shall designate an appropriate Person to respond to inquiries by or on behalf of
Certificateholders for original issue discount and related information in
accordance with applicable provisions of the Code.

     (e) The Paying Agent shall prepare and file all of each REMIC Pool's
federal and state income or franchise tax and information returns as such REMIC
Pool direct representative; the expenses of preparing and filing such returns
shall be borne by the Paying Agent, except that if additional state tax returns
are required to be filed in more than three states, the Paying Agent shall be
entitled, with respect to any such additional filings, to (i) be paid a
reasonable fee and (ii) receive its reasonable costs and expenses, both as
amounts reimbursable pursuant to Section 5.2(a)(vi) hereof. The Depositor, the
Master Servicer and the Special Servicer shall provide on a timely basis to the
Paying Agent or its designee such information with respect to the Trust or any
REMIC Pool as is in its possession, which the Depositor or the Master Servicer
and the Special Servicer has received or prepared by virtue of its role as
Depositor or Master Servicer and the Special Servicer hereunder and reasonably
requested by the Paying Agent to enable it to perform its obligations under this
subsection, and the Paying Agent shall be entitled to conclusively rely on such
information in the performance of its obligations hereunder. The Depositor shall
indemnify the Trust, the Trustee, the Paying Agent and the Fiscal Agent for any
liability or assessment against any of them or cost or expense (including
attorneys' fees) incurred by them resulting from any error resulting from bad
faith, negligence, or willful malfeasance of the Depositor in providing any
information for which the Depositor is responsible for preparing. The Master
Servicer and the Special Servicer shall indemnify the Trustee, the Fiscal Agent,
the Paying Agent and the Depositor for any liability or assessment against the
Trustee, the Fiscal Agent, the Depositor, the Paying Agent or any REMIC Pool and
any expenses incurred in connection with such liability or assessment (including
attorneys' fees) resulting from any error in any of such tax or information
returns resulting from errors in the information provided by the Master Servicer
or the Special Servicer, as the case may, be or caused by the negligence,
willful misconduct or bad faith of the Master Servicer or the Special Servicer,
as the case may be. The Paying Agent shall indemnify the Master Servicer, the
Depositor or any REMIC Pool for any expense incurred by the Master Servicer, the
Depositor and any REMIC Pool resulting from any error in any of such tax or
information returns resulting from errors in the preparation of such returns
caused by the negligence, willful misconduct or bad faith of the Paying Agent.
Each indemnified party shall immediately notify the indemnifying party or
parties of the existence of a claim for indemnification under this Section
12.1(e), and provide the indemnifying party or parties, at the expense of such
indemnifying party or parties, an opportunity to contest the tax or assessment
or expense giving rise to such claim, provided that the failure to give such
notification rights shall not affect the indemnification rights in favor of any
REMIC Pool under this Section 12.1(e). Any such indemnification shall survive
the resignation or termination of the Master Servicer, the Paying Agent or the
Special Servicer, or the termination of this Agreement.

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     (f) The Paying Agent shall perform on behalf of each REMIC all reporting
and other tax compliance duties that are the responsibility of such REMIC Pool
under the Code, REMIC Provisions, or other compliance guidance issued by the
Internal Revenue Service or any state or local taxing authority. Among its other
duties, the Paying Agent shall provide (i) to the Internal Revenue Service or
other Persons (including, but not limited to, the Transferor of a Residual
Certificate, to a Disqualified Organization or to an agent that has acquired a
Residual Certificate on behalf of a Disqualified Organization) such information
as is necessary for the application of any tax relating to the transfer of a
Residual Certificate to any Disqualified Organization and (ii) to the
Certificateholders such information or reports as are required by the Code or
REMIC Provisions.

     (g) The Paying Agent shall forward to the Depositor copies of quarterly and
annual REMIC tax returns and Internal Revenue Service Form 1099 information
returns and such other information within the control of the Paying Agent as the
Depositor may reasonably request in writing. Moreover, the Paying Agent shall
forward to each Certificateholder such forms and furnish such information within
its control as are required by the Code to be furnished to them, shall prepare
and file with the appropriate state authorities as may to the actual knowledge
of a Responsible Officer of the Paying Agent be required by applicable law and
shall prepare and disseminate to Certificateholders Internal Revenue Service
Forms 1099 (or otherwise furnish information within the control of the Paying
Agent) to the extent required by applicable law. The Paying Agent will make
available to any Certificateholder any tax related information required to be
made available to Certificateholders pursuant to the Code and any regulations
thereunder.

     (h) The Holder of more than 50% of the Percentage Interests in Class R-I,
Class R-II, Class R-III and Class R-K Certificates, respectively (or of the
greatest percentage of such Class R-I, Class R-II, Class R-III and Class R-K
Certificates if no Holder holds more than 50% thereof), shall be the applicable
REMIC's Tax Matters Person. The duties of the Tax Matters Person for each of the
REMIC Pools are hereby delegated to the Paying Agent and each Residual
Certificateholder, by acceptance of its Residual Certificate, agrees, on behalf
of itself and all successor holders of such Residual Certificate, to such
delegation to the Paying Agent as their agent and attorney in fact. If the Code
or applicable regulations prohibits the Paying Agent from signing any applicable
Internal Revenue Service, court or other administrative documents or from acting
as Tax Matters Person (as an agent or otherwise), the Paying Agent shall take
whatever action is necessary for the signing of such documents and designation
of a Tax Matters Person, including the designation of such Residual
Certificateholder. The Paying Agent shall not be required to expend or risk its
own funds or otherwise incur any other financial liability in the performance of
its duties hereunder or in the exercise of any of its rights or powers (except
to the extent of the ordinary expenses of performing its duties under this
Agreement), if it shall have reasonable grounds for believing that repayment of
such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.

     (i) The Trustee, the Paying Agent, the Holders of the Residual
Certificates, the Master Servicer and the Special Servicer shall each exercise
reasonable care, to the extent within its control, and with respect to each of
the Trustee, Paying Agent, the Master Servicer and the Special Servicer, within
the scope of its express duties, and shall each act in accordance with this
Agreement and the REMIC Provisions in order to create and maintain the status of
each

                                     -279-

<PAGE>

REMIC Pool as a REMIC and the Grantor Trust as a grantor trust or, as
appropriate, adopt a plan of complete liquidation with respect to each REMIC
Pool.

     (j) The Trustee, the Paying Agent, the Master Servicer, the Special
Servicer, the Fiscal Agent and the Holders of Residual Certificates shall not
take any action or fail to take any action or cause any REMIC Pool to take any
action or fail to take any action if any of such persons knows or could, upon
the exercise of reasonable diligence, know, that, under the REMIC Provisions
such action or failure, as the case may be, could (i) endanger the status of any
REMIC Pool as a REMIC, (ii) result in the imposition of a tax upon any REMIC
Pool (including but not limited to the tax on prohibited transactions as defined
in Code Section 860F(a)(2)) or (iii) endanger the status of the Grantor Trust as
a grantor trust unless the Trustee and the Paying Agent have received an Opinion
of Counsel (at the expense of the party seeking to take such action) to the
effect that the contemplated action will not endanger such status or result in
the imposition of such a tax. Any action required under this section which would
result in an unusual or unexpected expense shall be undertaken at the expense of
the party seeking the Trustee, the Paying Agent or the Holders of the Residual
Certificates to undertake such action.

     (k) In the event that any tax is imposed on any REMIC created hereunder,
including, without limitation, "prohibited transactions" taxes as defined in
Section 860F(a)(2) of the Code, any tax on "net income from foreclosure
property" as defined in Section 860G(c) of the Code, any taxes on contributions
to any REMIC created hereunder after the Startup Day pursuant to Section 860G(d)
of the Code, and any other tax imposed by the Code or any applicable provisions
of state or local tax laws (other than any tax permitted to be incurred by the
Special Servicer pursuant to Section 9.14(e)), such tax, together with all
incidental costs and expenses (including, without limitation, penalties and
reasonable attorneys' fees), shall be charged to and paid by: (i) the Paying
Agent, if such tax arises out of or results from a breach of any of its
obligations under this Agreement; (ii) the Special Servicer, if such tax arises
out of or results from a breach by the Special Servicer of any of its
obligations under this Agreement; (iii) the Master Servicer, if such tax arises
out of or results from a breach by the Master Servicer of any of its obligations
under this Agreement; (iv) the Fiscal Agent, if such tax arises out of or
results from a breach by the Fiscal Agent of any of its obligations under this
Agreement; and (v) the Trust in all other instances. Any tax permitted to be
incurred by the Special Servicer pursuant to Section 9.14(e) shall be charged to
and paid by the Trust from the net income generated on the related REO Property.
Any such amounts payable by the Trust in respect of taxes shall be paid by the
Paying Agent out of amounts on deposit in the Distribution Account.

     (l) The Paying Agent and, to the extent that records are maintained by the
Master Servicer or the Special Servicer in the normal course of its business,
the Master Servicer and the Special Servicer shall, for federal income tax
purposes, maintain books and records with respect to each REMIC Pool on a
calendar year and on an accrual basis. Notwithstanding anything to the contrary
contained herein, except to the extent provided otherwise in the Mortgage Loans
or in the Mortgages, all amounts collected on the Mortgage Loans shall, for
federal income tax purposes, be allocated first to interest due and payable on
the Mortgage Loans (including interest on overdue interest, other than
additional interest at a penalty rate payable following a default). The books
and records must be sufficient concerning the nature and amount of each REMIC
Pool's investments to show that such REMIC Pool has complied with the REMIC
Provisions.

                                     -280-
<PAGE>

     (m) Neither the Trustee, the Paying Agent, the Master Servicer nor the
Special Servicer shall enter into any arrangement by which any REMIC Pool will
receive a fee or other compensation for services.

     (n) In order to enable the Paying Agent to perform its duties as set forth
herein, the Depositor shall provide, or cause to be provided, to the Paying
Agent within ten (10) days after the Closing Date all information or data that
the Paying Agent reasonably determines to be relevant for tax purposes on the
valuations and offering prices of the Certificates, including, without
limitation, the yield, prepayment assumption, issue prices and projected cash
flows of the Certificates, as applicable, and the projected cash flows of the
Mortgage Loans. Thereafter, the Depositor shall provide to the Paying Agent or
its designee, promptly upon request therefor, any such additional information or
data within the Depositor's possession or knowledge that the Paying Agent may,
from time to time, reasonably request in order to enable the Paying Agent to
perform its duties as set forth herein. The Paying Agent is hereby directed to
use any and all such information or data provided by the Depositor in the
preparation of all federal and state income or franchise tax and information
returns and reports for each REMIC Pool to Certificateholders as required
herein. The Depositor hereby indemnifies the Trustee, the Paying Agent, the
Fiscal Agent, and each REMIC Pool for any losses, liabilities, damages, claims,
expenses (including attorneys' fees) or assessments against the Trustee, the
Paying Agent, the Fiscal Agent and each REMIC Pool arising from any errors or
miscalculations of the Paying Agent pursuant to this Section that result from
any failure of the Depositor to provide, or to cause to be provided, accurate
information or data to the Paying Agent (but not resulting from the methodology
employed by the Paying Agent) on a timely basis and such indemnification shall
survive the termination of this Agreement and the termination or resignation of
the Paying Agent and the Fiscal Agent.

     The Paying Agent agrees that all such information or data so obtained by it
are to be regarded as confidential information and agrees that it shall use its
reasonable best efforts to retain in confidence, and shall ensure that its
officers, employees and representatives retain in confidence, and shall not
disclose, without the prior written consent of the Depositor, any or all of such
information or data, or make any use whatsoever (other than for the purposes
contemplated by this Agreement) of any such information or data without the
prior written consent of the Depositor, unless such information is generally
available to the public (other than as a result of a breach of this Section
12.1(n)) or is required by law or applicable regulations to be disclosed or is
disclosed (i) to independent auditors and accountants, counsel and other
professional advisers of the Paying Agent and its parent, or (ii) in connection
with its rights and obligations under this Agreement.

     (o) At all times as may be required by the Code, the Master Servicer will
to the extent within its control and the scope of its duties more specifically
set forth herein, maintain substantially all of the assets of the Kimball Lane
Loan REMIC and REMIC I as "qualified mortgages" as defined in Section 860G(a)(3)
of the Code and "permitted investments" as defined in Section 860G(a)(5) of the
Code.

     (p) For the purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
Regulations, the "latest possible maturity date" for each Class of Certificates
representing a regular interest in REMIC III, for each Class of REMIC II Regular
Interests, for each Class of REMIC I Regular Interests and for the Kimball Lane
Loan REMIC Regular Interest is the Rated

                                     -281-

<PAGE>

Final Distribution Date; provided that the "latest possible maturity date" for
the Class X-2 Certificates is the Distribution Date in October 2011.

     SECTION 12.2 PROHIBITED TRANSACTIONS AND ACTIVITIES. Neither the Trustee,
the Paying Agent, the Master Servicer nor the Special Servicer shall permit the
sale, disposition or substitution of any of the Mortgage Loans (except in a
disposition pursuant to (i) the foreclosure or default of a Mortgage Loan, (ii)
the bankruptcy or insolvency of any REMIC Pool, (iii) the termination of any
REMIC Pool in a "qualified liquidation" as defined in Section 860F(a)(4) of the
Code, or (iv) a substitution pursuant to Article II hereof), nor acquire any
assets for the Trust, except as provided in Article II hereof, nor sell or
dispose of any investments in the Certificate Account or Distribution Account
for gain, nor accept any contributions to any REMIC Pool (other than a cash
contribution during the 3-month period beginning on the Startup Day), unless it
has received an Opinion of Counsel (at the expense of the Person requesting such
action) to the effect that such disposition, acquisition, substitution, or
acceptance will not (A) affect adversely the status of any REMIC Pool as a REMIC
or of the REMIC Certificates, other than the Residual Certificates, as the
regular interests therein, (B) affect the distribution of interest or principal
on the Certificates, (C) result in the encumbrance of the assets transferred or
assigned to any REMIC Pool (except pursuant to the provisions of this Agreement)
or (D) cause any REMIC Pool to be subject to a tax on "prohibited transactions"
or "prohibited contributions" or other tax pursuant to the REMIC Provisions.

     SECTION 12.3 MODIFICATIONS OF MORTGAGE LOANS. Notwithstanding anything to
the contrary in this Agreement, neither the Trustee, the Paying Agent, the
Master Servicer nor the Special Servicer shall permit any modification of a
Money Term of a Mortgage Loan or a Specially Serviced Mortgage Loan unless (i)
the Trustee, the Special Servicer, Paying Agent and the Master Servicer have
received a Nondisqualification Opinion or a ruling from the Internal Revenue
Service (at the expense of the party making the request that the Master Servicer
or the Special Servicer modify the Mortgage Loan or a Specially Serviced
Mortgage Loan) to the effect that such modification would not be treated as an
exchange pursuant to Section 1001 of the Code (or, if it would be so treated,
would not be treated as a "significant modification" for purposes of Section
1.860G-2(b) of the Treasury Regulations) or (ii) such modification meets the
requirements set forth in Sections 8.18 or 9.5.

     SECTION 12.4 LIABILITY WITH RESPECT TO CERTAIN TAXES AND LOSS OF REMIC
STATUS. In the event that any REMIC Pool fails to qualify as a REMIC, loses its
status as a REMIC, or incurs state or local taxes, or tax as a result of a
prohibited transaction or prohibited contribution subject to taxation under the
REMIC Provisions due to the negligent performance by either the Trustee or the
Paying Agent of its respective duties and obligations set forth herein, the
Trustee or the Paying Agent, as the case may be, shall be liable to the REMIC
Pools and the Holders of the Residual Certificates for any and all losses,
claims, damages, liabilities or expenses ("Losses") resulting from such
negligence and relating to the Residual Certificates; provided, however, that
the Trustee, or the Paying Agent, as applicable, shall not be liable for any
such Losses attributable to the action or inaction of the Master Servicer, the
Special Servicer, the Trustee (with respect to the Paying Agent), the Paying
Agent (with respect to the Trustee), the Depositor or the Holders of such
Residual Certificates nor for any such Losses resulting from any actions or
failure to act based upon reliance on an Opinion of Counsel or from
misinformation provided by the Master Servicer, the Special Servicer, the
Trustee (with respect

                                     -282-

<PAGE>

to the Paying Agent), the Paying Agent (with respect to the Trustee), the
Depositor or such Holders of the Residual Certificates on which the Trustee or
the Paying Agent, as the case may be, has relied. The foregoing shall not be
deemed to limit or restrict the rights and remedies of the Holders of the
Residual Certificates now or hereafter existing at law or in equity. The Trustee
or the Paying Agent shall be entitled to intervene in any litigation in
connection with the foregoing and to maintain control over its defense.

     SECTION 12.5 THE GRANTOR TRUST

     (a) The assets of the Grantor Trust, consisting of the right to any Excess
Interest in respect of the ARD Loans and the Excess Interest Sub-account, shall
be held by the Trustee and Paying Agent for the benefit of the Holders of the
Class O Grantor Trust Interest, represented by the Class O Certificates, which
Class O Certificates, in the aggregate, will evidence 100% beneficial ownership
of such assets from and after the Closing Date.

     (b) The assets of the Grantor Trust, consisting of the right to any Kimball
Lane Yield Maintenance Amounts and the Kimball Lane Sub-account, shall be held
by the Trustee and Paying Agent for the benefit of the Holders of the Class A-1
Grantor Trust Interest represented by the Class A-1 Certificates, for the
benefit of the Class X-1 Grantor Trust Interest represented by the Class X-1
Certificates and for the benefit of the Holders of the Class X-2 Grantor Trust
Interest represented by the Class X-2 Certificates, which Class A-1, Class X-1
and Class X-2 Certificates, in the aggregate, will evidence 100% beneficial
ownership of such assets from and after the Closing Date.

     (c) The parties intend that the portions of the Trust consisting of the
Grantor Trust shall constitute, and that the affairs of the Trust (exclusive of
the REMIC Pools) shall be conducted so as to qualify such portion as, a "grantor
trust" under the Code, and the provisions hereof shall be interpreted
consistently with this intention. Under no circumstances may the Trustee or the
Paying Agent vary the assets of the Grantor Trust so as to take advantage of
variations in the market so as to improve the rate of return of Holders of the
Class A-1, Class X-1, Class X-2 or Class O Certificates. The Trustee and Paying
Agent shall be deemed to hold and shall account for the Grantor Trust separate
and apart from the assets of the Kimball Lane Loan REMIC, REMIC I, REMIC II and
REMIC III created hereunder. The Paying Agent shall furnish or cause to be
furnished to the Class A-1, Class X-1, Class X-2 and Class O Certificateholders
and shall file, or cause to be filed with the Internal Revenue Service, together
with Form 1041 or such other form as may be applicable, information returns with
respect to income and expenses relating to their shares of the income and
expenses of the Grantor Trust, and with respect to the Grantor Trust, on the
cash or accrual method of accounting and so as to enable reporting to the
Holders of Class A-1, Class X-1, Class X-2 and Class O Certificates based on
their annual accounting period, at the time or times and in the manner required
by the Code.

                                     -283-
<PAGE>

                                  ARTICLE XIII

                            MISCELLANEOUS PROVISIONS

     SECTION 13.1 BINDING NATURE OF AGREEMENT. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns.

     SECTION 13.2 ENTIRE AGREEMENT. This Agreement contains the entire agreement
and understanding between the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements, understandings,
inducements and conditions, express or implied, oral or written, of any nature
whatsoever with respect to the subject matter hereof. The express terms hereof
control and supersede any course of performance or usage of the trade
inconsistent with any of the terms hereof.

     SECTION 13.3 AMENDMENT.

     (a) This Agreement may be amended from time to time by the parties hereto,
without notice to or the consent of any of the Holders, (i) to cure any
ambiguity, (ii) to cause the provisions herein to conform to or be consistent
with or in furtherance of the statements made with respect to the Certificates,
the Trust or this Agreement in the Private Placement Memorandum, the Preliminary
Prospectus Supplement, the Final Prospectus Supplement or the Prospectus, or to
correct or supplement any provision herein which may be inconsistent with any
other provisions herein, (iii) to amend any provision hereof to the extent
necessary or desirable to maintain the status of each REMIC Pool as a REMIC (or
the grantor trust created from the related portion of the Trust) for the
purposes of federal income tax law (or comparable provisions of state income tax
law), (iv) to make any other provisions with respect to matters or questions
arising under or with respect to this Agreement not inconsistent with the
provisions hereof, (v) to modify, add to or eliminate the provisions of Article
III relating to transfers of Residual Certificates, (vi) to amend any provision
herein to the extent necessary or desirable to list the Certificates on a stock
exchange, including, without limitation, the appointment of one or more
sub-paying agents and the requirement that certain information be delivered to
such sub-paying agents, (vii) to modify the provisions relating to the timing of
Advance reimbursements in order to conform them to the commercial
mortgage-backed securities industry standard for such provisions if (w) the
Depositor and the Master Servicer determine that that industry standard has
changed, (x) such modification will not result in an Adverse REMIC Event, as
evidenced by an Opinion of Counsel, (y) each Rating Agency has delivered a
Rating Agency Confirmation with respect to such modification, and (z) the
Operating Adviser consents to such modification, or (viii) to make any other
amendment which does not adversely affect in any material respect the interests
of any Certificateholder (unless such Certificateholder consents). No such
amendment effected pursuant to clause (i), (ii) or (iv) of the preceding
sentence shall (A) adversely affect in any material respect the interests of any
Certificateholder not consenting thereto without the consent of 100% of the
Certificateholders (if adversely affected) or (B) adversely affect the status of
any REMIC Pool as a REMIC(or the grantor trust created from the related portion
of the Trust). Prior to entering into any amendment without the consent of
Holders pursuant to this paragraph, the Trustee may require an Opinion of
Counsel and a Nondisqualification Opinion (in the case of clauses (i), (ii) and
(iii), at the expense of the Depositor, and otherwise at the expense of the
party requesting such amendment, except that if

                                     -284-

<PAGE>

the Trustee requests such amendment, such amendment shall be at the expense of
the Depositor, if the Depositor consents), to the effect that such amendment is
permitted under this paragraph. Any such amendment shall be deemed not to
adversely affect in any material economic respect any Holder if the Trustee
receives a Rating Agency Confirmation from each Rating Agency (and any Opinion
of Counsel requested by the Trustee in connection with any such amendment may
rely expressly on such confirmation as the basis therefor).

     (b) This Agreement may also be amended from time to time by the agreement
of the parties hereto (without the consent of the Certificateholders) and with
the written confirmation of the Rating Agencies that such amendment would not
cause the ratings on any Class of Certificates to be qualified, withdrawn or
downgraded; provided, however, that such amendment may not effect any of the
items set forth in clauses (i) through (iv) of the proviso in paragraph (c) of
this Section 13.3. The Trustee may request, at its option, to receive a
Nondisqualification Opinion and an Opinion of Counsel that any amendment
pursuant to this Section 13.3(b) is permitted by this Agreement at the expense
of the party requesting the amendment.

     (c) This Agreement may also be amended from time to time by the parties
with the consent of the Holders of not less than 51% of the Aggregate
Certificate Balance of the Certificates then outstanding, for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of the
Holders; provided that no such amendment may (i) directly or indirectly reduce
in any manner the amount of, or delay the timing of the distributions required
to be made on any Certificate without the consent of the Holder of such
Certificate, (ii) reduce the aforesaid percentages of Aggregate Certificate
Percentage or Certificate Balance, the Holders of which are required to consent
to any such amendment without the consent of all the Holders of each Class of
Certificates affected thereby, (iii) no such amendment shall eliminate or reduce
the Master Servicer's, the Trustee's or the Fiscal Agent's obligation to make an
Advance, including without limitation, in the case of the Master Servicer, the
obligation to advance on a B Note or the WestShore Plaza Companion Loan, or
alter the Servicing Standard except as may be necessary or desirable to comply
with the REMIC Provisions or (iv) adversely affect the status of any REMIC Pool
as a REMIC for federal income tax purposes (as evidenced by a
Nondisqualification Opinion) or the Grantor Trust as a grantor trust without the
consent of 100% of the Certificateholders (including the Class R-I, Class R-II,
Class R-III and Class R-K Certificateholders); provided that no such amendment
may modify Section 8.18 of this Agreement without Rating Agency Confirmation.
The Trustee may request, at its option, to receive a Nondisqualification Opinion
and an Opinion of Counsel that any amendment pursuant to this Section 13.3(c) is
permitted by this Agreement at the expense of the party requesting the
amendment.

     (d) The costs and expenses associated with any such amendment shall be
borne by the Depositor in the case the Trustee is the party requesting such
amendment or if pursuant to clauses (i), (ii) and (iii) of Section 13.3(a). In
all other cases, the costs and expenses shall be borne by the party requesting
the amendment.

     (e) Promptly after the execution of any such amendment, the Trustee shall
furnish written notification of the substance of such amendment to each Holder,
the Depositor and to the Rating Agencies.

                                     -285-

<PAGE>

     (f) It shall not be necessary for the consent of Holders under this Section
13.3 to approve the particular form of any proposed amendment, but it shall be
sufficient if such consent shall approve the substance thereof. The manner of
obtaining such consents and of evidencing the authorization of the execution
thereof by Holders shall be in the affirmative and in writing and shall be
subject to such reasonable regulations as the Trustee may prescribe.

     (g) Notwithstanding anything to the contrary contained in this Section
13.3, the parties hereto agree that this Agreement may not be amended in any
manner that is reasonably likely to have an adverse effect on any Primary
Servicer without first obtaining the written consent of such Primary Servicer.

     (h) Notwithstanding the fact that the provisions in Section 13.3(c) would
otherwise apply, with respect to any amendment that significantly modifies the
permitted activities of the Trust, the Trustee, any Primary Servicer, the Master
Servicer or the Special Servicer, any Certificate beneficially owned by a Seller
or any of its Affiliates shall be deemed not to be outstanding (and shall not be
considered when determining the percentage of Certificateholders consenting or
when calculating the total number of Certificates entitled to consent) for
purposes of determining if the requisite consents of Certificateholders under
this Section 13.3 have been obtained.

     (i) Notwithstanding anything to the contrary contained in this Section
13.3, the parties hereto agree that this Agreement may be amended pursuant to
Section 8.26(d) herein without any notice to or consent of any of the
Certificateholders, Opinions of Counsel, Officer's Certificates or Rating Agency
Confirmation.

     SECTION 13.4 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED
IN NEW YORK.

     SECTION 13.5 NOTICES. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given when received by
(A) in the case of the Depositor, Bear Stearns Commercial Mortgage Securities
Inc., 383 Madison Avenue, New York, New York 10179, Attention: J. Christopher
Hoeffel, Senior Managing Director, Commercial Mortgage Department, with copies
to the attention of Joseph T. Jurkowski, Jr., Managing Director, Legal
Department; (B) in the case of the Trustee and the Fiscal Agent at the Corporate
Trust Office; (C) in the case of the Master Servicer, Wells Fargo Bank, National
Association, 45 Fremont Street, 2nd Floor, San Francisco, California 94105,
Attention: Commercial Mortgage Servicing, with a copy to Robert F. Darling,
Esq., Wells Fargo Bank, National Association, 633 Folsom Street, 7th Floor, San
Francisco, California 94111; (D) in the case of Principal, Principal Global
Investors, LLC, 801 Grand Avenue, Des Moines Iowa 50392, Attention: Patrick
Halter, with a copy to Karen Pearston, Esq.; (E) in the case of BSCMI, Bear
Stearns Commercial Mortgage Inc., 383 Madison Avenue, New York, New York 10179,
Attention: J. Christopher Hoeffel, Senior Managing Director, Commercial Mortgage
Department, with copies to the attention of Joseph T. Jurkowski, Jr., Managing
Director, Legal Department; (F) in the case of MSMC, Morgan Stanley Mortgage
Capital Inc., 1585 Broadway,

                                     -286-

<PAGE>

New York, New York 10036, Attention: Andrew Berman, with a copy to: General
Counsel; (G) in the case of JHREF, John Hancock Real Estate Finance, Inc., 200
Clarendon Street, Boston, Massachusetts 02117, Attention: Barry S. Nectow,
Senior Vice President, with copies to the attention of Michael M. Epstein, Esq.
and Nathaniel I. Margolis, Esq.; (H) in the case of the Special Servicer, ARCap
Servicing, Inc., 5605 N. MacArthur Blvd., Suite 950, Irving, Texas 75038,
Attention: James L. Duggins, (I) in the case of the initial Operating Adviser,
ARCap CMBS Fund REIT, Inc., 5605 N. MacArthur Blvd., Suite 950, Irving, Texas
75038, Attention: James L. Duggins; and (J) in the case of the Paying Agent,
Wells Fargo Bank Minnesota, National Association, 9062 Old Annapolis Road,
Columbia, Maryland 21045, Attention: Corporate Trust Services (CMBS) Bear
Stearns Commercial Mortgage Securities Inc., Series 2003-TOP12, or as to each
party such other address as may hereafter be furnished by such party to the
other parties in writing. Any notice required or permitted to be mailed to a
Holder shall be given by first class mail, postage prepaid, at the address of
such Holder as shown in the Certificate Register. Any notice so mailed within
the time prescribed in this Agreement shall be conclusively presumed to have
been duly given, whether or not the Holder receives such notice.

     SECTION 13.6 SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the Holders thereof.

     SECTION 13.7 INDULGENCES; NO WAIVERS. Neither the failure nor any delay on
the part of a party to exercise any right, remedy, power or privilege under this
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, remedy, power or privilege preclude any other or further
exercise of the same or of any other right, remedy, power or privilege, nor
shall any waiver of any right, remedy, power or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power or privilege
with respect to any other occurrence. No waiver shall be effective unless it is
in writing and is signed by the party asserted to have granted such waiver.

     SECTION 13.8 HEADINGS NOT TO AFFECT INTERPRETATION. The headings contained
in this Agreement are for convenience of reference only, and shall not be used
in the interpretation hereof.

     SECTION 13.9 BENEFITS OF AGREEMENT. Nothing in this Agreement or in the
Certificates, express or implied, shall give to any Person, other than the
parties to this Agreement (including any Primary Servicer to the extent
applicable to such Primary Servicer) and their successors hereunder and the
Holders of the Certificates, any benefit or any legal or equitable right, power,
remedy or claim under this Agreement; provided, however, that (i) the Mortgagors
set forth on Schedule VIII hereto are intended third-party beneficiaries of the
fifth and sixth paragraph of Section 2.3(a), (ii) the holder of the WestShore
Plaza Companion Loan and any B Note, if any, is an intended third-party
beneficiary in respect of the rights afforded it hereunder and (iii) the
applicable Non-Serviced Mortgage Loan Master Servicer and the applicable
Non-Serviced Mortgage Loan Special Servicer are intended third-party
beneficiaries of Section 5.2(a)(ii)(B).

                                     -287-

<PAGE>

     SECTION 13.10 SPECIAL NOTICES TO THE RATING AGENCIES.

     (a) The Trustee shall give prompt notice to the Rating Agencies, Special
Servicer and the Operating Adviser of the occurrence of any of the following
events of which it has notice:

         (i) any amendment to this Agreement pursuant to Section 13.3 hereof;

         (ii) the Interim Certification and the Final Certification required
pursuant to Section 2.2 hereof;

         (iii) notice of the repurchase of any Mortgage Loan or REO Mortgage
Loan pursuant to Section 2.3(a) hereof;

         (iv) any resignation of the Master Servicer, Special Servicer, the
Paying Agent, the Operating Adviser or the Trustee pursuant to this Agreement;

         (v) the appointment of any successor to the Master Servicer, the Fiscal
Agent, the Trustee, the Paying Agent, the Operating Adviser or the Special
Servicer pursuant to Section 7.7, 7.14 or 9.37 hereof;

         (vi) waiver of a due-on-sale clause as provided in Section 8.7;

         (vii) waiver of a prohibition on subordinate liens on the Mortgaged
Properties;

         (viii) the making of a final payment pursuant to Section 10.3 hereof;

         (ix) a Servicing Transfer Event; and (x) an Event of Default.

     (b) All notices to the Rating Agencies shall be in writing and sent by
first class mail, telecopy or overnight courier, as follows:

                  If to Fitch, to:

                  Fitch Ratings, Inc.
                  One State Street Plaza
                  New York, NY 10009
                  Fax:  (212) 635-0294
                  Attention:   Commercial Mortgage Surveillance

                  If to Moody's, to:

                  Moody's Investors Service, Inc.
                  99 Church Street
                  New York, NY 10009

                                      -288-
<PAGE>

                  Fax:  (212) 553-0300
                  Attention:   Structured Finance Commercial Real Estate
Monitoring

or at such address as shall be provided in writing to the Depositor
by such Rating Agency.

     (c) The Trustee, or in the case of clauses (i) and (ii), the successor
trustee shall give prompt notice to the Rating Agencies of the occurrence of any
of the following events:

         (i) the resignation or removal of the Trustee pursuant to Section 7.6;
or

         (ii) the appointment of a successor trustee pursuant to Section 7.7; or

         (iii) the appointment of a successor Operating Adviser pursuant to
Section 9.37.

     (d) The Master Servicer shall deliver to the Rating Agencies and the
Depositor any other information as reasonably requested by the Rating Agencies
and the Depositor, and shall deliver to the Primary Servicers and the Special
Servicer each of the reports required to be delivered by the Master Servicer to
the Primary Servicers and the Special Servicer pursuant to the terms of this
Agreement. The Trustee, the Paying Agent and the Special Servicer shall deliver
to the Rating Agencies and the Depositor any information as reasonably requested
by the Rating Agencies and Depositor, as the case may be.

     (e) Any notice or other document required to be delivered or mailed by the
Depositor, Master Servicer, Paying Agent or Trustee shall be given by such
parties, respectively, on a best efforts basis and only as a matter of courtesy
and accommodation to the Rating Agencies, unless otherwise specifically required
herein, and such parties, respectively, shall have no liability for failure to
deliver any such notice or document to the Rating Agencies.

     SECTION 13.11 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, and all of which
together shall constitute one and the same instrument.

     SECTION 13.12 INTENTION OF PARTIES. It is the express intent of the parties
hereto that the conveyance of the Mortgage Loans and related rights and property
to the Trustee, for the benefit of the Certificateholders, by the Depositor as
provided in Section 2.1 be, and be construed as, an absolute sale of the
Mortgage Loans and related property. It is, further, not the intention of the
parties that such conveyance be deemed a pledge of the Mortgage Loans and
related property by the Depositor to the Trustee to secure a debt or other
obligation of the Depositor. However, in the event that, notwithstanding the
intent of the parties, the Mortgage Loans or any related property is held to be
the property of the Depositor, or if for any other reason this Agreement is held
or deemed to create a security interest in the Mortgage Loans or any related
property, then this Agreement shall be deemed to be a security agreement; and
the conveyance provided for in Section 2.1 shall be deemed to be a grant by the
Depositor to the Trustee, for the benefit of the Certificateholders, of a
security interest in all of the Depositor's right, title, and interest, whether
now owned or hereafter acquired, in and to:

                                     -289-

<PAGE>

         (i) the property described in clauses (1)-(4) below (regardless of
whether subject to the UCC or how classified thereunder) and all accounts,
general intangibles, chattel paper, instruments, documents, money, deposit
accounts, certificates of deposit, goods, letters of credit, advices of credit
and investment property consisting of, arising from or relating to any of the
property described in clauses (1)-(4) below: (1) the Mortgage Loans identified
on the Mortgage Loan Schedule, including the related Mortgage Notes, Mortgages,
security agreements, and title, hazard and other insurance policies, including
all Qualifying Substitute Mortgage Loans, all distributions with respect thereto
payable on and after the Cut-Off Date, and the Mortgage Files; (2) the
Distribution Account, all REO Accounts, the Certificate Account, the Reserve
Account and the Interest Reserve Account, including all property therein and all
income from the investment of funds therein (including any accrued discount
realized on liquidation of any investment purchased at a discount); (3) the
Kimball Lane Loan REMIC Regular Interest, the REMIC I Regular Interests and the
REMIC II Regular Interests; and (4) the Mortgage Loan Purchase Agreements that
are permitted to be assigned to the Trustee pursuant to Section 14 thereof;

         (ii) all accounts, general intangibles, chattel paper, instruments,
documents, money, deposit accounts, certificates of deposit, goods, letters of
credit, advices of credit, investment property, and other rights arising from or
by virtue of the disposition of, or collections with respect to, or insurance
proceeds payable with respect to, or claims against other Persons with respect
to, all or any part of the collateral described in clause (i) above (including
any accrued discount realized on liquidation of any investment purchased at a
discount); and

     All cash and non-cash Proceeds (as defined in the Uniform Commercial Code)
of the collateral described in clauses (i) and (ii) above.

     The possession by the Trustee of the Mortgage Notes, the Mortgages and such
other goods, letters of credit, advices of credit, instruments, money,
documents, chattel paper or certificated securities shall be deemed to be
possession by the secured party or possession by a purchaser for purposes of
perfecting the security interest pursuant to the Uniform Commercial Code
(including, without limitation, Sections 8-301 and 9-315 thereof) as in force in
the relevant jurisdiction.

     Notifications to Persons holding such property, and acknowledgments,
receipts or confirmations from Persons holding such property, shall be deemed to
be notifications to, or acknowledgments, receipts or confirmations from,
securities intermediaries, bailees or agents of, or persons holding for, the
Trustee, as applicable, for the purpose of perfecting such security interest
under applicable law.

     The Depositor and, at the Depositor's direction, the Master Servicer and
the Trustee, shall, to the extent consistent with this Agreement, take such
reasonable actions as may be necessary to ensure that, if this Agreement were
deemed to create a security interest in the property described above, such
security interest would be deemed to be a perfected security interest of first
priority under applicable law and will be maintained as such throughout the term
of the Agreement. The Master Servicer shall file, at the expense of the Trust as
an Additional Trust Expense all filings necessary to maintain the effectiveness
of any original filings necessary under the Uniform Commercial Code as in effect
in any jurisdiction to perfect the Trustee's security interest in such property,
including without limitation (i) continuation statements, and

                                     -290-

<PAGE>

(ii) such other statements as may be occasioned by any transfer of any interest
of the Master Servicer or the Depositor in such property. In connection
herewith, the Trustee shall have all of the rights and remedies of a secured
party and creditor under the Uniform Commercial Code as in force in the relevant
jurisdiction.

     SECTION 13.13 RECORDATION OF AGREEMENT. This Agreement is subject to
recordation
in all appropriate public offices for real property records in all the counties
or other comparable jurisdictions in which any or all of the properties subject
to the Mortgages are situated, and in any other appropriate public recording
office or elsewhere. Such recordation, if any, shall be effected by the Master
Servicer at the expense of the Trust as an Additional Trust Expense, but only
upon direction of the Depositor accompanied by an Opinion of Counsel to the
effect that such recordation materially and beneficially affects the interests
of the Certificateholders of the Trust.

     SECTION 13.14 RATING AGENCY MONITORING FEES. The parties hereto acknowledge
that on the Closing Date the Sellers will pay the ongoing monitoring fees of the
Rating Agencies relating to the rating of the Certificates that no monitoring
fees are payable subsequent to the Closing Date in respect of the rating of the
Certificates. The Master Servicer shall not be required to pay any such fees or
any fees charged for any Rating Agency Confirmation (except any confirmation
required under Section 8.22, Section 8.23 or in connection with a termination
and replacement of the Master Servicer following an Event of Default of the
Master Servicer).

     SECTION 13.15 ACKNOWLEDGEMENT BY PRIMARY SERVICERS. The Primary Servicers
agree, to the extent applicable to such Primary Servicer and the Mortgage Loans
serviced by such Primary Servicer, to be bound by the terms of Sections 5.1(g),
8.3, 8.4, 8.7, 8.10, 8.18, 8.25(d) and 8.26 of this Agreement.

                                     -291-
<PAGE>

     IN WITNESS WHEREOF, the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Paying Agent, the Certificate Registrar, the
Authenticating Agent and the Fiscal Agent have caused their names to be signed
hereto by their respective officers thereunto duly authorized as of the day and
year first above written.

                        BEAR STEARNS COMMERCIAL MORTGAGE
                        SECURITIES INC.
                        as Depositor

                        By:_____________________________________________
                           Name:
                           Title:

                        WELLS FARGO BANK, NATIONAL
                        ASSOCIATION, as Master Servicer

                        By:_____________________________________________
                           Name:
                           Title:

                        ARCAP SERVICING, INC., as Special Servicer

                        By:_____________________________________________
                           Name:
                           Title:

                        LASALLE BANK NATIONAL ASSOCIATION, as Trustee

                        By:_____________________________________________
                           Name:
                           Title:

                        ABN AMRO BANK N.V., as Fiscal Agent

                        By:____________________________________________
                            Name:
                            Title:

                                     -292-
<PAGE>

                        By:_____________________________________________
                           Name:
                           Title:

                        WELLS FARGO BANK MINNESOTA,
                        NATIONAL ASSOCIATION, as Paying Agent and
                        Certificate Registrar

                        By:_____________________________________________
                           Name:
                           Title:

                        PRINCIPAL GLOBAL INVESTORS, LLC,
                        acting solely in its capacity as Primary  Servicer
                        with respect to the sections referred to in Section
                        13.15 of the Agreement

                        By:_____________________________________________
                            Name:
                            Title:

                        By:_____________________________________________
                           Name:
                           Title:

                        JOHN HANCOCK REAL ESTATE FINANCE
                        INC., acting solely in its capacity as Primary
                        Servicer with respect to the sections referred to in
                        Section 13.15 of the Agreement

                        By:_____________________________________________
                            Name:
                            Title:

                                     -293-

<PAGE>

STATE OF NEW YORK                   )
                                    )  ss.:
COUNTY OF NEW YORK                  )

                  On this __ day of October 2003, before me, a notary public in
and for said State, personally appeared _____________, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the person who
executed the within instrument as Vice President on behalf of Bear Stearns
Commercial Mortgage Securities Inc., and acknowledged to me that such
corporation executed the within instrument pursuant to its by-laws or a
resolution of its Board of Directors.

                  IN WITNESS WHEREOF, I have hereunder set my hand and affixed
my official seal the day and year in this certificate first above written.

                                       ___________________________
                                              Notary Public

<PAGE>

STATE OF CALIFORNIA                         )
                                            )  ss.:
COUNTY OF SAN FRANCISCO                     )

                  On this ___ day of October 2003, before me, a notary public in
and for said State, personally appeared ____________, personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person who
executed the within instrument as Vice President of ___________________, and
acknowledged to me that such corporation executed the within instrument pursuant
to its by-laws or a resolution of its Board of Directors.

                  IN WITNESS WHEREOF, I have hereunder set my hand and affixed
my official seal the day and year in this certificate first above written.

                                       ___________________________
                                              Notary Public

                                      -2-
<PAGE>

STATE OF                            )
                                    )  ss.:
COUNTY OF                           )

                  On the ______ day of October 2003, before me, a notary public
in and for said State, personally appeared ___________________ known to me to be
a of _______________, one of the entities that executed the within instrument,
and acknowledged to me that such entity executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                       ___________________________
                                              Notary Public

                                      -3-
<PAGE>

STATE OF NEW YORK                   )
                                    )  ss.:
COUNTY OF NEW YORK                  )

                  On this ___ day of October 2003, before me, a notary public in
and for said State, personally appeared __________________, personally known to
me (or proved to me on the basis of satisfactory evidence) to be the person who
executed the within instrument as Vice President on behalf of ____________, and
acknowledged to me that such nationally chartered bank executed the within
instrument pursuant to its by-laws or a resolution of its Board of Directors.

                  IN WITNESS WHEREOF, I have hereunder set my hand and affixed
my official seal the day and year in this certificate first above written.

                                       ___________________________
                                              Notary Public

                                      -4-
<PAGE>

STATE OF NEW YORK                   )
                                    )  ss.:
COUNTY OF NEW YORK                  )

                  On this ___ day of October 2003, before me, a notary public in
and for said State, personally appeared __________________, personally known to
me (or proved to me on the basis of satisfactory evidence) to be the person who
executed the within instrument as Vice President on behalf of _______________,
and acknowledged to me that such nationally chartered bank executed the within
instrument pursuant to its by-laws or a resolution of its Board of Directors.

                  IN WITNESS WHEREOF, I have hereunder set my hand and affixed
my official seal the day and year in this certificate first above written.

                                       ___________________________
                                              Notary Public

                                      -5-
<PAGE>

STATE OF NEW YORK                   )
                                    )  ss.:
COUNTY OF NEW YORK                  )

                  On this ___ day of October 2003, before me, a notary public in
and for said State, personally appeared __________________, personally known to
me (or proved to me on the basis of satisfactory evidence) to be the person who
executed the within instrument as Vice President on behalf of ________________
and acknowledged to me that such nationally chartered bank executed the within
instrument pursuant to its by-laws or a resolution of its Board of Directors.

                  IN WITNESS WHEREOF, I have hereunder set my hand and affixed
my official seal the day and year in this certificate first above written.

                                       ___________________________
                                              Notary Public

                                      -6-
<PAGE>

STATE OF NEW YORK                   )
                                    )  ss.:
COUNTY OF NEW YORK                  )

                  On this ___ day of October 2003, before me, a notary public in
and for said State, personally appeared __________________, personally known to
me (or proved to me on the basis of satisfactory evidence) to be the person who
executed the within instrument as Vice President on behalf of
___________________ and acknowledged to me that such nationally chartered bank
executed the within instrument pursuant to its by-laws or a resolution of its
Board of Directors.

