Document:

<PAGE>   1
                                                                     EXHIBIT 4.1

                                                                  EXECUTION COPY

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                                    INDENTURE

                                  by and among

        FIRST SIERRA EQUIPMENT CONTRACT TRUST 2000-2, A COMMON LAW TRUST
        ACTING THROUGH ITS TRUSTEE, FIRST UNION TRUST COMPANY, NATIONAL
        ASSOCIATION, NOT IN ITS INDIVIDUAL CAPACITY BUT SOLELY AS OWNER
                                    TRUSTEE

                                   as Issuer,

                              SIERRACITIES.COM INC.

                           as Servicer and Originator

                                       and

                              BANKERS TRUST COMPANY

                            as the Indenture Trustee

                                   ----------

                            Dated as of June 1, 2000

                                   ----------

                  First Sierra Equipment Contract Trust 2000-2
                         Equipment Contract-Backed Notes

================================================================================

<PAGE>   2

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----

<S>      <C>                                                                                                   <C>
ARTICLE I. DEFINITIONS............................................................................................1

         Section 1.01      Definitions............................................................................1
         Section 1.02      Incorporation by Reference of the Trust Indenture Act..................................1
         Section 1.03      General Interpretive Principles........................................................1
         Section 1.04      Conflict with TIA......................................................................2

ARTICLE II. PLEDGE OF PLEDGED PROPERTY; ORIGINAL ISSUANCE OF NOTES AND RESIDUAL CLASS.............................2

         Section 2.01      Pledge of Pledged Property.............................................................2
         Section 2.02      Indenture Trustee to Act as Custodian..................................................3
         Section 2.03      Conditions to Closing..................................................................3
         Section 2.04      Acceptance by Indenture Trustee........................................................4
         Section 2.05      Liabilities of the Trust and Parties to this Indenture; Limitations Thereon............5
         Section 2.06      Intended Tax Characterization..........................................................5
         Section 2.07      Treasury Securities....................................................................6

ARTICLE III. ACCOUNTS; ALLOCATION AND APPLICATION OF  THE TRUST FUND..............................................6

         Section 3.01      Collection Account.....................................................................6
         Section 3.02      Reserved...............................................................................7
         Section 3.03      Investment of Monies Held in the Accounts; Subaccounts.................................7
         Section 3.04      Reserve Account........................................................................7
         Section 3.05      Disbursements From Collection Account..................................................8
         Section 3.06      Statements to Noteholders.............................................................11
         Section 3.07      Compliance With Withholding Requirements..............................................14

ARTICLE IV. REMOVAL OF NON-CONFORMING PLEDGED PROPERTY; SUBSTITUTION OF CONTRACTS................................14

         Section 4.01      Removal of Non-Conforming Pledged Property............................................14
         Section 4.02      Substitution of Contracts.............................................................15
         Section 4.03      Release of Pledged Property...........................................................16

ARTICLE V. THE NOTES.............................................................................................16

         Section 5.01      The Notes.............................................................................16
         Section 5.02      Initial Issuance of Notes.............................................................19
         Section 5.03      Registration of Transfer and Exchange of Notes........................................19
         Section 5.04      Mutilated, Destroyed, Lost or Stolen Notes............................................20
         Section 5.05      Persons Deemed Owners.................................................................21
         Section 5.06      Access to List of Noteholders' Names and Addresses....................................21
         Section 5.07      Acts of Noteholders...................................................................21
         Section 5.08      No Proceedings........................................................................22
</TABLE>

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<TABLE>
<S>      <C>                                                                                                   <C>
ARTICLE VI. THE TRUST............................................................................................22

         Section 6.01      Liability of the Trust................................................................22
         Section 6.02      Limitation on Liability of the Trust..................................................22
         Section 6.03      Indemnity for Liability Claims........................................................23
         Section 6.04      Liabilities...........................................................................23
         Section 6.05      [Reserved.]...........................................................................23
         Section 6.06      Annual Statement as to Compliance.....................................................23
         Section 6.07      Payment of Principal and Interest.....................................................23
         Section 6.08      Maintenance of Office or Agency.......................................................24
         Section 6.09      Money for Payments to be Held in Trust................................................24
         Section 6.10      Existence.............................................................................25
         Section 6.11      Protection of Pledged Property........................................................25
         Section 6.12      Performance of Obligations; Servicing of Receivables..................................26
         Section 6.13      Negative Covenants....................................................................27
         Section 6.14      Trust May Consolidate, Etc. Only on Certain Terms.....................................27
         Section 6.15      Successor or Transferee...............................................................29
         Section 6.16      No Other Business.....................................................................29
         Section 6.17      No Borrowing..........................................................................29
         Section 6.18      Guarantees, Loans, Advances and Other Liabilities.....................................29
         Section 6.19      Capital Expenditures..................................................................29
         Section 6.20      Compliance with Laws..................................................................29
         Section 6.21      Further Instruments and Acts..........................................................29

ARTICLE VII. THE INDENTURE TRUSTEE...............................................................................30

         Section 7.01      Duties of Indenture Trustee...........................................................30
         Section 7.02      Eligible Investments..................................................................31
         Section 7.03      Indenture Trustee's Assignment of Contracts...........................................32
         Section 7.04      Certain Matters Affecting the Indenture Trustee.......................................32
         Section 7.05      Indenture Trustee Not Liable for Notes or Contracts...................................33
         Section 7.06      Indenture Trustee May Own Notes.......................................................34
         Section 7.07      Indenture Trustee's Fees and Expenses.................................................34
         Section 7.08      Eligibility Requirements for Indenture Trustee........................................35
         Section 7.09      Preferential Collection of Claims Against Issuer......................................35
         Section 7.10      Resignation or Removal of Indenture Trustee...........................................35
         Section 7.11      Successor Indenture Trustee...........................................................36
         Section 7.12      Merger or Consolidation of Indenture Trustee..........................................36
         Section 7.13      Appointment of Co-Indenture Trustee or Separate Indenture Trustee.....................37
         Section 7.14      Indenture Trustee May Enforce Claims Without Possession of Note.......................38
         Section 7.15      Suits for Enforcement.................................................................38
         Section 7.16      Undertaking for Costs.................................................................39
         Section 7.17      Representations and Warranties of Indenture Trustee...................................39
         Section 7.18      Tax Returns...........................................................................39

ARTICLE VIII. EVENTS OF DEFAULT; REMEDIES........................................................................40

         Section 8.01      Events of Default.....................................................................40
         Section 8.02      Acceleration of Maturity, Rescission and Annulment....................................41
</TABLE>

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<TABLE>
<S>      <C>                                                                                                   <C>
         Section 8.03      Remedies..............................................................................42
         Section 8.04      Notice of Event of Default............................................................42
         Section 8.05      Exercise of Power by Indenture Trustee................................................42
         Section 8.06      Indenture Trustee May File Proofs of Claim............................................42
         Section 8.07      Allocation of Money Collected.........................................................43
         Section 8.08      Waiver of Events of Default...........................................................44
         Section 8.09      Limitation On Suits...................................................................44
         Section 8.10      Unconditional Right of Noteholders to Receive Principal and Interest..................45
         Section 8.11      Restoration of Rights and Remedies....................................................45
         Section 8.12      Rights and Remedies Cumulative........................................................45
         Section 8.13      Delay or Omission Not Waiver..........................................................45
         Section 8.14      Control by Majority Holders...........................................................46
         Section 8.15      Sale of Pledged Property..............................................................46
         Section 8.16      Action on Notes.......................................................................46

ARTICLE IX. TERMINATION..........................................................................................47

         Section 9.01      Termination of Obligations and Responsibilities.......................................47
         Section 9.02      Optional Redemption of Notes; Final Disposition of Funds..............................47

ARTICLE X. NOTEHOLDERS' LISTS AND REPORTS........................................................................48

         Section 10.01     Note Registrar To Furnish To Indenture Trustee Names and Addresses of
                           Noteholders...........................................................................48
         Section 10.02     Preservation of Information; Communications to Noteholders............................48
         Section 10.03     Reports by the Trust..................................................................49
         Section 10.04     Reports by Indenture Trustee..........................................................49
         Section 10.05     Compliance Certificates and Opinions, etc.............................................49

ARTICLE XI. MISCELLANEOUS PROVISIONS.............................................................................50

         Section 11.01     Amendment.............................................................................50
         Section 11.02     Conformity With Trust Indenture Act...................................................51
         Section 11.03     Limitation on Rights of Noteholders...................................................51
         Section 11.04     Counterparts..........................................................................51
         Section 11.05     Governing Law.........................................................................51
         Section 11.06     Notices...............................................................................52
         Section 11.07     Severability of Provisions............................................................52
         Section 11.08     Conflict with Trust Indenture Act.....................................................52
         Section 11.09     Reserved..............................................................................52
         Section 11.10     Assignment............................................................................52
         Section 11.11     Binding Effect........................................................................52
         Section 11.12     Survival of Agreement.................................................................53
         Section 11.13     Captions..............................................................................53
         Section 11.14     Exhibits..............................................................................53
         Section 11.15     Calculations..........................................................................53
         Section 11.16     No Proceedings........................................................................53
</TABLE>

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<TABLE>
Exhibits
--------
<S>              <C>
Exhibit A  -     Form of Trustee's Receipt
Exhibit B  -     Form of Wiring Instructions
Exhibit C  -     Form of Class A Notes
Exhibit D  -     Form of Subordinate Notes
Exhibit E  -     Form of Transferee Certification (Non-144A)
Exhibit F  -     Form of Transferee Certification (144A QIB)
Exhibit G  -     Form of Transferee Certification (Investment Company)
Exhibit H  -     Form of Instrument of Transfer

Annex A - Defined Terms
</TABLE>

<PAGE>   6

                  FIRST SIERRA EQUIPMENT CONTRACT TRUST 2000-2

                  Reconciliation and Tie between the Indenture
                        dated as of June 1, 2000 and the
                     Trust Indenture Act of 1939, as amended

<TABLE>
<CAPTION>
             Trust Indenture Act Section                                 Indenture Section
             ---------------------------                                 -----------------
             <S>                                                         <C>
                   Section 310(a)(1)                                        Section 7.08
                        (a)(2)                                                  7.08
                        (a)(3)                                                  7.13
                        (a)(4)                                             Not Applicable
                         (b)                                                 7.08; 7.10
                         (c)                                               Not Applicable
                        311(a)                                                  7.09
                         (b)                                                    7.09
                        312(a)                                                 10.02
                         (b)                                                   10.02
                         (c)                                                   10.02
                        313(a)                                                 10.04
                        (b)(1)                                     10.02; 10.04; 4.01; 4.02; 4.03
                        (b)(2)                                                 10.04
                         (c)                                                10.03; 10.04
                         (d)                                                   10.04
                        314(a)                                           10.03; 3.05; 6.06
                         (b)                                               Not Applicable
                        (c)(1)                                                 10.05
                        (c)(2)                                                 10.05
                        (c)(3)                                                 10.05
                         (d)                                               Not Applicable
                         (e)                                               Not Applicable
                         (f)                                               Not Applicable
                        315(a)                                               7.01; 7.05
                         (b)                                                    8.04
                         (c)                                                    8.05
                         (d)                                                    7.01
                         (e)                                                    7.01
                316(a) (last sentence)                                          2.07
                      (a)(1)(A)                                              8.03; 8.14
                      (a)(1)(B)                                                 8.08
                      317(a)(1)                                                 8.03
                        (a)(2)                                                  8.04
                         (b)                                                    6.09
                        318(a)                                                 11.08
                         (c)                                                   11.08
</TABLE>

<PAGE>   7

                  This INDENTURE, dated as of June 1, 2000, is made by and among
First Sierra Equipment Contract Trust 2000-2, a common law trust acting through
its trustee, First Union Trust Company, National Association, not in its
individual capacity but solely as Owner Trustee (the "Issuer" or the "Trust"),
SierraCities.com Inc., as servicer (in such capacity, the "Servicer"), as
originator (in such capacity, the "Originator") and, in its individual capacity
(in such capacity "SierraCities.com") and Bankers Trust Company, a New York
banking corporation, not in its individual capacity but solely as the indenture
trustee (the "Indenture Trustee").

                                   WITNESSETH:

                  In consideration of the mutual agreements herein contained,
and of other good and valuable consideration the receipt and adequacy of which
are hereby acknowledged, the parties agree as follows:

                                   ARTICLE I.

                                   DEFINITIONS

                  Section 1.01 Definitions. Capitalized terms used and not
defined herein shall have the meanings specified in Annex A hereto.

                  Section 1.02 Incorporation by Reference of the Trust Indenture
Act. Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:

                  "Commission" means the Securities and Exchange Commission.

                  "indenture securities" means the Notes.

                  "indenture security holder" means a Noteholder.

                  "indenture to be qualified" means this Indenture.

                  "Indenture Trustee" or "institutional trustee" means the
Indenture Trustee.

                  "obligor" on the indenture securities means the Issuer.

                  All other TIA terms used in this Indenture that are defined by
the TIA, or defined by Commission rule have the meaning assigned to them by such
definitions.

                  Section 1.03 General Interpretive Principles. For purposes of
this Indenture except as otherwise expressly provided or unless the context
otherwise requires:

                  (a) the terms defined in this Indenture have the meanings
assigned to them in this Indenture and include the plural as well as the
singular, and the use of any gender herein shall be deemed to include the other
gender;

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                  (b) accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles as in effect on the date hereof;

                  (c) references herein to "Articles", "Sections",
"Subsections", "Paragraphs" and other subdivisions without reference to a
document are to designated Articles, Sections, Subsections, Paragraphs and other
subdivisions of this Indenture;

                  (d) a reference to a Subsection without further reference to a
Section is a reference to such Subsection as contained in the same Section in
which the reference appears, and this rule shall also apply to Paragraphs and
other subdivisions;

                  (e) the words "herein", "hereof", "hereunder" and other words
of similar import refer to this Indenture as a whole and not to any particular
provision; and

                  (f) the term "include" or "including" shall mean without
limitation by reason of enumeration.