                  IN WITNESS WHEREOF, I have hereunder set my hand and affixed
my official seal the day and year in this certificate first above written.<PAGE>

                                                                    EXHIBIT 10.1

                                                                  EXECUTION COPY

--------------------------------------------------------------------------------

                      LOAN, GUARANTY AND SECURITY AGREEMENT

                                  BY AND AMONG

                        PAYLESS SHOESOURCE FINANCE, INC.

                                  AS BORROWER,

                        THE GUARANTORS SIGNATORY HERETO,

                               AS CREDIT PARTIES,

                     THE LENDERS THAT ARE SIGNATORIES HERETO

                                 AS THE LENDERS,

                                       AND

                         WELLS FARGO RETAIL FINANCE, LLC

                    AS THE ARRANGER AND ADMINISTRATIVE AGENT

                          DATED AS OF JANUARY 15, 2004

--------------------------------------------------------------------------------
<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<S>      <C>                                                                                                         <C>
1.       DEFINITIONS AND CONSTRUCTION............................................................................     1
         1.1      Definitions....................................................................................     1
         1.2      Accounting Terms...............................................................................    28
         1.3      Code...........................................................................................    28
         1.4      Construction...................................................................................    28
         1.5      Schedules and Exhibits.........................................................................    29

2.       LOAN AND TERMS OF PAYMENT...............................................................................    29
         2.1      Revolver Advances..............................................................................    29
         2.2      Revolver Increase..............................................................................    30
         2.3      Borrowing Procedures and Settlements...........................................................    31
         2.4      Payments.......................................................................................    38
         2.5      Overadvances...................................................................................    40
         2.6      Interest Rates and Letter of Credit Fee:  Rates, Payments, and Calculations....................    40
         2.7      Cash Management................................................................................    42
         2.8      Crediting Payments.............................................................................    45
         2.9      Designated Account.............................................................................    45
         2.10     Maintenance of Loan Account; Statements of Obligations.........................................    46
         2.11     Fees...........................................................................................    46
         2.12     Letters of Credit..............................................................................    46
         2.13     LIBOR Option...................................................................................    50
         2.14     Capital Requirements...........................................................................    54

3.       CONDITIONS; TERM OF AGREEMENT...........................................................................    54
         3.1      Conditions Precedent to the Initial Extension of Credit........................................    54
         3.2      Conditions Subsequent to the Initial Extension of Credit.......................................    56
         3.3      Conditions Precedent to all Extensions of Credit...............................................    56
         3.4      Term...........................................................................................    57
         3.5      Effect of Termination..........................................................................    57
         3.6      Early Termination by Borrower..................................................................    58

4.       CREATION OF SECURITY INTEREST...........................................................................    58
         4.1      Grant of Security Interest.....................................................................    58
         4.2      Collection of Accounts.........................................................................    59
         4.3      Filing of Financing Statements; Delivery of Additional Documentation Required..................    59
         4.4      Power of Attorney..............................................................................    59
         4.5      Right to Inspect...............................................................................    60
         4.6      Deposit Accounts...............................................................................    60
</TABLE>

                                      -i-
<PAGE>

<TABLE>
<S>      <C>                                                                                                         <C>
5.       REPRESENTATIONS AND WARRANTIES..........................................................................    60
         5.1      No Encumbrances................................................................................    61
         5.2      Eligible Accounts..............................................................................    61
         5.3      Eligible Inventory.............................................................................    61
         5.4      Location of Inventory..........................................................................    61
         5.5      Inventory Records..............................................................................    61
         5.6      State of Incorporation; Location of Chief Executive Office; FEIN; Organizational ID Number.....    61
         5.7      Due Organization and Qualification; Subsidiaries...............................................    62
         5.8      Due Authorization; No Conflict.................................................................    62
         5.9      Litigation.....................................................................................    63
         5.10     No Material Adverse Change.....................................................................    63
         5.11     Fraudulent Transfer............................................................................    63
         5.12     Employee Benefits..............................................................................    64
         5.13     Environmental Condition........................................................................    64
         5.14     Brokerage Fees.................................................................................    64
         5.15     Intellectual Property..........................................................................    64
         5.16     Leases.........................................................................................    64
         5.17     Deposit Accounts...............................................................................    64
         5.18     Complete Disclosure............................................................................    65
         5.19     Indebtedness...................................................................................    65
         5.20     Credit Card Receipts...........................................................................    65
         5.21     Margin Stock...................................................................................    65
         5.22     Senior Debt....................................................................................    65
         5.23     Anti-Terrorism Laws............................................................................    66

6.       AFFIRMATIVE COVENANTS...................................................................................    67
         6.1      Accounting System..............................................................................    67
         6.2      Collateral Reporting...........................................................................    67
         6.3      Financial Statements, Reports, Certificates....................................................    67
         6.4      Returns........................................................................................    69
         6.5      Maintenance of Properties......................................................................    69
         6.6      Taxes..........................................................................................    70
         6.7      Insurance......................................................................................    70
         6.8      Location of Inventory/Chief Executive Offices..................................................    71
         6.9      Compliance with Laws...........................................................................    71
         6.10     Leases.........................................................................................    71
         6.11     Existence......................................................................................    71
         6.12     Environmental..................................................................................    71
         6.13     Disclosure Updates.............................................................................    72
         6.14     Formation of Subsidiaries......................................................................    72

7.       NEGATIVE COVENANTS......................................................................................    72
</TABLE>

                                       -ii-
<PAGE>

<TABLE>
<S>      <C>                                                                                                         <C>
         7.1      Indebtedness...................................................................................    72
         7.2      Liens..........................................................................................    74
         7.3      Restrictions on Fundamental Changes/Disposal of Assets.........................................    74
         7.4      Change Name....................................................................................    75
         7.5      Nature of Business.............................................................................    75
         7.6      Amendments.....................................................................................    76
         7.7      Change of Control..............................................................................    76
         7.8      Distributions..................................................................................    76
         7.9      Accounting Methods.............................................................................    76
         7.10     Investments....................................................................................    76
         7.11     Transactions with Affiliates...................................................................    77
         7.12     Use of Proceeds................................................................................    77
         7.13     Equitable Lien; No Further Negative Pledges....................................................    77
         7.14     Minimum Gross Collateral Availability..........................................................    78
         7.15     Sales and Lease-Backs..........................................................................    78

8.       EVENTS OF DEFAULT.......................................................................................    78

9.       THE LENDER GROUP'S RIGHTS AND REMEDIES..................................................................    80
         9.1      Rights and Remedies............................................................................    80
         9.2      Remedies Cumulative............................................................................    83

10.      TAXES AND EXPENSES......................................................................................    83

11.      WAIVERS; INDEMNIFICATION................................................................................    83
         11.1     Demand; Protest; etc...........................................................................    83
         11.2     The Lender Group's Liability for Credit Party Collateral.......................................    83
         11.3     Indemnification................................................................................    84

12.      NOTICES.................................................................................................    84

13.      CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER..............................................................    85

14.      ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS..............................................................    86
         14.1     Assignments and Participations.................................................................    86
         14.2     Successors.....................................................................................    89

15.      AMENDMENTS; WAIVERS.....................................................................................    89
         15.1     Amendments and Waivers.........................................................................    89
         15.2     Replacement of Holdout Lender..................................................................    91
         15.3     No Waivers; Cumulative Remedies................................................................    91

16.      AGENT; THE LENDER GROUP.................................................................................    92
         16.1     Appointment and Authorization of Agent.........................................................    92
</TABLE>

                                     -iii-
<PAGE>

<TABLE>
<S>      <C>                                                                                                        <C>
         16.2     Delegation of Duties...........................................................................    93
         16.3     Liability of Agent.............................................................................    93
         16.4     Reliance by Agent..............................................................................    93
         16.5     Notice of Default or Event of Default..........................................................    94
         16.6     Credit Decision................................................................................    94
         16.7     Costs and Expenses; Indemnification............................................................    95
         16.8     Agent in Individual Capacity...................................................................    95
         16.9     Successor Agent................................................................................    96
         16.10    Lender in Individual Capacity..................................................................    96
         16.11    Withholding Taxes..............................................................................    97
         16.12    Collateral Matters.............................................................................    99
         16.13    Restrictions on Actions by Lenders; Sharing of Payments........................................   100
         16.14    Agency for Perfection..........................................................................   101
         16.15    Payments by Agent to the Lenders...............................................................   101
         16.16    Concerning the Credit Party Collateral and Related Loan Documents..............................   101
         16.17    Field Audits and Examination Reports; Confidentiality; Disclaimers by
                  Lenders; Other Reports and Information.........................................................   101
         16.18    Several Obligations; No Liability.............................................................    103
         16.19    Legal Representation of Agent.................................................................    103

17.      GUARANTY...............................................................................................    103
         17.1     Guaranty of the Obligations...................................................................    103
         17.2     Contribution by Guarantors....................................................................    103
         17.3     Payment by Guarantors.........................................................................    104
         17.4     Liability of Guarantors Absolute..............................................................    105
         17.5     Waivers by Guarantors.........................................................................    107
         17.6     Guarantors' Rights of Subrogation, Contribution, Etc..........................................    108
         17.7     Subordination Of Other Obligations............................................................    108
         17.8     Continuing Guaranty...........................................................................    109
         17.9     Authority of Guarantors or Borrower...........................................................    109
         17.10    Financial Condition of Borrower...............................................................    109
         17.11    Bankruptcy, Etc...............................................................................    109

18.      GENERAL PROVISIONS.....................................................................................    110
         18.1     Effectiveness.................................................................................    110
         18.2     Section Headings..............................................................................    110
         18.3     Interpretation................................................................................    110
         18.4     Severability of Provisions....................................................................    110
         18.5     Amendments in Writing.........................................................................    110
         18.6     Counterparts; Telefacsimile Execution.........................................................    110
         18.7     Revival and Reinstatement of Obligations......................................................    111
         18.8     Confidentiality...............................................................................    111
         18.9     Integration...................................................................................    112
</TABLE>

                                      -iv-
<PAGE>

                             EXHIBITS AND SCHEDULES

<TABLE>
<S>                          <C>
Exhibit A-1                  Form of Assignment and Acceptance
Exhibit C-1                  Form of Compliance Certificate
Exhibit L-1                  Form of LIBOR Notice
Exhibit M                    Form of Borrowing Base Certificate

Schedule A-1                 Agent's Account
Schedule A-2                 Authorized Persons
Schedule C-1                 Commitments
Schedule D-1                 Designated Account
Schedule E-1                 Eligible Inventory Locations
Schedule E-2                 Pool Locations
Schedule P-1                 Permitted Liens
Schedule 5.4                 Locations of Inventory
Schedule 5.6(a)              States of Organization
Schedule 5.6(b)              Chief Executive Offices
Schedule 5.6(c)              FEINs
Schedule 5.7(b)              Capitalization of Borrower
Schedule 5.7(c)              Capitalization of Borrower's Subsidiaries
Schedule 5.9                 Litigation
Schedule 5.13                Environmental Matters
Schedule 5.17                Deposit Accounts
Schedule 5.19                Permitted Indebtedness
Schedule 5.20                Credit Card Processors
Schedule 6.2                 Collateral Reporting
Schedule 7.10                Investments
Schedule 7.11                Transactions with Affiliates
</TABLE>

                                       -v-
<PAGE>

                      LOAN, GUARANTY AND SECURITY AGREEMENT

                  THIS LOAN, GUARANTY AND SECURITY AGREEMENT (this "Agreement"),
is entered into as of January 15, 2004, by and among, on the one hand, the
lenders identified on the signature pages hereof (such lenders, together with
their respective successors and permitted assigns, are referred to hereinafter
each individually as a "Lender" and collectively as the "Lenders") and WELLS
FARGO RETAIL FINANCE, LLC, a Delaware limited liability company, as the arranger
and administrative agent for the Lenders ("Agent"), and, on the other hand,
PAYLESS SHOESOURCE FINANCE, INC., a Nevada corporation ("Borrower") and the
Guarantors identified on the signature pages hereof (together with Borrower, the
"Credit Parties" and each individually as a "Credit Party").

                  The parties agree as follows:

1. DEFINITIONS AND CONSTRUCTION.

         1.1 DEFINITIONS. As used in this Agreement, the following terms shall
have the following definitions:

                  "Account" means an account (as that term is defined in the
Code), and any and all supporting obligations in respect thereof.

                  "Account Debtor" means any Credit Card Processor.

                  "ACH Transactions" means any cash management or related
services (including the Automated Clearing House processing of electronic fund
transfers through the direct Federal Reserve Fedline system) provided by Wells
Fargo or any of its Affiliates for the account of any Credit Party.

                  "Additional Documents" has the meaning set forth in Section
4.3(b).

                  "Advance Rates" means the percentage rates set forth in the
definition of "Borrowing Base", as such percentage rates may be modified
pursuant to Section 2.1(b).

                  "Advances" has the meaning set forth in Section 2.1(a).

                  "Affiliate" means, as applied to any Person, any other Person
who, directly or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such Person. For purposes of
this definition, "control" means the possession, directly or indirectly through
one or more intermediaries, of the power to direct the management and policies
of a Person, whether through the ownership of Stock, by contract, or otherwise;
provided, however, that, for purposes of the definition of Eligible Accounts and

                                      -1-

<PAGE>

Section 7.11 hereof: (a) any Person which owns directly or indirectly 20% or
more of the Stock having ordinary voting power for the election of directors or
other members of the governing body of a Person or 20% or more of the
partnership or other ownership interests of a Person (other than as a limited
partner of such Person) shall be deemed an Affiliate of such Person and (b) each
director (or comparable manager) of a Person shall be deemed to be an Affiliate
of such Person.

                  "Agent" means WFRF, in its capacity as arranger and
administrative agent hereunder, and any successor thereto.

                  "Agent Advances" has the meaning set forth in Section
2.3(e)(i).

                  "Agent-Related Persons" means Agent, together with its
Affiliates, officers, directors, employees, attorneys, and agents.

                  "Agent's Account" means the Deposit Account of Agent
identified on Schedule A-1.

                  "Agent's Liens" means the Liens granted by the Credit Parties
to Agent under this Agreement or the other Loan Documents.

                  "Aggregate Payments" has the meaning set forth in Section
17.2.

                  "Agreement" has the meaning set forth in the preamble to this
Agreement.

                  "Applicable Margin" means initially, the rates for Base Rate
Loans and LIBOR Rate Loans set forth in Level I below:

<TABLE>
<CAPTION>
                                                      DOCUMENTARY    STANDBY
           AVERAGE             BASE RATE  LIBOR RATE  LETTERS OF   LETTERS OF
LEVEL     UTILIZATION            LOANS       LOANS      CREDIT       CREDIT
-----------------------------------------------------------------------------
<S>     <C>                    <C>        <C>         <C>          <C>
  I     Up to and including     -0.25%       1.25%       1.00%       1.25%
        $50,000,000
-----------------------------------------------------------------------------
 II     Greater than                0%       1.50%       1.00%       1.50%
        $50,000,000 but less
        than or equal to
        $100,000,000
-----------------------------------------------------------------------------
 III    Greater than                0%       1.75%       1.25%       1.75%
        $100,000,000 but less
        than or equal to
-----------------------------------------------------------------------------
</TABLE>

                                      -2-

<PAGE>

<TABLE>
<S>     <C>                         <C>      <C>         <C>         <C>

        $150,000,000
-----------------------------------------------------------------------------
 IV     Greater than                0%       2.00%       1.50%       2.00%
        $150,000,000
-----------------------------------------------------------------------------
</TABLE>

                  The Applicable Margin shall be adjusted quarterly as of the
first day of each calendar quarter, based upon the Average Utilization for the
immediately preceding calendar quarter.

                  "Asian Subsidiary" means, as to any Credit Party, any
Subsidiary of such Credit Party organized under the laws of any jurisdiction in
Asia (as defined in Merriam Webster's Ninth New Collegiate Dictionary).

                  "Asset Sale" means a sale, lease or sub-lease (as lessor or
sublessor), sale and leaseback, assignment, conveyance, transfer or other
disposition to any Person (other than a Credit Party) or any exchange of
property with any Person (other than any exchange between Credit Parties), in
one transaction or a series of transactions, of all or any part of any Credit
Party's businesses, assets or properties of any kind, whether real, personal, or
mixed and whether tangible or intangible, whether now owned or hereafter
acquired, not including the Stock of any Credit Party, other than (i) Inventory
(or other assets) sold or leased in the ordinary course of business, (ii) Cash
Equivalents sold in the ordinary course of business, (iii) any disposition which
is deemed to have occurred in connection with a casualty or taking (pursuant to
the power of eminent domain, condemnation or otherwise) event which results in a
Credit Party receiving insurance or condemnation proceeds, (iv) non-perpetual
licenses of any Credit Party's intellectual property (which licenses may grant
varying degrees of exclusivity provided that such Credit Party retains an
unlimited right to use the intellectual property which is the subject of such
licenses) which are entered into in the ordinary course of business of such
Credit Party, as such business is now or hereafter conducted in compliance with
this Agreement, or (v) licenses of any Credit Party's intellectual property to
any Person domiciled outside of the United States, Puerto Rico or any U.S.
Territory for use solely in a jurisdiction outside of the United States, Puerto
Rico or any U.S. Territory.

                  "Assignee" has the meaning set forth in Section 14.1(a).

                  "Assignment and Acceptance" means an Assignment and Acceptance
Agreement substantially in the form of Exhibit A-1.

                  "Authorized Person" means those individuals identified on
Schedule A-2, as such schedule may be modified by written notice from Borrower
to Agent from time to time.

                                      -3-

<PAGE>

                  "Availability" means, as of any date of determination, the
amount that Borrower is entitled to borrow as Advances hereunder (after giving
effect to all then outstanding Obligations and all sublimits and Reserves then
applicable hereunder).

                  "Average Utilization" means for any calendar quarter an amount
equal to the sum of the Daily Balance of Revolver Usage for each day of such
calendar quarter divided by the actual number of days in such calendar quarter,
as determined by Agent, which determination shall be conclusive absent manifest
error.

                  "Bankruptcy Code" means title 11 of the United States Code, as
in effect from time to time.

                  "Base LIBOR Rate" means the rate per annum, determined by
Agent in accordance with its customary procedures, and utilizing such electronic
or other quotation sources as it considers appropriate (rounded upwards, if
necessary, to the next 1/100%), to be the rate at which Dollar deposits (for
delivery on the first day of the requested Interest Period) are offered to major
banks in the London interbank market at approximately 11 a.m. (London time) 2
Business Days prior to the commencement of the requested Interest Period, for a
term and in an amount comparable to the Interest Period and the amount of the
LIBOR Rate Loan requested (whether as an initial LIBOR Rate Loan or as a
continuation of an extant LIBOR Rate Loan or as a conversion of a Base Rate Loan
to a LIBOR Rate Loan) by Borrower in accordance with this Agreement, which
determination shall be conclusive in the absence of manifest error.

                  "Base Rate" means, the rate of interest announced, from time
to time, within Wells Fargo at its principal office in San Francisco as its
"prime rate", with the understanding that the "prime rate" is one of Wells
Fargo's base rates (not necessarily the lowest of such rates) and serves as the
basis upon which effective rates of interest are calculated for those loans
making reference thereto and is evidenced by the recording thereof after its
announcement in such internal publications as Wells Fargo may designate.

                  "Base Rate Loan" means the portion of the Advances that bears
interest at a rate determined by reference to the Base Rate.

                  "Benefit Plan" means a "defined benefit plan" (as defined in
Section 3(35) of ERISA) subject to Title IV of ERISA for which any Credit Party
or ERISA Affiliate of any Credit Party has been an "employer" (as defined in
Section 3(5) of ERISA) within the past six years.

                  "Board of Directors" means the board of directors (or
comparable managers) of Parent or any committee thereof duly authorized to act
on behalf of the board of directors (or comparable managers).

                                      -4-

<PAGE>

                  "Books" means each Credit Party's now owned or hereafter
acquired books and records (including all of its Records indicating,
summarizing, or evidencing its assets (including the Credit Party Collateral) or
liabilities, all of the Records of each Credit Party relating to its business
operations or financial condition, and all of its goods related to such
information).

                  "Borrower" has the meaning set forth in the preamble to this
Agreement.

                  "Borrowing" means a borrowing hereunder consisting of Advances
made on the same day by the Lenders (or Agent on behalf thereof), or by Swing
Lender in the case of a Swing Loan, or by Agent in the case of an Agent Advance.

                  "Borrowing Base" means, as of any date of determination, the
result of:

                                    (a)      85% of Eligible Accounts, plus

                                    (b)      the lesser of

                                                     (i)  70% of Eligible
                                            Inventory, and

                                                     (ii) (A) during the period
                                            from February 1st through December
                                            15th, 85% times the then extant Net
                                            Liquidation Percentage times
                                            Eligible Inventory and (B) during
                                            the period from December 16th
                                            through January 31st, 88% times the
                                            then extant Net Liquidation
                                            Percentage times Eligible Inventory,
                                            minus

                                    (c)      the aggregate amount of Reserves,
                                    if any, established by Agent.

                   "Borrowing Base Certificate" has the meaning set forth in
Schedule 6.2.

                  "Borrowing Base Triggering Period" means a period (a)
commencing on the earlier to occur of either (i) the occurrence and continuation
of an Event of Default, or (ii) the first date on which Availability is less
than $50,000,000, and (b) continuing until such time as, for a period of sixty
(60) consecutive days, both (x) Availability is equal to or greater than
$50,000,000 and (y) there shall not have occurred and be continuing any Event of
Default.

                  "Business Day" means any day that is not a Saturday, Sunday,
or other day on which banks are authorized or required to close in the states of
California, Kansas, Massachusetts or New York, except that, if a determination
of a Business Day shall relate to a LIBOR Rate Loan, the term "Business Day"
also shall exclude any day on which banks are closed for dealings in Dollar
deposits in the London interbank market.

                                      -5-

<PAGE>

                  "Capital Lease" means a lease that is required to be
capitalized for financial reporting purposes in accordance with GAAP.

                  "Capitalized Lease Obligation" means that portion of the
obligations under a Capital Lease that is required to be capitalized in
accordance with GAAP.

                  "Cash Equivalents" means, as of any date of determination, (i)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States Government or (b) issued by any
agency of the United States the obligations of which are backed by the full
faith and credit of the United States, in each case maturing within one year
after such date; (ii) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof, in each case maturing within one year after such
date and having, at the time of the acquisition thereof, a rating of at least
A-1 from Standard &Poor's Rating Group ("S&P") or at least P-1 from Moody's
Investors Service Inc. ("Moody's"); (iii) commercial paper maturing no more than
one year from the date of creation thereof and having, at the time of the
acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from
Moody's; (iv) certificates of deposit or bankers' acceptances maturing within
one year after such date and issued or accepted by any Lender or by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia that (a) is at least "adequately
capitalized" (as defined in the regulations of its primary Federal banking
regulator) and (b) has Tier 1 capital (as defined in such regulations) of not
less than $100,000,000; and (v) shares of any money market mutual fund that (a)
has substantially all of its assets invested continuously in the types of
investments referred to in clauses (i) and (ii) above, (b) has net assets of not
less than $500,000,000 and (c) has the highest rating obtainable from either S&P
or Moody's.

                  "Cash Management Account" has the meaning set forth in Section
2.7(a).

                  "Cash Management Agreements" means those certain cash
management agreements, in form and substance satisfactory to Agent, each of
which is among the applicable Credit Party, Agent, and one of the Cash
Management Banks.

                  "Cash Management Bank" has the meaning set forth in Section
2.7(a).

                  "Change of Control" means that (a) any "person" or "group"
(within the meaning of Sections 13(d) and 14(d) of the Exchange Act) becomes the
beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of the Stock
of Parent having more than 50% of the votes entitled to be cast for the election
of members of the Board of Directors, or (b) a majority of the members of the
Board of Directors do not constitute Continuing Directors, or (c) Parent ceases
to own, directly or indirectly, and control 100% of the outstanding Stock of
Borrower, or (d) Borrower ceases to own, directly or indirectly, and control
100% of the outstanding Stock of each Guarantor other than Parent and other than
with respect to (i) any Guarantor the Stock of which was sold or otherwise
disposed of in an Asset Sale permitted

                                      -6-

<PAGE>

by Section 7.3, or (ii) any Guarantor that is merged or consolidated with any
other Guarantor or (f) a Change of Control has occurred under the Indenture.

                   "Closing Date" means the date of the making of the initial
Advance (or other extension of credit) hereunder or the date on which Agent
sends Borrower a written notice that each of the conditions precedent set forth
in Section 3.1 either have been satisfied or have been waived.

                  "Closing Date Business Plan" means the set of Projections of
Parent and its Subsidiaries for the 1 year period following the Closing Date (on
a quarterly basis), in form and substance (including as to scope and underlying
assumptions) satisfactory to Agent.

                  "Code" means the New York Uniform Commercial Code, as in
effect from time to time.

                  "Collateral Access Agreement" means a landlord waiver, bailee
letter, or acknowledgement agreement of any lessor, warehouseman, processor,
consignee, or other Person in possession of, having a Lien upon, or having
rights or interests in any Credit Party's Inventory or Books relating to the
Credit Party Collateral, in each case, in form and substance satisfactory to
Agent.

                  "Collections" means all cash, checks, notes, instruments, and
other items of payment relating to the Credit Party Collateral.

                  "Commitment" means, with respect to each Lender, its Revolver
Commitment and, with respect to all Lenders, their Revolver Commitments, as such
Dollar amounts are set forth beside such Lender's name under the applicable
heading on Schedule C-1 or in the Assignment and Acceptance pursuant to which
such Lender became a Lender hereunder in accordance with the provisions of
Section 14.1 or pursuant to Section 2.2.

                  "Compliance Certificate" means a certificate substantially in
the form of Exhibit C-1 delivered by the chief financial officer of Borrower to
Agent.

                  "Concentration Accounts" has the meaning set forth in Section
2.7(a).

                  "Consignee/Bailee Location" means real property owned or
leased by a Person constituting a "bailee" or "consignee" for purposes of the
Code with respect to Inventory of the Credit Parties in excess of $2,500,000 in
the aggregate for all such Consignee/Bailee Locations and $1,000,000 in respect
of any particular Person constituting a "bailee" or "consignee"; provided that
no Pool Location shall be considered a Consignee/Bailee Location for purposes of
this Agreement.

                  "Consolidated Net Tangible Assets" means, at any date of
determination, (i) the consolidated net book value of all assets of Parent and
its Subsidiaries, minus (ii) the

                                      -7-

<PAGE>

consolidated total net book value of all assets of Parent and its Subsidiaries
which would be treated as intangibles under GAAP, including goodwill and
trademarks, all as determined on a consolidated basis in accordance with GAAP.

                  "Consolidated Store Deposit Accounts" has the meaning set
forth in Section 2.7(a).

                  "Continuing Director" means (a) any member of the Board of
Directors who was a director (or comparable manager) of Parent on the Closing
Date, and (b) any individual who becomes a member of the Board of Directors
after the Closing Date if such individual was appointed or nominated for
election to the Board of Directors by a majority of the then Continuing
Directors.

                  "Contributing Guarantors" has the meaning set forth in Section
17.2.

                  "Control Exercise Notice" has the meaning set forth in Section
2.7(f).

                  "Credit Card Agreements" means those certain credit card
receipts agreements, each in form and substance reasonably satisfactory to
Agent, and each of which is among Agent, the applicable Credit Party, and one of
such Credit Party's Credit Card Processors, whereby, among other things, such
Credit Card Processor is irrevocably directed and agrees to transfer all
proceeds of credit card charges for sales by such Credit Party received by it
(or other amounts payable by such Credit Card Processor) into a designated
Concentration Account on a daily basis or such other periodic basis as Agent may
otherwise direct.

                  "Credit Card Processor" means any Person (including an issuer
of a credit card) that acts as a credit card clearinghouse or remits payments
due to any Credit Party with respect to credit card charges accepted by such
Credit Party.

                  "Credit Card Receivables" means, on any date of determination
thereof, Accounts consisting of rights of any Credit Party to payment by any
Credit Card Processor in connection with consumer retail sales for which such
Credit Party has accepted payment by means of charges to debit cards or major
credit cards (MasterCard, VISA), American Express, Discover, Japan Credit
Bureau, Ahorro A Toda Hora Banco Popular ("ATH") Card, EBT Cards (so long as
Eligible Accounts relating to EBT Cards do not exceed, in the aggregate,
$250,000) and such other bank or non-bank credit or debit cards as may be
approved by Agent in its Permitted Discretion).

                  "Credit Party" means the Borrower and each Guarantor.

                  "Credit Party Collateral" means all of the now owned or
hereafter acquired right, title, and interest of each Credit Party in and to
each of the following:

                                      -8-

<PAGE>

                           (a)      all of its Accounts,

                           (b)      all of its Inventory,

                           (c)      as related to (a) and (b), all of its Books,

                           (d)      all of its Deposit Accounts at which
proceeds of any Credit Party Collateral is or may be held, and

                           (e)      the proceeds and products, whether tangible
or intangible, of any of the foregoing, including proceeds of insurance covering
any or all of the foregoing and any tangible or intangible property resulting
from the sale, exchange, collection, or other disposition of any of the
foregoing, or any portion thereof or interest therein, and the proceeds thereof.

                  "Customs Broker" means Expeditors International, or such other
Persons as may be selected by Borrower after the date hereof who are reasonably
acceptable to Agent in its Permitted Discretion to perform port of entry
services to accept and process Inventory imported by any Credit Party and who
have executed and delivered a Customs Broker Agreement.

                  "Customs Broker Agreement" means a custom broker agreement in
form and substance satisfactory to Agent in its Permitted Discretion, duly
executed and delivered to Agent by a Customs Broker and the applicable Credit
Party.

                  "Daily Balance" means, as of any date of determination and
with respect to any Obligation, the amount of such Obligation owed at the end of
such day.

                  "Default" means an event, condition, or default that, with the
giving of notice, the passage of time, or both, would be an Event of Default.

                  "Defaulting Lender" means any Lender that fails to make any
Advance (or other extension of credit) that it is required to make hereunder on
the date that it is required to do so hereunder.

                  "Defaulting Lender Rate" means (a) for the first 3 days from
and after the date the relevant payment is due, the Base Rate, and (b)
thereafter, the interest rate then applicable to Advances that are Base Rate
Loans (inclusive of the Applicable Margin applicable thereto).

                  "Deposit Account" means any deposit account (as that term is
defined in the Code).

                  "Designated Account" means the Deposit Account of each Credit
Party identified on Schedule D-1.

                                      -9-

<PAGE>

                  "Designated Account Bank" has the meaning ascribed thereto on
Schedule D-1.

                  "Disbursement Letter" means an instructional letter executed
and delivered by Borrower to Agent regarding the extensions of credit to be made
on the Closing Date, the form and substance of which is satisfactory to Agent.

                  "Dollars" or "$" means United States dollars.

                  "EBT Cards" means those cards subject to an electronic benefit
transfer system that allows the user to authorize the transfer of the user's
government benefits from a Federal account to a retailer account in order to pay
for products received.

                  "Eligible Accounts" means those Accounts consisting of Credit
Card Receivables in each case (for all such Accounts) that are created by any
Credit Party in the ordinary course of its business, that arise out of such
Credit Party's sale of goods or rendition of services, that comply with each of
the representations and warranties respecting Eligible Accounts made in the Loan
Documents, and that are not excluded as ineligible by virtue of one or more of
the excluding criteria set forth below; provided, however, that such criteria
may be revised from time to time by Agent in its Permitted Discretion to address
the results of any audit performed by Agent from time to time after the Closing
Date. In determining the amount to be included, Eligible Accounts shall be
calculated at face value. Eligible Accounts shall not include the following:

                           (a)      Credit Card Receivables that the applicable
Credit Card Processor has failed to pay within 5 Business Days after the
applicable sale date;

                           (b)      Accounts owed by an Account Debtor (or its
Affiliates) where 50% or more of all Accounts owed by that Account Debtor (or
its Affiliates) are deemed ineligible under clause (a) above,

                           (c)      Accounts that are not payable in Dollars,

                           (d)      Accounts with respect to which the Account
Debtor either (i) does not maintain its chief executive office in the United
States, or (ii) is not organized under the laws of the United States, any state
thereof or Puerto Rico, or (iii) is the government of any foreign country or
sovereign state, or of any state, province, municipality, or other political
subdivision thereof, or of any department, agency, public corporation, or other
instrumentality thereof, unless (y) the Account is supported by an irrevocable
letter of credit satisfactory to Agent in its Permitted Discretion (as to form,
substance, and issuer or domestic confirming bank) that has been delivered to
Agent and is directly drawable by Agent, or (z) the Account is covered by credit
insurance in form, substance, and amount, and by an insurer, satisfactory to
Agent in its Permitted Discretion,

                                      -10-

<PAGE>

                           (e)      Accounts with respect to which the Account
Debtor is subject to an Insolvency Proceeding, is not Solvent, or as to which
any Credit Party has received notice of an imminent Insolvency Proceeding or a
material impairment of the financial condition of such Account Debtor,

                           (f)      Accounts, the collection of which, Agent, in
its Permitted Discretion, believes to be doubtful by reason of the Account
Debtor's financial condition, or

                           (g)      Accounts that are not subject to a valid and
perfected first priority Agent's Lien, and, at any time after the 90th day
following the Closing Date are not subject to a Credit Card Agreement.

                  "Eligible In-Transit Inventory" means, as of the date of
determination thereof, without duplication of other Eligible Inventory,
Inventory (a) which has been shipped from a location outside the United States
for receipt by a Credit Party to a location listed on Schedule E-1 within 45
days of the date of determination, but which has not yet been delivered to a
Credit Party, (b) for which payment has been made by a Credit Party and title
has passed to a Credit Party, (c) for which the document of title reflects a
Credit Party as consignee (along with delivery to a Credit Party of the
documents of title with respect thereto), (d) (x) is being transported pursuant
to a nonnegotiable document of title within the meaning of the Code and (y) as
to which, at any time after the 90th day following the Closing Date, Agent has
control over the documents of title which evidence ownership of the subject
Inventory by the delivery of a Customs Broker Agreement, (e) such Inventory is
insured against types of loss, damage, hazards, and risks, and in amounts
satisfactory to Agent in its Permitted Discretion, and (f) which otherwise would
constitute Eligible Landed Inventory.

                  "Eligible Inventory" means Eligible Landed Inventory, Eligible
L/C Inventory, Eligible In-Transit Inventory or Eligible U.S. Territory
Inventory, less any Reserves imposed by the Agent.

                  "Eligible Landed Inventory" means Inventory consisting of
finished goods held for sale in the ordinary course of each Credit Party's
business that complies with each of the representations and warranties
respecting Eligible Inventory made in the Loan Documents, and that is not
excluded as ineligible by virtue of the one or more of the excluding criteria
set forth below; provided, however, that such criteria may be revised from time
to time by Agent in its Permitted Discretion to address the results of any audit
or appraisal performed by Agent from time to time after the Closing Date. In
determining the amount to be so included, Inventory shall be valued at the lower
of cost (determined on a perpetual basis) or market on a basis consistent with
such Credit Party's historical accounting practices, but excluding, for purposes
of any such determination, the value of any capitalized costs unrelated to the
acquisition of Inventory. An item of Inventory shall not be included in Eligible
Landed Inventory if:

                                      -11-

<PAGE>

                           (a)      a Credit Party does not have good, valid,
and marketable title thereto,

                           (b)      it is not located at one of the locations in
the United States set forth on Schedule E-1 or a Pool Location (or in transit
from one such location to another such location) as such locations are updated
by the Borrower from time to time by written notice to Agent,

                           (c)      it is located on real property leased by any
Credit Party or in a contract warehouse, Pool Location, or Consignee/Bailee
Location, unless (i) it is segregated or otherwise separately identifiable from
goods of others, if any, stored on the premises, (ii) with respect to any Credit
Party's chief executive office, Non-Owned Storage Facilities and any
Consignee/Bailee Location, after 90 days from closing, is subject to a
Collateral Access Agreement and (iii), in the case of Inventory held by a bailee
or consignee at a Consignee/Bailee Location, notice of Agent's security interest
in the Credit Party Collateral has been sent to each secured creditor having a
security interest in inventory of such bailee or consignee,

                           (d)      it is not subject to a valid and perfected
first priority Agent's Lien,

                           (e)      it consists of goods returned or rejected by
any Credit Party's customers unless such goods are repackaged and ready for sale
in the ordinary course of such Credit Party's business, or

                           (f)      it consists of goods that are obsolete or
slow moving (i.e. more than three (3) seasons old (it being understood that the
Borrower has only two seasons in each calendar year)), restrictive or custom
items, work-in-process, mismatches, goods on display, return to vendor goods,
raw materials, or goods that constitute spare parts, packaging and shipping
materials, supplies used or consumed in any Credit Party's business, bill and
hold goods, defective goods, "seconds" or Inventory acquired on consignment.

                  "Eligible L/C Inventory" means, as of the date of
determination thereof, without duplication of other Eligible Inventory,
Inventory (a) not yet delivered to a Credit Party, (b) the purchase of which is
supported by a Qualified Import Letter of Credit, (c) for which the document of
title reflects a Credit Party as consignee (along with delivery to a Credit
Party or the Issuing Bank, as applicable, of the documents of title with respect
thereto), (d) with respect to which the Underlying Letter of Credit has been
drawn upon in full and the Underlying Issuer has honored such drawing and Agent
has honored its obligations to the Underlying Issuer under the applicable
Qualified Import Letter of Credit, (e) (x) is being transported pursuant to a
nonnegotiable document of title within the meaning of the Code and (y) as to
which, at any time after the 90th day following the Closing Date, Agent has
control over the documents of title which evidence ownership of the subject
Inventory by the delivery of a Customs Broker Agreement, (f) such Inventory is
insured

                                      -12-

<PAGE>

against types of loss, damage, hazards and risks, and in amounts, satisfactory
to Agent in its Permitted Discretion, and (g) which upon completion of
manufacture otherwise would constitute Eligible Landed Inventory.

                  "Eligible Transferee" means (a) a commercial bank organized
under the laws of the United States, or any state thereof, and having total
assets in excess of $250,000,000, (b) a commercial bank organized under the laws
of any other country which is a member of the Organization for Economic
Cooperation and Development or a political subdivision of any such country and
which has total assets in excess of $250,000,000, provided that such bank is
acting through a branch or agency located in the United States, (c) a finance
company, insurance company, or other financial institution or fund that is
engaged in making, purchasing, or otherwise investing in commercial loans in the
ordinary course of its business and having (together with its Affiliates) total
assets in excess of $250,000,000, (d) any Affiliate (other than individuals) of
a Lender, (e) any other Person approved by Agent and, so long as no Event of
Default has occurred and is continuing, Borrower (which approval of Borrower
shall not be unreasonably withheld, delayed, or conditioned).

                  "Eligible U.S. Territory Inventory" means, as of the date of
determination thereof, without duplication of other Eligible Inventory,
Inventory consisting of finished goods for which a Credit Party or Subsidiary of
a Credit Party has good, valid and marketable title, held for sale in the
ordinary course of a Credit Party's or its Subsidiary's business and that
complies with each of the representations and warranties respecting Eligible
Inventory made in the Loan Documents and that is either (a) shipped from a
location outside of the U.S. Territories for receipt by a Credit Party or
Subsidiary of a Credit Party in a U.S. Territory and for which (i) payment has
been made by a Credit Party or Subsidiary of a Credit Party for such Inventory
and (ii) such Inventory is insured against types of loss, damage, hazards, and
risks, and in amounts satisfactory to Agent in its Permitted Discretion; or (b)
located on real property in a U.S. Territory leased or owned by a Credit Party
or Subsidiary of a Credit Party.

                  "Environmental Actions" means any complaint, summons,
citation, notice, directive, order, claim, litigation, investigation, judicial
or administrative proceeding, judgment, letter, or other communication, each, by
or from any Governmental Authority, or any third party involving (x) violations
of Environmental Laws or (y) releases of Hazardous Materials (a) from any
assets, properties, or businesses of any Credit Party, or any of their
predecessors in interest, (b) from adjoining properties or businesses, or (c)
from or onto any facilities which received Hazardous Materials generated by any
Credit Party, or any of their predecessors in interest.

                  "Environmental Law" means any applicable federal, state,
provincial, foreign or local statute, law, rule, regulation, ordinance, code,
binding and enforceable guideline, binding and enforceable written policy, or
rule of common law now or hereafter in effect and in each case as amended, or
any judicial or administrative interpretation thereof, including

                                      -13-

<PAGE>

any judicial or administrative order, consent decree or judgment, in each case,
to the extent binding on any Credit Party, relating to the environment, employee
health and safety, or Hazardous Materials, including CERCLA; RCRA; the Federal
Water Pollution Control Act, 33 USC Section 1251 et seq; the Toxic Substances
Control Act, 15 USC Section 2601 et seq; the Clean Air Act, 42 USC Section 7401
et seq.; the Safe Drinking Water Act, 42 USC Section 3803 et seq.; the Oil
Pollution Act of 1990, 33 USC Section 2701 et seq.; the Emergency Planning and
the Community Right-to-Know Act of 1986, 42 USC Section 11001 et seq.; the
Hazardous Material Transportation Act, 49 USC Section 1801 et seq.; and the
Occupational Safety and Health Act, 29 USC Section 651 et seq. (to the extent it
regulates occupational exposure to Hazardous Materials); any state and local or
foreign counterparts or equivalents, in each case as amended from time to time.

                  "Environmental Liabilities and Costs" means all liabilities,
monetary obligations, Remedial Actions, losses, damages, punitive damages,
consequential damages, treble damages, costs and expenses (including all
reasonable fees, disbursements and expenses of counsel, experts, or consultants,
and costs of investigation and feasibility studies), fines, penalties,
sanctions, and interest incurred as a result of any claim or demand by any
Governmental Authority or any third party, and which relate to any Environmental
Action.

                  "Environmental Lien" means any Lien in favor of any
Governmental Authority for Environmental Liabilities and Costs.

                  "Equipment" means equipment (as that term is defined in the
Code) and includes machinery, machine tools, motors, furniture, furnishings,
fixtures, vehicles (including motor vehicles), computer hardware, tools, parts,
and goods (other than consumer goods, farm products, or Inventory), wherever
located, including all attachments, accessories, accessions, replacements,
substitutions, additions, and improvements to any of the foregoing.

                  "ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute thereto.

                  "ERISA Affiliate" means (a) any Person subject to ERISA whose
employees are treated as employed by the same employer as the employees of any
Credit Party under IRC Section 414(b), (b) any trade or business subject to
ERISA whose employees are treated as employed by the same employer as the
employees of any Credit Party under IRC Section 414(c), (c) solely for purposes
of Section 302 of ERISA and Section 412 of the IRC, any organization subject to
ERISA that is a member of an affiliated service group of which any Credit Party
is a member under IRC Section 414(m), or (d) solely for purposes of Section 302
of ERISA and Section 412 of the IRC, any Person subject to ERISA that is a party
to an arrangement with any Credit Party and whose employees are aggregated with
the employees of any Credit Party under IRC Section 414(o).

                  "Event of Default" has the meaning set forth in Section 8.

                                      -14-

<PAGE>

                  "Excess Availability" means, as of any date of determination,
the amount equal to Availability minus the aggregate amount, if any, of all
trade payables of the Credit Parties aged in excess of historical levels with
respect thereto and all book overdrafts of the Credit Parties in excess of
historical practices with respect thereto, in each case as determined by Agent
in its Permitted Discretion.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
in effect from time to time.

                  "Excluded Subsidiary" means any Subsidiary that is organized
under the laws of a jurisdiction other than the United States of America or any
state thereof, the District of Columbia or Puerto Rico.

                  "Existing Agent" means Bank One, N.A.

                  "Fair Share" has the meaning set forth in Section 17.2.

                  "Fair Share Contribution Amount" has the meaning set forth in
Section 17.2.

                  "Fair Share Shortfall" has the meaning set forth in Section
17.2.

                  "Fee Letter" means that certain fee letter, dated as of even
date herewith, between Borrower and Agent, in form and substance satisfactory to
Agent.

                  "FEIN" means Federal Employer Identification Number.

                  "Funding Date" means the date on which a Borrowing occurs.

                  "Funding Guarantor" has the meaning set forth in Section 17.2.

                  "Funding Losses" has the meaning set forth in Section
2.13(b)(ii).

                  "GAAP" means generally accepted accounting principles as in
effect from time to time in the United States, consistently applied.

                  "General Intangibles" means the following general intangibles
of any Credit Party: payment intangibles, contract rights, rights to payment,
rights arising under common law, statutes, or regulations, choses or things in
action, goodwill, patents, trade names, trade secrets, trademarks, servicemarks,
copyrights, blueprints, drawings, purchase orders, customer lists, route lists,
computer programs, information contained on computer disks or tapes, software,
literature, reports and catalogs, and any and all supporting obligations of any
Credit Party in respect thereof.

                  "Governing Documents" means, with respect to any Person, the
certificate or articles of incorporation, by-laws, or other organizational
documents of such Person.

                                      -15-

<PAGE>

                  "Governmental Authority" means any federal, state, local, or
other governmental or administrative body, instrumentality, department, or
agency or any court, tribunal, administrative hearing body, arbitration panel,
commission, or other similar dispute-resolving panel or body.

                  "Gross Collateral Availability" means, as of any date of
determination, the Borrowing Base, less the Letter of Credit Usage, less the
then extant amount of outstanding Advances.