                  Section 1.04 Conflict with TIA. If any provision hereof
limits, qualifies or conflicts with a provision of the TIA that is required
under the TIA to be part of and govern this Indenture, the latter provision
shall control and all provisions required by the TIA are hereby incorporated by
reference. If any provision of this Indenture modifies or excludes any provision
of the TIA that may be so modified or excluded, the latter provisions shall be
deemed to apply to this Indenture as so modified or to be excluded, as the case
may be.

                                  ARTICLE II.

                           PLEDGE OF PLEDGED PROPERTY;
                  ORIGINAL ISSUANCE OF NOTES AND RESIDUAL CLASS

                  Section 2.01 Pledge of Pledged Property. The Trust, to secure
payment of principal of and interest on, and any other amounts owing in respect
of the Notes, equally and ratably, without prejudice, priority or distinction
except as set forth herein, and to secure compliance with the provision of this
Indenture, simultaneously with the execution and delivery of this Indenture,
does hereby pledge, deposit, transfer, assign, and otherwise grant to the
Indenture Trustee, without recourse (except as otherwise expressly set forth
herein), to be held in trust for the benefit of the Noteholders, as provided in
this Indenture, all the right, title, and interest of the Owner Trustee on
behalf of the Trust , whether now owned or hereafter acquired, in and to (a)(i)
any Equipment that is owned by the Owner Trustee on behalf of the Trust and any
and all income and proceeds from such Equipment, but subject to the rights of
the Obligor to quiet enjoyment of such Equipment under the related Contract and
(ii) any security interest of the Owner Trustee on behalf of the Trust in any of
the Equipment that is not owned by the Owner Trustee on behalf of the Trust, (b)
the Contracts, including, without limitation, all Scheduled Payments, Final
Scheduled Payments, Defaulted Contract Recoveries, Early Termination Contract
Proceeds, Liquidation Proceeds and any other payments due or made with respect
to the Contracts after the related Cut-Off Date, (c) any guarantees of an
Obligor's obligations under a Contract, (d) all other documents in the Contract
Files relating to the Contracts, including, without limitation, any UCC
financing statements related to the Contracts or the Equipment,

                                       2
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(e) any Insurance Policies and Insurance Proceeds with respect to the Contracts
and the related Equipment, (f) all of the Trust's right, title and interest in
and to, and rights under the Receivables Transfer Agreement and the Servicing
Agreement, each as executed and delivered in accordance therewith, (g) all
amounts on deposit in the Collection Account, the Reserve Account and the
Lockbox Account, held by the Indenture Trustee, (h) all of the Trust's right,
title and interest in and to, and rights and claims under, all Source Agreements
and Source Agreement Rights to the extent they relate to any Contract and any
Equipment covered by the Contracts, and (i) all present and future claims,
demands, causes and choses in action in respect of any or all of the foregoing
and all payments on or under and all proceeds of every kind and nature
whatsoever in respect of any or all of the foregoing, including all proceeds of
the conversion, voluntary or involuntary, into cash or other liquid property,
all cash proceeds, accounts, accounts receivable, notes, drafts, acceptances,
chattel paper, checks, deposit accounts, insurance proceeds, condemnation
awards, rights to payment of any and every kind and other forms of obligations
and receivables, instruments, securities, financial assets and other property
that at any time constitute all or part of or are included in the proceeds of
any of the foregoing (all of the foregoing, collectively, constituting the
"Pledged Property"); provided, however, that the pledge, transfer and assignment
effected by this Section 2.01 shall not include the Initial Unpaid Amounts
relating thereto.

                  This Indenture is a security agreement within the meaning of
Article 8 and Article 9 of the Uniform Commercial Code as in effect in the
States of Delaware, New York and Texas. The pledge provided for in this Section
2.01 is intended by the Trust to be a grant by the Trust to the Indenture
Trustee on behalf of the Noteholders, of a valid first priority perfected
security interest in all of the Owner Trustee's right, title and interest (on
behalf of the Trust) in and to the Pledged Property whether now or hereafter
owned and wherever located.

                  Section 2.02 Indenture Trustee to Act as Custodian. The
executed original counterpart of each Contract, together with the other
documents or instruments, if any, which constitute a part of a Contract File
shall be held by the Indenture Trustee for the benefit of the Noteholders.

                  Section 2.03 Conditions to Closing. As conditions to the
execution, authentication and delivery of the Notes by the Indenture Trustee and
the sale of the Notes by the Trust (by issuance thereof by the Trust upon the
Trust's instructions) on the Closing Date, (i) the Trust shall have received by
wire transfer the net proceeds of sale of the Class A Notes, the Class B Notes,
the Class C Notes, the Class D Notes and the Class E Notes in authorized
denominations equal in the aggregate to the Initial Class A Note Principal
Balance, the Initial Class B Note Principal Balance, the Initial Class C Note
Principal Balance, the Initial D Principal Balance and the Initial Class E Note
Principal Balance, and (ii) the Indenture Trustee shall have received the
following on or before the Closing Date:

                  (a) The List of Initial Contracts, certified by the President,
any Senior Vice President, any Vice President or any Assistant Vice President of
the Servicer;

                  (b) Copies of resolutions of the Depositor approving the
execution, delivery and performance of the Transaction Documents to which it is
a party and the transactions

                                       3
<PAGE>   10

contemplated hereby and thereby, certified by a Secretary or an Assistant
Secretary of the Depositor;

                  (c) A copy of an officially certified document, dated not more
than 30 days prior to the Closing Date, evidencing the due organization and good
standing of the Depositor in the State of Delaware;

                  (d) A copy of the Trust Certificate;

                  (e) Delivery of the executed Financing Statements with respect
to the Initial Contracts, in accordance with the Filing Requirements, prepared
for filing;

                  (f) A certificate listing the Servicing Officers as of the
Closing Date;

                  (g) Executed copies of the Transaction Documents;

                  (h) Copies of resolutions of the Board of Directors of
SierraCities.com approving the execution, delivery and performance of this
Indenture and the other Transaction Documents to which it is a party and the
transactions contemplated hereby and thereby, certified by a Secretary or an
Assistant Secretary of SierraCities.com;

                  (i) A copy of an officially certified document, dated not more
than 30 days prior to the Closing Date, evidencing the due organization and good
standing of SierraCities.com in the States of Delaware and Texas;

                  (j) A custody receipt, substantially in the form of Exhibit A
hereto, pursuant to which the Indenture Trustee certifies that it has received a
contract file with respect to each Initial Contract on the List of Initial
Contracts;

                  (k) All Necessary Consents;

                  (l) A letter from S&P that it has assigned a rating of (i)
"A-1+" to the Class A-1 Notes, (ii) "AAA" to the Class A-2 Notes, the Class A-3
Notes and the Class A-4 Notes, (iii) "A" to the Class B Notes and (iv) "BBB" to
the Class C Notes;

                  (m) A letter from Fitch that it has assigned a rating of (i)
F1+/AAA to the Class A-1 Notes, (ii) "AAA" to the Class A-2 Notes, the Class A-3
Notes and the Class A-4 Notes, (iii) "A" to the Class B Notes, (iv) "BBB" to the
Class C Notes, (v) "BB" to the Class D Notes, and (vi) "B" to the Class E Notes;
and

                  (n) Opinions of counsel to SierraCities.com and the Depositor,
in form and substance acceptable to the Indenture Trustee, covering such matters
as the Indenture Trustee may reasonably request including, without limitation,
opinions concerning nonconsolidation, true sale, security interest, federal tax
and general corporate matters.