                  "Guaranteed Obligations" has the meaning set forth in Section
17.1.

                  "Guarantor" means Parent and any Subsidiary of Borrower (other
than any Excluded Subsidiary).

                  "Guaranty" means the guaranty of each Guarantor set forth in
Section 17.

                  "Hazardous Materials" means (a) substances that are defined or
listed in, or otherwise classified pursuant to, any applicable laws or
regulations as "hazardous substances," "hazardous materials," "hazardous
wastes," "toxic substances," or any other formulation intended to define, list,
or classify substances by reason of deleterious properties such as ignitability,
corrosivity, reactivity, carcinogenicity, reproductive toxicity, or "EP
toxicity", (b) oil, petroleum, or petroleum derived substances, natural gas,
natural gas liquids, synthetic gas, drilling fluids, produced waters, and other
wastes associated with the exploration, development, or production of crude oil,
natural gas, or geothermal resources, (c) any flammable substances or explosives
or any radioactive materials, and (d) asbestos in any form or electrical
equipment that contains any oil or dielectric fluid containing levels of
polychlorinated biphenyls in excess of 50 parts per million.

                  "Hedge Agreement" means any and all agreements or documents
now existing or hereafter entered into by any Credit Party that provide for an
interest rate, credit, commodity or equity swap, cap, floor, collar, forward
foreign exchange transaction, currency swap, cross currency rate swap, currency
option, or any combination of, or option with respect to, these or similar
transactions, for the purpose of hedging such Credit Party's exposure to
fluctuations in interest or exchange rates, loan, credit exchange, security, or
currency valuations or commodity prices.

                  "Holdout Lender" has the meaning set forth in Section 15.2(a).

                  "Home Office Account" has the meaning set forth in Section
2.7(a).

                  "Indebtedness" means, without duplication, (a) all obligations
for borrowed money, (b) all obligations evidenced by bonds, debentures, notes,
or other similar instruments and all reimbursement or other obligations in
respect of letters of credit, bankers acceptances, interest rate swaps, or other
financial products, (c) all obligations as a lessee

                                      -16-

<PAGE>

under Capital Leases, (d) all obligations or liabilities of others secured by a
Lien on any asset of a Person or its Subsidiaries, irrespective of whether such
obligation or liability is assumed, (e) all obligations to pay the deferred
purchase price of assets (other than trade payables incurred in the ordinary
course of business), (f) all obligations owing under Hedge Agreements, and (g)
any obligation guaranteeing or intended to guarantee (whether directly or
indirectly guaranteed, endorsed, co-made, discounted, or sold with recourse) any
obligation of any other Person that constitutes Indebtedness under any of
clauses (a) through (f) above.

                  "Indemnified Liabilities" has the meaning set forth in Section
11.3.

                  "Indemnified Person" has the meaning set forth in Section
11.3.

                  "Indenture" means that certain Indenture dated as of July 28,
2003 by and among Borrower, the guarantors named therein and Wells Fargo Bank
Minnesota, National Association, as trustee, as amended, restated, supplemented
or otherwise modified from time to time as permitted hereby.

                  "Individual Store Deposit Accounts" has the meaning set forth
in Section 2.7(a).

                  "Initial Syndication Date" means the date on which the Agent
has notified the Borrower that the syndication of the Revolver Commitments has
been completed and the Agent has reached its "hold level" as contemplated by the
Fee Letter.

                  "Insolvency Proceeding" means any proceeding commenced by or
against any Person under any provision of the Bankruptcy Code or under any other
state or federal bankruptcy or insolvency law, assignments for the benefit of
creditors, formal or informal moratoria, compositions, extensions generally with
creditors, or proceedings seeking reorganization, arrangement, or other similar
relief.

                  "Intangible Assets" means, with respect to any Person, that
portion of the book value of all of such Person's assets that would be treated
as intangibles under GAAP.

                  "Interest Period" means, with respect to each LIBOR Rate Loan,
a period commencing on the date of the making of such LIBOR Rate Loan (or the
continuation of a LIBOR Rate Loan or the conversion of a Base Rate Loan to a
LIBOR Rate Loan) and ending 1, 2, 3, or 6 months thereafter, as elected by the
Borrower pursuant to Section 2.13 and subject to Section 2.13(d)(ii)(y);
provided, however, that (a) if any Interest Period would end on a day that is
not a Business Day, such Interest Period shall be extended (subject to clauses
(c)-(e) below) to the next succeeding Business Day, (b) interest shall accrue at
the applicable rate based upon the LIBOR Rate from and including the first day
of each Interest Period to, but excluding, the day on which any Interest Period
expires, (c) any Interest Period that would end on a day that is not a Business
Day shall be extended to the next succeeding

                                      -17-

<PAGE>

Business Day unless such Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Business Day, (d) with
respect to an Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period), the Interest Period shall
end on the last Business Day of the calendar month that is 1, 2, 3, or 6 months
after the date on which the Interest Period began, as applicable, and (e)
Borrower may not elect an Interest Period which will end after the Maturity
Date.

                  "Inventory" means inventory (as that term is defined in the
Code).

                  "Investment" means, with respect to any Person, any investment
by such Person in any other Person (including Affiliates) in the form of loans,
guarantees, advances, or capital contributions (excluding (a) commission,
travel, and similar advances to officers and employees of such Person made in
the ordinary course of business, and (b) bona fide Accounts arising in the
ordinary course of business consistent with past practice), purchases or other
acquisitions of Indebtedness, Stock, or all or substantially all of the assets
of such other Person (or of any division or business line of such other Person),
and any other items that are or would be classified as investments on a balance
sheet prepared in accordance with GAAP.

                  "Investment Property" means investment property (as that term
is defined in the Code), and any and all supporting obligations in respect
thereof.

                  "IRB" means an industrial revenue bond issued by the city of
Topeka, Kansas to a Credit Party pursuant to the City of Topeka resolution No.
7102 adopted and approved on November 14, 2000 or any similar resolution
authorizing an industrial revenue bond.

                  "IRC" means the Internal Revenue Code of 1986, as in effect
from time to time.

                  "Issuing Lender" means WFRF or any Affiliate thereof or any
other Lender that, at the request of Borrower and with the consent of Agent,
agrees, in such Lender's sole discretion, to become an Issuing Lender for the
purpose of issuing L/Cs or L/C Undertakings pursuant to Section 2.12.

                  "L/C" has the meaning set forth in Section 2.12(a).

                  "L/C Disbursement" means a payment made by the Issuing Lender
pursuant to a Letter of Credit.

                  "L/C Undertaking" has the meaning set forth in Section
2.12(a).

                  "Leased Store Location" means any store for which any Credit
Party has a leasehold interest.

                                      -18-

<PAGE>

                  "Lender" and "Lenders" have the respective meanings set forth
in the preamble to this Agreement, and shall include any other Person made a
party to this Agreement in accordance with the provisions of Section 14.1.

                  "Lender Group" means, individually and collectively, each of
the Lenders (including the Issuing Lender) and Agent.

                  "Lender Group Expenses" means all (a) costs or expenses
(including taxes, and insurance premiums) required to be paid by any Credit
Party under any of the Loan Documents that are paid, advanced, or incurred by
the Lender Group, (b) reasonable fees or charges paid or incurred by Agent in
connection with the Lender Group's transactions with any Credit Party,
including, fees or charges for photocopying, notarization, couriers and
messengers, telecommunication, public record searches (including tax lien,
litigation, and UCC searches), filing, recording, publication, appraisal
(including periodic collateral appraisals or business valuations to the extent
of the fees and charges (and up to the amount of any limitation) set forth in
the Loan Documents), (c) reasonable costs and expenses incurred by Agent in the
disbursement of funds to any Credit Party or other members of the Lender Group
(by wire transfer or otherwise), (d) reasonable charges paid or incurred by
Agent resulting from the dishonor of checks, (e) reasonable costs and expenses
paid or incurred by the Lender Group to correct any default or enforce any
provision of the Loan Documents, or in gaining possession of, maintaining,
handling, preserving, storing, shipping, selling, preparing for sale, or
advertising to sell the Credit Party Collateral, or any portion thereof,
irrespective of whether a sale is consummated, (f) audit fees and expenses of
Agent related to audit examinations of the Books to the extent of the fees and
charges (and up to the amount of any limitation) set forth in the Loan
Documents, (g) reasonable costs and expenses of third party claims or any other
suit paid or incurred by the Lender Group in enforcing or defending the Loan
Documents or in connection with the transactions contemplated by the Loan
Documents or the Lender Group's relationship with any Credit Party, (h) Agent's
reasonable costs and expenses (including attorneys fees) incurred in advising,
structuring, drafting, reviewing, administering, syndicating, or amending the
Loan Documents, and (i) Agent's and each Lender's reasonable costs and expenses
(including attorneys, accountants, consultants, and other advisors fees and
expenses) incurred in terminating, enforcing (including attorneys, accountants,
consultants, and other advisors fees and expenses incurred in connection with a
"workout," a "restructuring," or an Insolvency Proceeding concerning any Credit
Party or in exercising rights or remedies under the Loan Documents), or
defending the Loan Documents, irrespective of whether suit is brought, or in
taking any Remedial Action concerning the Credit Party Collateral.

                  "Lender-Related Person" means, with respect to any Lender,
such Lender, together with such Lender's Affiliates, officers, directors,
employees, attorneys, and agents.

                  "Letter of Credit" means an L/C or an L/C Undertaking, as the
context requires.

                                      -19-

<PAGE>

                  "Letter of Credit Usage" means, as of any date of
determination, the aggregate undrawn amount of all outstanding Letters of
Credit.

                  "LIBOR Deadline" has the meaning set forth in Section
2.13(b)(i).

                  "LIBOR Notice" means a written notice in the form of Exhibit
L-1.

                  "LIBOR Rate" means, for each Interest Period for each LIBOR
Rate Loan, the rate per annum determined by Agent (rounded upwards, if
necessary, to the next 1/100%) by dividing (a) the Base LIBOR Rate for such
Interest Period, by (b) 100% minus the Reserve Percentage. The LIBOR Rate shall
be adjusted on and as of the effective day of any change in the Reserve
Percentage.

                  "LIBOR Rate Loan" means each portion of an Advance that bears
interest at a rate determined by reference to the LIBOR Rate.

                  "Lien" means any interest in an asset securing an obligation
owed to, or a claim by, any Person other than the owner of the asset,
irrespective of whether (a) such interest is based on the common law, statute,
or contract, (b) such interest is recorded or perfected, and (c) such interest
is contingent upon the occurrence of some future event or events or the
existence of some future circumstance or circumstances. Without limiting the
generality of the foregoing, the term "Lien" includes the lien or security
interest arising from a mortgage, deed of trust, encumbrance, pledge,
hypothecation, assignment, deposit arrangement, security agreement, conditional
sale or trust receipt, or from a lease, consignment, or bailment for security
purposes and also includes reservations, exceptions, encroachments, easements,
rights-of-way, covenants, conditions, restrictions, leases, and other title
exceptions and encumbrances affecting Real Property.

                  "Loan Account" has the meaning set forth in Section 2.10.

                  "Loan Documents" means this Agreement, the Cash Management
Agreements, the Credit Card Agreements, the Customs Broker Agreements, the
Disbursement Letter, the Fee Letter, the Letters of Credit, any note or notes
executed by Borrower in connection with this Agreement and payable to a member
of the Lender Group, and any other agreement entered into, now or in the future,
by any Credit Party and the Lender Group in connection with this Agreement or
otherwise relating to the Obligations.

                  "Material Adverse Change" means (a) a material adverse change
in the business, operations, results of operations, assets, liabilities or
condition (financial or otherwise) of the Credit Parties, taken as a whole, (b)
a material impairment of the Credit Parties' ability to perform their
obligations under the Loan Documents to which they are parties or of the Lender
Group's ability to enforce the Obligations or realize upon the Credit Party
Collateral, or (c) a material impairment of the enforceability or priority of
the Agent's

                                      -20-
<PAGE>

Liens with respect to the Credit Party Collateral as a result of an action or
failure to act on the part of any Credit Party.

                  "Material Credit Party" means each of Borrower, Parent,
Payless Missouri and any other Credit Party which (i) owns or has any rights in
any Credit Party Collateral having a book value in excess of $500,000; provided
that the immaterial Credit Parties, collectively, do not own Credit Party
Collateral in excess of $2,000,000; or (ii) which in Agent's Permitted
Discretion is integrally related to the operation of the business of the Credit
Parties or is otherwise necessary to the preservation or realization of the
Credit Party Collateral by the Agent and Lenders.

                  "Maturity Date" has the meaning set forth in Section 3.4.

                  "Maximum Revolver Amount" means $200,000,000 plus the amount,
if any, of any increase permitted by Section 2.2 (after which increase, the
Maximum Revolver Amount shall not exceed $250,000,000).

                   "Net Liquidation Percentage" means the percentage of the
perpetual value of each Credit Party's Eligible Inventory that is estimated to
be recoverable in an orderly liquidation of such Inventory, such percentage to
be calculated as an average of the then current month's average Net Liquidation
Percentage and the average Net Liquidation Percentage for the preceding month as
determined from time to time by a qualified appraisal company selected by Agent
with Borrower's consent, which consent shall not be unreasonably withheld.

                  "Non-Owned Storage Facility" means any distribution center or
warehouse facility leased by any Credit Party, together with any other location
where Inventory of any Credit Party is stored or held pursuant to a lease,
bailment, warehousing or similar arrangement, which location (a) is not owned by
a Credit Party, and (b) is not a Leased Store Location or a Pool Location.

                  "Obligations" means all loans, Advances, debts, principal,
interest (including any interest that, but for the commencement of an Insolvency
Proceeding, would have accrued), contingent reimbursement obligations with
respect to outstanding Letters of Credit, premiums, liabilities (including all
amounts charged to Borrower's Loan Account pursuant hereto), obligations
(including indemnification obligations), fees (including the fees provided for
in the Fee Letter), charges, costs, Lender Group Expenses (including any fees or
expenses that, but for the commencement of an Insolvency Proceeding, would have
accrued), lease payments, guaranties, covenants, and duties of any kind and
description owing by any Credit Party to the Lender Group pursuant to or
evidenced by the Loan Documents and irrespective of whether for the payment of
money, whether direct or indirect, absolute or contingent, due or to become due,
now existing or hereafter arising, and including all interest not paid when due
and all Lender Group Expenses that the Credit Parties are required to pay or
reimburse by the Loan Documents, by law, or otherwise. Any reference in this
Agreement or in the

                                      -21-

<PAGE>

Loan Documents to the Obligations shall include all extensions, modifications,
renewals, or alterations thereof, both prior and subsequent to any Insolvency
Proceeding.

                  "Obligee Guarantor" has the meaning set forth in Section 17.7.

                  "Originating Lender" has the meaning set forth in Section
14.1(e).

                  "Overadvance" has the meaning set forth in Section 2.5.

                  "Parent" means Payless ShoeSource, Inc., a Delaware
corporation.

                  "Participant" has the meaning set forth in Section 14.1(e).

                  "Payless Missouri" means Payless ShoeSource, Inc., a Missouri
corporation.

                  "Pay-Off Letter" means a letter, in form and substance
satisfactory to Agent, from Existing Lender to Agent respecting the amount
necessary to repay in full all of the obligations of each Credit Party owing to
Existing Lender and obtain a release of all of the Liens existing in favor of
Existing Lender in and to the assets of any Credit Party.

                  "Permitted Discretion" means a determination made in the
exercise of reasonable (from the perspective of a secured asset-based lender)
business judgment.

                  "Permitted Dispositions" means (a) sales or other dispositions
of Equipment that is substantially worn, damaged, or obsolete in the ordinary
course of business, (b) sales of Inventory to buyers in the ordinary course of
business, (c) the use or transfer of money or Cash Equivalents in a manner that
is not prohibited by the terms of this Agreement or the other Loan Documents,
(d) the licensing, on a non-exclusive basis (or exclusive in the case of
licenses granted to Persons outside the United States, Puerto Rico or any U.S.
Territory for use solely outside of the United States, Puerto Rico or any U.S.
Territory), of patents, trademarks, copyrights, and other intellectual property
rights in the ordinary course of business and (e) Store Closings in any fiscal
year of the Borrower not in excess of the Store Closing Basket.

                  "Permitted Investments" means (a) Investments in cash and Cash
Equivalents, (b) Investments in negotiable instruments for collection, (c)
advances made in connection with purchases of goods or services in the ordinary
course of business, (d) Investments made by one Credit Party in another Credit
Party, (e) Investments received in settlement of amounts due to any Credit Party
effected in the ordinary course of business or owing to any Credit Party as a
result of Insolvency Proceedings involving an Account Debtor or upon the
foreclosure or enforcement of any Lien in favor of such Credit Party, (f)
Subordinated Indebtedness or guaranties of Subsidiaries, in each case to the
extent permitted by Section 7.1, and (g) Investments in bonds issued by a
Governmental Authority in connection with the lease of property or equipment by
any Credit Party from such Governmental Authority,

                                      -22-

<PAGE>

provided that such bonds are secured by the lease payments required to be made
by such Credit Party with respect to such leased property and are issued in
transactions which are in form and substance substantially similar to those in
which the Investments described on Schedule 7.10 were made.

                  "Permitted Liens" means (a) Liens held by Agent, (b) Liens for
unpaid taxes that either (i) are not yet delinquent, or (ii) do not constitute
an Event of Default hereunder and are the subject of Permitted Protests, (c)
Liens set forth on Schedule P-1, (d) the interests of lessors under operating
leases, (e) purchase money Liens or the interests of lessors under Capital
Leases to the extent that such Liens or interests secure Permitted Purchase
Money Indebtedness and so long as such Lien attaches only to the asset purchased
or acquired and the proceeds thereof, (f) Liens arising by operation of law in
favor of warehousemen, landlords, carriers, mechanics, materialmen, laborers, or
suppliers, incurred in the ordinary course of business and not in connection
with the borrowing of money, and which Liens either (i) are for sums not yet
delinquent, or (ii) are the subject of Permitted Protests, (g) Liens arising
from deposits made in connection with obtaining worker's compensation or other
unemployment insurance, (h) Liens or deposits to secure performance of bids,
tenders, or leases incurred in the ordinary course of business and not in
connection with the borrowing of money, (i) Liens granted as security for surety
or appeal bonds in connection with obtaining such bonds in the ordinary course
of business, (j) Liens resulting from any judgment or award that is not an Event
of Default hereunder, (k) with respect to any Real Property, easements, rights
of way, and zoning restrictions that do not materially interfere with or impair
the use or operation thereof, (l) Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of customs duties in
connection with the importation of goods, (m) Liens resulting from the filing of
precautionary UCC financing statements relating to operating leases of any
Credit Party which are entered into in the ordinary course of business and which
are limited solely to the assets subject thereto, (n) Liens incurred in
connection with the licensing of patents, trademarks, copyrights, and other
intellectual property rights of the Credit Parties and their Subsidiaries in the
ordinary course of business to Persons outside the United States, Puerto Rico or
any U.S. Territory for use solely outside of the United States, Puerto Rico or
any U.S. Territory and (o) Liens on assets not consisting of the Credit Party
Collateral that secure Indebtedness under any IRB to which any Credit Party and
any Governmental Authority is party.

                  "Permitted Protest" means the right of any Credit Party to
protest any Lien (other than any Lien that secures the Obligations), taxes
(other than payroll taxes or taxes that are the subject of a United States
federal tax lien), or rental payment, provided that (a) a reserve with respect
to such obligation is established on the Books in such amount as is required
under GAAP, (b) any such protest is instituted promptly and prosecuted
diligently by such Credit Party, as applicable, in good faith, and (c) Agent is
satisfied that, while any such protest is pending, there will be no impairment
of the enforceability, validity, or priority of any of the Agent's Liens.

                                      -23-

<PAGE>

                  "Permitted Purchase Money Indebtedness" means, as of any date
of determination, Purchase Money Indebtedness incurred after the Closing Date in
an aggregate principal amount outstanding at any one time not in excess of
$20,000,000.

                  "Permitted Sale-Leasebacks" has the meaning assigned to that
term in Section 7.15.

                  "Person" means natural persons, corporations, limited
liability companies, limited partnerships, general partnerships, limited
liability partnerships, joint ventures, trusts, land trusts, business trusts, or
other organizations, irrespective of whether they are legal entities, and
governments and agencies and political subdivisions thereof.

                  "Pool Location" means any of the locations in the United
States listed on Schedule E-2, as such schedule is updated pursuant to Section
6.13.

                  "Post-Closing Agreement" means that certain post-closing
agreement, dated as of even date herewith, between Borrower and Agent.

                  "Projections" means Parent's and its Subsidiaries' forecasted
(a) balance sheets, (b) profit and loss statements, and (c) cash flow
statements, all prepared on a basis consistent with Parent's historical
financial statements, together with appropriate supporting details and a
statement of underlying assumptions.

                  "Pro Rata Share" means, as of any date of determination: (i)
prior to the Revolver Commitments being terminated or reduced to zero, the
percentage obtained by dividing (y) such Lender's Revolver Commitment, by (z)
the aggregate Revolver Commitments of all Lenders, and (ii) from and after the
time that the Revolver Commitments have been terminated or reduced to zero, the
percentage obtained by dividing (y) the aggregate outstanding principal amount
of such Lender's Advances plus such Lender's ratable portion of the Risk
Participation Liability with respect to outstanding Letters of Credit by (z) the
aggregate outstanding principal amount of all Advances plus the aggregate amount
of the Risk Participation Liability with respect to outstanding Letters of
Credit.

                  "Purchase Money Indebtedness" means Indebtedness (other than
the Obligations, but including Capitalized Lease Obligations), incurred at the
time of, or within 20 days after, the acquisition of any fixed assets for the
purpose of financing all or any part of the acquisition cost thereof, together
with any refinancings under Section 7.1(d).

                  "Qualified Import Letter of Credit" means a Letter of Credit
that (a) is issued to facilitate the purchase by any Credit Party of Eligible
Inventory, (b) has an expiry date of less than 90 days and is otherwise in form
and substance acceptable to Agent, and (c) is issued to support an Underlying
Letter of Credit that only is drawable by the beneficiary thereof by the
presentation of, among other documents, such applicable documents satisfactory
to Agent as evidencing such Credit Party's title to the subject Inventory.

                                      -24-

<PAGE>

                  "Real Property" means any estates or interests in real
property now owned or hereafter acquired by any Credit Party and the
improvements thereto.

                  "Record" means information that is inscribed on a tangible
medium or which is stored in an electronic or other medium and is retrievable in
perceivable form.

                  "Remedial Action" means all actions taken to (a) clean up,
remove, remediate, contain, treat, monitor, assess, evaluate, or in any way
address Hazardous Materials in the indoor or outdoor environment, (b) prevent or
minimize a release or threatened release of Hazardous Materials so they do not
migrate or endanger or threaten to endanger public health or welfare or the
indoor or outdoor environment, (c) perform any pre-remedial studies,
investigations, or post-remedial operation and maintenance activities, or (d)
conduct any other actions authorized by 42 USC Section 9601.

                  "Replacement Lender" has the meaning set forth in Section
15.2(a).

                  "Report" has the meaning set forth in Section 16.17.

                  "Required Closing Availability" means that Excess Availability
is equal to or exceeds $100,000,000.

                  "Required Lenders" means, at any time, Lenders whose aggregate
Pro Rata Shares equal or exceed 50.1%.

                  "Reserve Percentage" means, on any day, for any Lender, the
maximum percentage prescribed by the Board of Governors of the Federal Reserve
System (or any successor Governmental Authority) for determining the reserve
requirements (including any basic, supplemental, marginal, or emergency
reserves) that are in effect on such date with respect to eurocurrency funding
(currently referred to as "eurocurrency liabilities") of that Lender, but so
long as such Lender is not required or directed under applicable regulations to
maintain such reserves, the Reserve Percentage shall be zero.

                  "Reserves" has the meaning set forth in Section 2.1(b).

                  "Restricted Payment" means (a) any dividend or other
distribution, direct or indirect, on account of any shares of any Stock of any
Credit Party now or hereafter outstanding, except a dividend payable solely in
shares of that class of Stock to the holders of that class; (b) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of Stock of a Credit Party
now or hereafter outstanding; (c) any payment made to retire, or to obtain the
surrender of, any outstanding warrants, options or other rights to acquire any
Stock of any Credit Party now or hereafter outstanding; and (d) any payment or
prepayment of principal of, premium, if any, or redemption, purchase,
retirement, defeasance (including in-substance or legal defeasance), sinking
fund or similar payment with respect to, any Subordinated Indebtedness.

                                      -25-

<PAGE>

                  "Revolver Commitment" means, with respect to each Lender, its
Revolver Commitment, and, with respect to all Lenders, their Revolver
Commitments, in each case as such Dollar amounts are set forth beside such
Lender's name under the applicable heading on Schedule C-1 or in the Assignment
and Acceptance pursuant to which such Lender became a Lender hereunder in
accordance with the provisions of Section 14.1 and as such amounts may be
increased pursuant to Section 2.2.

                  "Revolver Increase Notice" has the meaning set forth in
Section 2.2.

                  "Revolver Usage" means, as of any date of determination, the
sum of (a) the then extant amount of outstanding Advances, plus (b) the then
extant amount of the Letter of Credit Usage.

                  "Risk Participation Liability" means, as to each Letter of
Credit, all reimbursement obligations of Borrower to the Issuing Lender with
respect to an L/C Undertaking, consisting of (a) the amount available to be
drawn or which may become available to be drawn, (b) all amounts that have been
paid by the Issuing Lender to the Underlying Issuer to the extent not reimbursed
by Borrower, whether by the making of an Advance or otherwise, and (c) all
accrued and unpaid interest, fees, and expenses payable with respect thereto.

                  "Sale-Leasebacks" has the meaning assigned to that term in
Section 7.15.

                  "SEC" means the United States Securities and Exchange
Commission and any successor thereto.

                  "Senior Subordinated Notes" means (i) those certain 8.25%
Series A Senior Subordinated Notes due 2013 and (ii) those certain 8.25% Series
B Senior Subordinated Notes due 2013, each issued by Borrower pursuant to the
Indenture, in each case as amended, restated, supplemented or otherwise modified
from time to time as permitted hereby.

                  "Settlement" has the meaning set forth in Section 2.3(f)(i).

                  "Settlement Date" has the meaning set forth in Section
2.3(f)(i).

                  "Solvent" means, with respect to any Person on a particular
date, that, at fair valuations, the sum of such Person's assets is greater than
all of such Person's debts.

                  "Stock" means all shares, options, warrants, interests,
participations, or other equivalents (regardless of how designated) of or in a
Person, whether voting or nonvoting, including common stock, preferred stock, or
any other "equity security" (as such term is defined in Rule 3a11-1 of the
General Rules and Regulations promulgated by the SEC under the Exchange Act).

                                      -26-

<PAGE>

                  "Store Closing Basket" means, with respect to any fiscal year
of the Borrower, Store Closings in an amount up to 250 stores for such fiscal
year as previously disclosed by Borrower to Lenders in its business plan for
such year plus an additional 450 Store Closings in such fiscal year, provided
that in the event that the Borrower is closing more than 100 stores at any one
time, Borrower shall, at Agent's request, hire a qualified inventory liquidation
company reasonably satisfactory to the Agent to conduct such Store Closings on
terms satisfactory to Agent in its Permitted Discretion.

                  "Store Closings" means, the closing, sale or other disposition
of stores operated by any Credit Party in a manner consistent with the past
business practices of the Credit Parties (involving store closing sales and
liquidations of store inventory on site) provided that closing and relocation of
a store within a radius of five (5) miles shall not be considered a Store
Closing for purposes of this Agreement.

                   "Subordinated Indebtedness" means (a) all Indebtedness under
the Indenture and (b) (i) any other public Indebtedness of the Credit Parties
subordinated in right of payment to the Obligations pursuant to documentation
containing material terms, including subordination provisions substantially
similar to those set forth in the Indenture and (ii) all private Indebtedness of
the Credit Parties subordinated in right of payment to the Obligations pursuant
to documentation containing market terms and conditions consistent with private
subordinated indebtedness of such type, in each case pursuant to this clause
(b), satisfactory to Agent in its Permitted Discretion.

                  "Subsidiary" of a Person means a corporation, partnership,
limited liability company, or other entity in which that Person directly or
indirectly owns or controls the shares of Stock having ordinary voting power to
elect a majority of the board of directors (or appoint other comparable
managers) of such corporation, partnership, limited liability company, or other
entity.

                  "Swing Lender" means WFRF or any other Lender that, at the
request of Borrower and with the consent of Agent agrees, in such Lender's sole
discretion, to become the Swing Lender under Section 2.3(d).

                  "Swing Loan" has the meaning set forth in Section 2.3(d)(i).

                  "Taxes" has the meaning set forth in Section 16.11.

                  "Triggering Period" means a period (a) commencing on the
earliest to occur of (i) the occurrence and continuation of an Event of Default,
or (ii) the date on which Availability shall be less than $50,000,000 for seven
(7) consecutive Business Days, or (iii) the date on which Availability is less
than $50,000,000 for a period of less than seven (7) consecutive Business Days
if Availability had at any other time during the twelve (12) month period
inclusive of and ending on such date of determination, been less than
$50,000,000 for a period of less than seven (7) consecutive Business Days, or
(iv) the date on which

                                      -27-

<PAGE>

Availability shall be less than $40,000,000; and (b) continuing until the
earlier of such time as, (i) for a period of ninety (90) consecutive days, both
(x) Availability shall be equal to or in excess of $50,000,000 and (y) there
shall not have occurred and be continuing any Event of Default; and (ii) for at
least one (1) Business Day, Availability shall be equal to or in excess of
$100,000,000.

                  "UCC Filing Authorization Letter" means a letter duly executed
by each Credit Party authorizing Agent to file appropriate financing statements
on Form UCC-1 without the signature of such Credit Party, in such office or
offices as may be necessary or, in the opinion of Agent, desirable to perfect
the security interests purported to be created by the Loan Documents.

                  "United States" means the United States of America.

                  "Underlying Issuer" means a third Person which is the
beneficiary of an L/C Undertaking or Qualified Import Letter of Credit and which
has issued a letter of credit at the request of the Issuing Lender for the
benefit of any Credit Party.

                  "Underlying Letter of Credit" means a letter of credit that
has been issued by an Underlying Issuer.

                  "U.S. Territory" means each of the U.S. Virgin Islands, Guam
and Saipan.

                  "Voidable Transfer" has the meaning set forth in Section 18.7.

                  "Wells Fargo" means Wells Fargo Bank, National Association, a
national banking association.

                  "WFRF" means Wells Fargo Retail Finance, LLC, a Delaware
limited liability company.

         1.2 ACCOUNTING TERMS. All accounting terms not specifically defined
herein shall be construed in accordance with GAAP. When used herein, the term
"financial statements" shall include the notes and schedules thereto. Whenever
the term "Borrower" is used in respect of a financial covenant or a related
definition, it shall be understood to mean Borrower and its Subsidiaries on a
consolidated basis unless the context clearly requires otherwise.

         1.3 CODE. Any terms used in this Agreement that are defined in the Code
shall be construed and defined as set forth in the Code unless otherwise defined
herein.

         1.4 CONSTRUCTION. Unless the context of this Agreement or any other
Loan Document clearly requires otherwise, references to the plural include the
singular, references to the singular include the plural, the term "including" is
not limiting, and the term "or" has, except where otherwise indicated, the
inclusive meaning represented by the phrase "and/or." The

                                      -28-

<PAGE>

words "hereof," "herein," "hereby," "hereunder," and similar terms in this
Agreement or any other Loan Document refer to this Agreement or such other Loan
Document, as the case may be, as a whole and not to any particular provision of
this Agreement or such other Loan Document, as the case may be. Section,
subsection, clause, schedule, and exhibit references herein are to this
Agreement unless otherwise specified. Any reference in this Agreement or in the
other Loan Documents to any agreement, instrument, or document shall include all
alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, joinders, and supplements, thereto and thereof, as
applicable (subject to any restrictions on such alterations, amendments,
changes, extensions, modifications, renewals, replacements, substitutions,
joinders, and supplements set forth herein). Any reference herein to the
repayment in full or satisfaction in full of the Obligations shall mean the
repayment in full in cash (or cash collateralized in accordance with the terms
hereof) of all Obligations other than contingent indemnification Obligations
that, at such time, are allowed by the applicable member of the Lender Group to
remain outstanding and are not required to be repaid or cash collateralized
pursuant to the provisions of this Agreement. Any reference herein to any Person
shall be construed to include such Person's successors and assigns. Any
requirement of a writing contained herein or in the other Loan Documents shall
be satisfied by the transmission of a Record and any Record transmitted shall
constitute a representation and warranty as to the accuracy and completeness of
the information contained therein.

         1.5 SCHEDULES AND EXHIBITS. All of the schedules and exhibits attached
to this Agreement shall be deemed incorporated herein by reference.

2. LOAN AND TERMS OF PAYMENT.

         2.1 REVOLVER ADVANCES.

                           (a) Subject to the terms and conditions of this
Agreement, and during the term of this Agreement, each Lender agrees (severally,
not jointly or jointly and severally) to make advances ("Advances") to Borrower
in an amount at any one time outstanding not to exceed such Lender's Pro Rata
Share of an amount equal to the lesser of (i) the Maximum Revolver Amount less
the Letter of Credit Usage, or (ii) the Borrowing Base less the Letter of Credit
Usage.

                           (b) Anything to the contrary in this Section 2.1
notwithstanding, Agent shall have the right to establish and modify reserves
against Availability in such amounts, and with respect to such matters, as Agent
in its Permitted Discretion shall deem necessary or appropriate (collectively,
"Reserves"), including with respect to (i) shrinkage (so as to bring perpetual
records in line with historical levels), (ii) potential liabilities to
customers, including without limitation, in connection with merchandise
deposits, returns, merchandise credits, gift certificates, and frequent shopper
programs, (iii) bad debt write-downs, discounts, advertising allowances,
credits, or other dilutive items with respect to Accounts, (iv) unpaid freight
charges, warehousing or storage charges, taxes, duties, and other similar unpaid
costs associated with the acquisition of Inventory, (v) sums that any Credit
Party is

                                      -29-

<PAGE>

required to pay (such as taxes, assessments, insurance premiums, or, in the case
of leased assets, rents or other amounts payable under such leases) and has
failed to pay under any Section of this Agreement or any other Loan Document,
(vi) damaged goods, refurbished goods, goods returned for resale and similar
goods, (vii) Eligible U.S. Territory Inventory, and (viii) amounts owing by any
Credit Party to any Person to the extent secured by a Lien on, or trust over,
any of the Credit Party Collateral (other than any existing Permitted Lien set
forth on Schedule P-1 which is specifically identified thereon as entitled to
have priority over the Agent's Liens), which Lien or trust, in the Permitted
Discretion of Agent likely would have a priority superior to the Agent's Liens
(such as Liens or trusts in favor of landlords, warehousemen, carriers,
mechanics, materialmen, laborers, or suppliers, or Liens or trusts for ad
valorem, excise, sales, or other taxes where given priority under applicable
law) in and to such item of the Credit Party Collateral. In addition to the
foregoing, Agent shall have the right, subject to the any other limitations
contained herein or in the Loan Documents, to have the Credit Party Collateral
reappraised by a qualified company selected by Agent from time to time after the
Closing Date for the purpose of re-determining the value of Eligible Accounts or
Eligible Inventory and modifying Advance Rates and, as a result, re-determining
the Borrowing Base.

                           (c) The Lenders shall have no obligation to make
additional Advances hereunder to the extent such additional Advances would cause
the Revolver Usage to exceed the Maximum Revolver Amount.

                           (d) Amounts borrowed pursuant to this Section 2.1 may
be repaid and, subject to the terms and conditions of this Agreement, reborrowed
at any time during the term of this Agreement.

         2.2 REVOLVER INCREASE. On and after the Initial Syndication Date and
until the second anniversary of the Closing Date, Borrower may, at its option at
any time on a single occasion, seek to increase (the "Revolver Increase") the
Maximum Revolver Amount by up to $50,000,000 (after giving effect to which the
Maximum Revolver Amount shall not exceed $250,000,000 less the aggregate amount
of reductions to the Revolver Commitments effected on or prior to the date of
the Revolver Increase) upon at least 30 days (but not more than 45 days) written
notice ("Revolver Increase Notice") to the Agent (which notice Agent shall
promptly deliver to the Lenders). The Revolver Increase Notice shall (a) specify
the date upon which the Revolver Increase is requested to occur, (b) be
delivered at a time when no Default or Event of Default has occurred and is
continuing (and the effectiveness of the Revolver Increase shall be subject to
no Default or Event of Default existing of the time of the Revolver Increase)
and (c) certify that the Revolver Increase will not violate or conflict with the
terms of any Indebtedness or any other contract, agreement, instrument or
obligation of any Credit Party (and which notice will be accompanied by an
opinion of counsel to Credit Parties on terms satisfactory to Agent in its
Permitted Discretion to the effect that, among other matters, the Revolver
Increase constitutes senior debt under all such Indebtedness and that there is
no conflict with Credit Parties' other Indebtedness or any such

                                      -30-

<PAGE>

contract, agreement, instrument or obligation). Borrower shall, after giving a
Revolver Increase Notice, offer the Revolver Increase (i) first on a pro-rata
basis to the Lenders, which each Lender may in its sole and absolute discretion
accept or decline (it being understood that any Lender not affirmatively
committing in writing to its pro-rata portion shall be deemed to have declined),
(ii) second, if any Lender has declined its pro rata share or any part thereof,
such remaining amounts on a non pro-rata basis to the Lenders accepting their
pro rata share of the Revolver Increase and (iii) third, to other Eligible
Transferees. Agent agrees to use its reasonable efforts to syndicate any
remaining portion of the Revolver Increase to other Eligible Transferees;
provided, however, that the minimum final allocated Revolver Commitment of each
Eligible Transferee that is not a Lender shall be equal to or in excess of
$5,000,000. No increase in the Maximum Revolver Amount shall become effective
until all existing and new Lenders committing to the Revolver Increase have
delivered to the Agent a writing in form reasonably satisfactory to the Agent
pursuant to which such existing Lenders state the amount of their Revolver
Increase and any such new Lenders state the amount of their Revolver Commitment
and agree to assume and accept the obligations and rights of a Lender hereunder
and any such new and increasing Lenders agree to make an Advance such that the
outstandings of such new Lender or increasing Lender constitute a proportional
amount of the aggregate outstanding Advances based on the Revolver Commitment of
such new Lender. Any Advance as a result of an increase to the Revolver
Commitment pursuant to this Section 2.2 shall be subject to the terms and
conditions contained in this Agreement. Upon the increase of the Revolver
Commitment pursuant to this Section 2.2, Schedule C-1 shall be deemed amended
and replaced with a new Schedule C-1 reflecting the new Revolver Commitments
hereunder.

         2.3 BORROWING PROCEDURES AND SETTLEMENTS.

                           (a) PROCEDURE FOR BORROWING. Each Borrowing shall be
made by an irrevocable written request by an Authorized Person delivered to
Agent (which notice must be received by Agent no later than 1:00 p.m. (New York
time) on the Business Day prior to the date that is the requested Funding Date
(subject to Section 2.13(b)(i) in the case of any LIBOR Rate Loan) specifying
(i) the amount of such Borrowing, and (ii) the requested Funding Date, which
shall be a Business Day; provided, however, that in the case of a request for
Swing Loan in an amount of $25,000,000, or less, such notice will be timely
received if it is received by Agent no later than 1:00 p.m. (New York time) on
the Business Day that is the requested Funding Date) specifying (i) the amount
of such Borrowing, and (ii) the requested Funding Date, which shall be a
Business Day. At Agent's election, in lieu of delivering the above-described
written request, any Authorized Person may give Agent electronic notice of such
request by the required time. In such circumstances, Borrower agrees that any
such electronic notice will be confirmed in writing within 24 hours of the
giving of such notice and the failure to provide such written confirmation shall
not affect the validity of the request.

                                      -31-

<PAGE>

                           (b) AGENT'S ELECTION. Promptly after receipt of a
request for a Borrowing pursuant to Section 2.3(a), Agent shall elect, in its
discretion, (i) to have the terms of Section 2.3(c) apply to such requested
Borrowing, or (ii) if the Borrowing is for an Advance, to request Swing Lender
to make a Swing Loan pursuant to the terms of Section 2.3(d) in the amount of
the requested Borrowing; provided, however, that (i) if Swing Lender declines in
its sole discretion to make a Swing Loan pursuant to Section 2.3(d), Agent shall
elect to have the terms of Section 2.3(c) apply to such requested Borrowing; and
(ii) if a notice requesting a LIBOR Rate Loan has been timely delivered per
Section 2.13(b)(i), Agent shall not have the option to request Swing Line Lender
to make such Borrowing as a Swing Line Loan.

                           (c) MAKING OF LOANS.

                           (i)      In the event that Agent shall elect to have
                  the terms of this Section 2.3(c) apply to a requested
                  Borrowing as described in Section 2.3(b), then promptly after
                  receipt of a request for a Borrowing pursuant to Section
                  2.3(a), Agent shall notify the Lenders, not later than 4:00
                  p.m. (New York time) on the Business Day immediately preceding
                  the Funding Date applicable thereto, by telecopy, telephone,
                  or other similar form of transmission, of the requested
                  Borrowing. Each Lender shall make the amount of such Lender's
                  Pro Rata Share of the requested Borrowing available to Agent
                  in immediately available funds, to Agent's Account, not later
                  than 1:00 p.m. (New York time) on the Funding Date applicable
                  thereto. After Agent's receipt of the proceeds of such
                  Advances, Agent shall make the proceeds thereof available to
                  Borrower on the applicable Funding Date by transferring
                  immediately available funds equal to such proceeds received by
                  Agent to Borrower's Designated Account; provided, however,
                  that, subject to the provisions of Section 2.3(i), Agent shall
                  not request any Lender to make, and no Lender shall have the
                  obligation to make, any Advance if Agent shall have actual
                  knowledge that (1) one or more of the applicable conditions
                  precedent set forth in Section 3 will not be satisfied on the
                  requested Funding Date for the applicable Borrowing unless
                  such condition has been waived, or (2) the requested Borrowing
                  would exceed the Availability on such Funding Date.

                           (ii)     Unless Agent receives notice from a Lender
                  on or prior to the Closing Date or, with respect to any
                  Borrowing after the Closing Date, prior to noon (New York
                  time) on the date of such Borrowing, that such Lender will not
                  make available as and when required hereunder to Agent for the
                  account of Borrower the amount of that Lender's Pro Rata Share
                  of the Borrowing, Agent may assume that each Lender has made
                  or will make such amount available to Agent in immediately
                  available funds on the Funding Date and Agent may (but shall
                  not be so required), in reliance upon such assumption, make
                  available to Borrower on such date a corresponding amount. If
                  and to the

                                      -32-

<PAGE>

                  extent any Lender shall not have made its full amount
                  available to Agent in immediately available funds and Agent in
                  such circumstances has made available to Borrower such amount,
                  that such Lender shall on the Business Day following such
                  Funding Date make such amount available to Agent, together
                  with interest at the Defaulting Lender Rate for each day
                  during such period. A notice submitted by Agent to any Lender
                  with respect to amounts owing under this subsection shall be
                  conclusive, absent manifest error. If such amount is so made
                  available, such payment to Agent shall constitute such
                  Lender's Advance on the date of Borrowing for all purposes of
                  this Agreement. If such amount is not made available to Agent
                  on the Business Day following the Funding Date, Agent will
                  notify Borrower of such failure to fund and, upon demand by
                  Agent, Borrower shall pay such amount to Agent for Agent's
                  account, together with interest thereon for each day elapsed
                  since the date of such Borrowing, at a rate per annum equal to
                  the interest rate applicable at the time to the Advances
                  composing such Borrowing. The failure of any Lender to make
                  any Advance on any Funding Date shall not relieve any other
                  Lender of any obligation hereunder to make an Advance on such
                  Funding Date, but no Lender shall be responsible for the
                  failure of any other Lender to make the Advance to be made by
                  such other Lender on any Funding Date.

                           (iii)    Agent shall not be obligated to transfer to
                  a Defaulting Lender any payments made by any Credit Party to
                  Agent for the Defaulting Lender's benefit, and, in the absence
                  of such transfer to the Defaulting Lender, Agent shall
                  transfer any such payments to each other non-Defaulting Lender
                  member of the Lender Group ratably in accordance with their
                  Commitments (but only to the extent that such Defaulting
                  Lender's Advance was funded by the other members of the Lender
                  Group) or, if so directed by Borrower and if no Default or
                  Event of Default had occurred and is continuing (and to the
                  extent such Defaulting Lender's Advance was not funded by the
                  Lender Group), retain same to be re-advanced to Borrower as if
                  such Defaulting Lender had made Advances to Borrower. Subject
                  to the foregoing, Agent may hold and, in its Permitted
                  Discretion, re-lend to Borrower for the account of such
                  Defaulting Lender the amount of all such payments received and
                  retained by Agent for the account of such Defaulting Lender.
                  Solely for the purposes of voting or consenting to matters
                  with respect to the Loan Documents, such Defaulting Lender
                  shall be deemed not to be a "Lender" and such Lender's
                  Commitment shall be deemed to be zero. This Section shall
                  remain effective with respect to such Lender until (x) the
                  Obligations under this Agreement shall have been declared or
                  shall have become immediately due and payable, (y) the
                  non-Defaulting Lenders, Agent, and the Credit Parties shall
                  have waived such Defaulting Lender's default in writing, or
                  (z) the Defaulting Lender makes its Pro Rata Share of the
                  applicable Advance and pays to Agent all amounts

                                      -33-

<PAGE>

                  owing by Defaulting Lender in respect thereof. The operation
                  of this Section shall not be construed to increase or
                  otherwise affect the Commitment of any Lender, to relieve or
                  excuse the performance by such Defaulting Lender or any other
                  Lender of its duties and obligations hereunder, or to relieve
                  or excuse the performance by any Credit Party of its duties
                  and obligations hereunder to Agent or to the Lenders other
                  than such Defaulting Lender. Any such failure to fund by any
                  Defaulting Lender shall constitute a material breach by such
                  Defaulting Lender of this Agreement and shall entitle Borrower
                  at its option, upon written notice to Agent, to arrange for a
                  substitute Lender to assume the Commitment of such Defaulting
                  Lender, such substitute Lender to be acceptable to Agent. In
                  connection with the arrangement of such a substitute Lender,
                  the Defaulting Lender shall have no right to refuse to be
                  replaced hereunder, and agrees to execute and deliver a
                  completed form of Assignment and Acceptance in favor of the
                  substitute Lender (and agrees that it shall be deemed to have
                  executed and delivered such document if it fails to do so)
                  subject only to being repaid its share of the outstanding
                  Obligations (including an assumption of its Pro Rata Share of
                  the Risk Participation Liability) without any premium or
                  penalty of any kind whatsoever; provided, however, that any
                  such assumption of the Commitment of such Defaulting Lender
                  shall not be deemed to constitute a waiver of any of the
                  Lender Groups' or any Credit Party's rights or remedies
                  against any such Defaulting Lender arising out of or in
                  relation to such failure to fund.

                           (d) MAKING OF SWING LOANS.

                           (i)      In the event Agent shall elect, with the
                  consent of Swing Lender, as a Lender, to have the terms of
                  this Section 2.3(d) apply to a requested Borrowing as
                  described in Section 2.3(b), Swing Lender as a Lender shall
                  make such Advance in the amount of such Borrowing (any such
                  Advance made solely by Swing Lender as a Lender pursuant to
                  this Section 2.3(d) being referred to as a "Swing Loan" and
                  such Advances being referred to collectively as "Swing Loans")
                  available to Borrower on the Funding Date applicable thereto
                  by transferring immediately available funds to Borrower's
                  Designated Account; provided, however, the aggregate amount of
                  the Swing Loans at any one time outstanding shall not exceed
                  $25,000,000. Each Swing Loan shall be deemed to be an Advance
                  hereunder and shall be subject to all the terms and conditions
                  applicable to other Advances, except that no such Swing Loan
                  shall be eligible to be a LIBOR Rate Loan and all payments on
                  any Swing Loan shall be payable to Swing Lender as a Lender
                  solely for its own account (and for the account of the holder
                  of any participation interest with respect to such Swing
                  Loan). Subject to the provisions of Section 2.3(i), Agent
                  shall not request Swing Lender as a Lender to make, and Swing
                  Lender as a Lender shall not make, any Swing Loan if Agent has
                  actual knowledge

                                      -34-

<PAGE>

                  that (i) one or more of the applicable conditions precedent
                  set forth in Section 3 will not be satisfied on the requested
                  Funding Date for the applicable Borrowing unless such
                  condition has been waived, or (ii) the requested Borrowing
                  would exceed the Availability on such Funding Date. Swing
                  Lender as a Lender shall not otherwise be required to
                  determine whether the applicable conditions precedent set
                  forth in Section 3 have been satisfied on the Funding Date
                  applicable thereto prior to making, in its sole discretion,
                  any Swing Loan.

                           (ii)     The Swing Loans shall be secured by the
                  Agent's Liens, constitute Obligations hereunder, and bear
                  interest at the rate applicable from time to time to Advances
                  that are Base Rate Loans.

                           (e) AGENT ADVANCES.

                           (i)      Agent hereby is authorized by Borrower and
                  the Lenders, from time to time in Agent's sole discretion, (1)
                  after the occurrence and during the continuance of a Default
                  or an Event of Default, or (2) at any time that any of the
                  other applicable conditions precedent set forth in Section 3
                  have not been satisfied, to make Advances to Borrower on
                  behalf of the Lenders in an amount not exceeding the lesser of
                  (x) 5% of Gross Collateral Availability and (y) $10,000,000
                  that Agent, in its Permitted Discretion deems necessary or
                  desirable (A) to preserve or protect the Credit Party
                  Collateral, or any portion thereof, (B) to enhance the
                  likelihood of repayment of the Obligations, or (C) to pay any
                  other amount chargeable to any Credit Party pursuant to the
                  terms of this Agreement, including Lender Group Expenses and
                  the costs, fees, and expenses described in Section 10 (any of
                  the Advances described in this Section 2.3(e) shall be
                  referred to as "Agent Advances"); provided, however, that (i)
                  no Agent Advances shall be outstanding for a period exceeding
                  thirty (30) consecutive days and (ii) there shall be no more
                  than two separate Agent Advances during any twelve month
                  period. Each Agent Advance shall be deemed to be an Advance
                  hereunder, except that no such Agent Advance shall be eligible
                  to be a LIBOR Rate Loan and all payments thereon shall be
                  payable to Agent solely for its own account.

                           (ii)     The Agent Advances shall be repayable on
                  demand, secured by the Agent's Liens granted to Agent under
                  the Loan Documents, constitute Obligations hereunder, and bear
                  interest at the rate applicable from time to time to Advances
                  that are Base Rate Loans.

                           (f) SETTLEMENT. It is agreed that each Lender's
funded portion of the Advances is intended by the Lenders to equal, at all
times, such Lender's Pro Rata Share of the outstanding Advances. Such agreement
notwithstanding, Agent, Swing Lender, and the other Lenders agree (which
agreement shall not be for the benefit of or enforceable by

                                      -35-

<PAGE>

Borrower) that in order to facilitate the administration of this Agreement and
the other Loan Documents, settlement among them as to the Advances, the Swing
Loans, and the Agent Advances shall take place on a periodic basis in accordance
with the following provisions:

                           (i)      Agent shall request settlement
                  ("Settlement") with the Lenders on a weekly basis, or on a
                  more frequent basis if so determined by Agent, (1) on behalf
                  of Swing Lender, with respect to each outstanding Swing Loan,
                  (2) for itself, with respect to each Agent Advance, and (3)
                  with respect to any Credit Party's Collections received by
                  Agent, as to each by notifying the Lenders by telecopy,
                  telephone, or other similar form of transmission, of such
                  requested Settlement, no later than 2:00 p.m. (New York time)
                  on the Business Day immediately prior to the date of such
                  requested Settlement (the date of such requested Settlement
                  being the "Settlement Date"). Such notice of a Settlement Date
                  shall include a summary statement of the amount of outstanding
                  Advances, Swing Loans, and Agent Advances for the period since
                  the prior Settlement Date. Subject to the terms and conditions
                  contained herein (including Section 2.3(c)(iii)): (y) if a
                  Lender's balance of the Advances (including Swing Loans and
                  Agent Advances) exceeds such Lender's Pro Rata Share of the
                  Advances (including Swing Loans and Agent Advances) as of a
                  Settlement Date, then Agent shall, by no later than 3:00 p.m.
                  (New York time) on the Settlement Date, transfer in
                  immediately available funds to a Deposit Account of such
                  Lender (as such Lender may designate), an amount such that
                  each such Lender shall, upon receipt of such amount, have as
                  of the Settlement Date, its Pro Rata Share of the Advances
                  (including Swing Loans and Agent Advances), and (z) if a
                  Lender's balance of the Advances (including Swing Loans and
                  Agent Advances) is less than such Lender's Pro Rata Share of
                  the Advances (including Swing Loans and Agent Advances) as of
                  a Settlement Date, such Lender shall no later than 2:00 p.m.
                  (New York time) on the Settlement Date transfer in immediately
                  available funds to the Agent's Account, an amount such that
                  each such Lender shall, upon transfer of such amount, have as
                  of the Settlement Date, its Pro Rata Share of the Advances
                  (including Swing Loans and Agent Advances). Such amounts made
                  available to Agent under clause (z) of the immediately
                  preceding sentence shall be applied against the amounts of the
                  applicable Swing Loans or Agent Advances and, together with
                  the portion of such Swing Loans or Agent Advances representing
                  Swing Lender's Pro Rata Share thereof, shall constitute
                  Advances of such Lenders. If any such amount is not made
                  available to Agent by any Lender on the Settlement Date
                  applicable thereto to the extent required by the terms hereof,
                  Agent shall be entitled to recover for its account such amount
                  on demand from such Lender together with interest thereon at
                  the Defaulting Lender Rate.

                                      -36-

<PAGE>

                           (ii)     In determining whether a Lender's balance of
                  the Advances, Swing Loans, and Agent Advances is less than,
                  equal to, or greater than such Lender's Pro Rata Share of the
                  Advances, Swing Loans, and Agent Advances as of a Settlement
                  Date, Agent shall, as part of the relevant Settlement, apply
                  to such balance the portion of payments actually received in
                  good funds by Agent with respect to principal, interest, fees
                  payable any Credit Party and allocable to the Lenders
                  hereunder, and proceeds of the Credit Party Collateral. To the
                  extent that a net amount is owed to any such Lender after such
                  application, such net amount shall be distributed by Agent to
                  that Lender as part of such next Settlement.

                           (iii)    Between Settlement Dates, Agent, to the
                  extent no Agent Advances or Swing Loans are outstanding, may
                  pay over to Swing Lender any payments received by Agent, that
                  in accordance with the terms of this Agreement would be
                  applied to the reduction of the Advances, for application to
                  Swing Lender's Pro Rata Share of the Advances. If, as of any
                  Settlement Date, Collections of any Credit Party received
                  since the then immediately preceding Settlement Date have been
                  applied to Swing Lender's Pro Rata Share of the Advances other
                  than to Swing Loans, as provided for in the previous sentence,
                  Swing Lender shall pay to Agent for the accounts of the
                  Lenders, and Agent shall pay to the Lenders, to be applied to
                  the outstanding Advances of such Lenders, an amount such that
                  each Lender shall, upon receipt of such amount, have, as of
                  such Settlement Date, its Pro Rata Share of the Advances.
                  During the period between Settlement Dates, Swing Lender with
                  respect to Swing Loans, Agent with respect to Agent Advances,
                  and each Lender (subject to the effect of letter agreements
                  between Agent and individual Lenders) with respect to the
                  Advances other than Swing Loans and Agent Advances, shall be
                  entitled to interest at the applicable rate or rates payable
                  under this Agreement on the daily amount of funds employed by
                  Swing Lender, Agent, or the Lenders, as applicable.

                           (g) NOTATION. Agent shall record on its books the
principal amount of the Advances owing to each Lender, including the Swing Loans
owing to Swing Lender, and Agent Advances owing to Agent, and the interests
therein of each Lender, from time to time and such records shall, absent
manifest error, conclusively be presumed to be correct and accurate. In
addition, each Lender is authorized, at such Lender's option, to note the date
and amount of each payment or prepayment of principal of such Lender's Advances
in its books and records, including computer records.

                           (h) LENDERS' FAILURE TO PERFORM. All Advances (other
than Swing Loans and Agent Advances) shall be made by the Lenders
contemporaneously and in accordance with their Pro Rata Shares. It is understood
that (i) no Lender shall be responsible for any failure by any other Lender to
perform its obligation to make any

                                      -37-
<PAGE>

Advances (other than Swing Loans and Agent Advances) shall be made by the
Lenders contemporaneously and in accordance with their Pro Rata Shares. It is
understood that (i) no Lender shall be responsible for any failure by any other
Lender to perform its obligation to make any Advance (or other extension of
credit) hereunder, nor shall any Commitment of any Lender be increased or
decreased as a result of any failure by any other Lender to perform its
obligations hereunder, and (ii) no failure by any Lender to perform its
obligations hereunder shall excuse any other Lender from its obligations
hereunder.

         2.4 PAYMENTS.

                           (a) PAYMENTS BY BORROWER.

                                    (i)      Except as otherwise expressly
                  provided herein, all payments by Borrower shall be made to
                  Agent's Account for the account of the Lender Group and shall
                  be made in immediately available funds, no later than 2:00
                  p.m. (New York time) on the date specified herein. Any payment
                  received by Agent later than 2:00 p.m. (New York time) shall
                  be deemed to have been received on the following Business Day
                  and any applicable interest or fee shall continue to accrue
                  until such following Business Day.

                                    (ii)     Unless Agent receives notice from
                  Borrower prior to the date on which any payment is due to the
                  Lenders that Borrower will not make such payment in full as
                  and when required, Agent may assume that Borrower has made (or
                  will make) such payment in full to Agent on such date in
                  immediately available funds and Agent may (but shall not be so
                  required), in reliance upon such assumption, distribute to
                  each Lender on such due date an amount equal to the amount
                  then due such Lender. If and to the extent Borrower does not
                  make such payment in full to Agent on the date when due, each
                  Lender severally shall repay to Agent on demand such amount
                  distributed to such Lender, together with interest thereon at
                  the Defaulting Lender Rate for each day from the date such
                  amount is distributed to such Lender until the date repaid.

                           (b) APPORTIONMENT AND APPLICATION OF PAYMENTS.

                           (i)      Except as otherwise provided with respect to
                  Defaulting Lenders and except as otherwise provided in the
                  Loan Documents (including letter agreements between Agent,
                  individual Lenders and Borrower), aggregate principal and
                  interest payments shall be apportioned ratably among the
                  Lenders (according to the unpaid principal balance of the
                  Obligations to which such payments relate held by each Lender)
                  and payments of fees and expenses (other than fees or expenses
                  that are for Agent's separate account, after giving effect to
                  any letter agreements between Agent and individual Lenders)
                  shall be apportioned ratably among the Lenders having a Pro
                  Rata Share of the type of Commitment or Obligation to which a
                  particular fee relates. All payments shall be remitted to
                  Agent and all such payments, and all proceeds of the Credit
                  Party Collateral received by Agent, shall be applied as
                  follows:

                                      -38-

<PAGE>

                                    (A) first, to pay any Lender Group Expenses
                           then due to Agent under the Loan Documents, until
                           paid in full,

                                    (B) second, to pay any Lender Group Expenses
                           then due to the Lenders under the Loan Documents, on
                           a ratable basis, until paid in full,

                                    (C) third, to pay any fees then due to Agent
                           (for its separate account, after giving effect to any
                           letter agreements between Agent and individual
                           Lenders) under the Loan Documents until paid in full,

                                    (D) fourth, to pay any fees then due to any
                           or all of the Lenders (after giving effect to any
                           letter agreements between Agent and individual
                           Lenders) under the Loan Documents, on a ratable
                           basis, until paid in full,

                                    (E) fifth, to pay interest due in respect of
                           all Agent Advances until paid in full,

                                    (F) sixth, ratably to pay interest due in
                           respect of the Advances (other than Agent Advances)
                           and the Swing Loans, until paid in full,

                                    (G) seventh, to pay the principal of all
                           Agent Advances until paid in full,

                                    (H) eighth, to pay the principal of all
                           Swing Loans until paid in full,

                                    (I) ninth, so long as no Event of Default
                           has occurred and is continuing, to pay the principal
                           of all Advances until paid in full,

                                    (J) tenth, if an Event of Default has
                           occurred and is continuing, ratably (i) to pay the
                           principal of all Advances until paid in full and
                           (ii)to Agent, to be held by Agent, for the ratable
                           benefit of Issuing Lender and those Lenders having a
                           Revolver Commitment, as cash collateral an amount up
                           to 105% of the then extant Letter of Credit Usage
                           until paid in full,

                                    (K) eleventh, if an Event of Default has
                           occurred and is continuing, to pay any other
                           Obligations, and

                                    (L) twelfth, to Borrower (to be wired to the
                           Designated Account) or such other Person entitled
                           thereto under applicable law.

                                      -39-
<PAGE>

                           (ii)     Agent promptly shall distribute to each
                  Lender, pursuant to the applicable wire instructions received
                  from each Lender in writing, such funds as it may be entitled
                  to receive, subject to a Settlement delay as provided in
                  Section 2.3(f).

                           (iii)    In each instance, so long as no Event of
                  Default has occurred and is continuing, this Section 2.4(b)
                  shall not be deemed to apply to any payment by Borrower
                  specified by Borrower to be for the payment of specific
                  Obligations then due and payable (or prepayable) under any
                  provision of this Agreement.

                           (iv)     For purposes of the foregoing, "paid in
                  full" means payment of all amounts owing under the Loan
                  Documents according to the terms thereof, including loan fees,
                  service fees, professional fees, interest (and specifically
                  including interest accrued after the commencement of any
                  Insolvency Proceeding), default interest, interest on
                  interest, and expense reimbursements, whether or not any of
                  the foregoing would be or is allowed or disallowed in whole or
                  in part in any Insolvency Proceeding.

                           (v)      In the event of a direct conflict between
                  the priority provisions of this Section 2.4 and other
                  provisions contained in any other Loan Document, it is the
                  intention of the parties hereto that such priority provisions
                  in such documents shall be read together and construed, to the
                  fullest extent possible, to be in concert with each other. In
                  the event of any actual, irreconcilable conflict that cannot
                  be resolved as aforesaid, the terms and provisions of this
                  Section 2.4 shall control and govern.

         2.5 OVERADVANCES. If, at any time or for any reason, the amount of
Obligations owed by the Credit Parties to the Lender Group pursuant to Section
2.1 or Section 2.12 is greater than either the Dollar or percentage limitations
set forth in Section 2.1 or Section 2.12, as applicable (an "Overadvance"),
Borrower shall within three (3) Business Days pay to Agent, in cash, the amount
of such excess, which amount shall be used by Agent to reduce the Obligations in
accordance with the priorities set forth in Section 2.4(b). In addition,
Borrower hereby promises to pay the Obligations (including principal, interest,
fees, costs, and expenses) in Dollars in full as and when due and payable under
the terms of this Agreement and the other Loan Documents.

         2.6 INTEREST RATES AND LETTER OF CREDIT FEE: RATES, PAYMENTS, AND
CALCULATIONS.

                           (a) INTEREST RATES. Except as provided in clause (c)
below, all Obligations (except for undrawn Letters of Credit) that have been
charged to the Loan Account pursuant to the terms hereof shall bear interest on
the Daily Balance thereof as follows (i) if the relevant Obligation is an
Advance that is a LIBOR Rate Loan, at a per annum rate equal to the LIBOR Rate
plus the Applicable Margin for LIBOR Rate Loans and

                                      -40-
<PAGE>

(ii) otherwise, at a per annum rate equal to the Base Rate plus the Applicable
Margin for Base Rate Loans.

                           (b) LETTER OF CREDIT FEES. Borrower shall pay Agent
(for the ratable benefit of the Lenders), Letter of Credit fees (in addition to
the charges, commissions, fees, and costs set forth in Section 2.12(e)) (i) with
respect to standby Letters of Credit, which shall accrue at a rate equal to the
Applicable Margin then in effect for standby Letters of Credit times the Daily
Balance of the undrawn amount of all such outstanding standby Letters of Credit,
and (ii) with respect to documentary Letters of Credit, which shall accrue at a
rate equal to the Applicable Margin then in effect for documentary Letters of
Credit times the Daily Balance of the undrawn amount of all such outstanding
documentary Letters of Credit.

                           (c) DEFAULT RATE. Upon the occurrence and during the
continuation of an Event of Default (and at the election of Agent or the
Required Lenders),

                                    (i)      all Obligations (except for undrawn
                           Letters of Credit) that have been charged to the Loan
                           Account pursuant to the terms hereof shall bear
                           interest on the Daily Balance thereof at a per annum
                           rate equal to 2 percentage points above the per annum
                           rate otherwise applicable hereunder, and

                                    (ii)     the Letter of Credit fee provided
                           for above shall be increased to 2 percentage points
                           above the per annum rate otherwise applicable
                           hereunder.

                           (d) PAYMENT. Except as provided to the contrary in
Section 2.13(a), interest, Letter of Credit fees, and all other fees payable
hereunder shall be due and payable, in arrears, on the first day of each month
at any time that Obligations or Commitments are outstanding. Borrower hereby
authorizes Agent, from time to time without prior notice to Borrower, to charge
such interest and fees, all Lender Group Expenses (as and when incurred), the
charges, commissions, fees, and costs provided for in Section 2.12(e) (as and
when accrued or incurred), the fees and costs provided for in Section 2.11 (as
and when accrued or incurred), and all other payments as and when due and
payable with respect to the Obligations to Borrower's Loan Account, which
amounts thereafter shall constitute Advances hereunder and shall accrue interest
at the rate then applicable to Advances hereunder. Any interest not paid when
due shall be compounded by being charged to Borrower's Loan Account and shall
thereafter constitute Advances hereunder and shall accrue interest at the rate
then applicable to Advances that are Base Rate Loans hereunder.

                           (e) COMPUTATION. All interest and fees chargeable
under the Loan Documents shall be computed on the basis of a 360 day year for
the actual number of days elapsed. In the event the Base Rate is changed from
time to time hereafter, the rates of

                                      -41-
<PAGE>

interest hereunder based upon the Base Rate automatically and immediately shall
be increased or decreased by an amount equal to such change in the Base Rate.

                           (f) INTENT TO LIMIT CHARGES TO MAXIMUM LAWFUL RATE.
In no event shall the interest rate or rates payable under this Agreement, plus
any other amounts paid in connection herewith, exceed the highest rate
permissible under any law that a court of competent jurisdiction shall, in a
final determination, deem applicable. Borrower and the Lender Group, in
executing and delivering this Agreement, intend legally to agree upon the rate
or rates of interest and manner of payment stated within it; provided, however,
that, anything contained herein to the contrary notwithstanding, if said rate or
rates of interest or manner of payment exceeds the maximum allowable under
applicable law, then, ipso facto, as of the date of this Agreement, Borrower is
and shall be liable only for the payment of such maximum as allowed by law, and
payment received from Borrower in excess of such legal maximum, whenever
received, shall be applied to reduce the principal balance of the Obligations to
the extent of such excess.

         2.7 CASH MANAGEMENT.

                  In each case subject to the timing contemplated in Section 3.2
with respect to the Cash Management Agreements referenced in such Section:

                  (a)      Each Credit Party shall establish and maintain cash
management services of a type and on terms satisfactory to Agent at one or more
of the banks set forth on Schedule 5.17 (each, a "Cash Management Bank"), and,
in connection therewith, establish and maintain at such Cash Management Banks
pursuant to the terms hereof one or more accounts designated (either in Schedule
5.17 or pursuant to Section 2.7(h)) as concentration accounts (the
"Concentration Accounts") and additional accounts designated (either in Schedule
5.17 or pursuant to Section 2.7(h)) as (i) consolidated store deposit accounts
(the "Consolidated Store Deposit Accounts"), (ii) individual store deposit
accounts (the "Individual Store Accounts") and (iii) the home office deposit
account (the "Home Office Account" and together with the Concentration Accounts,
the Consolidated Store Deposit Accounts and the Individual Store Accounts, the
"Cash Management Accounts").

                  (b)      Each Credit Party shall (1) request in writing and
otherwise take such reasonable steps to ensure that all of its Account Debtors
forward payment of the amounts owed by them directly to a Cash Management Bank
for deposit into a Concentration Account, (2) deposit or cause to be deposited
promptly, and in any event no later than the first Business Day after the date
of receipt thereof (and subject to Section 2.7(g) with respect to payments from
Credit Card Processors), all such available Collections from Account Debtors
(including those sent directly to a Cash Management Bank) into a Concentration
Account, and (3) deposit or cause to be deposited promptly, and in any event no
later than the first Business Day after the date of receipt thereof, all other
available Collections (including cash, checks, drafts and all other forms of
daily store receipts or other similar items of payment) received by or otherwise
under its control into a Cash Management

                                      -42-
<PAGE>

Account provided, so long as no Triggering Period shall have occurred and be
continuing, Agent shall permit all funds in any Concentration Account to be
forwarded, by daily sweeps, to the Designated Account. For purposes of
clarification, after funds are swept pursuant to any provision of this Section
2.7 to the Designated Account, they may be used by the Borrower for its general
corporate purposes.

                  (c)      Each Credit Party further agrees to cause each of its
stores which utilize a Consolidated Store Deposit Account to cause all
Collections for such store to be deposited into a Consolidated Store Deposit
Account and each Credit Party agrees that with respect to each Consolidated
Store Deposit Account, it shall, at all times require each applicable Cash
Management Bank to forward, by automatic periodic transfers on a daily basis, if
practicable, and otherwise, once every three (3) Business Days, all available
amounts in each such Consolidated Store Deposit Account into a Concentration
Account; provided, (x) immediately after giving effect to each such transfer
from any Consolidated Store Deposit Account into a Concentration Account, each
Credit Party may maintain an amount not to exceed $3,000 of available funds in
any such Consolidated Store Deposit Account and (y) so long as no Triggering
Period shall have occurred and be continuing, Agent shall permit all funds in
any Concentration Account to be forwarded, by daily sweeps, to the Designated
Account.

                  (d)      Each Credit Party further agrees that with respect to
each store which utilizes an Individual Store Account, such store shall cause
all Collections for such store to be deposited into such Individual Store
Account and each Credit Party agrees that with respect to each Individual Store
Account it shall, at all times require each applicable Cash Management Bank to
forward, by automatic periodic transfers on a regular basis, but in no event
less frequently than once in any ten (10) day period, all available amounts in
each such Individual Store Account into a Concentration Account; provided,
however, that (x) such automatic transfers of funds therein shall be required
only at any time the available balance thereof should exceed $3,000, (y)
immediately after giving effect to each such transfer from such Individual Store
Account into a Concentration Account, the Credit Parties may maintain an
available amount not to exceed $3,000 in such Individual Store Account, and (z)
so long as no Triggering Period shall have occurred and be continuing, Agent
shall permit all funds in any Concentration Account to be forwarded, by daily
sweeps, to the Designated Account.

                  (e)      Each Credit Party further agrees that with respect to
the Home Office Account, it shall, at all times require the applicable Cash
Management Bank to forward, by automatic periodic transfers on a regular basis,
but in no event less frequently than once in any ten (10) day period, all
available amounts in the Home Office Account into a Concentration Account;
provided, however, that (x) such automatic transfers of funds therein shall be
required only at any time the available balance thereof should exceed $10,000,
(y) immediately after giving effect to each such transfer from the Home Office
Account into a Concentration Account, the Credit Parties may maintain an
available amount not to exceed $10,000 in such Home Office Account, and (z) so
long as no Triggering Period shall have

                                      -43-
<PAGE>

occurred and be continuing, Agent shall permit all funds in any Concentration
Account to be forwarded, by daily sweeps, to the Designated Account.

                  (f)      With respect to each Concentration Account, each Cash
Management Bank shall establish and maintain Cash Management Agreements with
Agent and the applicable Credit Party, in form and substance acceptable to Agent
in its Permitted Discretion; provided; however, that, with respect to
Consolidated Store Deposit Accounts, Individual Store Accounts and the Home
Office Account no Credit Party shall be obligated to establish a Cash Management
Agreement. Each Cash Management Agreement shall provide, among other things,
that (i) all items of payment deposited in such Concentration Account and
proceeds thereof are subject to the control of Agent, (ii) the Cash Management
Bank has no rights of setoff or recoupment or any other claim against the
applicable Concentration Account other than for payment of its service fees and
other charges directly related to the administration of such Concentration
Account and for returned checks or other items of payment, and (iii) from and
after the date that it receives written notification from Agent (a "Control
Exercise Notice"), it immediately will forward by daily sweep all amounts in the
applicable Concentration Account to the Agent's Account or as otherwise directed
by Agent to prepay the Obligations in such order as set forth in Section 2.4(b);
provided, that any such prepayments of the Loans pursuant to this Section 2.7(f)
may be reborrowed subject to Section 3.3. Anything contained herein into the
contrary notwithstanding, Agent agrees that it shall not provide a Control
Exercise Notice to the Cash Management Banks except during a Triggering Period.
At any time during a Triggering Period, Agent shall be free to exercise its
right to issue a Control Exercise Notice. Agent shall deliver to Borrower and
the applicable Credit Party a copy of any such Control Exercise Notice promptly
after delivery thereof to the applicable Cash Management Bank; provided, however
that a non-willful failure to so do shall not affect the validity of any such
Control Exercise Notice or otherwise limit Agent's right to send any other
Control Exercise Notice. Upon the subsequent termination of such Triggering
Period, Agent shall withdraw such Control Exercise Notice and permit funds to be
transferred as set forth above, including as to Credit Party access to funds in
any Concentration Account (and daily sweeps thereof into any Designated
Account), but subject in all events to the right of Agent to deliver a Control
Exercise Notice during any subsequent Triggering Period.

                  (g)      Each Credit Party may establish and maintain Credit
Card Agreements with Agent and each Credit Card Processor. Each such Credit Card
Agreement shall provide, among other things, that each such Credit Card
Processor shall transfer all proceeds of credit card charges for sales by each
Credit Party received by it (or other amounts payable by such Credit Card
Processor) into a designated Concentration Account on a daily basis or such
other periodic basis as Agent may otherwise direct. No Credit Party shall change
any direction or designation set forth in the Credit Card Agreements regarding
payment of charges without the prior written consent of Agent.

                                      -44-
<PAGE>

                  (h)      So long as no Event of Default has occurred and is
continuing, Borrower may amend Schedule 5.17 to add or replace a Cash Management
Bank or Cash Management Account; provided, however, that in the case of any
Concentration Account, (i) such prospective Cash Management Bank shall be
reasonably satisfactory to Agent and Agent shall have consented in writing in
advance to the opening of such Concentration Account with the prospective Cash
Management Bank (which consent shall not be required with respect to any
additional Concentration Account at an existing Cash Management Bank and
otherwise shall not be unreasonably withheld), and (ii) prior to the time of the
opening of any Concentration Account, the applicable Credit Party and such
prospective Cash Management Bank shall have executed and delivered to Agent a
Cash Management Agreement. Each Credit Party shall close any of its
Concentration Accounts (and establish replacement cash management accounts in
accordance with the foregoing sentence) promptly and in any event within 45 days
of notice from Agent (or such longer period as such Credit Party and Agent may
agree) that the creditworthiness of any Cash Management Bank is no longer
acceptable in Agent's reasonable judgment, or as promptly as practicable and in
any event within 60 days of notice from Agent (or such longer period as such
Credit Party and Agent may agree) that the operating performance, funds
transfer, or availability procedures or performance of the Cash Management Bank
with respect to Concentration Accounts or Agent's liability under any Cash
Management Agreement with such Cash Management Bank is no longer acceptable in
Agent's reasonable judgment.

                  The Cash Management Accounts shall be cash collateral
accounts, with all cash, checks and similar items of payment in such accounts
securing payment of the Obligations, and in which each Credit Party hereby
grants a Lien to Agent.

         2.8 CREDITING PAYMENTS. The receipt of any payment item by Agent
(whether from transfers to Agent by the Cash Management Banks pursuant to the
Cash Management Agreements or otherwise) shall not be considered a payment on
account unless such payment item is a wire transfer of immediately available
funds made to the Agent's Account or unless and until such payment item is
honored when presented for payment. Should any payment item not be honored when
presented for payment, then the applicable Credit Party shall be deemed not to
have made such payment and interest shall be calculated accordingly. Anything to
the contrary contained herein notwithstanding, any payment item shall be deemed
received by Agent only if it is received into the Agent's Account on a Business
Day on or before 2:00 p.m. (New York time). If any payment item is received into
the Agent's Account on a non-Business Day or after 2:00 p.m. (New York time) on
a Business Day, it shall be deemed to have been received by Agent as of the
opening of business on the immediately following Business Day.

         2.9 DESIGNATED ACCOUNT. Agent is authorized to make the Advances, and
Issuing Lender is authorized to issue the Letters of Credit, under this
Agreement based upon telephonic or other instructions received from anyone
purporting to be an Authorized Person or, without instructions, if pursuant to
Section 2.6(d). Borrower agrees to establish and

                                      -45-
<PAGE>

maintain the Designated Account with the Designated Account Bank for the purpose
of receiving the proceeds of the Advances requested by Borrower and made by
Agent or the Lenders hereunder. Unless otherwise agreed by Agent and Borrower,
any Advance, Agent Advance, or Swing Loan requested by Borrower and made by
Agent or the Lenders hereunder shall be made to the Designated Account.

         2.10 MAINTENANCE OF LOAN ACCOUNT; STATEMENTS OF OBLIGATIONS. Agent
shall maintain an account on its books in the name of Borrower (the "Loan
Account") on which Borrower will be charged with all Advances (including Agent
Advances and Swing Loans) made by Agent, Swing Lender, or the Lenders to
Borrower or for Borrower's account, the Letters of Credit issued by Issuing
Lender for Borrower's account, and with all other payment Obligations hereunder
or under the other Loan Documents, including, accrued interest, fees and
expenses, and Lender Group Expenses. In accordance with Section 2.8, the Loan
Account will be credited with all payments received by Agent from Borrower or
for Borrower's account, including all amounts received in the Agent's Account
from any Cash Management Bank. Agent shall render statements regarding the Loan
Account to Borrower, including principal, interest, fees, and including an
itemization of all charges and expenses constituting Lender Group Expenses
owing, and such statements, absent manifest error, shall be conclusively
presumed to be correct and accurate and constitute an account stated between
Borrower and the Lender Group unless, within 30 days after receipt thereof by
Borrower, Borrower shall deliver to Agent written objection thereto describing
the error or errors contained in any such statements.

         2.11 FEES. Borrower shall pay to Agent the following fees and charges,
which fees and charges shall be non-refundable when paid (irrespective of
whether this Agreement is terminated thereafter) and shall be apportioned among
the Lenders in accordance with the terms of letter agreements between Agent and
individual Lenders:

                           (a) UNUSED LINE FEE. On the first day of each month
during the term of this Agreement, an unused line fee in an amount equal to
0.30% per annum times the result of (i) the Maximum Revolver Amount, less (ii)
the sum of (A) the average Daily Balance of Advances that were outstanding
during the immediately preceding month, plus (B) the average Daily Balance of
the Letter of Credit Usage during the immediately preceding month,

                           (b) FEE LETTER FEES. As and when due and payable
under the terms of the Fee Letter, the fees set forth in the Fee Letter.

         2.12 LETTERS OF CREDIT.

                           (a) Subject to the terms and conditions of this
Agreement, the Issuing Lender agrees to issue letters of credit for the account
of Borrower (each, an "L/C") or to purchase participations or execute
indemnities or reimbursement obligations (each such undertaking, an "L/C
Undertaking") with respect to letters of credit issued by an Underlying

                                      -46-
<PAGE>

Issuer (as of the Closing Date, the prospective Underlying Issuer is to be Wells
Fargo) for the account of Borrower. To request the issuance of an L/C or an L/C
Undertaking (or the amendment, renewal, or extension of an outstanding L/C or
L/C Undertaking), Borrower shall hand deliver or telecopy (or transmit by
electronic communication, if arrangements for doing so have been approved by the
Issuing Lender) to the Issuing Lender and Agent (reasonably in advance of the
requested date of issuance, amendment, renewal, or extension) a notice
requesting the issuance of an L/C or L/C Undertaking, or identifying the L/C or
L/C Undertaking to be amended, renewed, or extended, specifying the date of
issuance, amendment, renewal, or extension (which shall be a Business Day), the
date on which such L/C or L/C Undertaking is to expire, the amount of such L/C
or L/C Undertaking, the name and address of the beneficiary thereof (or the
beneficiary of the Underlying Letter of Credit, as applicable), and such other
information as shall be necessary to prepare, amend, renew, or extend such L/C
or L/C Undertaking. If requested by the Issuing Lender, Borrower also shall be
an applicant under the application with respect to any Underlying Letter of
Credit that is to be the subject of an L/C Undertaking. The Issuing Lender shall
have no obligation to issue a Letter of Credit if any of the following would
result after giving effect to the issuance of such requested Letter of Credit:

                           (i)      the Letter of Credit Usage would exceed the
                  Borrowing Base less the then extant amount of outstanding
                  Advances, or

                           (ii)     the Letter of Credit Usage would exceed
                  $150,000,000, or

                           (iii)    the Letter of Credit Usage would exceed the
                  Maximum Revolver Amount less the then extant amount of
                  outstanding Advances.

                  Borrower and the Lender Group acknowledge and agree that
certain Underlying Letters of Credit may be issued to support letters of credit
that already are outstanding as of the Closing Date. Each Letter of Credit (and
corresponding Underlying Letter of Credit) shall be in form and substance
acceptable to the Issuing Lender (in the exercise of its Permitted Discretion),
including the requirement that the amounts payable thereunder must be payable in
Dollars. If Issuing Lender is obligated to advance funds under a Letter of
Credit, Borrower immediately shall reimburse such L/C Disbursement to Issuing
Lender by paying to Agent an amount equal to such L/C Disbursement not later
than 2:00 p.m., New York time, on the date that such L/C Disbursement is made,
if Borrower shall have received written or telephonic notice of such L/C
Disbursement prior to 1:00 p.m., New York time, on such date, or, if such notice
has not been received by Borrower prior to such time on such date, then not
later than 2:00 p.m., New York time, on the Business Day that Borrower receives
such notice, if such notice is received prior to 1:00 p.m., New York time, on
the date of receipt, and, in the absence of such reimbursement, the L/C
Disbursement immediately and automatically shall be deemed to be an Advance
hereunder and, thereafter, shall bear interest at the rate then applicable to
Advances that are Base Rate Loans under Section 2.6. To the extent an L/C
Disbursement is deemed to be an Advance hereunder,

                                      -47-
<PAGE>

Borrower's obligation to reimburse such L/C Disbursement shall be discharged and
replaced by the resulting Advance. Promptly following receipt by Agent of any
payment from Borrower pursuant to this paragraph, Agent shall distribute such
payment to the Issuing Lender or, to the extent that Lenders have made payments
pursuant to Section 2.12(c) to reimburse the Issuing Lender, then to such
Lenders and the Issuing Lender as their interests may appear.

                           (b) Promptly following receipt of a notice of L/C
Disbursement pursuant to Section 2.12(a), each Lender with a Revolver Commitment
agrees to fund its Pro Rata Share of any Advance deemed made pursuant to the
foregoing subsection on the same terms and conditions as if Borrower had
requested such Advance and Agent shall promptly pay to Issuing Lender the
amounts so received by it from the Lenders. By the issuance of a Letter of
Credit (or an amendment to a Letter of Credit increasing the amount thereof) and
without any further action on the part of the Issuing Lender or the Lenders with
Revolver Commitments, the Issuing Lender shall be deemed to have granted to each
Lender with a Revolver Commitment, and each Lender with a Revolver Commitment
shall be deemed to have purchased, a participation in each Letter of Credit, in
an amount equal to its Pro Rata Share of the Risk Participation Liability of
such Letter of Credit, and each such Lender agrees to pay to Agent, for the
account of the Issuing Lender, such Lender's Pro Rata Share of any payments made
by the Issuing Lender under such Letter of Credit. In consideration and in
furtherance of the foregoing, each Lender with a Revolver Commitment hereby
absolutely and unconditionally agrees to pay to Agent, for the account of the
Issuing Lender, such Lender's Pro Rata Share of each L/C Disbursement made by
the Issuing Lender and not reimbursed by Borrower on the date due as provided in
clause (a) of this Section, or of any reimbursement payment required to be
refunded to Borrower for any reason. Each Lender with a Revolver Commitment
acknowledges and agrees that its obligation to deliver to Agent, for the account
of the Issuing Lender, an amount equal to its respective Pro Rata Share of each
L/C Disbursement made by the Issuing Lender pursuant to this Section 2.12(b)
shall be absolute and unconditional and such remittance shall be made
notwithstanding the occurrence or continuation of an Event of Default or Default
or the failure to satisfy any condition set forth in Section 3 hereof. If any
such Lender fails to make available to Agent the amount of such Lender's Pro
Rata Share of each L/C Disbursement made by the Issuing Lender in respect of
such Letter of Credit as provided in this Section, such Lender shall be deemed
to be a Defaulting Lender and Agent (for the account of the Issuing Lender)
shall be entitled to recover such amount on demand from such Lender together
with interest thereon at the Defaulting Lender Rate until paid in full.

                           (c) Borrower hereby agrees to indemnify, save,
defend, and hold the Lender Group harmless from any loss, cost, expense, or
liability, and reasonable attorneys fees incurred by the Lender Group arising
out of or in connection with any Letter of Credit; provided, however, that
Borrower shall not be obligated hereunder to indemnify for any loss, cost,
expense, or liability to the extent that it is caused by the gross negligence or
willful misconduct of the Issuing Lender or any other member of the Lender
Group. Borrower

                                      -48-
<PAGE>

agrees to be bound by the Underlying Issuer's regulations and interpretations of
any Underlying Letter of Credit or by Issuing Lender's interpretations of any
L/C issued by Issuing Lender to or for Borrower's account, even though this
interpretation may be different from Borrower's own, and Borrower understands
and agrees that no member of the Lender Group shall be liable for any error,
negligence, or mistake, whether of omission or commission (except, as to any
member of the Lender Group, to the extent caused by its gross negligence or
willful misconduct), in following Borrower's instructions or those contained in
the Letter of Credit or any modifications, amendments, or supplements thereto.
Borrower understands that the L/C Undertakings may require Issuing Lender to
indemnify the Underlying Issuer for certain costs or liabilities arising out of
claims by Borrower against such Underlying Issuer. Borrower hereby agrees to
indemnify, save, defend, and hold the Lender Group harmless with respect to any
loss, cost, expense (including reasonable attorneys fees), or liability incurred
by the Lender Group under any L/C Undertaking as a result of the Lender Group's
indemnification of any Underlying Issuer; provided, however, that Borrower shall
not be obligated hereunder to indemnify for any loss, cost, expense, or
liability to the extent that it is caused by the gross negligence or willful
misconduct of the Issuing Lender or any other member of the Lender Group.

                           (d) Borrower hereby authorizes and directs any
Underlying Issuer to deliver to the Issuing Lender all instruments, documents,
and other writings and property received by such Underlying Issuer pursuant to
such Underlying Letter of Credit and to accept and rely upon the Issuing
Lender's instructions with respect to all matters arising in connection with
such Underlying Letter of Credit and the related application.

                           (e) Any and all charges, commissions, fees, and costs
incurred by the Issuing Lender relating to Underlying Letters of Credit shall be
Lender Group Expenses for purposes of this Agreement and immediately shall be
reimbursable by Borrower to Agent for the account of the Issuing Lender; it
being acknowledged and agreed by Borrower that the Underlying Issuer also
imposes a schedule of charges for amendments, extensions, drawings, and
renewals.

                           (f) If by reason of (i) any change after the Closing
Date in any applicable law, treaty, rule, or regulation or any change in the
interpretation or application thereof by any Governmental Authority, or (ii)
compliance by the Underlying Issuer or the Lender Group with any direction,
request, or requirement (irrespective of whether having the force of law) of any
Governmental Authority or monetary authority including, Regulation D of the
Federal Reserve Board as from time to time in effect (and any successor
thereto):

                           (i)      any reserve, deposit, or similar requirement
                  is or shall be imposed or modified in respect of any Letter of
                  Credit issued hereunder, or

                           (ii)     there shall be imposed on the Underlying
                  Issuer or the Lender Group any other condition regarding any
                  Underlying Letter of Credit or any Letter of Credit issued
                  pursuant hereto,

                                      -49-
<PAGE>

and the result of the foregoing is to increase, directly or indirectly, the cost
to the Lender Group of issuing, making, guaranteeing, or maintaining any Letter
of Credit or to reduce the amount receivable in respect thereof by the Lender
Group, then, and in any such case, Agent may, at any time within a reasonable
period after the additional cost is incurred or the amount received is reduced,
notify Borrower, and Borrower shall pay on demand such amounts as Agent may
specify to be necessary to compensate the Lender Group for such additional cost
or reduced receipt, together with interest on such amount from the date of such
demand until payment in full thereof at the rate then applicable to Base Rate
Loans hereunder. The determination by Agent of any amount due pursuant to this
Section, as set forth in a certificate setting forth the calculation thereof in
reasonable detail, shall, in the absence of manifest or demonstrable error, be
final and conclusive and binding on all of the parties hereto.

                  (g)      Borrower acknowledges and agrees that certain of the
Qualified Import Letters of Credit may provide for the presentation of time
drafts to the Underlying Issuer. If an Underlying Issuer accepts such a time
draft that is presented under an Underlying Letter of Credit, it is acknowledged
and agreed that (i) the Letter of Credit will require the Issuing Lender to
reimburse the Underlying Issuer for amounts paid on account of such time draft
on or after the maturity date thereof, (ii) the pricing provisions hereof
(including Sections 2.6(b) and 2.12(e)) shall continue to apply, until payment
of such time draft on or after the maturity date thereof, as if the Underlying
Letter of Credit were still outstanding, and (iii) on the date on which Issuing
Lender makes payment to the Underlying Issuer of the amounts paid on account of
such time draft, Borrower immediately shall reimburse such amount to Issuing
Lender and such amount shall constitute an L/C Disbursement hereunder.