                  Section 2.04 Acceptance by Indenture Trustee. The Indenture
Trustee acknowledges its acceptance, simultaneously with the execution and
delivery of this Indenture, of all right, title and interest in and to the
Pledged Property on behalf of the Noteholders and

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declares that the Indenture Trustee holds and will hold such right, title and
interest for the benefit of all present and future Noteholders for the use and
purpose and subject to the terms and provisions of this Indenture. The Trust
hereby (a) appoints the Indenture Trustee as the Trust's attorney-in-fact with
all power independently to enforce all of the Trust's rights against the
Originator and the Depositor hereunder, under the Receivables Transfer Agreement
and under the Servicing Agreement and (b) directs the Indenture Trustee to
enforce such rights. The Indenture Trustee hereby accepts such appointment and
agrees to enforce such rights.

                  Section 2.05 Liabilities of the Trust and Parties to this
Indenture; Limitations Thereon. (a) The obligations evidenced by the Notes
provide recourse only to the Pledged Property and provide no recourse against
SierraCities.com, the Depositor, the Servicer, the Indenture Trustee, the Owner
Trustee or any other Person, except as set forth in paragraph (b) below and as
may be set forth in the Transaction Documents.

                  (b) Neither SierraCities.com, the Trust, the Depositor, the
Servicer nor any other Person shall be liable to the Indenture Trustee or the
Noteholders except as provided in Article VI hereof and Sections 5.01, 5.03, and
5.07 of the Servicing Agreement and Section 4.01(g) of the Receivables Transfer
Agreement. Without limiting the generality of the foregoing, if any Obligor
fails to pay any Scheduled Payment, Final Scheduled Payment or other amounts due
under a Contract, then neither the Indenture Trustee nor the Noteholders will
have any recourse against SierraCities.com or the Servicer for such Scheduled
Payment, Final Scheduled Payment, other amounts due under the Contract or any
losses, damages, claims, liabilities or expenses incurred by the Indenture
Trustee or any Noteholder as a direct or indirect result thereof, except as may
be provided for in Article VI hereof and Sections 5.01, and 5.07 of the
Servicing Agreement and Section 4.01(g) of the Receivables Transfer Agreement.

                  (c) The Indenture Trustee agrees that in the event of a
default by an Obligor under the terms of a Contract, which default is not cured
within any applicable cure period set forth in such Contract, the Indenture
Trustee and the Noteholders shall be expressly limited to the sources of payment
specified herein. In addition, the Indenture Trustee shall have the right to
exercise the rights of the Originator under the Contracts, the Insurance
Policies and any document in any Contract File in the name of the Indenture
Trustee and the Noteholders, either directly or through the Servicer as agent,
and the Indenture Trustee is hereby directed by the Trust to exercise such
rights; provided, however, that the Indenture Trustee shall not be required to
take any action pursuant to this Section 2.05(c) except upon written
instructions from the Servicer. A carbon, photographic or other reproduction of
this Indenture or any financing statement is sufficient as a financing statement
in any State.

                  (d) The pledge of the Pledged Property by the Trust pursuant
to this Indenture does not constitute and is not intended to result in an
assumption by the Indenture Trustee, the Trust or any Noteholder of any
obligation (except for the obligation not to disturb an Obligor's right of quiet
enjoyment) of the Originator or the Servicer to any Obligor or other Person in
connection with the Equipment, the Contracts, the Insurance Policies or any
document in the Contract Files.

                  Section 2.06 Intended Tax Characterization. The parties hereto
agree that it is their mutual intent that, for all applicable tax purposes, the
Notes will constitute indebtedness

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<PAGE>   12

and that for all applicable tax purposes, accordingly, the Trust will be treated
as sole and exclusive owner of the Pledged Property. Further, each party hereto
and each Noteholder (by receiving and holding a Note), hereby covenants to every
other party hereto and to every other Noteholder to treat the Notes as
indebtedness for all applicable tax purposes in all tax filings, reports and
returns and otherwise, and further covenants that neither it nor any of its
Affiliates will take, or participate in the taking of or permit to be taken, any
action that is inconsistent with the treatment of the Notes as indebtedness for
tax purposes. All successors and assigns of the parties hereto shall be bound by
the provisions hereof.

                  Section 2.07 Treasury Securities. In determining whether the
Noteholders of the required outstanding principal balance of the Notes have
concurred in any direction, waiver or consent, Notes owned by SierraCities.com,
any other obligor upon the Notes or any Affiliate of SierraCities.com shall be
considered as though not outstanding, except that for the purposes of
determining whether the Indenture Trustee shall be protected in relying on any
such direction, waiver or consent, only Notes which a Responsible Officer
actually knows are so owned shall be so disregarded.

                                  ARTICLE III.

                     ACCOUNTS; ALLOCATION AND APPLICATION OF
                                 THE TRUST FUND

                  Section 3.01 Collection Account. (a) The Servicer shall
establish and maintain with the Indenture Trustee an Eligible Bank Account (the
"Collection Account") for the benefit of the Noteholders as an Eligible Bank
Account, in the name of "First Sierra Equipment Contract-Backed Notes 2000-2
Collection Account, in trust for the registered holders of Equipment
Contract-Backed Notes, Series 2000-2." At the Servicer's written direction, the
Indenture Trustee shall make withdrawals from the Collection Account only as
provided in this Indenture. The Indenture Trustee shall possess all right, title
and interest in all funds on deposit from time to time in the Collection Account
and all proceeds thereof. The Collection Account shall be under the sole
dominion and control of the Indenture Trustee for the benefit of the
Noteholders.

                  (b) At the times indicated in this Section 3.01(b) or in
Section 3.01(c) below, the following amounts (net of Excluded Amounts) shall be
deposited in the Collection Account in immediately available funds:

                           (i) The Servicer shall deposit or cause to be
         deposited the aggregate amounts of Collections;

                           (ii) The Servicer shall deposit the aggregate
         Servicer Advances payable pursuant to Section 4.03 of the Servicing
         Agreement;

                           (iii) The Servicer shall deposit any Repurchase
         Amounts payable by it under the Servicing Agreement, or by the
         Originator pursuant to Section 4.01 hereof; and

                                       6
<PAGE>   13

                           (iv) Investment Earnings, as described in Section
         3.03(a) hereof and except as may be set forth herein.

                  (c) The Servicer shall so transfer the aggregate amount of
Collections no later than two Business Days after the Servicer's receipt of such
amount. The Servicer shall so deposit the aggregate amount of Servicer Advances
no later than one day prior to the related Payment Date. The Servicer shall
instruct the Indenture Trustee in writing to deposit the portion of any Advance
Payment due and owing for a Collection Period no later than the related
Determination Date. Except as otherwise expressly set forth, any other deposits
and transfers of funds to be made pursuant to this Section 3.01 shall be made no
later than the third Business Day immediately preceding the related Payment
Date.

                  Notwithstanding the foregoing, the Servicer may deduct from
amounts otherwise payable to the Collection Account amounts previously deposited
by the Servicer into the Collection Account but (i) subsequently uncollectable
as a result of dishonor of the instrument of payment for or on behalf of the
Obligor or (ii) later determined to have resulted from mistaken deposits.

                  Section 3.02 Reserved.

                  Section 3.03 Investment of Monies Held in the Accounts;
Subaccounts. (a) The Servicer shall direct the Indenture Trustee in writing to
invest the amounts in each Account in Eligible Investments that mature not later
than the Business Day immediately preceding the next Payment Date following the
investment of such amounts. Eligible Investments shall not be sold or disposed
of prior to their maturities. Except as may be set forth in the Transaction
Documents, the Trust Certificate Holder shall be entitled to the Investment
Earnings on amounts held in the Accounts as earned. In the absence of any
direction from the Servicer, amounts on deposit in each Account shall be
invested in money market funds as described in clause (a)(iv) in the definition
of "Eligible Investments" in Annex A hereto.(b) The Indenture Trustee and the
Servicer may, from time to time and in connection with the administration of any
Account, establish and maintain with the Indenture Trustee one or more
sub-accounts of any of the Accounts, as the Indenture Trustee and/or the
Servicer may consider useful.

                  Section 3.04 Reserve Account. (a) The Servicer shall establish
and maintain with the Indenture Trustee an Eligible Bank Account (the "Reserve
Account") for the benefit of the Noteholders as an Eligible Bank Account, in the
name of "First Sierra Equipment Contract-Backed Notes 2000-2 Collection Account,
in trust for the registered holders of Equipment Contract-Backed Notes, Series
2000-2." At the Servicer's written direction, the Indenture Trustee shall make
withdrawals from the Reserve Account only as provided in this Indenture. The
Indenture Trustee shall possess all right, title and interest in all funds on
deposit from time to time in the Reserve Account and all proceeds thereof. The
Reserve Account shall be under the sole dominion and control of the Indenture
Trustee for the benefit of the Noteholders.

                  (b) On the Closing Date, the Indenture Trustee shall deposit
the Requisite Amount into the Reserve Account from the proceeds of the sale of
the Notes. Amounts on deposit in the Reserve Account shall be invested in
accordance with Section 3.03 hereof. The Trust Certificate Holder shall be
entitled to any net income from such investment.

                                       7
<PAGE>   14

                  (c) On each Payment Date, to the extent that the related
Monthly Statement discloses a deficiency, the Indenture Trustee shall withdraw
from Reserve Account, to the extent necessary, the amounts, if any, necessary to
fund such deficiencies in the following amounts, in the following order of
priority:

                           (i)      the Class A Note Interest then due;

                           (ii)     the Class B Note Interest then due;

                           (iii)    the Class C Note Interest then due;

                           (iv)     the Class D Note Interest then due;

                           (v)      the amount necessary to reduce the Note
                                    Principal Balance of any Class of Notes
                                    having its stated Maturity Date on such
                                    Payment Date to zero;

                           (vi)     the Class A Principal Payment Amount, the
                                    Class B Principal Payment Amount, the Class
                                    C Principal Payment Amount, the Class D
                                    Principal Payment Amount, and Reallocated
                                    Principal in accordance with the payment
                                    priorities set forth in clauses (x) through
                                    (xiv) of Section 3.05(b) hereof;

                           (vii)    the Class E Note Interest then due;

                           (viii)   the Class E Principal Payment Amount due on
                                    such Payment Date; and

                           (ix)     to pay the Supplemental Principal Payment
                                    Amount in accordance with the payment
                                    priorities set forth in clause (xvii) of
                                    Section 3.05(b) hereof;

                  provided; however, that in the event that payments on the
Contracts may not be used to make payments on the Notes due to the bankruptcy of
SierraCities.com, amounts on deposit in the Reserve Account shall only be
available to pay Note Interest on the related Class of Notes and principal
payments on the related Maturity Date of the Notes in the priorities set forth
above.

                  (d) On each Payment Date, (after giving effect to any
withdrawals therefrom on such Payment Date in accordance with the foregoing),
the Available Funds remaining after the distributions made pursuant to clauses
(i) through (xvii) of Section 3.05(b) hereof, if any, will be deposited in the
Reserve Account in the amount necessary to maintain the amount on deposit in the
Reserve Account at the Requisite Amount with respect to such Payment Date. On
any Payment Date, if the amount on deposit in the Reserve Account (after giving
effect to any withdrawals therefrom on such Payment Date in accordance with the
foregoing) is in excess of the Requisite Amount with respect to such Payment
Date, such excess shall be distributed to the Trust Certificate Holder.

                  Section 3.05 Disbursements From Collection Account. (a) On
each Payment Date, the Indenture Trustee shall pay the entire amount of money
then on deposit in the Collection Account with respect to the related Collection
Period, as indicated on the Monthly

                                       8
<PAGE>   15

Statement, as applicable, to the Persons to which such money is then due,
calculated on the basis of and in accordance with the Monthly Statement for the
related Collection Period; provided, however, that in the event the Servicer
fails to deliver a Monthly Statement by a Payment Date the Indenture Trustee
shall, nevertheless, pay interest on each Class of Notes from the sources of
funding set forth herein, in each case in an amount with respect to each Class
equal to the product of (i) one-twelfth, (ii) the related Note Rate and (iii)
the related Note Principal Balance, as reflected on the Monthly Statement most
recently delivered by the Servicer (net of any principal payments in respect
thereof on the immediately preceding Payment Date).(b) On each Payment Date, the
Indenture Trustee shall pay such money to the following Persons, in the
following order of priority, without duplication:

                           (i) To SierraCities.com by wire transfer of
         immediately available funds, the aggregate amount of any Initial Unpaid
         Amounts inadvertently deposited in the Collection Account;

                           (ii) From the amount then remaining in the Collection
         Account, to any party entitled thereto, by check, any indemnity
         payments paid pursuant to any Contract, to the extent that such amounts
         are inadvertently deposited in the Collection Account;

                           (iii) From the Available Funds then remaining in the
         Collection Account, to the Servicer by wire transfer to the account
         designated in writing by the Servicer of immediately available funds,
         the aggregate amount of the following:

                                    (A) An amount equal to the unreimbursed
                  Servicer Advances (other than Servicer Advances for the
                  current Collection Period);

                                    (B) An amount equal to the Servicer Fee
                  owing on such Payment Date, plus any unpaid Servicer Fee owing
                  from prior Collection Periods; and

                                    (C) Any Servicing Charges inadvertently
                  deposited in the Collection Account;

                           (iv) From the Available Funds then remaining in the
         Collection Account, to the Indenture Trustee by wire transfer to the
         account designated in writing by the Indenture Trustee, an amount equal
         to the Indenture Trustee Fees owing on such Payment Date, plus any
         unpaid Indenture Trustee Fees from prior Collection Periods, subject to
         the limitation set forth in Section 7.07(a)(i) hereof;