         2.13 LIBOR OPTION.

                           (a) INTEREST AND INTEREST PAYMENT DATES. In lieu of
having interest charged at the rate based upon the Base Rate, Borrower shall
have the option (the "LIBOR Option") to have interest on all or a portion of the
Advances be charged at a rate of interest based upon the LIBOR Rate. Interest on
LIBOR Rate Loans shall be payable on the earliest of (i) the last day of the
Interest Period applicable thereto, (ii) the date that is one month after the
commencement of the applicable Interest Period, (iii) the occurrence of an Event
of Default in consequence of which the Required Lenders or Agent on behalf
thereof elect to accelerate the maturity of all or any portion of the
Obligations, or (iv) termination of this Agreement pursuant to the terms hereof.
On the last day of each applicable Interest Period in respect of a LIBOR Rate
Loan, unless Borrower properly has exercised the LIBOR Option with respect
thereto, the interest rate applicable to such LIBOR Rate Loan automatically
shall convert to the rate of interest then applicable to Base Rate Loans of the
same type hereunder. At any time that an Event of Default has occurred and is
continuing, Borrower no longer shall have the option to request that Advances
bear interest at the LIBOR Rate and Agent shall have the right to convert the
interest rate on all outstanding LIBOR Rate Loans to the rate then applicable to
Base Rate Loans hereunder.

                                      -50-
<PAGE>

                           (b) LIBOR Election.

                           (i)      Borrower may, at any time and from time to
                  time, so long as no Event of Default has occurred and is
                  continuing, elect to exercise the LIBOR Option by notifying
                  Agent prior to 2:00 p.m. (New York time) at least 3 Business
                  Days prior to the commencement of the proposed Interest Period
                  (the "LIBOR Deadline"). Notice of Borrower's election of the
                  LIBOR Option for a permitted portion of the Advances and an
                  Interest Period pursuant to this Section shall be made by
                  delivery to Agent of a LIBOR Notice received by Agent before
                  the LIBOR Deadline, or by telephonic notice received by Agent
                  before the LIBOR Deadline (to be confirmed by delivery to
                  Agent of a LIBOR Notice received by Agent prior to 5:00 p.m.
                  (New York time) on the same day). Promptly upon its receipt of
                  each such LIBOR Notice, Agent shall provide a copy thereof to
                  each of the Lenders having a Revolver Commitment.

                           (ii)     Each LIBOR Notice shall be irrevocable and
                  binding on Borrower. In connection with each LIBOR Rate Loan,
                  Borrower shall indemnify, defend, and hold Agent and the
                  Lenders harmless against any loss, cost, or expense incurred
                  by Agent or any Lender as a result of (a) the payment of any
                  principal of any LIBOR Rate Loan other than on the last day of
                  an Interest Period applicable thereto (including as a result
                  of an Event of Default), (b) the conversion of any LIBOR Rate
                  Loan other than on the last day of the Interest Period
                  applicable thereto, or (c) the failure to borrow, convert,
                  continue or prepay any LIBOR Rate Loan on the date specified
                  in any LIBOR Notice delivered pursuant hereto (such losses,
                  costs, and expenses, collectively, "Funding Losses"). Funding
                  Losses shall, with respect to Agent or any Lender, be deemed
                  to equal the amount determined by Agent or such Lender to be
                  the excess, if any, of (i) the amount of interest that would
                  have accrued on the principal amount of such LIBOR Rate Loan
                  had such event not occurred, at the LIBOR Rate that would have
                  been applicable thereto, for the period from the date of such
                  event to the last day of the then current Interest Period
                  therefor (or, in the case of a failure to borrow, convert, or
                  continue, for the period that would have been the Interest
                  Period therefor), minus (ii) the amount of interest that would
                  accrue on such principal amount for such period at the
                  interest rate which Agent or such Lender would be offered were
                  it to be offered, at the commencement of such period, Dollar
                  deposits of a comparable amount and period in the London
                  interbank market. A certificate of Agent or a Lender delivered
                  to Borrower setting forth any amount or amounts that Agent or
                  such Lender is entitled to receive pursuant to this Section
                  2.13 shall be conclusive absent manifest error.

                           (iii)    Borrower shall have not more than 8 LIBOR
                  Rate Loans in effect at any given time. Borrower only may
                  exercise the LIBOR Option for

                                      -51-
<PAGE>

                  LIBOR Rate Loans of at least $1,000,000 and integral multiples
                  of $500,000 in excess thereof.

                           (c) PREPAYMENTS. Borrower may prepay LIBOR Rate Loans
at any time; provided, however, that in the event that LIBOR Rate Loans are
prepaid on any date that is not the last day of the Interest Period applicable
thereto, including as a result of any automatic prepayment through the required
application by Agent of proceeds of each Credit Party's Collections in
accordance with Section 2.4(b) or for any other reason, including early
termination of the term of this Agreement or acceleration of all or any portion
of the Obligations pursuant to the terms hereof, Borrower shall indemnify,
defend, and hold Agent and the Lenders and their Participants harmless against
any and all Funding Losses in accordance with clause (b)(ii) above.

                           (d) SPECIAL PROVISIONS APPLICABLE TO LIBOR RATE.

                           (i)      The LIBOR Rate may be adjusted by Agent with
                  respect to any Lender on a prospective basis to take into
                  account any additional or increased costs to such Lender of
                  maintaining or obtaining any eurodollar deposits or increased
                  costs due to changes in applicable law occurring subsequent to
                  the commencement of the then applicable Interest Period,
                  including changes in tax laws (except changes of general
                  applicability in corporate income tax laws) and changes in the
                  reserve requirements imposed by the Board of Governors of the
                  Federal Reserve System (or any successor), excluding the
                  Reserve Percentage, which additional or increased costs would
                  increase the cost of funding loans bearing interest at the
                  LIBOR Rate. In any such event, the affected Lender shall give
                  Borrower and Agent notice of such a determination and
                  adjustment and Agent promptly shall transmit the notice to
                  each other Lender and, upon its receipt of the notice from the
                  affected Lender, Borrower may, by notice to such affected
                  Lender (y) require such Lender to furnish to Borrower a
                  statement setting forth the basis for adjusting such LIBOR
                  Rate and the method for determining the amount of such
                  adjustment, or (z) repay the LIBOR Rate Loans with respect to
                  which such adjustment is made (together with any amounts due
                  under clause (b)(ii) above).

                           (ii)     In the event that any change in market
                  conditions or any law, regulation, treaty, or directive, or
                  any change therein or in the interpretation of application
                  thereof, shall at any time after the date hereof, in the
                  reasonable opinion of any Lender, make it unlawful or
                  impractical for such Lender to fund or maintain LIBOR Advances
                  or to continue such funding or maintaining, or to determine or
                  charge interest rates at the LIBOR Rate, such Lender shall
                  give notice of such changed circumstances to Agent and
                  Borrower and Agent promptly shall transmit the notice to each
                  other Lender and (y) in the case of any LIBOR Rate Loans of
                  such Lender that are

                                      -52-
<PAGE>

                  outstanding, the date specified in such Lender's notice shall
                  be deemed to be the last day of the Interest Period of such
                  LIBOR Rate Loans, and interest upon the LIBOR Rate Loans of
                  such Lender thereafter shall accrue interest at the rate then
                  applicable to Base Rate Loans, and (z) Borrower shall not be
                  entitled to elect the LIBOR Option until such Lender
                  determines that it would no longer be unlawful or impractical
                  to do so. Each Lender at such time having as its lending
                  office an office outside the United States agrees to use
                  reasonable efforts to designate a different lending office if
                  such designation will avoid the need for such a notice of
                  changed circumstances and would not, in the good faith
                  judgment of such Lender, otherwise be disadvantageous to such
                  Lender.

                           (e) NO REQUIREMENT OF MATCHED FUNDING. Anything to
the contrary contained herein notwithstanding, neither Agent, nor any Lender,
nor any of their Participants, is required actually to acquire eurodollar
deposits to fund or otherwise match fund any Obligation as to which interest
accrues at the LIBOR Rate. The provisions of this Section shall apply as if each
Lender or its Participants had match funded any Obligation as to which interest
is accruing at the LIBOR Rate by acquiring eurodollar deposits for each Interest
Period in the amount of the LIBOR Rate Loans.

                                      -53-
<PAGE>

         2.14 CAPITAL REQUIREMENTS. If, after the date hereof, any Lender
determines that (i) the adoption of or change in any law, rule, regulation or
guideline regarding capital requirements for banks or bank holding companies, or
any change in the interpretation or application thereof by any Governmental
Authority charged with the administration thereof, or (ii) compliance by such
Lender or its parent bank holding company with any guideline, request, or
directive of any such entity regarding capital adequacy (whether or not having
the force of law), has the effect of reducing the return on such Lender's or
such holding company's capital as a consequence of such Lender's Commitments
hereunder to a level below that which such Lender or such holding company could
have achieved but for such adoption, change, or compliance (taking into
consideration such Lender's or such holding company's then existing policies
with respect to capital adequacy and assuming the full utilization of such
entity's capital) by any amount deemed by such Lender to be material, then such
Lender may notify Borrower and Agent thereof. Following receipt of such notice,
Borrower agrees to pay such Lender on demand the amount of such reduction of
return of capital as and when such reduction is determined, payable within 90
days after presentation by such Lender of a statement in the amount and setting
forth in reasonable detail such Lender's calculation thereof and the assumptions
upon which such calculation was based (which statement shall be deemed true and
correct absent manifest error). Notwithstanding anything to the contrary in this
Section, Borrower will not be required to compensate any Lender pursuant to this
Section for any reduction incurred more than 270 days before such Lender
notified Borrower of the change in law (or other circumstance) giving rise to
such reduction. In determining such amount, such Lender may use any reasonable
averaging and attribution methods.

3.       CONDITIONS; TERM OF AGREEMENT.

         3.1 CONDITIONS PRECEDENT TO THE INITIAL EXTENSION OF CREDIT. The
obligation of the Lender Group (or any member thereof) to make the initial
Advance (or otherwise to extend any credit provided for hereunder), is subject
to the fulfillment, to the satisfaction of Agent in its Permitted Discretion, of
each of the conditions precedent set forth below:

                           (a) the Closing Date shall occur on or before January
31, 2004;

                           (b) Agent shall have received a UCC Filing
Authorization Letter, duly executed by Borrower and each Guarantor, together
with appropriate financing statements on Form UCC-1 duly filed in such office or
offices as may be necessary or, in the opinion of Agent, desirable to perfect
the Agent's Liens in and to the Credit Party Collateral, and Agent shall have
received searches reflecting the filing of all such financing statements;

                           (c) Agent shall have received each of the following
documents, in form and substance satisfactory to Agent in its Permitted
Discretion, duly executed, and each such document shall be in full force and
effect:

                           (i)      the Disbursement Letter;

                                      -54-
<PAGE>

                           (ii)     the Compliance Certificate;

                           (iii)    the Fee Letter;

                           (iv)     the Pay-Off Letter, together with UCC
                  termination statements and other documentation evidencing the
                  termination by Existing Lender of its Liens in and to the
                  properties and assets of Borrower and its Subsidiaries; and

                           (v)      the Post-Closing Agreement;

                           (d) Agent shall have received a certificate from the
Secretary of each Credit Party attesting to the resolutions of such Credit
Party's Board of Directors authorizing its execution, delivery, and performance
of this Agreement and the other Loan Documents to which such Credit Party is a
party and authorizing specific officers of such Credit Party to execute the
same;

                           (e) except as contemplated by the Post-Closing
Agreement, Agent shall have received copies of each Credit Party's Governing
Documents, as amended, modified, or supplemented as of the Closing Date,
certified by the respective Secretary of such Credit Party;

                           (f) except as contemplated by the Post-Closing
Agreement, Agent shall have received a recent certificate of status with respect
to each Credit Party, such certificate to be issued by the appropriate officer
of the jurisdiction of organization of such Credit Party, which certificate
shall indicate that such Credit Party is in good standing in such jurisdiction;

                           (g) except as contemplated by the Post-Closing
Agreement, Agent shall have received recent certificates of status with respect
to each Credit Party, such certificates to be issued by the appropriate officer
of the jurisdictions (other than the jurisdiction of organization of such Credit
Party) in which its failure to be duly qualified or licensed would constitute a
Material Adverse Change, which certificates shall indicate that such Credit
Party is in good standing in such jurisdictions;

                           (h) Agent shall have received a certificate of
insurance, together with the endorsements thereto, as are required by Section
6.7, the form and substance of which shall be satisfactory to Agent in its
Permitted Discretion;

                           (i) Agent shall have received opinions of counsel,
including certain local counsel in such jurisdictions as required by Agent, for
the Credit Parties, each in form and substance satisfactory to Agent in its
Permitted Discretion;

                           (j) Borrower shall have delivered a Borrowing Base
Certificate, dated as of the Closing Date based on the most recent completed
fiscal month, and Borrower shall have the Required Closing Availability after
giving effect to the initial extensions of credit

                                      -55-
<PAGE>

hereunder and the payment of all fees and expenses required to be paid by
Borrower on the Closing Date under this Agreement or the other Loan Documents;

                           (k) Agent shall have received Borrower's Closing Date
Business Plan;

                           (l) Borrower shall have paid all documented Lender
Group Expenses incurred in connection with the transactions evidenced by this
Agreement; provided that Agent shall have given notice to Borrower at least one
day prior to the Closing Date with respect thereto;

                           (m) Each Credit Party shall have received all
licenses, approvals or evidence of other actions required by any Governmental
Authority in connection with the execution and delivery by each such Credit
Party of the Loan Documents or with the consummation of the transactions
contemplated thereby; and

                           (n) all other documents and legal matters in
connection with the transactions contemplated by this Agreement shall have been
delivered, executed, or recorded and shall be in form and substance satisfactory
to Agent in its Permitted Discretion.

         3.2 CONDITIONS SUBSEQUENT TO THE INITIAL EXTENSION OF CREDIT. The
obligation of the Lender Group (or any member thereof) to continue to make
Advances (or otherwise extend credit hereunder) is subject to the fulfillment,
on or before the date applicable thereto, of each of the conditions subsequent
set forth below (the failure by Borrower to so perform or cause to be performed
constituting an Event of Default):

                           (a) by the Initial Syndication Date, Agent shall have
received an appraisal of the Liquidation Percentage applicable to Parent's and
its Subsidiaries' Inventory, the results of which shall be satisfactory to Agent
in its Permitted Discretion; and

                           (b) by the 90th day following the Closing Date, Agent
shall have received Cash Management Agreements with respect to each
Concentration Account, in form and substance satisfactory to Agent, duly
executed, and each such document shall be in full force and effect.

         3.3 CONDITIONS PRECEDENT TO ALL EXTENSIONS OF CREDIT. The obligation of
the Lender Group (or any member thereof) to make any Advances hereunder at any
time (or to extend any other credit hereunder) shall be subject to the following
conditions precedent:

                           (a) the representations and warranties contained in
this Agreement and the other Loan Documents shall be true and correct in all
material respects on and as of the date of such extension of credit, as though
made on and as of such date (except to the extent that such representations and
warranties relate solely to an earlier date);

                                      -56-
<PAGE>

                           (b) no Default or Event of Default shall have
occurred and be continuing on the date of such extension of credit, nor shall
either result from the making thereof;

                           (c) no injunction, writ, restraining order, or other
order of any nature restricting or prohibiting, directly or indirectly, the
extending of such credit shall have been issued and remain in force by any
Governmental Authority against any Credit Party, Agent, any Lender, or any of
their Affiliates; and

                           (d) no Material Adverse Change shall have occurred.

         3.4 TERM. This Agreement shall continue in full force and effect for a
term ending on January 15, 2008, provided that, upon prior written notice by
Borrower to Agent no less than 60 days prior to January 15, 2008, Borrower may
extend this Agreement for a single period of an additional twelve (12) months
commencing from the end of the initial term hereof, so long as no Default or
Event of Default has occurred and is continuing as of the date of such request
and the date of such extension (such date, as it may be extended pursuant
hereto, the "Maturity Date"). The foregoing notwithstanding, the Lender Group,
upon the election of the Required Lenders, shall have the right to terminate its
obligations under this Agreement immediately and without notice upon the
occurrence and during the continuation of an Event of Default.

         3.5 EFFECT OF TERMINATION. On the date of termination of this
Agreement, all Obligations (including contingent reimbursement obligations of
Borrower with respect to outstanding Letters of Credit and including all other
Obligations) immediately shall become due and payable without notice or demand
(including either (i) providing cash collateral to be held by Agent for the
benefit of those Lenders with a Revolver Commitment in an amount equal to 105%
of the then extant Letter of Credit Usage, or (ii) causing the original Letters
of Credit to be returned to the Issuing Lender. No termination of this
Agreement, however, shall relieve or discharge any Credit Party of its duties,
Obligations, or covenants hereunder and the Agent's Liens in the Credit Party
Collateral shall remain in effect until all Obligations have been paid in full
(including by the provision of cash collateral set forth above) and the Lender
Group's obligations to provide additional credit hereunder have been terminated.
When this Agreement has been terminated and all of the Obligations have been
paid in full (including by the provision of cash collateral set forth above) and
the Lender Group's obligations to provide additional credit under the Loan
Documents have been terminated irrevocably, Agent will, at Borrower's sole
expense, execute and deliver any UCC termination statements, lien releases,
mortgage releases, re-assignments of trademarks, discharges of security
interests, and other similar discharge or release documents (and, if applicable,
in recordable form) as are reasonably necessary to release, as of record, the
Agent's Liens and all notices of security interests and liens previously filed
by Agent with respect to the Obligations.

                                      -57-
<PAGE>

         3.6 EARLY TERMINATION BY BORROWER. Borrower has the option, at any time
upon 5 Business Days prior written notice to Agent, to (A) permanently reduce
the Revolver Commitment in the minimum amount of $5,000,000 and integral
multiples of $1,000,000 in excess thereof and (B) terminate this Agreement in
its entirety by paying to Agent, in cash, the Obligations (including either (i)
providing cash collateral to be held by Agent for the benefit of those Lenders
with a Revolver Commitment in an amount equal to 105% of the then extant Letter
of Credit Usage, or (ii) causing the original Letters of Credit to be returned
to the Issuing Lender. If Borrower has sent a notice of termination pursuant to
the provisions of this Section, then the Commitments shall terminate and
Borrower shall be obligated to repay the Obligations (including either (i)
providing cash collateral to be held by Agent for the benefit of those Lenders
with a Revolver Commitment in an amount equal to 105% of the then extant Letter
of Credit Usage, or (ii) causing the original Letters of Credit to be returned
to the Issuing Lender, on the date set forth as the date of termination of this
Agreement in such notice.

4.       CREATION OF SECURITY INTEREST.

         4.1 GRANT OF SECURITY INTEREST. Each Credit Party hereby grants to
Agent, for the benefit of the Lender Group, a continuing security interest in
all of its right, title, and interest in all currently existing and hereafter
acquired or arising Credit Party Collateral in order to secure prompt repayment
of any and all of the Obligations in accordance with the terms and conditions of
the Loan Documents and in order to secure prompt performance by each Credit
Party of each of its covenants and duties under the Loan Documents. The Agent's
Liens in and to the Credit Party Collateral shall attach to all Credit Party
Collateral without further act on the part of Agent or any Credit Party.
Anything contained in this Agreement or any other Loan Document to the contrary
notwithstanding, except for Permitted Dispositions or any other disposition
permitted under Section 7.3, no Credit Party has any authority, express or
implied, to dispose of any item or portion of the Credit Party Collateral (it
being understood, with respect to any such Permitted Disposition of Credit Party
Collateral, Agent's Liens in and to such Credit Party Collateral shall be
released automatically upon consummation of such Permitted Disposition, and the
proceeds and products of such Permitted Disposition shall be subject to Agent's
Liens).

                                      -58-
<PAGE>

         4.2 COLLECTION OF ACCOUNTS. At any time after the occurrence and during
the continuation of an Event of Default, Agent or Agent's designee may (a)
notify Account Debtors of any Credit Party that such Credit Party's Accounts,
or, as relates to the Credit Party Collateral, have been assigned to Agent or
that Agent has a security interest therein, or (b) collect the Accounts of such
Credit Party directly and charge the collection costs and expenses to the Loan
Account. Each Credit Party agrees that it will hold in trust for the Lender
Group, as the Lender Group's trustee, any of its Collections that it receives
and immediately will deliver such Collections to Agent or a Concentration
Account at a Cash Management Bank in their original form as received by such
Credit Party.

         4.3 FILING OF FINANCING STATEMENTS; DELIVERY OF ADDITIONAL
DOCUMENTATION REQUIRED.

                           (a) Each Credit Party authorizes Agent to file any
financing statement necessary or desirable to effectuate the transactions
contemplated by the Loan Documents, and any continuation statement or amendment
with respect thereto, in any appropriate filing office without the signature of
such Credit Party where permitted by applicable law. Each Credit Party hereby
ratifies the filing of any financing statement filed without the signature of
such Credit Party prior to the date hereof.

                           (b) At any time upon the request of Agent, each
Credit Party shall execute or deliver to Agent any and all financing statements,
original financing statements in lieu of continuation statements, security
agreements, assignments, and all other documents (collectively, the "Additional
Documents") that Agent may request in its Permitted Discretion, in form and
substance satisfactory to Agent, to create, perfect, and continue perfected or
to better perfect the Agent's Liens in the assets of any Credit Party
constituting the Credit Party Collateral, and in order to fully consummate all
of the transactions contemplated hereby and under the other Loan Documents. To
the maximum extent permitted by applicable law, each Credit Party authorizes
Agent to execute any such Additional Documents in such Credit Party's name and
authorizes Agent to file such executed Additional Documents in any appropriate
filing office.

         4.4 POWER OF ATTORNEY. Each Credit Party hereby irrevocably makes,
constitutes, and appoints Agent (and any of Agent's officers, employees, or
agents designated by Agent) as such Credit Party's true and lawful attorney,
with power to (a) if such Credit Party refuses to, or fails timely to execute
and deliver any of the documents described in Section 4.3, sign the name of such
Credit Party on any of the documents described in Section 4.3, (b) at any time
that an Event of Default has occurred and is continuing, sign such Credit
Party's name on any invoice or bill of lading relating to the Credit Party
Collateral, drafts against Account Debtors, or notices to Account Debtors, (c)
send requests for verification of such Credit Party's Accounts, (d) after the
occurrence of and during the continuation of an Event of Default endorse such
Credit Party's name on any of its payment items (including all of its
Collections) that may come into the Lender Group's possession, (e) at any time
that an Event

                                      -59-
<PAGE>

of Default has occurred and is continuing, as relates to the Credit Party
Collateral, make, settle, and adjust all claims under such Credit Party's
policies of insurance and make all determinations and decisions with respect to
such policies of insurance, and (f) at any time that an Event of Default has
occurred and is continuing, settle and adjust disputes and claims respecting
such Credit Party's Accounts constituting the Credit Party Collateral directly
with Account Debtors, for amounts and upon terms that Agent determines to be
reasonable, and Agent may cause to be executed and delivered any documents and
releases that Agent determines to be necessary. The appointment of Agent as each
Credit Party's attorney, and each and every one of its rights and powers, being
coupled with an interest, is irrevocable until all of the Obligations have been
fully and finally repaid and performed and the Lender Group's obligations to
extend credit hereunder are terminated.

         4.5 RIGHT TO INSPECT. Agent and each Lender (through any of their
respective officers, employees, or agents) shall have the right, from time to
time hereafter (at reasonable times following reasonable notice to Borrower,
except after the occurrence of and during the continuation of an Event of
Default) to inspect the Books and make copies or abstracts thereof and to check,
test, and appraise the Credit Party Collateral, or any portion thereof, in order
to verify each Credit Party's financial condition or the amount, quality, value,
condition of, or any other matter relating to, the Credit Party Collateral.

         4.6 DEPOSIT ACCOUNTS. (a) Other than as specified in Section 2.7 with
respect to Cash Management Accounts, on and after the 90th day following the
Closing Date, each Credit Party agrees that it will cause each Deposit Account
of such Credit Party to be either a Concentration Account, Consolidated Store
Deposit Account, Individual Store Account, the Designated Account or the Home
Office Account.

5.       REPRESENTATIONS AND WARRANTIES.

                  In order to induce the Lender Group to enter into this
Agreement, each Credit Party jointly and severally makes the following
representations and warranties to the Lender Group which shall be true, correct,
and complete, in all material respects, as of the date hereof, and shall be
true, correct, and complete, in all material respects, as of the Closing Date,
and at and as of the date of the making of each Advance (or other extension of
credit) made thereafter, as though made on and as of the date of such Advance
(or other extension of credit) (except to the extent that such representations
and warranties relate solely to an earlier date) and such representations and
warranties shall survive the execution and delivery of this Agreement:

                                      -60-

<PAGE>

         5.1 NO ENCUMBRANCES. Except as disclosed on Schedule P-1 hereto, each
Credit Party has good and indefeasible title to its personal property assets and
good and marketable title to its owned Real Property (subject to exceptions that
do not, in the aggregate, materially impair the use of the personal property and
Real Property of the Credit Parties taken as a whole), and in the case of the
Credit Party Collateral, free and clear of Liens except for Permitted Liens.

         5.2 ELIGIBLE ACCOUNTS. The Eligible Accounts are bona fide existing
payment obligations of Account Debtors created by the sale and delivery of
Inventory or the rendition of services in the ordinary course of each Credit
Party's business, owed to such Credit Party without any known defenses,
disputes, offsets, counterclaims, or rights of return or cancellation, except
where the existence of such defenses, disputes, offsets, counterclaims, or
rights of return or cancellation would not cause a Material Adverse Change. As
to each Account that is identified by Borrower as an Eligible Account in a
borrowing base report submitted to Agent, to the knowledge of Borrower, each
such Account is not excluded as ineligible by virtue of one or more of the
excluding criteria set forth in the definition of Eligible Accounts.

         5.3 ELIGIBLE INVENTORY. All Eligible Inventory is of good and
merchantable quality, free from known defects, except where the existence of
such defects would not cause a Material Adverse Change. As to each item of
Inventory that is identified by Borrower as Eligible Inventory in a Borrowing
Base Certificate submitted to Agent, to the knowledge of Borrower, such
Inventory is not excluded as ineligible by virtue of one or more of the
excluding criteria set forth in the definition of Eligible Inventory.

         5.4 LOCATION OF INVENTORY. All Eligible Inventory of each Credit Party
is located only at, or in-transit between (or with respect to Eligible
In-Transit Inventory which has been shipped from a location outside of the
United States, in transit to), the locations identified on Schedule 5.4 (as such
Schedule may be updated pursuant to Sections 6.8 and 6.13) other than Inventory
located at any Pool Location and Inventory, the value of which, in the
aggregate, does not exceed $500,000. Schedule 5.4 separately identifies each
Leased Store Location and each Non-Owned Storage Facility.

         5.5 INVENTORY RECORDS. Borrower keeps materially correct and accurate
records itemizing and describing the type, quality, and quantity of its
consolidated Inventory and the book value thereof.

         5.6 STATE OF INCORPORATION; LOCATION OF CHIEF EXECUTIVE OFFICE; FEIN;
ORGANIZATIONAL ID NUMBER. (a) The jurisdiction of organization of each Credit
Party is set forth on Schedule 5.6(a).

                  (b) The chief executive office of each Credit Party is located
at the address indicated on Schedule 5.6(b) (as such Schedule may be updated
pursuant to Section 6.7).

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<PAGE>

                  (c) Each Credit Party's FEIN and organizational identification
number, if any, are identified on Schedule 5.6(c).

         5.7 DUE ORGANIZATION AND QUALIFICATION; SUBSIDIARIES.

                           (a) Except as described in the Post-Closing
Agreement, each Credit Party is duly organized and existing and in good standing
under the laws of the jurisdiction of its organization and qualified to do
business in any state where the failure to be so qualified reasonably could be
expected to have a Material Adverse Change.

                           (b) As of the Closing Date, other than as described
on Schedule 5.7(b), and except for employee stock options, there are no
subscriptions, options, warrants, or calls relating to any shares of any Credit
Party's capital Stock, including any right of conversion or exchange under any
outstanding security or other instrument. Except as set forth on Schedule
5.7(b), as of the Closing Date, no Credit Party is subject to any obligation
(contingent or otherwise) to repurchase or otherwise acquire or retire any
shares of its capital Stock or any security convertible into or exchangeable for
any of its capital Stock.

                           (c) Set forth on Schedule 5.7(c), is a complete and
accurate list of each Credit Party's direct and indirect Subsidiaries, as of the
Closing Date, showing: (i) with respect to all Subsidiaries other than Excluded
Subsidiaries, (A) the jurisdiction of their organization, (B) the number of
shares of each class of common and preferred Stock authorized for each Credit
Party, and (C) the percentage of the outstanding shares of each such class owned
directly or indirectly by such Credit Party and (ii) with respect to all
Excluded Subsidiaries, (x) the jurisdiction of their organization and (y) the
percentage of Stock owned directly or indirectly by any Credit Party in such
Excluded Subsidiaries. All of the outstanding capital Stock of each such
Subsidiary has been validly issued and is fully paid and non-assessable.

         5.8 DUE AUTHORIZATION; NO CONFLICT.

                           (a) The execution, delivery, and performance by each
Credit Party of this Agreement and the Loan Documents to which it is a party
have been duly authorized by all necessary action on the part of such Credit
Party.

                           (b) The execution, delivery, and performance by each
Credit Party of this Agreement and the other Loan Documents to which it is a
party do not and will not (i) violate any provision of federal, state, or local
law or regulation applicable to such Credit Party, the Governing Documents of
such Credit Party, or any order, judgment, or decree of any court or other
Governmental Authority binding on such Credit Party, (ii) conflict with, result
in a breach of, or constitute (with due notice or lapse of time or both) a
default under any material contractual obligation of such

                                      -62-

<PAGE>

Credit Party, including, without limitation, the Indenture or Senior
Subordinated Notes, (iii) result in or require the creation or imposition of any
Lien of any nature whatsoever upon any properties or assets of such Credit
Party, other than Permitted Liens, or (iv) require any approval of such Credit
Party's equity holders or any approval or consent of any Person under any
material contractual obligation of such Credit Party, other than consents or
approvals that have been obtained and that are still in force and effect, unless
such violation, imposition of Lien or failure to obtain approval or consent
could not reasonably be expected to result in a Material Adverse Change.

                           (c) Other than the filing of financing statements,
the execution, delivery, and performance by each Credit Party of this Agreement
and the other Loan Documents to which each such Credit Party is a party do not
and will not require any registration with, consent, or approval of, or notice
to, or other action with or by, any Governmental Authority, other than consents
or approvals that have been obtained and that are still in force and effect.

                           (d) This Agreement and the other Loan Documents to
which each Credit Party is a party, and all other documents contemplated hereby
and thereby, when executed and delivered by such Credit Party will be the
legally valid and binding obligations of such Credit Party, enforceable against
such Credit Party in accordance with their respective terms, except as may be
limited by equitable principles or by bankruptcy, insolvency, reorganization,
moratorium, or similar laws relating to or limiting creditors' rights generally.

                           (e) The Agent's Liens are validly created, perfected,
and first priority Liens, subject only to Permitted Liens.

         5.9 LITIGATION. Other than those matters disclosed on Schedule 5.9,
there are no actions, suits, or proceedings pending or, to the best knowledge of
each Credit Party, threatened against any Credit Party, except for (a) matters
that are fully covered by insurance (subject to customary deductibles), and (b)
matters arising after the Closing Date that are not reasonably likely to be
decided adversely to any Credit Party or, if decided adversely to any Credit
Party, reasonably could not be expected to result in a Material Adverse Change.

         5.10 NO MATERIAL ADVERSE CHANGE. All financial statements relating to
the Credit Parties that have been delivered by Borrower to the Lender Group have
been prepared in accordance with GAAP (except, in the case of unaudited
financial statements, for the lack of footnotes and being subject to year-end
audit adjustments) and present fairly in all material respects, the financial
condition of Parent and its Subsidiaries as of the date thereof and results of
operations for the period then ended. There has not been a Material Adverse
Change since the date of the latest financial statements submitted to the Lender
Group on or before the Closing Date.

         5.11 FRAUDULENT TRANSFER

                           (a) The Credit Parties taken as a whole are Solvent
and each Material Credit Party is Solvent.

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<PAGE>

                           (b) No transfer of property is being made by any
Credit Party and no obligation is being incurred by any Credit Party in
connection with the transactions contemplated by this Agreement or the other
Loan Documents with the intent to hinder, delay, or defraud either present or
future creditors of any Credit Party.

         5.12 EMPLOYEE BENEFITS. As of the date hereof, no Credit Party or any
of their ERISA Affiliates maintains or contributes to any Benefit Plan.

         5.13 ENVIRONMENTAL CONDITION. Except for matters described on Schedule
5.13 hereto and except for other matters that could not reasonably be expected
to result in a Material Adverse Change, (a) to each Credit Party's knowledge, no
owned Real Property of any Credit Party has ever been used by any Credit Party
or by previous owners or operators in the disposal of, or to produce, store,
handle, treat, release, or transport, any Hazardous Materials, where such
production, storage, handling, treatment, release or transport was in violation
of applicable Environmental Law, (b) to each Credit Party's knowledge, no Credit
Party's owned Real Property has ever been designated or identified in any manner
pursuant to any environmental protection statute as a Hazardous Materials
disposal site, (c) no Credit Party has received notice that a Lien arising under
any Environmental Law has attached to any revenues or to any Real Property owned
or operated by any Credit Party, and (d) no Credit Party has received a summons,
citation, notice, or directive from the U.S. Environmental Protection Agency or
any other federal or state governmental agency concerning any action or omission
by any Credit Party resulting in the releasing or disposing of Hazardous
Materials into the environment in violation of any applicable Environmental Law.

         5.14 BROKERAGE FEES. No Credit Party has utilized the services of any
broker or finder in connection with Borrower's obtaining financing from the
Lender Group under this Agreement and no brokerage commission or finders fee is
payable by any Credit Party in connection herewith.

         5.15 INTELLECTUAL PROPERTY. Each Credit Party owns, or holds licenses
in, all trademarks, trade names, copyrights, patents, patent rights, and
licenses that are necessary to the conduct of the business of the Credit
Parties, taken as a whole, as currently conducted, except where the failure to
do so, in the aggregate, would not result in a Material Adverse Change.

         5.16 LEASES. Except where the failure to do so would not cause a
Material Adverse Change, each Credit Party enjoys peaceful and undisturbed
possession under all leases material to its business and to which it is a party
or under which it is operating. Except to the extent that such default would not
cause a Material Adverse Change, all of such leases are valid and subsisting and
no material default by any Credit Party exists under any of them.

         5.17 DEPOSIT ACCOUNTS. Set forth on Schedule 5.17 are all of each
Credit Party's Deposit Accounts at which the Credit Party Collateral is or may
be held, including, with

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respect to each bank (i) the name and address of such Person, and (ii) the
account numbers of the Deposit Accounts maintained with such Person. Schedule
5.17 separately identifies each Concentration Account, Consolidated Store
Deposit Account, Individual Store Deposit Account and the Home Office Account.

         5.18 COMPLETE DISCLOSURE. All factual information (taken as a whole)
furnished by or on behalf of any Credit Party in writing to Agent or any Lender
(including all information contained in the Schedules hereto or in the other
Loan Documents) for purposes of or in connection with this Agreement, the other
Loan Documents, or any transaction contemplated herein or therein is, and all
other such factual information (taken as a whole) hereafter furnished by or on
behalf of any Credit Party in writing to Agent or any Lender will be, true and
accurate, in all material respects, on the date as of which such information is
dated or certified and not incomplete by omitting to state any fact necessary to
make such information (taken as a whole) not misleading in any material respect
at such time in light of the circumstances under which such information was
provided. On the Closing Date, the Closing Date Business Plan represents, and as
of the date on which any other Projections are delivered to Agent, such
additional Projections represent each Credit Party's good faith best estimate of
its future performance for the periods covered thereby, it being understood that
such projections as to future events are not to be viewed as facts and that
actual results during the period or periods covered by any projections may
differ from the projected results and no assurance can be given that the
Projections will be realized.

         5.19 INDEBTEDNESS. Set forth on Schedule 5.19 is a true and complete
list of all Indebtedness of each Credit Party outstanding immediately prior to
the Closing Date that is to remain outstanding after the Closing Date and such
Schedule accurately reflects the aggregate principal amount of such Indebtedness
(other than Indebtedness of any Credit Party owing to any other Credit Party).

         5.20 CREDIT CARD RECEIPTS. Schedule 5.20 sets forth each Credit Party's
Credit Card Processors and all material arrangements to which any Credit Party
is a party with respect to the payment to any Credit Party of the proceeds of
credit card charges for sales by such Credit Party.

         5.21 MARGIN STOCK. No Credit Party is engaged in the business of
extending credit for the purpose of purchasing or carrying margin stock (as
defined in Regulation U of the Board of Governors of the Federal Reserve
System), and no proceeds of any Advance or drawings under any Letter of Credit
will be used to purchase or carry any margin stock or to extend credit to others
for the purpose of purchasing or carrying any margin stock.

         5.22 SENIOR DEBT. All Obligations hereunder constitute "Senior Debt"
(as such term is defined in the Indenture) permitted under the Indenture and
each of the Credit Parties acknowledge that Agent and each Lender are entering
into this Agreement and are extending the Commitments in reliance on this
Section 5.22.

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         5.23 ANTI-TERRORISM LAWS.

                  (i)      None of the Credit Parties or, to the knowledge of
         any of the Credit Parties, any of their Affiliates, is in violation of
         any laws relating to terrorism or money laundering ("Anti-Terrorism
         Laws"), including Executive Order No. 13224 on Terrorist Financing,
         effective September 24, 2001 (the "Executive Order"), and the Uniting
         and Strengthening America by Providing Appropriate Tools Required to
         Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56.

                  (ii)     No Credit Party or, to the knowledge of any of the
         Credit Parties, any of their Affiliates or their respective brokers or
         other agents acting or benefiting in any capacity in connection with
         the Obligations, is any of the following:

                           (A) a Person or entity that is listed in the annex
                  to, or is otherwise subject to the provisions of, the
                  Executive Order;

                           (B) a Person or entity owned or controlled by, or
                  acting for or on behalf of, any Person or entity that is
                  listed in the annex to, or is otherwise subject to the
                  provisions of, the Executive Order;

                           (C) a Person or entity with which any Lender is
                  prohibited from dealing or otherwise engaging in any
                  transaction by any Anti-Terrorism Law;

                           (D) a Person or entity that commits, threatens or
                  conspires to commit or supports "terrorism" as defined in the
                  Executive Order; or

                           (E) a Person or entity that is named as a "specially
                  designated national and blocked person" on the most current
                  list published by the U.S. Treasury Department Office of
                  Foreign Asset Control at its official website or any
                  replacement website or other replacement official publication
                  of such list.

                  (iii)    No Credit Party or to the knowledge of any Credit
         Party, any of its brokers or other agents acting in any capacity in
         connection with the Obligations (i) conducts any business or engages in
         making or receiving any contribution of funds, goods or services to or
         for the benefit of any Person described in clause (b) above, (ii) deals
         in, or otherwise engages in any transaction relating to, any property
         or interests in property blocked pursuant to the Executive Order, or
         (iii) engages in or conspires to engage in any transaction that evades
         or avoids, or has the purpose of evading or avoiding, or attempts to
         violate, any of the prohibitions set forth in any Anti-Terrorism Law.

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6.       AFFIRMATIVE COVENANTS.

                  Each Credit Party jointly and severally covenants and agrees
that, until termination of all of the Commitments and payment in full of the
Obligations, each Credit Party shall do all of the following:

         6.1 ACCOUNTING SYSTEM. Maintain a system of accounting that enables the
Parent and its Subsidiaries to produce consolidated financial statements in
accordance with GAAP and maintain consolidated records pertaining to the Credit
Party Collateral that contain information as from time to time reasonably may be
requested by Agent. Parent or one or more Credit Parties also shall keep an
inventory reporting system that shows all additions, sales, claims, returns, and
allowances with respect to Inventory of the Credit Parties and their
Subsidiaries.

         6.2 COLLATERAL REPORTING. Provide Agent with the documents set forth on
Schedule 6.2 in accordance with the delivery schedule set forth thereon. In
addition, each Credit Party agrees to cooperate fully with Agent to facilitate
and implement a system of electronic collateral reporting in order to provide
electronic reporting of each of the items set forth on Schedule 6.2.

         6.3 FINANCIAL STATEMENTS, REPORTS, CERTIFICATES. Deliver to Agent, with
copies to each Lender:

                           (a) as soon as available, but in any event within 30
days (45 days in the case of a month that is the end of one of Borrower's fiscal
quarters) after the end of each month during each of Borrower's fiscal years,

                           (i)      a company prepared consolidated balance
                  sheet, income statement, and statement of cash flow covering
                  Borrower's and Parent's and its Subsidiaries' operations
                  during such period,

                           (ii)     a Compliance Certificate signed by the chief
                  financial officer of Borrower to the effect that:

                                    (A)      the financial statements delivered
                           hereunder have been prepared in accordance with GAAP
                           (except for the lack of footnotes and being subject
                           to quarterly and year-end audit adjustments) and
                           fairly present in all material respects the financial
                           condition of Parent and its Subsidiaries,

                                    (B)      the representations and warranties
                           of each Credit Party contained in this Agreement and
                           the other Loan Documents are true

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                           and correct in all material respects on and as of the
                           date of such certificate, as though made on and as of
                           such date (except to the extent that such
                           representations and warranties relate solely to an
                           earlier date), and

                                    (C)      there does not exist any condition
                           or event that constitutes a Default or Event of
                           Default (or, to the extent of any non-compliance,
                           describing such non-compliance as to which he or she
                           may have knowledge and what action the Credit Parties
                           have taken, are taking, or propose to take with
                           respect thereto), and

                           (iii)    a Compliance Certificate demonstrating, in
                  reasonable detail, compliance at the end of such period with
                  the covenant contained in Section 7.14,

                           (b) as soon as available, but in any event within 90
days after the end of each of Borrower's fiscal years, consolidated financial
statements of Parent and its Subsidiaries (and consolidating financial
statements of Parent and its Subsidiaries, to the extent produced by Parent in
the normal course of its operations) for each such fiscal year, audited by
independent certified public accountants reasonably acceptable to Agent and
certified, without any qualifications, by such accountants to have been prepared
in accordance with GAAP (such audited financial statements to include a balance
sheet, income statement, and statement of cash flow and, if prepared, such
accountants' letter to management),

                           (c) as soon as available, but in any event within 30
days after the start of each of Borrower's fiscal years, copies of the
Projections, in form and substance (including as to scope and underlying
assumptions) satisfactory to Agent, in its sole discretion, for such fiscal
year, quarter by quarter (or by such shorter periods as are reasonably requested
by the Agent), which Projections shall represent Borrower's good faith best
estimate of the financial performance of Parent and its Subsidiaries during the
period covered thereby, it being understood that such Projections as to future
events are not to be viewed as facts and that actual results during the period
or periods covered by any Projections may differ from the projected results and
no assurance can be given that the Projections will be realized,

                           (d) if and when filed by Parent,

                           (i)      Form 10-Q quarterly reports, Form 10-K
                  annual reports, and Form 8-K current reports,

                           (ii)     any other filings made by Parent with the
                  SEC, and

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<PAGE>

                           (iii)    any other information that is provided by
                  Parent to its shareholders generally

                  (provided, that for purposes of this clause (d), any
information to be delivered hereunder shall be deemed to have been delivered
when posted on the Parent's website or otherwise made available on the website
of the SEC),

                           (e) as soon as any Credit Party has knowledge of any
event or condition that constitutes a Default or an Event of Default, notice
thereof and a statement of the curative action that such Credit Party proposes
to take with respect thereto,

                           (f) within 30 days after the later of (i) the service
of process with respect thereto on any Credit Party or (ii) such time as
exposure of the Credit Party could be reasonably determined, notice of all
actions, suits, or proceedings brought by or against any Credit Party before any
Governmental Authority which, if determined adversely to such Credit Party,
reasonably could be expected to result in a Material Adverse Change, and

                           (g) upon the request of Agent, any other report
reasonably requested relating to the financial condition of any Credit Parties;
provided that such reports shall not be overly burdensome for any Credit Party
to prepare.

                  In addition, no Credit Party will have a fiscal year different
from that of Borrower. Borrower agrees to cooperate with Agent to allow Agent to
consult with its independent certified public accountants if Agent reasonably
requests the right to do so (and Agent shall notify Borrower as to the timing of
such consultations and permit Borrower to be present thereat or to otherwise
participate therein) and that, in such connection, its independent certified
public accountants are authorized to communicate with Agent and to release to
Agent whatever financial information concerning any Credit Party that Agent
reasonably may request.

         6.4 RETURNS. Cause returns and allowances, as between any Credit Party
and their Account Debtors, to be on the same basis and in accordance with the
usual customary practices of Borrower, as they exist at the time of the
execution and delivery of this Agreement, except where failure to do so could
not reasonably be expected to result in a Material Adverse Change.

         6.5 MAINTENANCE OF PROPERTIES. Maintain and preserve all of its
properties which are necessary or useful in the proper conduct to its business
in good working order and condition, ordinary wear and tear excepted, except for
any non-compliance therewith and/or any loss or forfeiture thereunder that could
not, individually or in the aggregate, reasonably could be expected to result in
a Lien (other than Permitted Liens) on all or any portion of the Credit Party
Collateral or otherwise result in a Material Adverse Change.

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<PAGE>

         6.6 TAXES. Cause all assessments and taxes, whether real, personal, or
otherwise, due or payable by, or imposed, levied, or assessed against each
Credit Party or any of their respective assets to be paid in full, before
delinquency or before the expiration of any extension period, except where the
failure to do so, individually or in the aggregate, would not result in a
Material Adverse Change. Each Credit Party will make timely payment or deposit
of all tax payments and withholding taxes required of it and them by applicable
laws, including those laws concerning F.I.C.A., F.U.T.A., state disability, and
local, state, and federal income taxes.

         6.7 INSURANCE.

                           (a) At each Credit Party's' expense, maintain
insurance respecting such Credit Party's assets wherever located, covering loss
or damage by fire, theft, explosion, and all other hazards and risks, and
maintain business interruption, public liability, and product liability
insurance, as well as insurance against larceny, embezzlement, and criminal
misappropriation, all as ordinarily are insured against by other Persons engaged
in the same or similar businesses. All such policies of insurance shall be in
such amounts which are customary for Persons engaged in the same or similar
business and with nationally recognized insurance companies. Each Credit Party
shall deliver copies of all such policies to Agent with a customary lender's
loss payable endorsement naming Agent as loss payee (with respect to the Credit
Party Collateral) or additional insured, as appropriate. Each such policy of
insurance or endorsement shall contain a clause requiring the insurer to give
not less than 30 days prior written notice to Agent in the event of cancellation
of the policy.

                           (b) Each Credit Party shall give Agent prompt notice
of any loss of the Credit Party Collateral valued in excess of $2 million
covered by such insurance. Agent shall have the exclusive right to adjust any
losses of the Credit Party Collateral claimed under any such insurance policies
during the continuation of an Event of Default, without any liability to such
Credit Party whatsoever in respect of such adjustments. Any monies received as
payment for any loss of the Credit Party Collateral under any insurance policy
mentioned above (other than liability insurance policies) during any Triggering
Period or during the continuation of an Event of Default, shall be paid over to
Agent to be applied to the prepayment of the Obligations with amounts so prepaid
available to be reborrowed subject to Section 3.3.

                           (c) No Credit Party will take out separate insurance
concurrent in form or contributing in the event of loss of the Credit Party
Collateral with that required to be maintained under this Section 6.7, unless
Agent is included thereon as named insured with the loss payable to Agent under
a lender's loss payable endorsement or its equivalent. Each Credit Party
immediately shall notify Agent whenever such separate insurance is taken out,
specifying the insurer thereunder and full particulars as to the policies
evidencing the same, and copies of such policies promptly shall be provided to
Agent.

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<PAGE>

         6.8 LOCATION OF INVENTORY/CHIEF EXECUTIVE OFFICES. Keep each Credit
Party's Inventory only at the locations identified on Schedule 5.4 and their
chief executive offices only at the locations identified on Schedule 5.6(b);
provided, however, that Borrower may amend (a) Schedule 5.4, on behalf of any
Credit Party as contemplated by Section 6.13, and (b) Schedule 5.6, on behalf of
any Credit Party, provided in the case of clause (b) hereof so long as (i) such
amendment occurs by written notice to Agent not less than 30 days prior to the
date such chief executive office is relocated and (ii) such new location is
within the United States, Puerto Rico or any U.S. Territory. Within a
commercially reasonable time following written notification with respect to any
Non-Owned Warehouse, Borrower shall provide Agent a Collateral Access Agreement
with respect thereto.

         6.9 COMPLIANCE WITH LAWS. Comply with the requirements of all
applicable laws, rules, regulations, and orders of any Governmental Authority,
including the Fair Labor Standards Act and the Americans With Disabilities Act,
other than laws, rules, regulations, and orders the non-compliance with which,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Change.

         6.10 LEASES. Pay when due all rents and other amounts payable under any
leases to which any Credit Party is a party or by which any Credit Party's
properties and assets are bound, unless such payments are the subject of a
Permitted Protest or unless nonpayment of such rents and other amounts,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Change.

         6.11 EXISTENCE. At all times preserve and keep in full force and effect
each Credit Party's valid existence and good standing and any rights and
franchises material to their businesses.

         6.12 ENVIRONMENTAL. Except for such Environmental Liens, failures to
comply, releases, Environmental Actions, notices, citations or orders which,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Change: (a) keep any property either owned or operated by any
Credit Party free of any Environmental Liens or post bonds or other financial
assurances sufficient to satisfy the obligations or liability evidenced by such
Environmental Liens, (b) comply with all applicable Environmental Laws and
provide to Agent documentation of such compliance which Agent reasonably
requests, (c) promptly notify Agent of any release of a Hazardous Material in
any reportable quantity from or onto property owned or operated by any Credit
Party and take any Remedial Actions required to abate said release or otherwise
to come into compliance with applicable Environmental Law, and (d) promptly, but
in any event within 5 days of its receipt thereof, provide Agent with written
notice of any of the following: (i) notice that an Environmental Lien has been
filed against any of the real or personal property of any Credit Party, (ii)
commencement of any Environmental Action or notice that an Environmental Action
will be filed against any Credit Party, and (iii) notice of any violation,
citation, or other administrative order received by any Credit Party.

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         6.13 DISCLOSURE UPDATES. Promptly and in no event later than 5 Business
Days after obtaining knowledge thereof, notify Agent if any written information,
exhibit, or report furnished to the Lender Group contained any untrue statement
of a material fact or omitted to state any material fact necessary to make the
statements contained therein not misleading in light of the circumstances in
which made; provided, that with respect to Schedules E-1 (in respect of Pool
Locations), E-2, 5.4, 5.17, and 5.20, Borrower shall provide updates to such
Schedules as necessary in its discretion to reflect material changes thereto
occurring before any quarterly update thereto, but in any event no less than
quarterly; provided, further, that any reference herein to any Schedule(s) shall
be deemed to be a reference to such Schedule(s) as updated pursuant hereto. The
foregoing to the contrary notwithstanding, any notification pursuant to the
foregoing provision will not cure or remedy the effect of the prior untrue
statement of a material fact or omission of any material fact nor shall any such
notification have the affect of amending or modifying this Agreement or any of
the Schedules hereto.

         6.14 FORMATION OF SUBSIDIARIES. At the time that any Credit Party forms
or acquires any direct or indirect Subsidiary after the Closing Date (other than
an Excluded Subsidiary), such Credit Party shall (a) cause such new Subsidiary
to provide to Agent a joinder to this Agreement (as a Guarantor and Credit
Party), together with such other security documents, as well as appropriate
UCC-1 financing statements, all in form and substance satisfactory to Agent
(including being sufficient to grant Agent a first priority Lien (subject to
Permitted Liens) in and to the assets of such newly formed or acquired
Subsidiary (other than any such assets that would not be required to be subject
to Agent's Liens if they were assets of any Credit Party)) and (b) provide to
Agent all other documentation, including one or more opinions of counsel
satisfactory to Agent, which in its reasonable opinion is appropriate with
respect to the execution and delivery of the applicable documentation referred
to above. Any document, agreement, or instrument executed or issued pursuant to
this Section 6.14 shall be a Loan Document.

7.       NEGATIVE COVENANTS.

                  Each Credit Party, jointly and severally, covenants and agrees
that, until termination of all of the Commitments and payment in full of the
Obligations, such Credit Party will not and will not permit any of its
Subsidiaries which is a Credit Party to do any of the following:

         7.1 INDEBTEDNESS. Create, incur, assume, suffer to exist, guarantee, or
otherwise become or remain, directly or indirectly, liable with respect to any
Indebtedness, except:

                           (a) Indebtedness evidenced by this Agreement and the
other Loan Documents, together with Indebtedness owed to Underlying Issuers with
respect to Underlying Letters of Credit and any other Obligations that
constitute Indebtedness,

                           (b) Indebtedness set forth on Schedule 5.19,

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                           (c) Permitted Purchase Money Indebtedness,

                           (d) refinancings, renewals, or extensions of
Indebtedness permitted under clauses (b) and (c) of this Section 7.1 (and
continuance or renewal of any Permitted Liens associated therewith) so long as:
(i) the terms and conditions of such refinancings, renewals, or extensions do
not, in Agent's Permitted Discretion, materially impair the prospects of
repayment of the Obligations by Borrower or materially impair Borrower's
creditworthiness, (ii) such refinancings, renewals, or extensions do not result
in an increase in the then extant principal amount of, or interest rate with
respect to, the Indebtedness so refinanced, renewed, or extended, (iii) such
refinancings, renewals, or extensions do not result in a shortening of the
average weighted maturity of the Indebtedness so refinanced, renewed, or
extended, nor are they on terms or conditions that, taken as a whole, are
materially more burdensome or restrictive to Borrower, (iv) if the Indebtedness
that is refinanced, renewed, or extended was subordinated in right of payment to
the Obligations, then the terms and conditions of the refinancing, renewal, or
extension Indebtedness must include subordination terms and conditions that are
at least as favorable to the Lender Group as those that were applicable to the
refinanced, renewed, or extended Indebtedness, and (v) the Indebtedness that is
refinanced, renewed, or extended is not recourse to any Person that is liable on
account of the Obligations other than those Persons which were obligated with
respect to the Indebtedness that was refinanced, renewed, or extended,

                           (e) Subordinated Indebtedness of any Credit Party;
provided, immediately prior to, and after giving effect to the incurrence of
such Subordinated Indebtedness, no Default or Event of Default shall have
occurred and be continuing or would result from such incurrence;

                           (f) Indebtedness of any Credit Party to any other
Credit Party and Indebtedness of a Credit Party guaranteeing Indebtedness of
another Credit Party otherwise permitted under this Section 7.1;

                           (g) Indebtedness which may be deemed to exist
pursuant to any guaranties, performance, surety, statutory, appeal or similar
bonds or obligations incurred in the ordinary course of business;

                           (h) Indebtedness in respect of netting services,
overdraft protections and otherwise in connection with Deposit Accounts
maintained in the ordinary course of business;

                           (i) guaranties in the ordinary course of business of
the obligations of suppliers, customers, franchisees and licensees of any Credit
Party;

                           (j) Indebtedness of any Credit Party consisting of
guaranties of obligations of a Subsidiary of a Credit Party which is not an
Asian Subsidiary, provided that (i) such guaranties are subordinated in right of
payment to the Obligations, (ii) such

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Indebtedness, together with Investments made pursuant to Section 7.10(c) in the
aggregate does not exceed at any one time outstanding $20,000,000, (iii) no
Default or Event of Default shall have occurred and be continuing or would
result from the incurrence of such Indebtedness and (iv) such guaranties are
otherwise on terms and conditions satisfactory to the Agent in its Permitted
Discretion;

                           (k) Indebtedness of any Credit Party consisting of
guaranties of the obligations of any Asian Subsidiary, provided that (i) such
guaranties are subordinated in right of payment to the Obligations, (ii) no
Default or Event of Default shall have occurred and be continuing or would
result from the incurrence of such Indebtedness and (iii) the subordination
terms of such guaranties are otherwise on terms and conditions satisfactory to
the Agent in its Permitted Discretion;

                           (l) endorsement of instruments or other payment items
for deposit;

                           (m) Indebtedness under Capital Leases arising out of
Permitted Sale-Leasebacks made in compliance with Section 7.15, in an aggregate
amount not to exceed at any time $30,000,000;

                           (n) Indebtedness under Hedge Agreements incurred for
bona fide hedging purposes and not for speculation; and

                           (o) other Indebtedness of the Credit Parties, in an
aggregate amount not to exceed at any time $50,000,000.

         7.2 LIENS. Create, incur, assume, or suffer to exist, directly or
indirectly, any Lien on or with respect to any of its assets, of any kind,
whether now owned or hereafter acquired, or any income or profits therefrom,
except:

                           (a) Permitted Liens (including Liens that are
replacements of Permitted Liens to the extent that the original Indebtedness is
refinanced, renewed, or extended under Section 7.1(d) and so long as the
replacement Liens only encumber those assets that secured the refinanced,
renewed, or extended Indebtedness); and

                           (b) Liens on assets other than the Credit Party
Collateral securing Indebtedness in an aggregate amount not to exceed
$50,000,000 at any time outstanding.

         7.3 RESTRICTIONS ON FUNDAMENTAL CHANGES/DISPOSAL OF ASSETS. Enter into
any transaction of merger or consolidation, or liquidate, wind-up or dissolve
itself (or suffer any liquidation or dissolution), or convey, sell, lease or
sub-lease (as lessor or sublessor), transfer or otherwise dispose of, in one
transaction or a series of transactions, all or any part of its business, assets
or property of any kind whatsoever, whether real, personal or mixed and whether
tangible or intangible, whether now owned or hereafter acquired, except:

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                           (a) any Credit Party may be merged with or into a
Credit Party, or be liquidated, wound up or dissolved, or all or any part of its
business, property or assets may be conveyed, sold, leased, transferred or
otherwise disposed of, in one transaction or a series of transactions, to any
Credit Party; provided, (i) at the time of any such merger, no Event of Default
shall exist or shall result from such merger, and (ii) in the case of such a
merger, a Credit Party shall be the continuing or surviving Person;

                           (b) Permitted Dispositions;

                           (c) Asset Sales not otherwise permitted hereunder;
provided that (i) the consideration received for such assets shall be in an
amount at least equal to the fair market value thereof; (ii) at the time of any
such Asset Sale, no Event of Default shall exist or shall result from such Asset
Sale; (iii) in the case of Asset Sales consisting of the Credit Party Collateral
and in the case of any Asset Sale if Availability is less than $60,000,000 at
the time of such Asset Sale, no less than 80% of the consideration therefor
shall be paid in cash; (iv) in the case of Asset Sales not consisting of the
Credit Party Collateral, if Availability is equal to or in excess of
$60,000,000, no less than 50% of the consideration therefor shall be paid in
cash and (v) at the time of such Asset Sale and after giving effect thereto, the
aggregate sales price of all Asset Sales, together, since the Closing Date shall
not exceed, in the case of Asset Sales consisting of the Credit Party
Collateral, (A) if availability is less than $60,000,000 at the time of such
Asset Sale, 5% of the Consolidated Net Tangible Assets of the Parent and its
Subsidiaries determined in accordance with GAAP and (B) if Availability is equal
to or in excess of $60,000,000 at the time of such Asset Sale, 10% of the
Consolidated Net Tangible Assets of the Parent and its Subsidiaries determined
in accordance with GAAP, in each case as aggregated with all other Asset Sales
occurring after the Closing Date; and

                           (d) Asset Sales of stores developed by any Credit
Party in connection with Permitted Sale-Leasebacks, provided that the proceeds
of any such Permitted Sale-Leaseback shall be entirely in cash and shall not be
less than 100% of the fair market value of the equipment being sold.

         7.4 CHANGE NAME. Change the name, FEIN, organizational identification
number, state of organization or organizational identity of any Credit Party;
provided, however, that any Credit Party may change any of the foregoing upon at
least 30 days prior written notice to Agent of such change and so long as, at
the time of such written notification, such Credit Party provides any financing
statements necessary to perfect and continue perfected the Agent's Liens.

         7.5 NATURE OF BUSINESS. Make any material change in the principal
nature of its or their business. Any change in the types of products sold or the
methods or channels of distribution shall not constitute a material change in
the principal nature of the business of the Credit Parties.

                                      -75-
<PAGE>

         7.6 AMENDMENTS. Amend or otherwise change the terms of any Subordinated
Indebtedness if the effect of such amendment or other change is to increase the
interest rate on such Indebtedness, change (to earlier dates) any dates upon
which payments of principal or interest are due thereon, change any event of
default or change any condition to an event of default with respect thereto
(other than to eliminate any such event of default or increase any grace period
related thereto or otherwise modify the same in a manner favorable to the Credit
Parties), change the redemption, prepayment or defeasance provisions thereof,
change the subordination provisions thereof (or of any guaranty thereof), or if
the effect of any such amendment or change, together with all other amendments
or changes made, is to increase materially the obligations of the obligor
thereunder or to confer any additional rights on the holders of such
Indebtedness (or a trustee or representative on their behalf) which would be
adverse to any Credit Party or the Lenders.

         7.7 CHANGE OF CONTROL. Cause, permit, or suffer, directly or
indirectly, any Change of Control.

         7.8 DISTRIBUTIONS. Make or set apart any sum for any Restricted
Payment, except that (i) Parent may make regularly scheduled payments of
interest in respect of the Senior Subordinated Notes in accordance with the
subordination provisions contained in the Indenture; (ii) any Credit Party may
make Restricted Payments to any other Credit Party; and (iii) Parent may make
Restricted Payments consisting of the repurchase of shares of common stock of
Parent from employees of any Credit Party provided that (x) no Default or Event
of Default is then existing or would result from such Restricted Payment and (y)
no more than $5,000,000 in the aggregate of such Restricted Payments pursuant to
this clause (iii) may be made in any fiscal year of the Parent and its
Subsidiaries.

                  Notwithstanding the foregoing, any Credit Party may make any
Restricted Payment so long as Availability at the time of such Restricted
Payment is (and is reasonably expected to be for a period of three months
following such Restricted Payment) greater than or equal to $60,000,000 both
before and after giving effect to any such Restricted Payment as evidenced by
the delivery by the Borrower of a certificate to Agent not later than ten (10)
days prior to such Restricted Payment certifying to and demonstrating such
Availability.

         7.9 ACCOUNTING METHODS. Modify or change its fiscal year or its method
of accounting (other than as may be required to conform to GAAP or as otherwise
permitted by GAAP).

         7.10 INVESTMENTS. Directly or indirectly, make or acquire any
Investment or incur any liabilities (including contingent obligations) for or in
connection with any Investment, except;

                           (a) Permitted Investments;

                                      -76-

<PAGE>

                           (b) Investments or commitments to make Investments
existing on the Closing Date and described on Schedule 7.10; and

                           (c) other Investments of the Credit Parties made
after the Closing Date in an aggregate amount not to exceed, when aggregated
with Investments made after the Closing Date pursuant to clause (b) of this
Section 7.10 and Indebtedness outstanding pursuant to Section 7.1(j),
$20,000,000, provided that no more than $10,000,000 of such Investments under
this clause (c) may be funded with the proceeds of any Advance under this
Agreement.

                  Notwithstanding the foregoing, the Credit Parties may make any
Investments so long as Availability at the time of such Investment is (and is
reasonably expected to be for a period of three months following such
Investment) greater than or equal to $60,000,000 both before and after giving
effect to any such Investment as evidenced by the delivery by the Borrower of a
certificate not later than ten (10) days prior to any such Investment to Agent
certifying to and demonstrating such Availability.

         7.11 TRANSACTIONS WITH AFFILIATES. Directly or indirectly enter into or
permit to exist any transaction with any Affiliate of a Credit Party except for
transactions that are in the ordinary course of a Credit Party's business, upon
fair and reasonable terms and that are no less favorable to such Credit Party
than would be obtained in an arm's length transaction with a non-Affiliate
provided that the foregoing restriction shall not apply to (a) any transaction
between Credit Parties; (b) reasonable and customary fees paid to members of the
board of directors of a Credit Party; (c) compensation arrangements for officers
and other employees of the Credit Parties entered into in the ordinary course of
business; and (d) transactions described in Schedule 7.11; provided, however,
that the Credit Parties may enter into transactions with Affiliates which do not
comply with this Section 7.11 provided that the aggregate value (or cost) of
such transactions do not exceed $10,000,000 in any fiscal year of the Parent.

         7.12 USE OF PROCEEDS. Use the proceeds of the Advances for any purpose
other than (a) on the Closing Date, (i) to repay, in full, the outstanding
principal, accrued interest, and accrued fees and expenses owing to Existing
Lender, and (ii) to pay transactional fees, costs, and expenses incurred in
connection with this Agreement, the other Loan Documents, and the transactions
contemplated hereby and thereby, and (b) thereafter, consistent with the terms
and conditions hereof, for its lawful and permitted purposes.

         7.13 EQUITABLE LIEN; NO FURTHER NEGATIVE PLEDGES

                  If any Credit Party shall create or assume any Lien upon any
of its properties or assets, whether now owned or hereafter acquired (other than
Permitted Liens and other Liens permitted by Section 7.2), it shall make or
cause to be made effective provision whereby the Obligations will be secured by
such Lien equally and ratably with any and all other Indebtedness secured
thereby as long as any such Indebtedness shall be so secured;

                                      -77-

<PAGE>

provided, notwithstanding the foregoing, this covenant shall not be construed as
a consent by Required Lenders to the creation or assumption of any such Lien not
otherwise permitted hereby. Except with respect to (a) specific property
encumbered to secure payment of particular Indebtedness or to be sold pursuant
to an executed agreement with respect to a Permitted Disposition, (b)
restrictions by reason of customary provisions restricting assignments,
subletting or other transfers contained in leases, licenses and similar
agreements entered into in the ordinary course of business (provided that such
restrictions are limited to the property or assets secured by such Liens or the
property or assets subject to such leases, licenses or similar agreements, as
the case may be) and (c) restrictions contained in the Indenture as in effect on
the Closing Date, no Credit Party shall enter into any agreement prohibiting the
creation or assumption of any Lien upon any of its properties or assets, whether
now owned or hereafter acquired. Notwithstanding anything else in this Agreement
to the contrary, except for Permitted Liens, no Credit Party shall incur a Lien
on any of its General Intangibles without the prior written consent of Agent and
the Required Lenders.

         7.14 MINIMUM GROSS COLLATERAL AVAILABILITY. The Credit Parties shall
have at all times Gross Collateral Availability equal to or greater than
$25,000,000.

         7.15 SALES AND LEASE-BACKS. Directly or indirectly, become or remain
liable as lessee or as a guarantor or other surety with respect to any lease of
any property (whether real, personal or mixed), whether now owned or hereafter
acquired (a "Sale-Leaseback"), which such Credit Party (a) has sold or
transferred or is to sell or transfer to any other Person (other than a Credit
Party), or (b) intends to use for substantially the same purpose as any other
property which has been or is to be sold or transferred by such Credit Party to
any Person (other than another Credit Party) in connection with such lease;
provided, however, that a Credit Party may enter into Sale-Leasebacks not
involving the Credit Party Collateral at market rates and subject to compliance
with Section 7.3(d) provided that the aggregate amount of such Sale-Leasebacks
since the Closing Date shall not exceed $30,000,000 ("Permitted
Sale-Leasebacks"). For avoidance of doubt, Sale-Leasebacks that result in
Capital Leases shall be treated as Indebtedness for all purposes of this
Agreement.

8. EVENTS OF DEFAULT.

                  Any one or more of the following events shall constitute an
event of default (each, an "Event of Default") under this Agreement:

         8.1 If Borrower fails to pay (a) when due any installment of principal
of any Obligations, whether at stated maturity, by acceleration or otherwise,
(b) when due any amount payable to Issuing Lender in reimbursement of any
drawing under a Letter of Credit; or (c) any interest on any Obligations or any
fee or any other amount due with respect to the Obligations within five (5) days
after the date due;

         8.2 If Borrower:

                                      -78-

<PAGE>

                           (a) fails to perform, keep, or observe any term,
provision, condition, covenant, or agreement contained in Sections 3.2, 4.5,
6.7(a), 6.11, and 7.1 through 7.15 of this Agreement;

                           (b) fails or neglects to perform, keep, or otherwise
observe any term, provision, condition, covenant, or agreement contained in
Sections 2.7(b), 2.7(f), 2.7(g), 2.7(h), 4.6, 6.2, or 6.9 of this Agreement and
such failure continues for a period of 10 days; or

                           (c) fails or neglects to perform, keep, or observe
any other term, provision, condition, covenant, or agreement contained in this
Agreement, or in any of the other Loan Documents (giving effect to any grace
periods, cure periods, or required notices, if any, expressly provided for in
such Loan Documents), in each case, other than any such term, provision,
covenant, or agreement that is the subject of another provision of this Section
8 (in which event such other provision of this Section 8 shall govern), and such
failure continues for a period of 30 days from the earlier of (a) an officer of
any Credit Party becoming aware of such failure or (b) notice thereof from Agent
or a Lender;

         8.3 If any material portion of any Material Credit Party's assets is
attached, seized, subjected to a writ or distress warrant, levied upon, or comes
into the possession of any third Person and the same is not discharged before
the earlier of 60 days (so long as Availability is equal to or greater than
$75,000,000, otherwise 30 days) after the date it first arises or 5 days prior
to the date on which such property or asset is subject to forfeiture;

         8.4 If an Insolvency Proceeding is commenced by Borrower or any of its
Subsidiaries or Borrower admits in writing its inability to, or is generally
unable to, pay its debts as such debts become due;

         8.5 If an Insolvency Proceeding is commenced against Borrower, Parent,
or any other Material Credit Party, and any of the following events occur: (a)
Borrower, Parent or such other Material Credit Party consents to the institution
of such Insolvency Proceeding against it, (b) the petition commencing the
Insolvency Proceeding is not timely controverted; provided, however, that,
during the pendency of such period, each member of the Lender Group shall be
relieved of its obligations to extend credit hereunder, (c) the petition
commencing the Insolvency Proceeding is not dismissed within 60 calendar days of
the date of the filing thereof; provided, however, that, during the pendency of
such period, each member of the Lender Group shall be relieved of its
obligations to extend credit hereunder, (d) an interim trustee is appointed to
take possession of all or any substantial portion of the properties or assets
of, or to operate all or any substantial portion of the business of, Borrower,
Parent or any other Material Credit Party, or (e) an order for relief shall have
been entered therein;

         8.6 If any Credit Party is enjoined, restrained, or in any way
prevented by court order from continuing to conduct all or any material part of
its business affairs;

                                      -79-

<PAGE>

         8.7 If there is a default in one or more agreements to which any Credit
Party is a party relative to such Credit Party's Indebtedness involving an
aggregate amount of $10,000,000, or more, and such default (a) occurs at the
final maturity of the obligations thereunder, or (b) results in a right by the
other party thereto, irrespective of whether exercised, to accelerate the
maturity of any Credit Party's obligations thereunder or to terminate such
agreement;

         8.8 If any Credit Party makes any payment on account of Indebtedness
that has been contractually subordinated in right of payment to the payment of
the Obligations, except to the extent such payment is not prohibited by the
terms of the subordination provisions applicable to such Indebtedness;

         8.9 If any material misstatement or misrepresentation exists now or
hereafter in any warranty, representation, statement, or Record made to the
Lender Group by any Credit Party, or any officer, employee, agent, or director
of any Credit Party;

         8.10 If this Agreement or any other Loan Document that purports to
create a Lien, shall, for any reason, fail or cease to create a valid and
perfected and, except to the extent permitted by the terms hereof or thereof,
first priority Lien on or security interest in the Credit Party Collateral
covered hereby or thereby; or

         8.11 Any provision of any Loan Document shall at any time for any
reason be declared to be null and void, or the validity or enforceability
thereof shall be contested by any Credit Party, or a proceeding shall be
commenced by any Credit Party, or by any Governmental Authority having
jurisdiction over any Credit Party, seeking to establish the invalidity or
unenforceability thereof, or any Credit Party shall deny that it has any
liability or obligation purported to be created under any Loan Document.

9. THE LENDER GROUP'S RIGHTS AND REMEDIES.

         9.1 RIGHTS AND REMEDIES. Upon the occurrence, and during the
continuation, of an Event of Default, the Required Lenders (at their election
but without notice of their election and without demand) may authorize and
instruct Agent to do any one or more of the following on behalf of the Lender
Group (and Agent, acting upon the instructions of the Required Lenders, shall do
the same on behalf of the Lender Group), all of which are authorized by each
Credit Party:

                           (a) Declare all Obligations (or any portion thereof),
whether evidenced by this Agreement, by any of the other Loan Documents, or
otherwise, immediately due and payable;

                           (b) Cease (or restrict) advancing money or extending
credit to or for the benefit of Borrower under this Agreement, under any of the
Loan Documents, or under any other agreement between Borrower and the Lender
Group;

                                      -80-
<PAGE>

                           (c) Upon notice to Borrower (except with respect to
an Event of Default under Sections 8.4 or 8.5, in which case no notice shall be
required), terminate this Agreement and any of the other Loan Documents as to
any future liability or obligation of the Lender Group, but without affecting
any of the Agent's Liens in the Credit Party Collateral and without affecting
the Obligations;

                           (d) Settle or adjust disputes and claims directly
with any Credit Party's Account Debtors for amounts and upon terms which Agent
considers advisable, and in such cases, Agent will credit Borrower's Loan
Account with only the net amounts received by Agent in payment of such disputed
Accounts after deducting all Lender Group Expenses incurred or expended in
connection therewith;

                           (e) Cause any Credit Party to hold all of its
returned Inventory in trust for the Lender Group and segregate all such
Inventory from all other assets of such Credit Party or in such Credit Party's
possession;

                           (f) Without notice to or demand upon any Credit
Party, make such payments and do such acts as Agent considers necessary or
reasonable to protect its security interests in the Credit Party Collateral.
Each Credit Party agrees to assemble the Credit Party Collateral if Agent so
requires, and to make the Credit Party Collateral available to Agent at a place
that Agent may designate which is reasonably convenient to both parties. Each
Credit Party authorizes Agent to enter the premises where the Credit Party
Collateral is located, to take and maintain possession of the Credit Party
Collateral, or any part of it, and to pay, purchase, contest, or compromise any
Lien that in Agent's determination appears to conflict with the Agent's Liens in
and to the Credit Party Collateral and to pay all expenses incurred in
connection therewith and to charge Borrower's Loan Account therefor. With
respect to any of any Credit Party's owned or leased premises, each Credit Party
hereby grants Agent a license to enter into possession of such premises and to
occupy the same, without charge, in order to exercise any of the Lender Group's
rights or remedies provided herein, at law, in equity, or otherwise;

                           (g) Without notice to any Credit Party (such notice
being expressly waived), and without constituting an acceptance of any
collateral in full or partial satisfaction of an obligation (within the meaning
of the Code), set off and apply to the Obligations any and all (i) balances and
deposits of any Credit Party held by the Lender Group (including any amounts
received in the Cash Management Accounts), or (ii) Indebtedness at any time
owing to or for the credit or the account of any Credit Party held by the Lender
Group;

                           (h) Hold, as cash collateral, any and all balances
and deposits of any Credit Party held by the Lender Group, and any amounts
received in the Cash Management Accounts, to secure the full and final repayment
of all of the Obligations;

                           (i) Ship, reclaim, recover, store, finish, maintain,
repair, prepare for sale, advertise for sale, and sell (in the manner provided
for herein) the Credit Party

                                      -81-
<PAGE>

Collateral. Each Credit Party hereby grants to Agent a non-exclusive license or
other right to use, without charge, such Credit Party's instruments and General
Intangibles, including, without limitation, labels, patents, copyrights, trade
secrets, trade names, trademarks, service marks, and advertising matter,
merchandising systems, inventory locations, fixed assets or any property of a
similar nature, as it pertains to the Credit Party Collateral, in completing
production of, advertising for sale, and selling any Credit Party Collateral and
such Credit Party's rights under all licenses and all franchise agreements shall
inure to the Lender Group's benefit;

                           (j) Sell the Credit Party Collateral at either a
public or private sale, or both, by way of one or more contracts or
transactions, for cash or on terms, in such manner and at such places (including
any Credit Party's premises) as Agent determines is commercially reasonable. It
is not necessary that the Credit Party Collateral be present at any such sale;

                           (k) Agent shall give notice of the disposition of the
Credit Party Collateral as follows:

                           (i)      Agent shall give Borrower on behalf of the
                  Credit Parties, a notice in writing of the time and place of
                  public sale, or, if the sale is a private sale or some other
                  disposition other than a public sale is to be made of the
                  Credit Party Collateral, the time on or after which the
                  private sale or other disposition is to be made; and

                           (ii)     The notice shall be personally delivered or
                  mailed, postage prepaid, to Borrower as provided in Section
                  12, at least 10 days before the earliest time of disposition
                  set forth in the notice; no notice needs to be given prior to
                  the disposition of any portion of the Credit Party Collateral
                  that is perishable or threatens to decline speedily in value
                  or that is of a type customarily sold on a recognized market;

                           (l) Agent, on behalf of the Lender Group, may credit
bid and purchase at any public sale;

                           (m) Agent may seek the appointment of a receiver or
keeper to take possession of all or any portion of the Credit Party Collateral
or to operate same and, to the maximum extent permitted by law, may seek the
appointment of such a receiver without the requirement of prior notice or a
hearing; and

                           (n) The Lender Group shall have all other rights and
remedies available at law or in equity or pursuant to any other Loan Document.

; provided, however, that upon the occurrence of any Event of Default described
in Section 8.4 or Section 8.5, in addition to the remedies set forth above,
without any notice to any

                                      -82-
<PAGE>

Credit Party or any other Person or any act by the Lender Group, the Commitments
shall automatically terminate and the Obligations then outstanding, together
with all accrued and unpaid interest thereon and all fees and all other amounts
due under this Agreement and the other Loan Documents, shall automatically and
immediately become due and payable, without presentment, demand, protest, or
notice of any kind, all of which are expressly waived by each Credit Party.

         9.2 REMEDIES CUMULATIVE. The rights and remedies of the Lender Group
under this Agreement, the other Loan Documents, and all other agreements shall
be cumulative. The Lender Group shall have all other rights and remedies not
inconsistent herewith as provided under the Code, by law, or in equity. No
exercise by the Lender Group of one right or remedy shall be deemed an election,
and no waiver by the Lender Group of any Event of Default shall be deemed a
continuing waiver. No delay by the Lender Group shall constitute a waiver,
election, or acquiescence by it.

10. TAXES AND EXPENSES.

                  If any Credit Party fails to pay any monies (whether taxes,
assessments, insurance premiums, or, in the case of leased properties or assets,
rents or other amounts payable under such leases) due to third Persons, or fails
to make any deposits or furnish any required proof of payment or deposit, all as
required under the terms of this Agreement, then, Agent, in its sole discretion
and without prior notice to Borrower, may do any or all of the following: (a)
make payment of the same or any part thereof, (b) set up such Reserves in
Borrower's Loan Account as Agent deems necessary to protect the Lender Group
from the exposure created by such failure, or (c) in the case of the failure to
comply with Section 6.7 hereof, obtain and maintain insurance policies of the
type described in Section 6.7 and take any action with respect to such policies
as Agent deems prudent. Any such amounts paid by Agent shall constitute Lender
Group Expenses and any such payments shall not constitute an agreement by the
Lender Group to make similar payments in the future or a waiver by the Lender
Group of any Event of Default under this Agreement. Agent need not inquire as
to, or contest the validity of, any such expense, tax, or Lien and the receipt
of the usual official notice for the payment thereof shall be conclusive
evidence that the same was validly due and owing.

11. WAIVERS; INDEMNIFICATION.

         11.1     DEMAND; PROTEST; ETC. Each Credit Party waives demand,
protest, notice of protest, notice of default or dishonor, notice of payment and
nonpayment, nonpayment at maturity, release, compromise, settlement, extension,
or renewal of documents, instruments, chattel paper, and guarantees at any time
held by the Lender Group on which each such Credit Party may in any way be
liable.

         11.2     THE LENDER GROUP'S LIABILITY FOR CREDIT PARTY COLLATERAL. Each
Credit Party hereby agrees that: (a) so long as Agent complies with its
obligations, if any, under the

                                      -83-
<PAGE>

Code, the Lender Group shall not in any way or manner be liable or responsible
for: (i) the safekeeping of the Credit Party Collateral, (ii) any loss or damage
thereto occurring or arising in any manner or fashion from any cause, (iii) any
diminution in the value thereof, or (iv) any act or default of any carrier,
warehouseman, bailee, forwarding agency, or other Person, and (b) all risk of
loss, damage, or destruction of the Credit Party Collateral shall be borne by
the Credit Parties.

         11.3     INDEMNIFICATION. Each Credit Party shall jointly and severally
pay, indemnify, defend, and hold the Agent-Related Persons, the Lender-Related
Persons, and each Participant (each, an "Indemnified Person") harmless (to the
fullest extent permitted by law) from and against any and all claims, demands,
suits, actions, investigations, proceedings, and damages, and all reasonable
attorneys fees and disbursements and other costs and expenses actually incurred
in connection therewith (as and when they are incurred and irrespective of
whether suit is brought), at any time asserted against, imposed upon, or
incurred by any of them (a) in connection with or as a result of or related to
the execution, delivery, enforcement, performance, or administration (including
any restructuring or workout with respect hereto) of this Agreement, any of the
other Loan Documents, or the transactions contemplated hereby or thereby or the
monitoring of each Credit Party's compliance with the terms of the Loan
Documents, and (b) with respect to any investigation, litigation, or proceeding
related to this Agreement, any other Loan Document, or the use of the proceeds
of the credit provided hereunder (irrespective of whether any Indemnified Person
is a party thereto), or any act, omission, event, or circumstance in any manner
related thereto (all the foregoing, collectively, the "Indemnified
Liabilities"). The foregoing to the contrary notwithstanding, no Credit Party
shall have any obligation to any Indemnified Person under this Section 11.3 with
respect to any Indemnified Liability that a court of competent jurisdiction
finally determines to have resulted from the gross negligence (as opposed to
negligence) or willful misconduct of such Indemnified Person. This provision
shall survive the termination of this Agreement and the repayment of the
Obligations. If any Indemnified Person makes any payment to any other
Indemnified Person with respect to an Indemnified Liability as to which any
Credit Party was required to indemnify the Indemnified Person receiving such
payment, the Indemnified Person making such payment is entitled to be
indemnified and reimbursed by such Credit Party with respect thereto.

12. NOTICES.

                  Unless otherwise provided in this Agreement, all notices or
demands by the Credit Parties or Agent to the other relating to this Agreement
or any other Loan Document shall be in writing and (except for financial
statements and other informational documents which may be sent by first-class
mail, postage prepaid) shall be personally delivered or sent by registered or
certified mail (postage prepaid, return receipt requested), overnight courier,
electronic mail (at such email addresses as Borrower or Agent, as applicable,
may designate to each other in accordance herewith), or telefacsimile to the
Credit Parties or Agent, as the case may be, at its address set forth below:

                                      -84-
<PAGE>

         If to any Credit Party:    PAYLESS SHOESOURCE, INC.
                                    3231 Southeast Sixth Avenue
                                    Topeka, Kansas 66607-2207
                                    Attn: General Counsel
                                    Fax No. (785) 368-7524

                With a copy to:     WACHTELL, LIPTON, ROSEN & KATZ
                                    51 West 52nd Street
                                    New York, New York 10019
                                    Attn: Richard G. Mason
                                    Fax No. (212) 403-2000

                    If to Agent:    WELLS FARGO RETAIL FINANCE, LLC
                                    One Boston Place, 18th Floor
                                    Boston, Massachusetts, 02108
                                    Attn: Francis D. O'Connor
                                    Fax No. (617) 523-4032

                  Agent and any Credit Party may change the address at which
they are to receive notices hereunder, by notice in writing in the foregoing
manner given to the other party. All notices or demands sent in accordance with
this Section 12, other than notices by Agent in connection with enforcement
rights against the Credit Party Collateral under the provisions of the Code,
shall be deemed received on the earlier of the date of actual receipt or 3
Business Days after the deposit thereof in the mail. Each Credit Party
acknowledges and agrees that notices sent by the Lender Group in connection with
the exercise of enforcement rights against Credit Party Collateral under the
provisions of the Code shall be deemed sent when deposited in the mail or
personally delivered, or, where permitted by law, transmitted by telefacsimile
or any other method set forth above.

13. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.

                           (a) THE VALIDITY OF THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN
RESPECT OF SUCH OTHER LOAN DOCUMENT), THE CONSTRUCTION, INTERPRETATION, AND
ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS OF THE PARTIES HERETO AND THERETO
WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR
THERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.

                                      -85-
<PAGE>

                           (b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS
ARISING IN CONNECTION WITH THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE
TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN NEW YORK
COUNTY IN THE STATE OF NEW YORK, PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY CREDIT PARTY COLLATERAL OR OTHER PROPERTY MAY BE
BROUGHT, AT AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE AGENT ELECTS
TO BRING SUCH ACTION OR WHERE SUCH CREDIT PARTY COLLATERAL OR OTHER PROPERTY MAY
BE FOUND. EACH OF THE CREDIT PARTIES AND THE LENDER GROUP WAIVE, TO THE EXTENT
PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE
OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS
BROUGHT IN ACCORDANCE WITH THIS SECTION 13(b).

                           (c) EACH OF THE CREDIT PARTIES AND THE LENDER GROUP
HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE
TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS,
BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH OF THE
CREDIT PARTIES AND THE LENDER GROUP REPRESENT THAT EACH HAS REVIEWED THIS WAIVER
AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS
AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

14. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS.

         14.1     ASSIGNMENTS AND PARTICIPATIONS.

                           (a) Any Lender may assign and delegate to one or more
assignees (each an "Assignee") that are Eligible Transferees all, or any ratable
part of all, of the Obligations, the Commitments and the other rights and
obligations of such Lender hereunder and under the other Loan Documents, in a
minimum amount of $5,000,000; provided, however, that Borrower and Agent may
continue to deal solely and directly with such Lender in connection with the
interest so assigned to an Assignee until (i) written notice of such assignment,
together with payment instructions, addresses, and related information with
respect to the Assignee, have been given to Borrower and Agent by such Lender
and the Assignee, (ii) such Lender and its Assignee have delivered to Borrower
and Agent an Assignment and Acceptance, and (iii) the assignor Lender or
Assignee has paid to Agent for Agent's separate account a processing fee in the
amount of $5,000. Anything contained herein to the contrary

                                      -86-
<PAGE>

notwithstanding, the payment of any fees shall not be required and the Assignee
need not be an Eligible Transferee if such assignment is in connection with any
merger, consolidation, sale, transfer, or other disposition of all or any
substantial portion of the business or loan portfolio of the assigning Lender.

                           (b) From and after the date that Agent notifies the
assignor Lender (with a copy to Borrower) that it has received an executed
Assignment and Acceptance and payment of the above-referenced processing fee,
(i) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Lender
under the Loan Documents, and (ii) the assignor Lender shall, to the extent that
rights and obligations hereunder and under the other Loan Documents have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
(except with respect to Section 11.3 hereof) and be released from any future
obligations under this Agreement (and in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's rights
and obligations under this Agreement and the other Loan Documents, such Lender
shall cease to be a party hereto and thereto), and such assignment shall effect
a novation between Borrower and the Assignee; provided, however, that nothing
contained herein shall release any assigning Lender from obligations that
survive the termination of this Agreement, including such assigning Lender's
obligations under Article 16 and Section 17.8 of this Agreement.

                           (c) By executing and delivering an Assignment and
Acceptance, the assigning Lender thereunder and the Assignee thereunder confirm
to and agree with each other and the other parties hereto as follows: (1) other
than as provided in such Assignment and Acceptance, such assigning Lender makes
no representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other Loan Document furnished
pursuant hereto, (2) such assigning Lender makes no representation or warranty
and assumes no responsibility with respect to the financial condition of
Borrower or the performance or observance by Borrower of any of its obligations
under this Agreement or any other Loan Document furnished pursuant hereto, (3)
such Assignee confirms that it has received a copy of this Agreement, together
with such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into such Assignment and
Acceptance, (4) such Assignee will, independently and without reliance upon
Agent, such assigning Lender or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Agreement, (5)
such Assignee appoints and authorizes Agent to take such actions and to exercise
such powers under this Agreement as are delegated to Agent, by the terms hereof,
together with such powers as are reasonably incidental thereto, and (6) such
Assignee agrees that it will perform all of the obligations which by the terms
of this Agreement are required to be performed by it as a Lender.

                                      -87-
<PAGE>

                           (d) Immediately upon Agent's receipt of the required
processing fee payment and the fully executed Assignment and Acceptance, this
Agreement shall be deemed to be amended to the extent, but only to the extent,
necessary to reflect the addition of the Assignee and the resulting adjustment
of the Commitments arising therefrom. The Commitment allocated to each Assignee
shall reduce such Commitments of the assigning Lender pro tanto.

                           (e) Any Lender may at any time, with the written
consent of Agent, sell to one or more commercial banks, financial institutions,
or other Persons not Affiliates of such Lender (a "Participant") participating
interests in its Obligations, the Commitment, and the other rights and interests
of that Lender (the "Originating Lender") hereunder and under the other Loan
Documents (provided that no written consent of Agent shall be required in
connection with any sale of any such participating interests by a Lender to an
Eligible Transferee); provided, however, that (i) the Originating Lender shall
remain a "Lender" for all purposes of this Agreement and the other Loan
Documents and the Participant receiving the participating interest in the
Obligations, the Commitments, and the other rights and interests of the
Originating Lender hereunder shall not constitute a "Lender" hereunder or under
the other Loan Documents and the Originating Lender's obligations under this
Agreement shall remain unchanged, (ii) the Originating Lender shall remain
solely responsible for the performance of such obligations, (iii) Borrower,
Agent, and the Lenders shall continue to deal solely and directly with the
Originating Lender in connection with the Originating Lender's rights and
obligations under this Agreement and the other Loan Documents, (iv) no Lender
shall transfer or grant any participating interest under which the Participant
has the right to approve any amendment to, or any consent or waiver with respect
to, this Agreement or any other Loan Document, except to the extent such
amendment to, or consent or waiver with respect to this Agreement or of any
other Loan Document would (A) extend the final maturity date of the Obligations
hereunder in which such Participant is participating, (B) reduce the interest
rate applicable to the Obligations hereunder in which such Participant is
participating, (C) release all or substantially all of the Credit Party
Collateral or guaranties (except to the extent expressly provided herein or in
any of the Loan Documents) supporting the Obligations hereunder in which such
Participant is participating, (D) postpone the payment of, or reduce the amount
of, the interest or fees payable to such Participant through such Lender, or (E)
change the amount or due dates of scheduled principal repayments or prepayments
or premiums, and (v) all amounts payable by Borrower hereunder shall be
determined as if such Lender had not sold such participation, except that, if
amounts outstanding under this Agreement are due and unpaid, or shall have been
declared or shall have become due and payable upon the occurrence of an Event of
Default, each Participant shall be deemed to have the right of set-off in
respect of its participating interest in amounts owing under this Agreement to
the same extent as if the amount of its participating interest were owing
directly to it as a Lender under this Agreement. The rights of any Participant
only shall be derivative through the Originating Lender with whom such
Participant participates and no Participant shall have any rights under this
Agreement or the other Loan Documents or any direct rights as to the other
Lenders, Agent, Borrower, the

                                      -88-
<PAGE>

Collections of any Credit Party, the Credit Party Collateral, or otherwise in
respect of the Obligations. No Participant shall have the right to participate
directly in the making of decisions by the Lenders among themselves.
Notwithstanding the foregoing, for purposes of Section 16.11, a Participant
shall be treated as a Lender that is an assignee of the Originating Lender.