                           (v) From the Available Funds then remaining in the
         Collection Account, to the Indenture Trustee by wire transfer to the
         account designated in writing by the Indenture Trustee, an amount equal
         to the reimbursable expenses due and unpaid to the Indenture Trustee in
         accordance with and subject to Section 7.07(a)(ii) hereof;

                           (vi) From the Available Funds then remaining in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account, to the Class A-1 Noteholders, the Class A-1 Note
         Interest for the related Collection Period, to the Class A-2
         Noteholders, the Class A-2 Note Interest for the related Collection
         Period, to the Class A-3 Noteholders, the Class A-3 Note Interest for
         the related Collection Period,

                                       9
<PAGE>   16
        and to the Class A-4 Noteholders, the Class A-4 Note Interest for the
        related Collection Period pari passu;

                           (vii) From the Available Funds then remaining in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account, to the Class B Noteholders an amount equal to the
         Class B Note Interest for the related Collection Period;

                           (viii) From the Available Funds then remaining in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account, to the Class C Noteholders an amount equal to the
         Class C Note Interest for the related Collection Period;

                           (ix) From the Available Funds then remaining in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account, to the Class D Noteholders an amount equal to the
         Class D Note Interest for the related Collection Period;

                           (x) From the Available Funds then remaining in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account until the Class A Note Principal Balance has been
         reduced to zero, to the Class A Noteholders from the Available Funds
         then remaining in the Collection Account, the Class A Principal Payment
         Amount for such Payment Date, such amount to be applied sequentially,
         with 100% of such amount being applied to reduce the Note Principal
         Balance of the Class A Notes then Outstanding and having the lowest
         numerical designation (e.g., first to the Class A-1 Notes) to zero
         before any principal payment is made to the next Class;

                           (xi) From the Available Funds then remaining in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account, until the Class B Note Principal Balance has been
         reduced to zero, to the Class B Noteholders, the Class B Principal
         Payment Amount for such Payment Date;

                           (xii) From the Available Funds then remaining in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account, until the Class C Note Principal Balance has been
         reduced to zero, to the Class C Noteholders, Class C Principal Payment
         Amount for such Payment Date;

                           (xiii) From the Available Funds then remaining in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account, until the Class D Note Principal Balance has been
         reduced to zero, to the Class D Noteholders, the Class D Principal
         Payment Amount for such Payment Date;

                           (xiv) From the Available Funds then on deposit in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account, to pay the Reallocated Principal, if any, as an
         additional reduction of principal to the Class A Noteholders, as
         provided in clause (x) above, until the Note Principal Balance on all
         of the Class A Notes has been reduced to zero, then to Class B
         Noteholders until the Note Principal Balance on the Class B Notes has
         been reduced to zero, then to the Class C Noteholders

                                       10
<PAGE>   17

         until the Note Principal Balance on the Class C Notes has been reduced
         to zero, then to the Class D Noteholders until the Note Principal
         Balance on the Class D Notes has been reduced to zero, and finally to
         the Class E Noteholders, until the Note Principal Balances on the Class
         E Notes has been reduced to zero;

                           (xv) From the Available Funds then remaining in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account, to the Class E Noteholders an amount equal to the
         Class E Note Interest for the related Collection Period;

                           (xvi) From the Available Funds then remaining in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account, until the Class E Note Principal Balance has been
         reduced to zero, to the Class E Noteholders, the Class E Principal
         Payment Amount for such Payment Date;

                           (xvii) From the Available Funds then remaining in the
         Collection Account and from amounts, if any, transferred from the
         Reserve Account, to pay the Supplemental Principal Payment Amount, if
         any, first, to the Class A-1 Noteholders, until the Class A-1 Note
         Principal Balance has been reduced to zero and second, after the Class
         A-1 Note Principal Balance has been reduced to zero, to the Noteholders
         of each Class of Notes then Outstanding, on a pro rata basis;

                           (xviii) From Available Funds then remaining in the
         Collection Account, to the Reserve Account, the amount necessary to
         maintain the amount on deposit therein at the Requisite Amount for such
         Payment Date;

                           (xix) From the Available Funds then remaining in the
         Collection Account, to the Indenture Trustee, the Indenture Trustee
         Expenses then due together with any Indenture Trustee Expenses from
         prior Collection Periods, in excess of the $75,000 limitation set forth
         in Section 7.07(a)(ii) hereof, and

                           (xx) From the Available Funds then remaining in the
         Collection Account, to the Trust Certificate Holder, any remaining
         amounts.

                  (c) All payments to Noteholders shall be made on each Payment
Date to each Noteholder of record on the related Record Date by check, or, if
requested by such Noteholder, by wire transfer to the account designated in
writing in the form of Exhibit B hereto (or such other account as the Noteholder
may designate in writing) delivered to the Indenture Trustee on or prior to the
related Determination Date, in immediately available funds, in amounts equal to
such Noteholder's pro rata share (based on the aggregate Class A Percentage
Interest in the case of the Class A Noteholders, the Class B Percentage Interest
in the case of the Class B Noteholders, the Class C Percentage Interest in the
case of the Class C Noteholders, the Class D Percentage in the case of the Class
D Noteholders and the Class E Percentage in the case of the Class E Noteholders)
of such payment.

                  Section 3.06 Statements to Noteholders. (a) If the Servicer
has delivered the Monthly Statement on the preceding Determination Date, then on
each Payment Date, the Servicer will forward such Monthly Statement to the
Indenture Trustee. Not later than one

                                       11
<PAGE>   18

Business Day prior to such Payment Date, the Indenture Trustee will mail to the
Rating Agencies a statement (which statement will be prepared by the Servicer
furnished to the Indenture Trustee in the Monthly Statement delivered pursuant
to Section 4.07 of the Servicing Agreement or otherwise pursuant to this
Indenture), setting forth the following information (per $1,000 of the Initial
Class A Note Principal Amount, the Initial Class B Note Principal Amount, the
Initial Class C Note Principal Amount, the Initial Class D Note Principal Amount
or the Initial Class D Note Principal Amount (as the case may be) as to (i) and
(ii) below):

                           (i) With respect to a statement to a Class A
         Noteholder, a Class B Noteholder, a Class C Noteholder, a Class D
         Noteholder or a Class E Noteholder, the amount of such payment
         allocable to such Noteholder's Percentage Interest of the Class A
         Principal Payment Amount, Class B Principal Payment Amount, Class C
         Principal Payment Amount, Class D Principal Payment Amount or Class E
         Principal Payment Amount, as applicable;

                           (ii) With respect to a statement to a Noteholder, the
         amount of such payment allocable to such Noteholder's Percentage
         Interest of Class A-1, Class A-2, Class A-3, Class A-4, Class B, Class
         C, Class D or Class E Note Current Interest and Class A-1, Class A-2,
         Class A-3, Class A-4, Class B, Class C, Class D or Class E Overdue
         Interest, as applicable;