                           (f) In connection with any such assignment or
participation or proposed assignment or participation, a Lender may, subject to
the provisions of Section 18.8, disclose all documents and information which it
now or hereafter may have relating to Borrower and its Subsidiaries and their
respective businesses.

                           (g) Any other provision in this Agreement
notwithstanding, any Lender may at any time create a security interest in, or
pledge, all or any portion of its rights under and interest in this Agreement,
including without limitation, in favor of any Federal Reserve Bank in accordance
with Regulation A of the Federal Reserve Bank or U.S. Treasury Regulation 31 CFR
Section 203.24 (and such Federal Reserve Bank may enforce such pledge or
security interest in any manner permitted under applicable law).

                           (h) Agent, acting solely for this purpose as an agent
of Borrower, shall maintain at one of its offices in the United States a copy of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of each Lender, and the Revolving
Commitments of, and principal amount of the Advances owing to, such Lender
pursuant to the terms hereof. The entries in such register shall be conclusive,
and Borrower, Agent and Lenders may treat each Person whose name is recorded
therein pursuant to the terms hereof as a Lender hereunder for all purposes of
this Agreement, notwithstanding notice to the contrary. Such register shall be
available for inspection by Borrower and any Lender, at any reasonable time upon
reasonable prior notice to Agent.

         14.2     SUCCESSORS. This Agreement shall bind and inure to the benefit
of the respective successors and assigns of each of the parties; provided,
however, that no Credit Party may assign this Agreement or any rights or duties
hereunder without the Lenders' prior written consent and any prohibited
assignment shall be absolutely void ab initio. No consent to assignment by the
Lenders shall release any Credit Party from its Obligations. A Lender may assign
this Agreement and the other Loan Documents and its rights and duties hereunder
and thereunder pursuant to Section 14.1 hereof and, except as expressly required
pursuant to Section 14.1 hereof, no consent or approval by any Credit Party is
required in connection with any such assignment.

15. AMENDMENTS; WAIVERS.

         15.1     AMENDMENTS AND WAIVERS. No amendment or waiver of any
provision of this Agreement or any other Loan Document, and no consent with
respect to any departure by any Credit Party therefrom, shall be effective
unless the same shall be in writing and signed by the Required Lenders (or by
Agent at the written request of the Required Lenders)

                                      -89-
<PAGE>

and each Credit Party and then any such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given;
provided, however, that no such waiver, amendment, or consent shall, unless in
writing and signed by all of the Lenders affected thereby and each Credit Party,
do any of the following:

                           (a) increase or extend any Commitment of any Lender,

                           (b) postpone or delay any date fixed by this
Agreement or any other Loan Document for any payment of principal, interest,
fees, or other amounts due hereunder or under any other Loan Document,

                           (c) reduce the principal of, or the rate of interest
on, any loan or other extension of credit hereunder, or reduce any fees or other
amounts payable hereunder or under any other Loan Document,

                           (d) change the percentage of the Commitments that is
required to take any action hereunder,

                           (e) amend or modify this Section or any provision of
the Agreement providing for consent or other action by all Lenders,

                           (f) release the Credit Party Collateral other than as
permitted by Section 16.12,

                           (g) change the definition of "Required Lenders" or
"Pro Rata Share",

                           (h) contractually subordinate any of the Agent's
Liens other than with respect to a release of the Credit Party Collateral
otherwise permitted by Section 16.12,

                           (i) release any Credit Party from any obligation for
the payment of money, other than, with respect to any Credit Party other than
the Parent, Borrower or Payless Missouri, as would be permitted with respect to
a release of the Credit Party Collateral permitted by Section 16.12, or

                           (j) change the definition of Borrowing Base or the
definitions of Eligible Accounts, Eligible Inventory, Eligible In-Transit
Inventory, Eligible Landed Inventory, Maximum Revolver Amount, or change Section
2.1(b) (provided that Agent's establishment and adjustment of the Reserves as
permitted by Section 2.1(b) shall not be considered a change for purposes of
this Section 15.1(j)),

                           (k) amend any of the provisions of Section 16, or

                           (l) amend Section 7.14,

                                      -90-
<PAGE>

and, provided further, however, that no amendment, waiver or consent shall,
unless in writing and signed by Agent, Issuing Lender, or Swing Lender, as
applicable, affect the rights or duties of Agent, Issuing Lender, or Swing
Lender, as applicable, under this Agreement or any other Loan Document. The
foregoing notwithstanding, any amendment, modification, waiver, consent,
termination, or release of, or with respect to, any provision of this Agreement
or any other Loan Document that relates only to the relationship of the Lender
Group among themselves, and that does not affect the rights or obligations of
any Credit Party, shall not require consent by or the agreement of such Credit
Party. For purposes of clarification, other than as required by Section 2.2, no
Lender consent will be required with respect to the Revolver Increase.

         15.2     REPLACEMENT OF HOLDOUT LENDER.

                           (a) (i) If any action to be taken by the Lender Group
or Agent hereunder requires the unanimous consent, authorization, or agreement
of all Lenders, and a Lender fails to give its consent, authorization, or
agreement or (ii) if any Lender gives notice to Borrower pursuant to Section
2.14 (in each case, a "Holdout Lender"), then Borrower or Agent, upon at least 5
Business Days prior irrevocable notice to the Holdout Lender, may permanently
replace the Holdout Lender with one or more substitute Lenders (each, a
"Replacement Lender"), and the Holdout Lender shall have no right to refuse to
be replaced hereunder. Such notice to replace the Holdout Lender shall specify
an effective date for such replacement, which date shall not be later than 15
Business Days after the date such notice is given.

                           (b) Prior to the effective date of such replacement,
the Holdout Lender and each Replacement Lender shall execute and deliver an
Assignment and Acceptance, subject only to the Holdout Lender being repaid its
share of the outstanding Obligations (including an assumption of its Pro Rata
Share of the Risk Participation Liability) without any premium or penalty of any
kind whatsoever. If the Holdout Lender shall refuse or fail to execute and
deliver any such Assignment and Acceptance prior to the effective date of such
replacement, the Holdout Lender shall be deemed to have executed and delivered
such Assignment and Acceptance. The replacement of any Holdout Lender shall be
made in accordance with the terms of Section 14.1. Until such time as the
Replacement Lenders shall have acquired all of the Obligations, the Commitments,
and the other rights and obligations of the Holdout Lender hereunder and under
the other Loan Documents, the Holdout Lender shall remain obligated to make the
Holdout Lender's Pro Rata Share of Advances and to purchase a participation in
each Letter of Credit, in an amount equal to its Pro Rata Share of the Risk
Participation Liability of such Letter of Credit.

         15.3     NO WAIVERS; CUMULATIVE REMEDIES. No failure by Agent or any
Lender to exercise any right, remedy, or option under this Agreement or any
other Loan Document, or delay by Agent or any Lender in exercising the same,
will operate as a waiver thereof. No waiver by Agent or any Lender will be
effective unless it is in writing, and then only to the

                                      -91-
<PAGE>

extent specifically stated. No waiver by Agent or any Lender on any occasion
shall affect or diminish Agent's and each Lender's rights thereafter to require
strict performance by each Credit Party of any provision of this Agreement.
Agent's and each Lender's rights under this Agreement and the other Loan
Documents will be cumulative and not exclusive of any other right or remedy that
Agent or any Lender may have.

16. AGENT; THE LENDER GROUP.

         16.1     APPOINTMENT AND AUTHORIZATION OF AGENT. Each Lender hereby
designates and appoints WFRF as its representative under this Agreement and the
other Loan Documents and each Lender hereby irrevocably authorizes Agent to
execute and deliver each of the other Loan Documents on its behalf and to take
such other action on its behalf under the provisions of this Agreement and each
other Loan Document and to exercise such powers and perform such duties as are
expressly delegated to Agent by the terms of this Agreement or any other Loan
Document, together with such powers as are reasonably incidental thereto. Agent
agrees to act as such on the express conditions contained in this Section 16.
The provisions of this Section 16 (other than Section 16.11 and the release
provisions in Section 16.12) are solely for the benefit of Agent, and the
Lenders, and the Credit Parties shall have no rights as a third party
beneficiary of any of the provisions contained herein. Any provision to the
contrary contained elsewhere in this Agreement or in any other Loan Document
notwithstanding, Agent shall not have any duties or responsibilities, except
those expressly set forth herein, nor shall Agent have or be deemed to have any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against Agent; it being
expressly understood and agreed that the use of the word "Agent" is for
convenience only, that WFRF is merely the representative of the Lenders, and
only has the contractual duties set forth herein. Except as expressly otherwise
provided in this Agreement, Agent shall have and may use its sole discretion
with respect to exercising or refraining from exercising any discretionary
rights or taking or refraining from taking any actions that Agent expressly is
entitled to take or assert under or pursuant to this Agreement and the other
Loan Documents. Without limiting the generality of the foregoing, or of any
other provision of the Loan Documents that provides rights or powers to Agent,
Lenders agree that Agent shall have the right to exercise the following powers
as long as this Agreement remains in effect: (a) maintain, in accordance with
its customary business practices, ledgers and records reflecting the status of
the Obligations, the Credit Party Collateral, the Collections of each Credit
Party, and related matters, (b) execute or file any and all financing or similar
statements or notices, amendments, renewals, supplements, documents,
instruments, proofs of claim, notices and other written agreements with respect
to the Loan Documents, (c) make Advances, for itself or on behalf of Lenders as
provided in the Loan Documents, (d) exclusively receive, apply, and distribute
the Collections of each Credit Party as provided in the Loan Documents, (e) open
and maintain such bank accounts and cash management arrangements as Agent deems
necessary and appropriate in accordance with the Loan Documents for the
foregoing purposes with respect to the Credit

                                      -92-
<PAGE>

Party Collateral and the Collections of each Credit Party, (f) perform,
exercise, and enforce any and all other rights and remedies of the Lender Group
with respect to each Credit Party, the Obligations, the Credit Party Collateral,
the Collections of each Credit Party, or otherwise related to any of same as
provided in the Loan Documents, and (g) incur and pay such Lender Group Expenses
as Agent may deem necessary or appropriate for the performance and fulfillment
of its functions and powers pursuant to the Loan Documents.

         16.2     DELEGATION OF DUTIES. Agent may execute any of its duties
under this Agreement or any other Loan Document by or through agents, employees
or attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects as
long as such selection was made without gross negligence or willful misconduct.

         16.3     LIABILITY OF AGENT. None of the Agent-Related Persons shall
(i) be liable for any action taken or omitted to be taken by any of them under
or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct), or (ii) be responsible in any manner to any of the Lenders for any
recital, statement, representation or warranty made by any Credit Party, or any
officer or director thereof, contained in this Agreement or in any other Loan
Document, or in any certificate, report, statement or other document referred to
or provided for in, or received by Agent under or in connection with, this
Agreement or any other Loan Document, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document, or for any failure of any Credit Party or any other party to any Loan
Document to perform its obligations hereunder or thereunder. No Agent-Related
Person shall be under any obligation to any Lender to ascertain or to inquire as
to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
Books or properties of any Credit Party or the books or records or properties of
any Credit Party or its Affiliates.

         16.4     RELIANCE BY AGENT. Agent shall be entitled to rely, and shall
be fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent, or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to any Credit
Party or counsel to any Lender), independent accountants and other experts
selected by Agent. Agent shall be fully justified in failing or refusing to take
any action under this Agreement or any other Loan Document unless Agent shall
first receive such advice or concurrence of the Lenders as it deems appropriate
and until such instructions are received, Agent shall act, or refrain from
acting, as it deems advisable. If Agent so requests, it shall first be
indemnified to its reasonable satisfaction by the Lenders against any and all
liability and expense that may be incurred by it by reason of taking or
continuing to take any such action. Agent shall in all cases be fully protected
in acting, or in refraining from acting,

                                      -93-
<PAGE>

under this Agreement or any other Loan Document in accordance with a request or
consent of the requisite Lenders and such request and any action taken or
failure to act pursuant thereto shall be binding upon all of the Lenders.

         16.5     NOTICE OF DEFAULT OR EVENT OF DEFAULT. Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default, except with respect to defaults in the payment of principal, interest,
fees, and expenses required to be paid to Agent for the account of the Lenders
and, except with respect to Events of Default of which Agent has actual
knowledge, unless Agent shall have received written notice from a Lender or
Borrower referring to this Agreement, describing such Default or Event of
Default, and stating that such notice is a "notice of default." Agent promptly
will notify the Lenders of its receipt of any such notice or of any Event of
Default of which Agent has actual knowledge. If any Lender obtains actual
knowledge of any Event of Default, such Lender promptly shall notify the other
Lenders and Agent of such Event of Default. Each Lender shall be solely
responsible for giving any notices to its Participants, if any. Subject to
Section 16.4, Agent shall take such action with respect to such Default or Event
of Default as may be requested by the Required Lenders in accordance with
Section 9; provided, however, that unless and until Agent has received any such
request, Agent may (but shall not be obligated to) take such action, or refrain
from taking such action, with respect to such Default or Event of Default as it
shall deem advisable.

         16.6     CREDIT DECISION. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by Agent hereinafter taken, including any review of the affairs of any
Credit Party or its Affiliates, shall be deemed to constitute any representation
or warranty by any Agent-Related Person to any Lender. Each Lender represents to
Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition and creditworthiness of each
Credit Party and any other Person party to a Loan Document, and all applicable
bank regulatory laws relating to the transactions contemplated hereby, and made
its own decision to enter into this Agreement and to extend credit to Borrower.
Each Lender also represents that it will, independently and without reliance
upon any Agent-Related Person and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of each Credit Party and any other
Person party to a Loan Document. Except for notices, reports, and other
documents expressly herein required to be furnished to the Lenders by Agent,
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, prospects, operations,
property, financial and other condition or creditworthiness of any Credit Party
and any other Person

                                      -94-
<PAGE>

party to a Loan Document that may come into the possession of any of the
Agent-Related Persons.

         16.7     COSTS AND EXPENSES; INDEMNIFICATION. Agent may incur and pay
Lender Group Expenses to the extent Agent reasonably deems necessary or
appropriate for the performance and fulfillment of its functions, powers, and
obligations pursuant to the Loan Documents, including court costs, attorneys
fees and expenses, fees and expenses of financial accountants, advisors,
consultants, and appraisers, costs of collection by outside collection agencies,
auctioneer fees and expenses, and costs of security guards or insurance premiums
paid to maintain the Credit Party Collateral, whether or not any Credit Party is
obligated to reimburse Agent or Lenders for such expenses pursuant to the Loan
Agreement or otherwise. Agent is authorized and directed to deduct and retain
sufficient amounts from the Collections of each Credit Party received by Agent
to reimburse Agent for such out-of-pocket costs and expenses prior to the
distribution of any amounts to Lenders. In the event Agent is not reimbursed for
such costs and expenses from the Collections of each Credit Party received by
Agent, each Lender hereby agrees that it is and shall be obligated to pay to or
reimburse Agent for the amount of such Lender's Pro Rata Share thereof. Whether
or not the transactions contemplated hereby are consummated, the Lenders shall
indemnify upon demand the Agent-Related Persons (to the extent not reimbursed by
or on behalf of any Credit Party and without limiting the obligation of any
Credit Party to do so), according to their Pro Rata Shares, from and against any
and all Indemnified Liabilities; provided, however, that no Lender shall be
liable for the payment to any Agent-Related Person of any portion of such
Indemnified Liabilities resulting solely from such Person's gross negligence or
willful misconduct nor shall any Lender be liable for the obligations of any
Defaulting Lender in failing to make an Advance or other extension of credit
hereunder. Without limitation of the foregoing, each Lender shall reimburse
Agent upon demand for such Lender's Pro Rata Share of any costs or out-of-pocket
expenses (including attorneys, accountants, advisors, and consultants fees and
expenses) incurred by Agent in connection with the preparation, execution,
delivery, administration, modification, amendment, or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the extent
that Agent is not reimbursed for such expenses by or on behalf of a Credit
Party. The undertaking in this Section shall survive the payment of all
Obligations hereunder and the resignation or replacement of Agent.

         16.8     AGENT IN INDIVIDUAL CAPACITY. WFRF and its Affiliates may make
loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in, and generally engage in any kind of banking, trust,
financial advisory, underwriting, or other business with any Credit Party and
its Affiliates and any other Person party to any Loan Documents as though WFRF
were not Agent hereunder, and, in each case, without notice to or consent of the
other members of the Lender Group. The other members of the Lender Group
acknowledge that, pursuant to such activities, WFRF or its Affiliates may
receive

                                      -95-
<PAGE>

information regarding any Credit Party or its Affiliates and any other Person
party to any Loan Documents that is subject to confidentiality obligations in
favor of such Credit Party or such other Person and that prohibit the disclosure
of such information to the Lenders, and the Lenders acknowledge that, in such
circumstances (and in the absence of a waiver of such confidentiality
obligations, which waiver Agent will use its reasonable best efforts to obtain),
Agent shall not be under any obligation to provide such information to them. The
terms "Lender" and "Lenders" include WFRF in its individual capacity.

         16.9     SUCCESSOR AGENT. Agent may resign as Agent upon 45 days notice
to the Lenders and Borrower. If Agent resigns under this Agreement, the Required
Lenders shall, in consultation with Borrower, appoint a successor Agent for the
Lenders. If no successor Agent is appointed and shall have accepted such
appointment prior to the effective date of the resignation of Agent, Agent may
appoint, after consulting with the Lenders and Borrower, a successor Agent. If
Agent has materially breached or failed to perform any material provision of
this Agreement or of applicable law, the Required Lenders may agree in writing
to remove and replace Agent with a successor Agent from among the Lenders chosen
in consultation with Borrower. In any such event (whether an appointment by
Agent or by the Required Lenders) described in the two immediately preceding
sentences, upon the acceptance of its appointment as successor Agent hereunder,
such successor Agent shall succeed to all the rights, powers, and duties of the
retiring Agent and the term "Agent" shall mean such successor Agent and the
retiring Agent's appointment, powers, and duties as Agent shall be terminated.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this Section 16 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Agent under this Agreement. If no successor Agent
has accepted appointment as Agent by the date which is 45 days following a
retiring Agent's notice of resignation, the retiring Agent's resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of the
duties of Agent hereunder until such time, if any, as the Lenders appoint a
successor Agent as provided for above.

         16.10    LENDER IN INDIVIDUAL CAPACITY. Any Lender and its respective
Affiliates may make loans to, issue letters of credit for the account of, accept
deposits from, acquire equity interests in and generally engage in any kind of
banking, trust, financial advisory, underwriting or other business with any
Credit Party and its Affiliates and any other Person party to any Loan Documents
as though such Lender were not a Lender hereunder without notice to or consent
of the other members of the Lender Group. The other members of the Lender Group
acknowledge that, pursuant to such activities, such Lender and its respective
Affiliates may receive information regarding any Credit Party or its Affiliates
and any other Person party to any Loan Documents that is subject to
confidentiality obligations in favor of such Credit Party or such other Person
and that prohibit the disclosure of such information to the Lenders, and the
Lenders acknowledge that, in such circumstances (and in the absence of a waiver
of such confidentiality obligations, which waiver such Lender will use its
reasonable best efforts to obtain), such Lender not shall be under any
obligation to provide such information to them. With respect to the Swing Loans
and Agent Advances, Swing

                                      -96-
<PAGE>

Lender shall have the same rights and powers under this Agreement as any other
Lender and may exercise the same as though it were not the sub-agent of Agent.

         16.11    WITHHOLDING TAXES.

                           (a) If any Lender is a "foreign person" within the
meaning of the IRC and such Lender claims exemption from, or a reduction of,
U.S. withholding tax under Sections 1441 or 1442 of the IRC, such Lender agrees
with and in favor of Agent and Borrower, to deliver to Agent and Borrower:

                           (i)      if such Lender claims an exemption from
                  withholding tax pursuant to its portfolio interest exception,
                  (A) a statement of the Lender, signed under penalty of
                  perjury, that it is not a (I) a "bank" as described in Section
                  881(c)(3)(A) of the IRC, (II) a 10% shareholder of Borrower
                  (within the meaning of Section 871(h)(3)(B) of the IRC), or
                  (III) a controlled foreign corporation related to Borrower
                  within the meaning of Section 864(d)(4) of the IRC, and (B) a
                  properly completed and executed IRS Form W-8BEN, before the
                  first payment of any interest under this Agreement to the
                  Lender and at any other time reasonably requested by Agent or
                  Borrower;

                           (ii)     if such Lender claims an exemption from, or
                  a reduction of, withholding tax under a United States tax
                  treaty, properly completed and executed IRS Form W-8BEN before
                  the first payment of any interest to the Lender under this
                  Agreement and at any other time reasonably requested by Agent
                  or Borrower;

                           (iii)    if such Lender claims that interest paid
                  under this Agreement is exempt from United States withholding
                  tax because it is effectively connected with a United States
                  trade or business of such Lender, two properly completed and
                  executed copies of IRS Form W-8ECI before the first payment of
                  any interest to the Lender is due under this Agreement and at
                  any other time reasonably requested by Agent or Borrower; and

                           (iv)     such other form or forms as may be required
                  under the IRC or other laws of the United States as a
                  condition to exemption from, or reduction of, United States
                  withholding tax, as reasonably requested by Agent or Borrower
                  at times reasonably requested by Agent or Borrower.

Such Lender agrees promptly to notify Agent and Borrower of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction.

                           (b) If any Lender claims exemption from, or reduction
of, withholding tax under a United States tax treaty by providing IRS Form
W-8BEN and such Lender sells, assigns, grants a participation in, or otherwise
transfers all or part of the Obligations of

                                      -97-
<PAGE>

Borrower to such Lender, such Lender agrees to notify Agent of the percentage
amount in which it is no longer the beneficial owner of Obligations of Borrower
to such Lender. To the extent of such percentage amount, Agent will treat such
Lender's IRS Form W-8BEN as no longer valid.

                           (c) Subject to Section 16.11(e), if any Lender is
entitled to a reduction in the applicable withholding tax, Agent may withhold
from any interest payment to such Lender an amount equivalent to the applicable
withholding tax after taking into account such reduction. If the forms or other
documentation required by subsection (a) of this Section are not delivered to
Agent, then Agent may withhold from any interest payment to such Lender not
providing such forms or other documentation an amount equivalent to the
applicable withholding tax.

                           (d) If the IRS or any other Governmental Authority of
the United States or other jurisdiction asserts a claim that Agent did not
properly withhold tax from amounts paid to or for the account of any Lender
(because the appropriate form was not delivered, was not properly executed, or
because such Lender failed to notify Agent of a change in circumstances which
rendered the exemption from, or reduction of, withholding tax ineffective, or
for any other reason) such Lender shall indemnify and hold Agent harmless for
all amounts paid, directly or indirectly, by Agent as tax or otherwise,
including penalties and interest, and including any taxes imposed by any
jurisdiction on the amounts payable to Agent under this Section, together with
all costs and expenses (including attorneys fees and expenses). The obligation
of the Lenders under this subsection shall survive the payment of all
Obligations and the resignation or replacement of Agent.

                           (e) All payments made by Borrower hereunder or under
any note will be made without setoff, counterclaim, or other defense, except as
required by applicable law other than for Taxes (as defined below). To the
extent permitted by applicable law, all such payments will be made free and
clear of, and without deduction or withholding for, any present or future taxes,
levies, imposts, duties, fees, assessments or other charges of whatever nature
now or hereafter imposed by any jurisdiction (other than the United States) or
by any political subdivision or taxing authority thereof or therein (other than
of the United States) with respect to such payments (but excluding, any tax
imposed by any jurisdiction or by any political subdivision or taxing authority
thereof or therein (i) measured by or based on the net income or net profits of
a Lender, or (ii) to the extent that such tax results from a change in the
circumstances of the Lender, including a change in the residence, place of
organization, or principal place of business of the Lender, or a change in the
branch or lending office of the Lender participating in the transactions set
forth herein) and all interest, penalties or similar liabilities with respect
thereto (all such non-excluded taxes, levies, imposts, duties, fees, assessments
or other charges being referred to collectively as "Taxes"). If any Taxes are so
levied or imposed, Borrower agrees to pay the full amount of such Taxes, and
such additional amounts as may be necessary so that every payment of all amounts
due under this Agreement or under any note, including any amount paid pursuant
to this Section 16.11(e)

                                      -98-
<PAGE>

after withholding or deduction for or on account of any Taxes, will not be less
than the amount provided for herein; provided, however, that Borrower shall not
be required to increase any such amounts payable to Agent or any Lender (i) that
is not organized under the laws of the United States, if such Person fails to
comply with the other requirements of this Section 16.11, (ii) if the increase
in such amount payable results from Agent's or such Lender's own willful
misconduct or gross negligence or (iii) as provided in Section 16.11(f).
Borrower will furnish to Agent as promptly as possible after the date the
payment of any Taxes is due pursuant to applicable law certified copies of tax
receipts evidencing such payment by Borrower.

                           (f) Notwithstanding anything in this Section 16.11,
Borrower will not be required to make payments under this Section 16.11
(including any increased payments under Section 16.11(e)) with respect to taxes
that are imposed on amounts payable to the Lender at the time the Lender becomes
a party to this Agreement (or designates a new lending office outside the United
States), except to the extent that such Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment), to
receive additional amounts from Borrower with respect to such withholding tax
pursuant to Section 16.11.

                           (g) If any payment by the Borrower is made to or for
the account of the Lender after deduction for or on account of any Taxes, and
increased payments are made by Borrower pursuant to this Section 16.11, then, if
the Lender reasonably determines that it has received or been granted a refund
of, credit against or remission of such Taxes, such Lender shall reimburse to
Borrower such amount as such Lender shall determine to be attributable to the
relevant Taxes or deduction or withholding; provided, that (i) such Lender shall
not be obligated to disclose to Borrower any information regarding its tax
affairs and computations, and (ii) nothing herein shall be construed so as to
interfere with the right of such Lender to arrange its tax affairs as it deems
appropriate. If the Lender reasonably determines that a refund or credit is
disallowed or reduced, Borrower shall promptly reimburse the Lender to the
extent of such disallowance or reduction (and any interest paid to any
applicable taxing authority).

         16.12    COLLATERAL MATTERS.

                           (a) The Lenders hereby irrevocably authorize Agent,
at its option and in its sole discretion (it being understood that such release
shall be mandatory under the circumstances described in clauses (ii) and (iv)
below if no Event of Default has occurred and is continuing at the time of such
circumstances described in clause (ii) and (iv) below), to release any Lien on
any Credit Party Collateral (i) upon the termination of the Commitments and
payment and satisfaction in full by Borrower of all Obligations, (ii)
constituting property being sold or disposed of if a release is required or
desirable in connection therewith and if Borrower certifies to Agent that the
sale or disposition is permitted under Section 7.3 of this Agreement or the
other Loan Documents (and Agent may

                                      -99-
<PAGE>

rely conclusively on any such certificate, without further inquiry) in which
case Agent shall release such Credit Party Collateral at the request of
Borrower, (iii) constituting property in which no Credit Party owned any
interest at the time the Agent's Lien was granted nor at any time thereafter, or
(iv) constituting property leased to any Credit Party under a lease that has
expired or is terminated in a transaction permitted under this Agreement. Except
as provided above, Agent will not execute and deliver a release of any Lien on
any Credit Party Collateral without the prior written authorization of (y) if
the release is of all or substantially all of the Credit Party Collateral, all
of the Lenders, or (z) otherwise, the Required Lenders. Upon request by Agent or
Borrower at any time, the Lenders will confirm in writing Agent's authority to
release any such Liens on particular types or items of Credit Party Collateral
pursuant to this Section 16.12; provided, however, that (1) Agent shall not be
required to execute any document necessary to evidence such release on terms
that, in Agent's opinion, would expose Agent to liability or create any
obligation or entail any consequence other than the release of such Lien without
recourse, representation, or warranty, and (2) such release shall not in any
manner discharge, affect, or impair the Obligations or any Liens (other than
those expressly being released) upon (or obligations of any Credit Party in
respect of) all interests retained by each Credit Party, including, the proceeds
of any sale, all of which shall continue to constitute part of the Credit Party
Collateral.

                           (b) Agent shall have no obligation whatsoever to any
of the Lenders to assure that the Credit Party Collateral exists or is owned by
a Credit Party or is cared for, protected, or insured or has been encumbered, or
that the Agent's Liens have been properly or sufficiently or lawfully created,
perfected, protected, or enforced or are entitled to any particular priority, or
to exercise at all or in any particular manner or under any duty of care,
disclosure or fidelity, or to continue exercising, any of the rights,
authorities and powers granted or available to Agent pursuant to any of the Loan
Documents, it being understood and agreed that in respect of the Credit Party
Collateral, or any act, omission, or event related thereto, subject to the terms
and conditions contained herein, Agent may act in any manner it may deem
appropriate, in its sole discretion given Agent's own interest in the Credit
Party Collateral in its capacity as one of the Lenders and that Agent shall have
no other duty or liability whatsoever to any Lender as to any of the foregoing,
except as otherwise provided herein.

         16.13 RESTRICTIONS ON ACTIONS BY LENDERS; SHARING OF PAYMENTS.

                           (a) Each of the Lenders agrees that it shall not,
without the express written consent of Agent, and that it shall, to the extent
it is lawfully entitled to do so, upon the written request of Agent, set off
against the Obligations, any amounts owing by such Lender to Borrower or any
deposit accounts of any Credit Party now or hereafter maintained with such
Lender. Each of the Lenders further agrees that it shall not, unless
specifically requested to do so in writing by Agent, take or cause to be taken
any action, including, the commencement of any legal or equitable proceedings,
to foreclose any Lien on, or otherwise enforce any security interest in, any of
the Credit Party Collateral.

                                     -100-
<PAGE>

                           (b) If, at any time or times any Lender shall receive
(i) by payment, foreclosure, setoff, or otherwise, any proceeds of the Credit
Party Collateral or any payments with respect to the Obligations, except for any
such proceeds or payments received by such Lender from Agent pursuant to the
terms of this Agreement, or (ii) payments from Agent in excess of such Lender's
ratable portion of all such distributions by Agent, such Lender promptly shall
(1) turn the same over to Agent, in kind, and with such endorsements as may be
required to negotiate the same to Agent, or in immediately available funds, as
applicable, for the account of all of the Lenders and for application to the
Obligations in accordance with the applicable provisions of this Agreement, or
(2) purchase, without recourse or warranty, an undivided interest and
participation in the Obligations owed to the other Lenders so that such excess
payment received shall be applied ratably as among the Lenders in accordance
with their Pro Rata Shares; provided, however, that to the extent that such
excess payment received by the purchasing party is thereafter recovered from it,
those purchases of participations shall be rescinded in whole or in part, as
applicable, and the applicable portion of the purchase price paid therefor shall
be returned to such purchasing party, but without interest except to the extent
that such purchasing party is required to pay interest in connection with the
recovery of the excess payment.

         16.14 AGENCY FOR PERFECTION. Agent hereby appoints each other Lender as
its agent (and each Lender hereby accepts such appointment) for the purpose of
perfecting the Agent's Liens in assets which, in accordance with Article 9 of
the Code can be perfected only by possession or control. Should any Lender
obtain possession or control of any such Credit Party Collateral, such Lender
shall notify Agent thereof, and, promptly upon Agent's request therefor shall
deliver possession or control of such Credit Party Collateral to Agent or in
accordance with Agent's instructions.

         16.15 PAYMENTS BY AGENT TO THE LENDERS. All payments to be made by
Agent to the Lenders shall be made by bank wire transfer of immediately
available funds pursuant to such wire transfer instructions as each party may
designate for itself by written notice to Agent. Concurrently with each such
payment, Agent shall identify whether such payment (or any portion thereof)
represents principal, premium, or interest of the Obligations.

         16.16 CONCERNING THE CREDIT PARTY COLLATERAL AND RELATED LOAN
DOCUMENTS. Each member of the Lender Group authorizes and directs Agent to enter
into this Agreement and the other Loan Documents. Each member of the Lender
Group agrees that any action taken by Agent in accordance with the terms of this
Agreement or the other Loan Documents relating to the Credit Party Collateral
and the exercise by Agent of its powers set forth therein or herein, together
with such other powers that are reasonably incidental thereto, shall be binding
upon all of the Lenders.

         16.17 FIELD AUDITS AND EXAMINATION REPORTS; CONFIDENTIALITY;
DISCLAIMERS BY LENDERS; OTHER REPORTS AND INFORMATION. By becoming a party to
this Agreement, each Lender:

                                     -101-
<PAGE>

                           (a) is deemed to have requested that Agent furnish
such Lender, promptly after it becomes available, a copy of each field audit or
examination report (each a "Report" and collectively, "Reports") prepared by
Agent, and Agent shall so furnish each Lender with such Reports,

                           (b) expressly agrees and acknowledges that each of
Agent and Borrower (i) do not make any representation or warranty as to the
accuracy of any Report, and (ii) shall not be liable for any information
contained in any Report, except with respect to Borrower to the extent that it
has supplied materially false or misleading information contained in any Report,

                           (c) expressly agrees and acknowledges that the
Reports are not comprehensive audits or examinations, that Agent or other party
performing any audit or examination will inspect only specific information
regarding the applicable Credit Party and will rely significantly upon the
Books, as well as on representations of such Credit Party's personnel,

                           (d) agrees to keep all Reports and other material,
non-public information regarding each Credit Party and its operations, assets,
and existing and contemplated business plans in a confidential manner in
accordance with Section 18.8, and

                           (e) without limiting the generality of any other
indemnification provision contained in this Agreement, agrees: (i) to hold Agent
and any other Lender preparing a Report harmless from any action the
indemnifying Lender may take or fail to take or any conclusion the indemnifying
Lender may reach or draw from any Report in connection with any loans or other
credit accommodations that the indemnifying Lender has made or may make to any
Credit Party, or the indemnifying Lender's participation in, or the indemnifying
Lender's purchase of, a loan or loans of any Credit Party, and (ii) to pay and
protect, and indemnify, defend and hold Agent, and any such other Lender
preparing a Report harmless from and against, the claims, actions, proceedings,
damages, costs, expenses, and other amounts (including, attorneys fees and
costs) incurred by Agent and any such other Lender preparing a Report as the
direct or indirect result of any third parties who might obtain all or part of
any Report through the indemnifying Lender.

In addition to the foregoing: (x) any Lender may from time to time request of
Agent in writing that Agent provide to such Lender a copy of any report or
document provided by any Credit Party to Agent that has not been
contemporaneously provided by such Credit Party to such Lender, and, upon
receipt of such request, Agent promptly shall provide a copy of same to such
Lender, (y) to the extent that Agent is entitled, under any provision of the
Loan Documents, to request additional reports or information from any Credit
Party, any Lender may, from time to time, reasonably request Agent to exercise
such right as specified in such Lender's notice to Agent, whereupon Agent
promptly shall request of such Credit Party the additional reports or
information reasonably specified by such Lender, and, upon receipt thereof from
Borrower, Agent promptly shall provide a copy of same to such Lender, and (z)

                                     -102-
<PAGE>

any time that Agent renders to such Credit Party a statement regarding the Loan
Account, Agent shall send a copy of such statement to each Lender.

         16.18 SEVERAL OBLIGATIONS; NO LIABILITY. Notwithstanding that certain
of the Loan Documents now or hereafter may have been or will be executed only by
or in favor of Agent in its capacity as such, and not by or in favor of the
Lenders, any and all obligations on the part of Agent (if any) to make any
credit available hereunder shall constitute the several (and not joint)
obligations of the respective Lenders on a ratable basis, according to their
respective Commitments, to make an amount of such credit not to exceed, in
principal amount, at any one time outstanding, the amount of their respective
Commitments. Nothing contained herein shall confer upon any Lender any interest
in, or subject any Lender to any liability for, or in respect of, the business,
assets, profits, losses, or liabilities of any other Lender. Each Lender shall
be solely responsible for notifying its Participants of any matters relating to
the Loan Documents to the extent any such notice may be required, and no Lender
shall have any obligation, duty, or liability to any Participant of any other
Lender. Except as provided in Section 16.7, no member of the Lender Group shall
have any liability for the acts of any other member of the Lender Group. No
Lender shall be responsible to any Credit Party or any other Person for any
failure by any other Lender to fulfill its obligations to make credit available
hereunder, nor to advance for it or on its behalf in connection with its
Commitment, nor to take any other action on its behalf hereunder or in
connection with the financing contemplated herein.

         16.19 LEGAL REPRESENTATION OF AGENT. In connection with the
negotiation, drafting, and execution of this Agreement and the other Loan
Documents, or in connection with future legal representation relating to loan
administration, amendments, modifications, waivers, or enforcement of remedies,
Winston & Strawn LLP ("Winston") only has represented and only shall represent
WFRF in its capacity as Agent and as a Lender. Each other Lender hereby
acknowledges that Winston does not represent it in connection with any such
matters.

17. GUARANTY.

         17.1 GUARANTY OF THE OBLIGATIONS. Subject to the provisions of Section
17.2, Guarantors jointly and severally hereby irrevocably and unconditionally
guaranty to Agent for the ratable benefit of the Lender Group the due and
punctual payment in full of all Obligations when the same shall become due,
whether at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise (including amounts that would become due but for the
operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11
U.S.C. Section 362(a)) (collectively, the "Guaranteed Obligations").

         17.2 CONTRIBUTION BY GUARANTORS. All Guarantors desire to allocate
among themselves (collectively, the "Contributing Guarantors"), in a fair and
equitable manner, their obligations arising under this Guaranty. Accordingly, in
the event any payment or distribution is made on any date by a Guarantor (a
"Funding Guarantor") under this Guaranty that exceeds its Fair Share as of such
date, such Funding Guarantor shall be entitled to a

                                     -103-
<PAGE>

contribution from each of the other Contributing Guarantors in the amount of
such other Contributing Guarantor's Fair Share Shortfall as of such date, with
the result that all such contributions will cause each Contributing Guarantor's
Aggregate Payments to equal its Fair Share as of such date. "Fair Share" means,
with respect to a Contributing Guarantor as of any date of determination, an
amount equal to (a) the ratio of (i) the Fair Share Contribution Amount with
respect to such Contributing Guarantor to (ii) the aggregate of the Fair Share
Contribution Amounts with respect to all Contributing Guarantors multiplied by
(b) the aggregate amount paid or distributed on or before such date by all
Funding Guarantors under this Guaranty in respect of the Guaranteed Obligations.
"Fair Share Shortfall" means, with respect to a Contributing Guarantor as of any
date of determination, the excess, if any, of the Fair Share of such
Contributing Guarantor over the Aggregate Payments of such Contributing
Guarantor. "Fair Share Contribution Amount" means, with respect to a
Contributing Guarantor as of any date of determination, the maximum aggregate
amount of the obligations of such Contributing Guarantor under this Guaranty
that would not render its obligations hereunder or thereunder subject to
avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11
of the United States Code or any comparable applicable provisions of state law;
provided, solely for purposes of calculating the "Fair Share Contribution
Amount" with respect to any Contributing Guarantor for purposes of this Section
17.2, any assets or liabilities of such Contributing Guarantor arising by virtue
of any rights to subrogation, reimbursement or indemnification or any rights to
or obligations of contribution hereunder shall not be considered as assets or
liabilities of such Contributing Guarantor. "Aggregate Payments" means, with
respect to a Contributing Guarantor as of any date of determination, an amount
equal to (a) the aggregate amount of all payments and distributions made on or
before such date by such Contributing Guarantor in respect of this Guaranty
(including, without limitation, in respect of this Section 17.2), minus (b) the
aggregate amount of all payments received on or before such date by such
Contributing Guarantor from the other Contributing Guarantors as contributions
under this Section 17.2. The amounts payable as contributions hereunder shall be
determined as of the date on which the related payment or distribution is made
by the applicable Funding Guarantor. The allocation among Contributing
Guarantors of their obligations as set forth in this Section 17.2 shall not be
construed in any way to limit the liability of any Contributing Guarantor
hereunder. Each Guarantor is a third party beneficiary to the contribution
agreement set forth in this Section 17.2.

         17.3 PAYMENT BY GUARANTORS. Subject to Section 17.2, Guarantors hereby
jointly and severally agree, in furtherance of the foregoing and not in
limitation of any other right which any member of the Lender Group may have at
law or in equity against any Guarantor by virtue hereof, that upon the failure
of Borrower to pay any of the Guaranteed Obligations when and as the same shall
become due, whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise (including amounts that would become due but
for the operation of the automatic stay under Section 362(a) of the Bankruptcy
Code, 11 U.S.C. Section 362(a)), Guarantors will upon demand pay, or cause to be
paid, in cash, to Agent for the ratable benefit of the Lender Group, an amount
equal to the sum of the unpaid

                                     -104-
<PAGE>

principal amount of all Guaranteed Obligations then due as aforesaid, accrued
and unpaid interest on such Guaranteed Obligations (including interest which,
but for Borrower's becoming the subject of a case under the Bankruptcy Code,
would have accrued on such Guaranteed Obligations, whether or not a claim is
allowed against Borrower for such interest in the related bankruptcy case) and
all other Guaranteed Obligations then owed to the Lender Group as aforesaid.

         17.4 LIABILITY OF GUARANTORS ABSOLUTE. Each Guarantor agrees that its
obligations hereunder are irrevocable, absolute, independent and unconditional
and shall not be affected by any circumstance which constitutes a legal or
equitable discharge of a guarantor or surety other than payment in full of the
Guaranteed Obligations. In furtherance of the foregoing and without limiting the
generality thereof, each Guarantor agrees as follows:

                           (a) this Guaranty is a guaranty of payment when due
and not of collectability. This Guaranty is a primary obligation of each
Guarantor and not merely a contract of surety;

                           (b) Agent may enforce this Guaranty upon the
occurrence of an Event of Default notwithstanding the existence of any dispute
between Borrower and any member of the Lender Group with respect to the
existence of such Event of Default;

                           (c) the obligations of each Guarantor hereunder are
independent of the obligations of Borrower and the obligations of any other
guarantor (including any other Guarantor) of the obligations of Borrower, and a
separate action or actions may be brought and prosecuted against such Guarantor
whether or not any action is brought against Borrower or any of such other
guarantors and whether or not Borrower is joined in any such action or actions;

                           (d) payment by any Guarantor of a portion, but not
all, of the Guaranteed Obligations shall in no way limit, affect, modify or
abridge any Guarantor's liability for any portion of the Guaranteed Obligations
which has not been paid. Without limiting the generality of the foregoing, if
Agent is awarded a judgment in any suit brought to enforce any Guarantor's
covenant to pay a portion of the Guaranteed Obligations, such judgment shall not
be deemed to release such Guarantor from its covenant to pay the portion of the
Guaranteed Obligations that is not the subject of such suit, and such judgment
shall not, except to the extent satisfied by such Guarantor, limit, affect,
modify or abridge any other Guarantor's liability hereunder in respect of the
Guaranteed Obligations;

                           (e) Any member of the Lender Group, upon such terms
as it deems appropriate, without or demand and without affecting the validity or
enforceability hereof or giving rise to any reduction, limitation, impairment,
discharge or termination of any Guarantor's liability hereunder, from time to
time may (i) renew, extend, accelerate, increase the rate of interest on, or
otherwise change the time, place, manner or terms of payment of the Guaranteed
Obligations; (ii) settle, compromise, release or discharge, or accept or refuse

                                     -105-
<PAGE>

any offer of performance with respect to, or substitutions for, the Guaranteed
Obligations or any agreement relating thereto and/or subordinate the payment of
the same to the payment of any other obligations; (iii) request and accept other
guaranties of the Guaranteed Obligations and take and hold security for the
payment of the Guaranteed Obligations; (iv) release, surrender, exchange,
substitute, compromise, settle, rescind, waive, alter, subordinate or modify,
with or without consideration, any security for payment of the Guaranteed
Obligations, any other guaranties of the Guaranteed Obligations, or any other
obligation of any Person (including any other Guarantor) with respect to the
Guaranteed Obligations; (v) enforce and apply any security now or hereafter held
by or for the benefit of such member of the Lender Bank Group in respect hereof
or the Guaranteed Obligations and direct the order or manner of sale thereof, or
exercise any other right or remedy that such member of the Lender Bank Group may
have against any such security, in each case as such member of the Lender Bank
Group in its discretion may determine consistent herewith and any applicable
security agreement, including foreclosure on any such security pursuant to one
or more judicial or nonjudicial sales, whether or not every aspect of any such
sale is commercially reasonable, and even though such action operates to impair
or extinguish any right of reimbursement or subrogation or other right or remedy
of any Guarantor against Borrower or any security for the Guaranteed
Obligations; and (vi) exercise any other right available to it under the Loan
Documents; and

                           (f) this Guaranty and the obligations of Guarantors
hereunder shall be valid and enforceable and shall not be subject to any
reduction, limitation, impairment, discharge or termination for any reason
(other than payment in full of the Guaranteed Obligations), including the
occurrence of any of the following, whether or not any Guarantor shall have had
notice or knowledge of any of them: (i) any failure or omission to assert or
enforce or agreement or election not to assert or enforce, or the stay or
enjoining, by order of court, by operation of law or otherwise, of the exercise
or enforcement of, any claim or demand or any right, power or remedy (whether
arising under the Loan Documents or at law, in equity or otherwise) with respect
to the Guaranteed Obligations or any agreement relating thereto, or with respect
to any other guaranty of or security for the payment the Guaranteed Obligations
(ii) any rescission, waiver, amendment or modification of, or any consent to
departure from, any of the terms or provisions (including provisions relating to
events of default) hereof, any of the other Loan Documents, or any agreement or
instrument executed pursuant thereto, or of any other guaranty or security for
the Guaranteed Obligations, in each case whether or not in accordance with the
terms hereof or such Loan Document, or any agreement relating to such other
guaranty or security; (iii) the Guaranteed Obligations or any agreement relating
thereto, at any time being found to be illegal invalid or unenforceable in any
respect; (iv) the application of payments received from any source (other than
payments received pursuant to the other Loan Documents or from the proceeds of
any security for the Guaranteed Obligations, except to the extent such security
also serves as collateral for Indebtedness other than the Guaranteed
Obligations) to the payment of Indebtedness other than the Guarantee
Obligations, even though any member of the Lender Group might have elected to
apply such payment to any part or all of the Guaranteed Obligations; (v) any

                                     -106-
<PAGE>

member of the Lender Group's consent to the change, reorganization or
termination of the corporate structure or existence of any Credit Party and to
any corresponding restructuring of the Guaranteed Obligations; (vi) any failure
to perfect or continue perfection of a security interest in any collateral which
secures any of the Guaranteed Obligations; (vii) any defenses, set-offs or
counterclaims which Borrower may allege or assert against any member of the
Lender Group in respect of the Guaranteed Obligations, including failure of
consideration, breach of warranty, payment, statute of frauds, statute of
limitations, accord and satisfaction and usury; and (viii) any other act or
thing or omission, or delay to do any other act or thing, which may or might in
any manner or to any extent vary the risk of any Guarantor as an obligor in
respect of the Guaranteed Obligations.