                           (iii) The aggregate amount of fees and compensation
         received by the Servicer pursuant to Section 3.05 hereof for the
         Collection Period;

                           (iv) The aggregate Class A Note Principal Balance
         (and, individually, the Class A-1 Note Principal Balance, the Class A-2
         Note Principal Balance, the Class A-3 Note Principal Balance, the Class
         A-4 Note Principal Balance), the aggregate Class B Note Principal
         Balance, the aggregate Class C Note Principal Balance, the aggregate
         Class D Note Principal Balance and the aggregate Class E Note Principal
         Balance, the Class A Percentage, the Class B Percentage, the Class C
         Percentage, the Class D Percentage, the Class E Percentage, the Class A
         Note Factor, the Class B Note Factor, the Class C Note Factor, the
         Class D Note Factor, the Class E Note Factor, the Pool Factor and the
         Aggregate Discounted Contract Principal Balance, after taking into
         account all distributions made on such Payment Date;

                           (v) The total unreimbursed Servicer Advances with
         respect to the related Collection Period;

                           (vi) The amount of Defaulted Contract Recoveries for
         the related Collection Period and the aggregate Discounted Contract
         Principal Balances for all Contracts that became Defaulted Contracts
         during the related Collection Period (specifying, by aggregate
         Discounted Contract Principal Balance, the amount of such Contracts
         originated pursuant to SierraCities.com's "Retail Program", "Private
         Label Program" and "Broker/Vendor Program");

                           (vii) The total number of Contracts and the aggregate
         Discounted Contract Principal Balances thereof, together with the
         number and aggregate Discounted Contract

                                       12
<PAGE>   19

         Principal Balances of all Contracts as to which the Obligors, as of the
         related Calculation Date, have missed one, two, three or four Scheduled
         Payments (including Final Scheduled Payments) (specifying, by aggregate
         Discounted Contract Principal Balance, the amount of such Contracts
         originated pursuant to SierraCities.com's "Retail Program", "Private
         Label Program" and "Broker/Vendor Program"), and Delinquent Contracts
         reconveyed; and

                           (viii) The total number of Contracts and the
         aggregate Discounted Contract Principal Balances of all Contracts which
         were removed from the Trust Estate and replaced with a Substitute
         Contract, specifying by aggregate Discounted Contract Principal Balance
         (1) the amount of such Contracts originated pursuant to
         SierraCities.com's "Retail Program", "Private Label Program" and
         "Broker/Vendor Program" and (2) the amount of Contracts removed because
         such Contract was a Delinquent Contract, Defaulted Contract or an Early
         Termination Contract or was the subject of a Prepayment, a Casualty
         Loss or a Warranty Event.

                  (b) By January 31 of each calendar year, commencing January
31, 2001, or as otherwise required by applicable law, the Indenture Trustee
shall furnish to each Person who at any time during the immediately preceding
calendar year was a Noteholder a statement prepared by the Servicer, and
delivered to the Indenture Trustee, containing the applicable aggregate amounts
distributed with respect to such Noteholder hereof for such calendar year or, in
the event such Person was a Noteholder during a portion of such calendar year,
for the applicable portion of such year, for the purposes of such Noteholder's
preparation of federal income tax returns. In addition to the foregoing the
Servicer and the Indenture Trustee (to the extent the Servicer has provided the
necessary information to the Indenture Trustee) shall make available to
Noteholders any other information provided to the Servicer or the Indenture
Trustee or otherwise in the Indenture Trustee's possession reasonably requested
by Noteholders in connection with tax matters, in accordance with the written
directions of the Servicer.

                  (c) The Servicer shall furnish to each Subordinate Noteholder,
on request, during the term of this Indenture, such periodic, special or other
reports or information not specifically provided for herein, as shall be
necessary, reasonable or appropriate with respect to such Subordinate Noteholder
all such reports or information to be provided by and in accordance with such
applicable instructions and directions as the Subordinate Noteholder may
reasonably require and as the Servicer may reasonably be able to produce;
provided, however, that the Servicer may require such Subordinate Noteholder to
execute a confidentiality agreement in form and substance acceptable to the
Servicer.

                  (d) The Indenture Trustee shall promptly send to each
Noteholder and to the Rating Agencies in writing:

                           (i) Notice of any breach by SierraCities.com, the
         Depositor, the Trust, any Seller or the Servicer of any of their
         respective representations, warranties and covenants made herein, the
         Servicing Agreement or in the Receivables Transfer Agreement;

                           (ii) A copy of each Servicer compliance statement
         delivered to the Indenture Trustee pursuant to Section 4.09 of the
         Servicing Agreement;

                                       13
<PAGE>   20

                           (iii) Notice of any breach by the Indenture Trustee
         of its representations and warranties set forth in Section 7.17 hereof
         of which a Responsible Officer has actual knowledge;

                           (iv) Notice of the occurrence of any Event of Default
         (which shall also be given to the Rating Agencies);

                           (v) Notice of any Event of Servicing Termination, or
         any other default under any of the Transaction Documents; and

                           (vi) Notice of the resignation or removal of the
         Indenture Trustee;

provided, however, that in each case the Indenture Trustee shall only be
required to send such notices and other items to the Subordinate Noteholders to
the extent that the Indenture Trustee has itself received the related
information and the Subordinate Noteholders have not already received such
notice or other items. Except as may be specifically provided herein, the
Indenture Trustee shall have no obligation to seek to obtain any such
information.

                  Section 3.07 Compliance With Withholding Requirements.
Notwithstanding any other provisions of this Indenture, the Indenture Trustee,
as paying agent for and on behalf of, and at the direction of the Servicer,
shall comply with all federal withholding requirements respecting payments (or
advances thereof) to Noteholders as may be applicable to instruments
constituting indebtedness for federal income tax purposes. Any amounts so
withheld shall be treated as having been paid to the related Noteholder for all
purposes of this Indenture. In no event shall the consent of Noteholders be
required for any withholding.

                                   ARTICLE IV.

                        REMOVAL OF NON-CONFORMING PLEDGED
                       PROPERTY; SUBSTITUTION OF CONTRACTS

                  Section 4.01 Removal of Non-Conforming Pledged Property. (a)
Upon discovery by the Trust, the Servicer (or any of its successors or assigns)
or in the case of the Indenture Trustee, upon actual knowledge of a Responsible
Officer of the Indenture Trustee, of a breach of any of the representations or
warranties set forth in Section 2.02 of the Servicing Agreement that materially
and adversely affects any Contract, the related Equipment or the related
Contract File, as the case may be, or if the Servicer fails to cause delivery of
evidence of filing or copies of any UCC financing statement or delivery of any
Certificate of Title in accordance with the Servicing Agreement (any such event,
a "Warranty Event"), the party (including any such successor or assign)
discovering such breach shall give prompt written notice to the other parties.
As of the last day of the calendar month following the month of its discovery or
its receipt of notice of breach (or, at SierraCities.com's election, any earlier
date), SierraCities.com shall deposit (or cause to be deposited) to the
Collection Account the Repurchase Amount with respect to such Contract or
replace such contract with a Substitute Contract pursuant to Section 4.02
hereof. Any such nonconforming Contract so removed shall not be deemed to be a
Defaulted Contract for purposes of this Article IV.