         17.5 WAIVERS BY GUARANTORS. Each Guarantor hereby waives, for the
benefit of the Lender Group: (a) any right to require any member of the Lender
Group, as a condition of payment or performance by such Guarantor, to (i)
proceed against Borrower, any other guarantor (including any other Guarantor) of
the Guaranteed Obligations or any other Person, (ii) proceed against or exhaust
any security held from Borrower, any such other guarantor or any other Person,
(iii) proceed against or have resort to any balance of any Deposit Account or
credit on the books of any member of the Lender Group in favor of Borrower or
any other Person, or (iv) pursue any other remedy in the power of any member of
the Lender Group whatsoever; (b) any defense arising by reason of the
incapacity, lack of authority or any disability or other defense of Borrower or
any other Guarantor including any defense based on or arising out of the lack of
validity or the unenforceability of the Guaranteed Obligations or any agreement
or instrument relating thereto or by reason of the cessation of the liability of
Borrower or any other Guarantor from any cause other than payment in full of the
Guaranteed Obligations; (c) any defense based upon any statute or rule of law
which provides that the obligation of a surety must be neither larger in amount
nor in other respects more burdensome than that of the principal; (d) any
defense based upon any member of the Lender Group's errors or omissions in the
administration of the Guaranteed Obligations, except behavior which amounts to
bad faith; (e) (i) any principles or provisions of law, statutory or otherwise,
which are or might be in conflict with the terms hereof and any legal or
equitable discharge of such Guarantor's obligations hereunder, (ii) the benefit
of any statute of limitations affecting such Guarantor's liability hereunder or
the enforcement hereof, (iii) any rights to set-offs, recoupments and
counterclaims, and (iv) promptness, diligence and any requirement that any
member of the Lender Group protect, secure, perfect or insure any security
interest or lien or any property subject thereto; (f) notices, demands,
presentments, protests, notices of protest, notices of dishonor and notices of
any action or inaction, including acceptance hereof, notices of default
hereunder, or any agreement or instrument related thereto, notices of any
renewal, extension or modification of the Guaranteed Obligations or any
agreement related thereto, notices of any extension of credit to Borrower and
notices of any of the matters referred to in Section 17.4 and any right to
consent to any thereof; and (g) any defenses or benefits that may be derived
from or afforded by law which limit the liability of or exonerate guarantors or
sureties, or which may conflict with the terms hereof.

                                     -107-
<PAGE>

         17.6 GUARANTORS' RIGHTS OF SUBROGATION, CONTRIBUTION, ETC. Until the
Guaranteed Obligations shall have been indefeasibly paid in full and the
Commitments shall have terminated and all Letters of Credit shall have expired
or been cancelled, each Guarantor hereby waives any claim, right or remedy,
direct or indirect, that such Guarantor now has or may hereafter have against
Borrower or any other Guarantor or any of its assets in connection with this
Guaranty or the performance by such Guarantor of its obligations hereunder, in
each case whether such claim, right or remedy arises in equity, under contract,
by statute, under common law or otherwise and including without limitation (a)
any right of subrogation, reimbursement or indemnification that such Guarantor
now has or may hereafter have against Borrower with respect to the Guaranteed
Obligations, (b) any right to enforce, or to participate in, any claim, right or
remedy that any member of the Lender Group now has or may hereafter have against
Borrower, and (c) any benefit of, and any right to participate in, any
collateral or security now or hereafter held by any member of the Lender Group.
In addition, until the Guaranteed Obligations shall have been indefeasibly paid
in full and the Commitments shall have terminated and all Letters of Credit
shall have expired or been cancelled, each Guarantor shall withhold exercise of
any right of contribution such Guarantor may have against any other guarantor
(including any other Guarantor) of the Guaranteed Obligations, including,
without limitation, any such right of contribution as contemplated by Section
17.2. Each Guarantor further agrees that, to the extent the waiver or agreement
to withhold the exercise of its rights of subrogation, reimbursement,
indemnification and contribution as set forth herein is found by a court of
competent jurisdiction to be void or voidable for any reason, any rights of
subrogation, reimbursement or indemnification such Guarantor may have against
Borrower or against any collateral or security, and any rights of contribution
such Guarantor may have against any such other guarantor, shall be junior and
subordinate to any rights any member of the Lender Group may have against
Borrower, to all right, title and interest any member of the Lender Group may
have in any such collateral or security, and to any right any member of the
Lender Group may have against such other guarantor. If any amount shall be paid
to any Guarantor on account of any such subrogation, reimbursement,
indemnification or contribution rights at any time when all Guaranteed
Obligations shall not have been finally and indefeasibly paid in full, such
amount shall be held in trust for Agent on behalf of the Lender Group and shall
forthwith be paid over to Agent for the benefit of the Lender Group to be
credited and applied against the Guaranteed Obligations, whether matured or
unmatured, in accordance with the terms hereof.

         17.7 SUBORDINATION OF OTHER OBLIGATIONS. Any Indebtedness of Borrower
or any Guarantor now or hereafter held by any Guarantor (the "Obligee
Guarantor") is hereby subordinated in right of payment to the Guaranteed
Obligations, and any such indebtedness collected or received by the Obligee
Guarantor after an Event of Default has occurred and is continuing shall be held
in trust for Agent on behalf of the Lender Group and shall forthwith be paid
over to Agent for the benefit of the Lender Group to be credited and applied
against the Guaranteed Obligations but without affecting, impairing or limiting
in any manner the liability of the Obligee Guarantor under any other provision
hereof.

                                     -108-
<PAGE>

         17.8 CONTINUING GUARANTY. This Guaranty is a continuing guaranty and
shall remain in effect until all of the Guaranteed Obligations shall have been
finally and indefeasibly paid in full and the Commitments shall have terminated
and all Letters of Credit shall have expired or been cancelled. Each Guarantor
hereby irrevocably waives any right to revoke this Guaranty as to future
transactions giving rise to any Guaranteed Obligations.

         17.9 AUTHORITY OF GUARANTORS OR BORROWER. It is not necessary for any
member of the Lender Group to inquire into the capacity or powers of any
Guarantor or Borrower or the officers, directors or any agents acting or
purporting to act on behalf of any of them.

         17.10 FINANCIAL CONDITION OF BORROWER. Any Advance may be made to
Borrower or continued from time to time, and any other agreements relating to
the Obligations may be entered into from time to time, in each case without
notice to or authorization from any Guarantor regardless of the financial or
other condition of Borrower at the time of any such grant or continuation or at
the time such other agreement is entered into, as the case may be. No member of
the Lender Group shall have any obligation to disclose or discuss with any
Guarantor its assessment, or any Guarantor's assessment, of the financial
condition of Borrower. Each Guarantor has adequate means to obtain information
from Borrower on a continuing basis concerning the financial condition of
Borrower and its ability to perform its obligations under the Loan Documents and
each Guarantor assumes the responsibility for being and keeping informed of the
financial condition of Borrower and of all circumstances bearing upon the risk
of nonpayment of the Guaranteed Obligations. Each Guarantor hereby waives and
relinquishes any duty on the part of any member of the Lender Group to disclose
any matter, fact or thing relating to the business, operations or conditions of
Borrower now known or hereafter known by any member of the Lender Group.

         17.11 BANKRUPTCY, ETC.

                           (a) The obligations of Guarantors hereunder shall not
be reduced, limited, impaired, discharged, deferred, suspended or terminated by
any case or proceeding, voluntary or involuntary, involving the bankruptcy,
insolvency, receivership, reorganization, liquidation or arrangement of Borrower
or any other Guarantor or by any defense which Borrower or any other Guarantor
may have by reason of the order, decree or decision of any court or
administrative body resulting from any such proceeding.

                           (b) Each Guarantor acknowledges and agrees that any
interest on any portion of the Guaranteed Obligations which accrues after the
commencement of any case or proceeding referred to in clause (a) above (or, if
interest on any portion of the Guaranteed Obligations ceases to accrue by
operation of law by reason of the commencement of such case or proceeding, such
interest as would have accrued on such portion of the Guaranteed Obligations if
such case or proceeding had not been commenced) shall be included in the
Guaranteed Obligations because it is the intention of Guarantors and the Lender
Group that the Guaranteed Obligations which are guaranteed by Guarantors
pursuant hereto should be determined without regard to any rule of law or order
which may relieve Borrower of any

                                     -109-
<PAGE>

portion of such Guaranteed Obligations. Guarantors will permit any trustee in
bankruptcy, receiver, debtor in possession, assignee for the benefit of
creditors or similar person to pay Agent, or allow the claim of Agent in respect
of, any such interest accruing after the date on which such case or proceeding
is commenced.

                           (c) In the event that all or any portion of the
Guaranteed Obligations are paid by Borrower, the obligations of Guarantors
hereunder shall continue and remain in full force and effect or be reinstated,
as the case may be, in the event that all or any part of such payment(s) are
rescinded or recovered directly or indirectly from any member of the Lender
Group as a preference, fraudulent transfer or otherwise, and any such payments
which are so rescinded or recovered shall constitute Guaranteed Obligations for
all purposes hereunder.

18. GENERAL PROVISIONS.

         18.1 EFFECTIVENESS. This Agreement shall be binding and deemed
effective when executed by each Credit Party, Agent, and each Lender whose
signature is provided for on the signature pages hereof.

         18.2 SECTION HEADINGS. Headings and numbers have been set forth herein
for convenience only. Unless the contrary is compelled by the context,
everything contained in each Section applies equally to this entire Agreement.

         18.3 INTERPRETATION. Neither this Agreement nor any uncertainty or
ambiguity herein shall be construed against the Lender Group or the Credit
Parties, whether under any rule of construction or otherwise. On the contrary,
this Agreement has been reviewed by all parties and shall be construed and
interpreted according to the ordinary meaning of the words used so as to
accomplish fairly the purposes and intentions of all parties hereto.

         18.4 SEVERABILITY OF PROVISIONS. Each provision of this Agreement shall
be severable from every other provision of this Agreement for the purpose of
determining the legal enforceability of any specific provision.

         18.5 AMENDMENTS IN WRITING. This Agreement only can be amended by a
writing signed by Agent (on behalf of the requisite Lenders pursuant to Section
15.1) and each Credit Party.

         18.6 COUNTERPARTS; TELEFACSIMILE EXECUTION. This Agreement may be
executed in any number of counterparts and by different parties on separate
counterparts, each of which, when executed and delivered, shall be deemed to be
an original, and all of which, when taken together, shall constitute but one and
the same Agreement. Delivery of an executed counterpart of this Agreement by
telefacsimile shall be equally as effective as delivery of an original executed
counterpart of this Agreement. Any party delivering an executed counterpart of
this Agreement by telefacsimile also shall deliver an original

                                     -110-
<PAGE>

executed counterpart of this Agreement but the failure to deliver an original
executed counterpart shall not affect the validity, enforceability, and binding
effect of this Agreement. The foregoing shall apply to each other Loan Document
mutatis mutandis.

         18.7 REVIVAL AND REINSTATEMENT OF OBLIGATIONS. If the incurrence or
payment of the Obligations by any Credit Party or the transfer to the Lender
Group of any property should for any reason subsequently be declared to be void
or voidable under any state or federal law relating to creditors' rights,
including provisions of the Bankruptcy Code relating to fraudulent conveyances,
preferences, or other voidable or recoverable payments of money or transfers of
property (collectively, a "Voidable Transfer"), and if the Lender Group is
required to repay or restore, in whole or in part, any such Voidable Transfer,
or elects to do so upon the reasonable advice of its counsel, then, as to any
such Voidable Transfer, or the amount thereof that the Lender Group is required
or elects to repay or restore, and as to all reasonable costs, expenses, and
attorneys fees of the Lender Group related thereto, the liability of such Credit
Party automatically shall be revived, reinstated, and restored and shall exist
as though such Voidable Transfer had never been made.

         18.8 CONFIDENTIALITY. The Agent and the Lenders each individually (and
not jointly or jointly and severally) agree that material, non-public
information regarding any Credit Party, its operations, assets, and existing and
contemplated business plans shall be treated by Agent and the Lenders in a
confidential manner, and shall not be disclosed by Agent and the Lenders to
Persons who are not parties to this Agreement, except: (a) to attorneys for and
other advisors, accountants, auditors, and consultants to any member of the
Lender Group, who are advised about the confidentiality of such information (b)
to Subsidiaries and Affiliates of any member of the Lender Group, provided that
any such Subsidiary or Affiliate shall have agreed to receive such information
hereunder subject to the terms of this Section 18.8 or similar confidentiality
agreement, (c) as may be required by statute, decision, or judicial or
administrative order, rule, or regulation (with prompt notice to Borrower so
that Borrower may seek a protective order or other appropriate remedy and/or
waive Agent's or any Lender's compliance with the provisions of this Section
18.8), (d) as may be agreed to in advance by such Credit Party or as requested
or required by any Governmental Authority pursuant to any subpoena or other
legal process regulation (with prompt notice to Borrower so that Borrower may
seek a protective order or other appropriate remedy and/or waive Agent's or any
Lender's compliance with the provisions of this Section 18.8), (e) as to any
such information that is or becomes generally available to the public (other
than as a result of prohibited disclosure by or on behalf of Agent or the
Lenders), (f) in connection with any assignment, prospective assignment, sale,
prospective sale, participation or prospective participations, or pledge or
prospective pledge of any Lender's interest under this Agreement, provided that
any such assignee, prospective assignee, purchaser, prospective purchaser,
participant, prospective participant, pledgee, or prospective pledgee shall have
agreed in writing to receive such information hereunder subject to the terms of
this Section, and (g) in connection with any litigation or other adversary
proceeding involving parties hereto which such litigation or adversary
proceeding involves claims related to the rights or

                                     -111-
<PAGE>

duties of such parties under this Agreement or the other Loan Documents;
provided, that the disclosing party shall use its best efforts to ensure that
such documents are filed under seal. The provisions of this Section 18.8 shall
survive the payment in full of the Obligations. Anything contained herein or in
any other Loan Document to the contrary notwithstanding, the obligations of
confidentiality contained herein and therein, as they relate to the transactions
contemplated hereby, shall not apply to the federal tax structure or federal tax
treatment of such transactions, and each party hereto (and any employee,
representative, or agent of any party hereto) may disclose to any and all
Persons, without limitation of any kind, the federal tax structure and federal
tax treatment of such transactions (including all written materials related to
such tax structure and tax treatment). The preceding sentence is intended to
cause the transactions contemplated hereby to not be treated as having been
offered under conditions of confidentiality for purposes of Section
1.6011-4(b)(3) (or any successor provision) of the Treasury Regulations
promulgated under Section 6011 of the IRC, and shall be construed in a manner
consistent with such purpose. In addition, each party hereto acknowledges that
it has no proprietary or exclusive rights to the tax structure of the
transactions contemplated hereby or any tax matter or tax idea related thereto.

         18.9 INTEGRATION. This Agreement, together with the other Loan
Documents, reflects the entire understanding of the parties with respect to the
transactions contemplated hereby and shall not be contradicted or qualified by
any other agreement, oral or written, before the date hereof.

                          [Signature pages to follow.]

                                     -112-
<PAGE>

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

                               PAYLESS SHOESOURCE FINANCE, INC.
                               a Nevada Corporation

                               By: /s/ ULLRICH E. PORZIG
                                  ------------------------------------
                               Name: Ullrich E. Porzig
                               Title: President

                               WELLS FARGO RETAIL FINANCE, LLC,
                               a Delaware limited liability company, as Agent
                               and as a Lender

                               By: /s/ FRANCIS D. O'CONNOR
                                  ------------------------------------
                               Title: Senior Vice President

                               CREDIT PARTIES:

                               PAYLESS SHOESOURCE DISTRIBUTION, INC.

                               By: /s/ ULLRICH E. PORZIG
                                  ------------------------------------
                               Name: Ullrich E. Porzig
                               Title: Vice President and Treasurer

                               PAYLESS SHOESOURCE
                               MERCHANDISING, INC.

                               By: /s/ ULLRICH E. PORZIG
                                  ------------------------------------
                               Name: Ullrich E. Porzig
                               Title: Senior Vice President and Treasurer

             Signature Page to Loan, Guaranty and Security Agreement

<PAGE>

                               SHOE SOURCING, INC.
                               EASTBOROUGH, INC.
                               DYELIGHTS, INC.
                               PSS DELAWARE COMPANY 2, INC.
                               PSS DELAWARE COMPANY 3, INC.
                               PSS DELAWARE COMPANY 4, INC.

                               By: /s/ Ullrich E. Porzig
                                   ---------------------------------
                               Name: Ullrich E. Porzig
                               Title: Vice President

                               PAYLESS SHOESOURCE GOLD VALUE, INC.
                               PAYLESS PURCHASING SERVICES, INC.
                               PSS LABOR LEASING, INC.
                               PSS INVESTMENT I, INC.
                               PSS INVESTMENT III, INC.
                               PSS CANADA, INC.
                               PAYLESS SHOESOURCE WORLDWIDE, INC.

                               By: /s/ Ullrich E. Porzig
                                   ---------------------------------
                               Name: Ullrich E. Porzig
                               Title: President

                               PAYLESS SHOESOURCE, INC., a Delaware corporation

                               By: /s/ Ullrich E. Porzig
                                   ---------------------------------
                               Name: Ullrich E. Porzig
                               Title: Senior Vice President - Chief Financial
                                      Officer and Treasurer

                               PAYLESS SHOESOURCE, INC., a Missouri corporation

                               By: /s/ Ullrich E. Porzig
                                   ---------------------------------
                               Name: Ullrich E. Porzig
                               Title: President

             Signature Page to Loan, Guaranty and Security Agreement

<PAGE>

                               PAYLESS SHOESOURCE LEASING, LLC
                               BY: PAYLESS SHOESOURCE, INC. (ITS SOLE MEMBER)

                               By: /s/ Ullrich E. Porzig
                                   ---------------------------------
                               Name: Ullrich E. Porzig
                               Title: Senior Vice President - Chief Financial
                               Officer and Treasurer

             Signature Page to Loan, Guaranty and Security Agreement

<PAGE>

                               PAYLESS SHOESOURCE OF PUERTO RICO, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4150, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4152, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4153, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4157, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4158, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4162, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4163, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4164, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4166, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4167, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4168, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4204, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4207, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4208, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4219, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4220, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4221, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4238, INC.
                               PAYLESS SHOESOURCE OF PUERTO RICO NO. 4940, INC.

                               By: /s/ Ullrich E. Porzig
                                   ---------------------------------
                               Name: Ullrich E. Porzig
                               Title: Vice President

             Signature Page to Loan, Guaranty and Security Agreement
<PAGE>
                                   EXHIBIT A-1

                   FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT

         This ASSIGNMENT AND ACCEPTANCE AGREEMENT ("Assignment Agreement") is
entered into as of between a ("Assignor"), and a ("Assignee"). Reference is made
to the agreement described in Annex I annexed hereto (the "Loan Agreement").
Capitalized terms used herein and in Annex I and not otherwise defined shall
have the meanings ascribed to them in the Loan Agreement.

         1. In accordance with the terms and conditions of the Loan Agreement,
Assignor hereby sells and assigns to Assignee, and Assignee hereby purchases and
assumes from Assignor, solely that interest in and to Assignor's rights and
obligations under the Loan Documents as of the date hereof with respect to
Assignor's amount, portion and share of the Revolver Commitment [and/or
Obligations](1) as specified in Annex I. After giving effect to such sale and
assignment, Assignee's amount, portion and share of the Revolver Commitment
[and/or Obligations]1 will be as set forth in Annex I.

         2. Assignor (a) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (b) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Loan Documents
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Loan Documents or any other instrument or document furnished
pursuant thereto; and (c) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Credit Party or
the performance or observance by any Credit Party of any of its obligations
under the Loan Documents or any other instrument or document furnished pursuant
thereto.

         3. Assignee (a) confirms that it has received copies of the Loan
Agreement and the other Loan Documents, together with copies of the financial
statements referred to therein and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to enter
into this Assignment Agreement; (b) agrees that it will, independently and
without reliance upon Agent, Assignor, or any other Lender, based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Loan
Documents; (c) confirms that it is eligible as an assignee under the terms of
the Loan Agreement; (d) appoints and authorizes Agent to take such action as
Agent on its behalf and to exercise such powers under the Loan Documents as are
delegated to Agent by the terms thereof, together with such powers as are
reasonably incidental thereto; (e) agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Loan Documents
are required to be performed by it as a Lender.

         4. Following the execution of this Assignment Agreement by the Assignor
and Assignee, it will be delivered by the Assignor to the Agent for (i)
recording by the

----------

(1) To be modified by Agent as applicable with respect to any assignment of
Obligations separate from assignment of Revolver Commitments.

<PAGE>

Agent and (ii) delivery by the Agent of a copy thereof to
Borrower. The effective date of this Assignment (the "Settlement Date") shall be
the later of (a) the date of the execution hereof by the Assignor and the
Assignee, the payment by Assignor or Assignee to Agent for Agent's sole and
separate account a processing fee in the amount of $5,000, and the receipt of
any required consent of the Agent [and Borrower](2), and (b) the date specified
in Annex I.

         5. Upon recording by Agent, as of the Settlement Date and pursuant to
the terms of the Loan Agreement (a) Assignee shall be a party to the Loan
Agreement and, to the extent of the interest assigned pursuant to this
Assignment Agreement, have the rights and obligations of a Lender thereunder and
under the other Loan Documents, and (b) Assignor shall, to the extent of the
interest assigned pursuant to this Assignment Agreement, relinquish its rights
and be released from its obligations under the Loan Agreement and the other Loan
Documents.

         6. Upon recording by Agent, from and after the Settlement Date, Agent
shall make all payments under the Loan Agreement and the other Loan Documents in
respect of the interest assigned hereby to Assignee. On the Settlement Date,
Assignee shall pay to Assignor the Purchase Price (as set forth in Annex I).
Assignor and Assignee shall make all appropriate adjustments in payments under
the Loan Agreement and the other Loan Documents for periods prior to the
Settlement Date directly between themselves on the Settlement Date.

         7. This Assignment Agreement may be executed in counterparts and by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all of which shall together constitute one
and the same instrument. This Assignment Agreement may be executed and delivered
by telecopier or other facsimile transmission all with the same force and effect
as if the same were a fully executed and delivered original manual counterpart.

         8. THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

                  [Remainder of page left intentionally blank.]

----------

(2) Include only if Borrower has right of approval pursuant to Loan Agreement.
<PAGE>

                 IN WITNESS WHEREOF, the parties hereto have caused this
Assignment Agreement and Annex I hereto to be executed by their respective
officers as of the first date written above.

                                       [ASSIGNOR] _________________,
                                       a as Assignor

                                       By:
                                           -------------------------
                                       Name:
                                             -----------------------
                                       Title:
                                              ----------------------

                                       [ASSIGNEE] _________________,
                                       a as Assignee

                                       By:
                                           -------------------------
                                       Name:
                                             -----------------------
                                       Title:
                                              ----------------------

ACCEPTED THIS _____ DAY OF _______, ____

WELLS FARGO RETAIL FINANCE, LLC,
a Delaware limited liability company,
as Agent

By:
    -------------------------
Name:
      -----------------------
Title:
       ----------------------

[PAYLESS SHOESOURCE FINANCE, INC.
as Borrower

By:
    -------------------------
Name:
      -----------------------
Title:
       ----------------------](2)

<PAGE>

                                     ANNEX I
                                       TO
                       ASSIGNMENT AND ACCEPTANCE AGREEMENT

1.       Borrower:  Payless ShoeSource Finance, Inc.

2.       Name and Date of Loan Agreement:

                  Loan and Security Agreement, dated as of January 15, 2004, as
                  amended, restated, supplemented or otherwise modified from
                  time to time, among Borrower, the other Credit Parties from
                  time to time party thereto, the lenders from time to time
                  Party thereto (the "Lenders"), and Wells Fargo Retail Finance,
                  LLC, as arranger and administrative agent for the Lenders.

3.       Date of Assignment Agreement:                                 ________

4.       Amounts:

         a.  Assigned Amount of the [Revolver Commitment](3)          $________
         b.  Assignee's Resulting [Revolver Commitment](3)            $________

5.       Purchase Price                                               $________

6.       Settlement Date:                                              ________

7.       Notice and Payment Instructions, etc.

         Assignee:                          Assignor:

         Wiring Instructions:               Wiring Instructions:

----------

(3) To be modified by Agent as applicable with respect to any assignment of
Obligations separate from assignment of Revolver Commitments.
<PAGE>

8.       Agreed and Accepted:

         [ASSIGNEE] _____________           [ASSIGNOR] _____________
         a ________, as Assignee            a _________, as Assignor

         By:                                By:
             -------------------------          -------------------------
         Name:                              Name:
               -----------------------            -----------------------
         Title:                             Title:
                ----------------------             ----------------------

Accepted:
WELLS FARGO RETAIL FINANCE, LLC, as Agent

By:
    -------------------------
Name:
      -----------------------
Title:
       ----------------------

<PAGE>

                                   EXHIBIT C-l
                        (FORM OF COMPLIANCE CERTIFICATE)

                           [on Borrower's letterhead]

To:      Wells Fargo Retail Finance, LLC
         One Boston Place
         18th Floor
         Boston, Massachusetts 02108
         Attn: Business Finance Division Manager

                Re: Compliance Certificate dated ______________

Ladies and Gentlemen:

         Reference is made to that certain Loan and Security Agreement, dated as
of January 15, 2004 (the "Loan Agreement"), among Payless ShoeSource Finance,
Inc., a Nevada corporation ("Borrower"), the other credit parties signatory
thereto (together with Borrower, the "Credit Parties") the lenders signatory
thereto (the "Lenders"), and Wells Fargo Retail Finance, LLC, a Delaware limited
liability company, as the arranger and administrative agent for the Lenders
("Agent"). Capitalized terms used in this Compliance Certificate have the
meanings set forth in the Loan Agreement unless specifically defined herein.

         Pursuant to Section 6.3 of the Loan Agreement, the undersigned chief
financial officer of Borrower hereby certifies that:

         1. Such officer has reviewed the terms of the Loan Agreement and has
made, or caused to be made under his/her supervision, a review in reasonable
detail of the transactions and condition of Borrower during the accounting
period covered by the financial statements delivered pursuant to Section 6.3 of
the Loan Agreement (with respect to which this Compliance Certificate is being
delivered).

         2. The financial information of Borrower and its Subsidiaries furnished
in Schedule 1 attached hereto has been prepared in accordance with GAAP (except
for the lack of footnotes and being subject to year-end audit adjustments) and
fairly presents in all material respects the financial condition of Borrower and
its Subsidiaries.

         3. There does not exist any condition or event that constitutes a
Default or an Event of Default, except for such conditions or events listed on
Schedule 2 attached hereto (specifying the nature and period of existence
thereof and what action Borrower and/or the applicable Credit Party has taken,
is taking, or proposes to take with respect thereto).

         4. The representations and warranties of each Credit Party set forth in
the Loan Agreement and the other Loan Documents are true and correct in all
material respects on and as of the date hereof, as though made on and as of such
date (except to the extent that such representations and warranties relate
solely to an earlier date and except to the extent that such representations and
warranties relate to Schedules under the Loan Agreement that require only
quarterly updates thereto).

<PAGE>

         5. Without limiting the generality of the foregoing, the Gross
Collateral Availability measured as of the month ended _________, ____ is
$______ which amount [IS/IS NOT] greater than or equal to the minimum Gross
Collateral Availability amount set forth in Section 7.14 of the Loan Agreement.

<PAGE>

         IN WITNESS WHEREOF, this Compliance Certificate is executed by the
undersigned this __ day of January 2004.

                                       PAYLESS SHOESOURCE FINANCE, INC.,
                                       as Borrower

                                       By:
                                           ---------------------------
                                       Name:  Ullrich E. Porzig
                                       Title:  President

                    SIGNATURE PAGE TO COMPLIANCE CERTIFICATE

<PAGE>

                                   SCHEDULE 1
                            TO COMPLIANCE CERTIFICATE

                          [ATTACH FINANCIAL STATEMENTS]

<PAGE>

                                   SCHEDULE 2
                            TO COMPLIANCE CERTIFICATE

    [INCLUDE REQUIRED INFORMATION RELATING TO DEFAULTS OR EVENTS OF DEFAULT]

<PAGE>

                                   EXHIBIT L-l

                              FORM OF LIBOR NOTICE

Wells Fargo Retail Finance, LLC
One Boston Place
18th Floor
Boston, Massachusetts 02108
Attention: Business Finance Division Manager

Ladies and Gentlemen:

         Reference is made to that certain Loan and Security Agreement, dated as
of January 15, 2004 (the "Loan Agreement"), among Payless ShoeSource Finance,
Inc., a Nevada corporation ("Borrower") the other credit parties signatory
thereto (together with Borrower, the "Credit Parties"), the lenders signatory
thereto (the "Lenders"), and Wells Fargo Retail Finance, LLC, a Delaware limited
liability company, as the arranger and administrative agent for the Lenders
("Agent"). Capitalized terms used herein and not otherwise defined herein shall
have the meanings ascribed to them in the Loan Agreement.

         This LIBOR Notice represents Borrower's request to elect the LIBOR
Option with respect to [outstanding] Advances in the amount of $____________
(the "LIBOR Rate Loan")[, and is a written confirmation of the telephonic notice
of such election given to Agent].

         Such LIBOR Rate Loan will have an Interest Period of [1, 2, 3, or 6]
month(s) commencing on _____________.

         This LIBOR Notice further confirms Borrower's acceptance, for purposes
of determining the rate of interest based on the LIBOR Rate under the Loan
Agreement, of the LIBOR Rate as determined pursuant to the Loan Agreement.

         As to any advance requested hereby, Borrower represents and warrants
that (i) as of the date hereof, and as of the effective date of such Advance,
each representation or warranty of any Credit Party contained in or pursuant to
any Loan Document is true and correct in all material respects (except to the
extent any representation or warranty expressly related to an earlier date and
except to the extent that such representations and warranties relate to
Schedules under the Loan Agreement that require only quarterly updates thereto),
(ii) no Default or Event of Default has occurred and is continuing on the date
hereof, nor will any thereof occur after giving effect to the request above,
(iii) no injunction, writ, restraining order, or other order of any nature
restricting or prohibiting, directly or indirectly, the making of the Advance
requested above has been issued and remains in force by any Governmental
Authority against any Credit Party or any of its Affiliates, and (iv) no
Material Adverse Change has occurred.

<PAGE>

         As to any conversion or continuation requested hereby, Borrower
represents and warrants that no Event of Default has occurred and is continuing
on the date hereof, nor will any thereof occur after giving effect to the
request above, in each case except as to any such Event of Default for which
Agent has received written notice (pursuant to Section 16.5 of the Loan
Agreement) within 10 Business Days prior to the date hereof.

                                       Dated:
                                              ---------------------------

                                       PAYLESS SHOESOURCE FINANCE, INC.,
                                       as Borrower

                                       By:
                                           ------------------------------
                                       Name:
                                             ----------------------------
                                       Title:
                                              ---------------------------

Acknowledged by:

WELLS FARGO RETAIL FINANCE, LLC,
a Delaware limited liability company, as Agent

By:
    -------------------------
Name:
      -----------------------
Title:
       ----------------------

                        [SIGNATURE PAGE TO LIBOR NOTICE]

<PAGE>
<TABLE>
<S><C>
                                                                                                                           EXHIBIT M

[PAYLESS SHOESOURCE LOGO]

                    PAYLESS SHOESOURCE, INC.                                                           CERT. #:                 001
                                                                                                                       ------------
                    Borrowing Base Certificate                                                         DATE:               01/21/04
                    --------------------------                                                                         ------------

                    FAX TO:  PHIL CARMICHAEL @ 617-523-4029                                            UPDATES:           MONTHLY
------------------------------------------------------------------------------------------------------------------------------------
CREDIT CARD RECEIVABLES                                  AS OF:                                                                  $0
                                                                -------------                                          -------------
Advance Rate on Credit Card Receivables                                                                                   #VALUE!
                                                                -------------                                          -------------

Total Credit Card Receivables Borrowing Base (capped @ $7MM if reporting monthly, no cap otherwise)                       #VALUE!
                                                                                                                       -------------
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                            COST
                                                                                                                       -------------
SIL & WIL (BELOW-THE-LINE) INVENTORY BALANCE: AS OF:
                                                    ------------
             WIL Payless (WA 2203)                                                                  $0
                                                                                         --------------
             WIL Parade (1WA2203)                                                                   $0
                                                                                         --------------
             WIL Other                                                                               0
                                                                                         --------------
             SIL Payless (SL7703 - BU101ST)                                                          0
                                                                                         --------------
             SIL Parade (1SL7703-BU201ST)                                                            0
                                                                                         --------------
             SIL Payless Canada (GL Acct 161000 BU 103ST)                                            0
                                                                                         --------------
             SIL Payless International (GL Acct 161000 - All Int'l BU's)                             0
                                                                                         --------------
             SIL Other (SL7703 - BU601ST)                                                           $0
                                                                                         --------------
                                                                                                                       -------------
TOTAL SIL & WIL (BELOW-THE-LINE) STOCK LEDGER INVENTORY BALANCE:                                                                 $0
                                                                                                                       -------------

   LESS:     Discontinued Operations (Bundles)                                                       0
                                                                                         --------------
             Canada / International                                                                  0
                                                                                         --------------
             Guam / Saipan / Virgin Islands (SL 7703 Download)                                       0
                                                                                         --------------
             Consigned in Excess of $2.5MM                                                           0
                                                                                         --------------
             Unprocessed Damages (GL 163000)                                                         0
                                                                                         --------------
             WIL Shrink Reserve (1% of Total WIL)                                                    0
                                                                                         --------------
   TOTAL INVENTORY INELIGIBLES                                                                                                    0
                                                                                                                       -------------

   TOTAL ELIGIBLE STOCK LEDGER INVENTORY                                                                                          0
                                                                                                                       -------------

             STANDARD ADVANCE RATE ON COST:                                                      0.00%                            -
                                                                                         --------------                -------------

             ADVANCE RATE: LESSER OF 85% OF NRLV OR 70% OF COST VALUE OF INVENTORY

   PLUS IN-TRANSIT INVENTORY:
                  Eligible Letter of Credit In-Transits:
                                                         ---------------
                  Other Eligible In-Transits:                                                         0 (1) (IT1052)
                                                                                         --------------                -------------

   TOTAL IN-TRANSIT INVENTORY          AS OF:                                                                             #VALUE!
                                            -------------                                                              -------------

                  Less: In-Transit to International (2) (Colon DC PO's)
                                                                                         --------------
                  Less: In-Transit w/o Documentation (3)
                       (Acct 171015 PSIL + BU401CO Wholesaling)                          --------------

                  Less: Letter of Credit Inventory Over 60-Days (4)                                                       #VALUE!
                                                                                         --------------
                  Less: In-Transit Over 60-days (5) (EF1052)
                                                                                         --------------

                  Less: In-Transits from PSIL
                       (related Hong Kong entity) (6) (#1+#2+#3)X30%
                                                                                         --------------
                  Less: In-Transit Not Paid For (7) (#1+#2+#3+#6)X27%
                                                                                         --------------
   TOTAL IN-TRANSIT INELIGIBLES                                                                                                   0
                                                                                                                       -------------
   TOTAL ELIGIBLE IN-TRANSIT INVENTORY                                                                                    #VALUE!
                                                                                                                       -------------
             ADVANCE RATE ON IN-TRANSIT INVENTORY                                                0.00%                    #VALUE!
                                                                                         --------------                -------------
TOTAL INVENTORY BORROWING BASE                                                                                            #VALUE!
                                                                                                                       -------------

   LESS AVAILABILITY RESERVES:
             Gift Cards/Merchandise Credits/Customer Deposits - 50% of Balance    As of:
                                                                                         --------------                -------------
             Rent Reserves (one month's rent for PA, VA and WA)
                                                                                         --------------                -------------
             Landing Cost/Freight & Duty on In-Transit (10% of Eligible In-Transit)                                       #VALUE!
                                                                                         --------------                -------------
   TOTAL AVAILABILITY RESERVES                                                                                            #VALUE!
                                                                                                                       -------------

TOTAL INVENTORY & CREDIT CARD RECEIVABLES BORROWING BASE  - UNCAPPED                                                      #VALUE!
                                                                                                                       -------------

TOTAL INVENTORY & ACCOUNTS RECEIVABLE BORROWING BASE (CAPPED AT $200 MILLION) - CAPPED                                    #VALUE!
                                                                                                                       -------------

====================================================================================================================================
</TABLE>

                                   Page 1 of 2

<PAGE>
<TABLE>
<S><C>
                                                                                                                           EXHIBIT M
[PAYLESS SHOESOURCE LOGO]

                    PAYLESS SHOESOURCE, INC.                                                           CERT. #:                 001
                                                                                                                -------------------
                    Borrowing Base Certificate                                                         DATE:               01/21/04
                    --------------------------                                                                  -------------------

                    FAX TO:  PHIL CARMICHAEL @ 617-523-4029                                            UPDATES:       MONTHLY
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
                                   AVAILABILITY CALCULATION (DUE 10:30AM PST FOR SAME-DAY FUNDING)

          BEGINNING PRINCIPAL BALANCE AS OF:                                  01/21/04                                           $0
                                                                             ------------                        -------------------
                    ADD:                      Advances through                01/21/04                                            0
                                                                             ------------                        -------------------
                                              Fees as of                      01/21/04                                            0
                                                                             ------------                        -------------------
                                              Adjustments                     01/21/04                                            0
                                                                             ------------                        -------------------
                    LESS:                     Payments through                01/21/04                                            0
                                                                             ------------                        -------------------
          ENDING PRINCIPAL BALANCE PRIOR TO ADVANCE REQUEST                                                                       0
                                                                                                                 -------------------

          LOAN BALANCE PRIOR TO TODAY'S REQUEST                                                                                   0
                                                                                                                 -------------------

          NET AVAILABILITY PRIOR TO TODAY'S REQUEST                                                                   #VALUE!
                                                                                                                 -------------------

                    TODAY'S ADVANCE REQUEST:                                                                                      0
                                                                                                                 -------------------

          ENDING LOAN BALANCE                                                                                                     0
                                                                                                                 -------------------

          TOTAL L/C'S OUTSTANDING                  Doc:                   $0    Standby:                              #VALUE!
                                                                -------------            --------------          -------------------

          TOTAL EXPOSURE                                                                                              #VALUE!
                                                                                                                 -------------------

          EXCESS AVAILABILITY (minimum Availability at all times of $25MM; based
          on Uncapped Total Borrowing Base)                                                                           #VALUE!
                                                                                                                 -------------------

------------------------------------------------------------------------------------------------------------------------------------

Payless ShoeSource Finance, Inc. (the "Borrower") represents and warrants that (a) said collateral complies with their
representations, warrants, and covenants contained in the Loan Agreement between Lender and undersigned and; (b) no "Event of
Default" (as defined in the Loan and Security Agreement) is presently in existence.

Authorized Signer:         Printed Name:  _______________________________________   Signature:  ___________________________________

WFRF  Account Executive:   Printed Name:  _______________________________________   Signature:  ___________________________________
</TABLE>

                                  Page 2 of 2

<PAGE>

                                  SCHEDULE C-1
                                   COMMITMENTS

<TABLE>
<CAPTION>
           LENDER                          REVOLVER COMMITMENT
<S>                                        <C>
WELLS FARGO RETAIL FINANCE, LLC                $200,000,000
TOTAL:                                         $200,000,000
</TABLE>

<PAGE>

                                  SCHEDULE 6.2
                              COLLATERAL REPORTING

Borrower shall provide Agent with the following documents at the following times
in form reasonably satisfactory to Agent:

                  (a)      Borrowing Base Certificate. On a quarterly basis
within 20 days of the end of each of Borrower's fiscal quarters for the
immediately preceding fiscal quarter; provided, however, if Revolver Usage at
any time exceeds $25,000,000 then the deliveries required by this clause (a)
shall be on a monthly basis, not later than ten days from the fiscal month end,
Borrower shall provide to Agent a signed borrowing base certificate based on the
most recent completed fiscal month, in form as approved by Agent and including a
detailed calculation of the Borrowing Base (including detail regarding those
Accounts of the Credit Parties that are not Eligible Accounts) in the form of
Exhibit M to the Loan, Guaranty and Security Agreement (a "Borrowing Base
Certificate"); provided, further, that, during any Borrowing Base Triggering
Period, Agent may require such borrowing base certificate on such more frequent
basis as Agent may determine in its Permitted Direction. Such certificate may be
sent to Agent electronically (with an electronic signature) or by facsimile
transmission, provided, that in each case, upon request by Agent, the original
thereof is forwarded to Agent on the date of such transmission. No adjustments
to the borrowing base certificate may be made without supporting documentation
and such other documentation as may be reasonably requested by Agent from time
to time.

                  (b)      Borrowing Base Certificate Supporting Documents. At
any such time as Borrower shall deliver a Borrowing Base Certificate to Agent
pursuant to subsection (a) above, Borrower shall provide to Agent each of the
following documents in support thereof:

                           (i)      the store stock ledger (SIL) and warehouse
                  stock ledger (WIL) reports of the Credit Parties;

                           (ii)     a summary report of the in-transit Inventory
                  of the Credit Parties;

                           (iii)    a report of the gift card balances from the
                  general ledger; and

                           (iv)     a report of the Credit Card Receivables of
                  the Credit Parties.

                  (c)      Additional Documentation. In addition to subsections
(a) and (b) above, Agent may, in its Permitted Discretion, from time to time
require Borrower to deliver to Agent any of the following documents:

                           (i)      a detailed aging, by total, of the Inventory
                  of the Credit Parties, together with a reconciliation to the
                  detailed calculation of the Borrowing Base previously provided
                  to Agent;

                                       1
<PAGE>

                           (ii)     additional supporting documentation for the
                  Borrowing Base Collateral as may be available, including
                  copies of invoices in connection with Credit Parties'
                  Accounts, credit memos, remittance advices, deposit slips,
                  shipping and delivery documents in connection with Credit
                  Parties' Accounts and, for Inventory acquired by any Credit
                  Party, purchase orders and invoices;

                           (iii)    a detailed aging, by total, of the Accounts
                  of the Credit Parties, together with a reconciliation to the
                  detailed calculation of the Borrowing Base previously provided
                  to Agent;

                           (iv)     Inventory reports specifying the cost and
                  the retail value of Inventory, by category, with additional
                  detail showing additions to and deletions therefrom;

                           (v)      "flash sales report";

                           (vi)     reconciliation of the stock ledger to the
                  general ledger; and

                           (vii)    such other reports or documents as to the
                  Credit Party Collateral or the financial condition of the
                  Credit Parties, as requested by Agent.

                                       2

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