                                       14
<PAGE>   21

                  (b) The obligation of SierraCities.com to remove any Pledged
Property from the Trust and to remit the Repurchase Amount or substitute a
Substitute Contract, as appropriate, with respect to the related Contract as to
which a breach has occurred and is continuing shall constitute the sole remedy
against SierraCities.com for such breach available to the Indenture Trustee and
the Noteholders, except to the extent that such breach is the result of any
fraud or willful misconduct on the part of SierraCities.com.

                  (c) Upon the removal of a Contract and the related Equipment
and the payment of the related Repurchase Amount as described above, the
security interest of the Indenture Trustee in such replaced Contract, the
related Equipment and all proceeds thereon shall be terminated and the replaced
Contract and the related Equipment shall be released to the Trust.

                  Section 4.02 Substitution of Contracts. (a) Subject to the
provisions of Sections 4.02(b) through (d) hereof, SierraCities.com, upon notice
from the Servicer, may substitute one or more Contracts (each a "Substitute
Contract") and transfer all of its right, title and interest in the Substitute
Conveyed Assets for and replace any Contract and terminate the security interest
in the related Equipment that (i) becomes a Delinquent Contract, Defaulted
Contract or an Early Termination Contract or (ii) is the subject of a
Prepayment, a Casualty Loss or a Warranty Event.

                  (b) Each Substitute Contract shall be a Contract with respect
to which all of the representations and warranties set forth in Section 2.02 of
the Servicing Agreement were true as of the related Substitute Cut-Off Date.

                  (c) Any substitution of a Contract pursuant to this Section
4.02 will be effected by (i) delivery to the Trustee of the Contract File for
each such Substitute Contract, (ii) the filing of any UCC financing statements
in accordance with the Filing Requirements necessary to perfect the interest of
the Indenture Trustee in the Substitute Contract, (iii) delivery to the
Indenture Trustee of the List of Substitute Contracts reflecting the
substitution, and (iv) delivering to the Indenture Trustee a release request, in
form and substance acceptable to the Indenture Trustee, with respect to the
Contract being replaced and the originally executed trust receipt relating
thereto.

                  (d) No such substitution under this Section 4.02 shall be
permitted on any Substitute Transfer Date if:

                           (i) on a cumulative basis from the Initial Cut-Off
         Date, the sum of the Discounted Contract Principal Balances (as of the
         related Substitute Cut-Off Date) of Substitute Contracts which replaced
         Delinquent Contracts or Defaulted Contracts would exceed ten percent
         (10%) of the sum of the Aggregate Discounted Contract Principal Balance
         of all Contracts as of the Initial Cut-Off Date;

                           (ii) as of the related Substitute Cut-Off Date, the
         Substitute Contracts then being transferred have a Discounted Contract
         Principal Balance less than the Discounted Contract Principal Balance
         of the Contracts being replaced or have a maturity date later than the
         latest maturity date of any Contract then held by the Trust; and

                                       15
<PAGE>   22

                           (iii) as a result thereof, (x) the sum of the
         Scheduled Payments on all Contracts due in any Collection Period
         thereafter would be less than or increase the amount by which it is
         less than (y) the sum of the Scheduled Payments which would otherwise
         be due in such Collection Period.

                           For purposes of determining compliance with clause
(ii), if more than one Substitute Contract is being provided on any date, the
Discounted Contract Principal Balance of the Substitute Contracts and the
Contracts being replaced shall be determined on an aggregate basis.

                  (e) Upon the replacement of a Contract and the related
Equipment with a Substitute Contract as described above, the security interest
of the Indenture Trustee in such replaced Contract, the related Equipment and
all proceeds thereon shall be terminated and the replaced Contract and the
related Equipment shall be transferred to the Trust and to SierraCities.com.

                  Section 4.03 Release of Pledged Property. (a) The Indenture
Trustee, when required by the Trust and the provisions of this Indenture, shall
execute instruments provided to it in order to release property from the lien of
this Indenture in a manner and under circumstances that are not inconsistent
with the provisions of this Indenture and the Servicing Agreement. No party
relying upon an instrument executed by the Indenture Trustee as provided in this
Article IV shall be bound to ascertain the Indenture Trustee's authority,
inquire into the satisfaction of any conditions precedent or see to the
application of any monies.

                  (b) The Indenture Trustee shall, at such time as there are no
Notes outstanding and all sums due the Indenture Trustee have each been paid,
release any remaining portion of the Pledged Property that secured the Note from
the lien of this Indenture and release to the Trust or any other Person entitled
thereto any funds then on deposit in the Collection Account or any subaccounts
thereof as may have been established pursuant to Sections 3.01 and 3.02. The
Indenture Trustee shall release property from the lien of this Indenture
pursuant to this Section 4.03(b) only upon receipt of an Issuer Request
accompanied by an Officer's Certificate, an Opinion of Counsel and (if required
by the TIA) Independent Certificates in accordance with TIA Section Section
314(c) and 314(d)(1) meeting the applicable requirements of Section 10.05
hereof.

                                   ARTICLE V.

                                   THE NOTES

                  Section 5.01 The Notes. (a) The Class A Notes will be issued
in denominations of $1,000 and multiples of $1,000 in excess thereof (with the
exception of one Note of each class which will be issued in an odd amount) of
the Initial Class A-1 Note Principal Balance, the Initial Class A-2 Note
Principal Balance, the Initial Class A-3 Note Principal Balance, the Initial
Class A-4 Note Principal Balance and the Subordinate Notes will be issued in
denominations of $1,000,000 and $1,000 increments above $1,000,000 of the
Initial Class B Note Principal Balance, the Initial Class C Note Principal
Balance, the Initial Class D Note Balance and the Initial Class E Note Principal
Balance. Each Note shall represent a validly

                                       16
<PAGE>   23

issued and binding obligation, but only if such Note has been executed on behalf
of the Trust by a Responsible Officer of the Owner Trustee by manual signature,
and authenticated on behalf of the Indenture Trustee by a Responsible Officer of
the Indenture Trustee by manual signature. Each Note bearing the manual
signatures of individuals who were, at the time when such signatures were
affixed, authorized to sign on behalf of the Trust shall be valid and binding
obligations, notwithstanding that such individuals or any of them have ceased to
be so authorized prior to the authentication and delivery of such Note or did
not hold such offices at the date of such Note. No Note shall be entitled to any
benefit under this Indenture, or be valid for any purpose, unless there appears
on such Note a certificate of authentication substantially in the form set forth
in the form of the Notes of the related Class, each attached as Exhibits hereto,
signed by the Indenture Trustee by manual signature, and such signature upon any
Note shall be conclusive evidence, and the only evidence, that such Note has
been duly authenticated and delivered hereunder. All Class A-1 Notes, Class A-2
Notes, Class A-3 Notes and Class A-4 Notes shall be substantially in the forms
set forth in Exhibits C-1, C-2, C-3 and C-4 hereto, respectively, all Class B
Notes shall be substantially in the form set forth in Exhibit D-1 hereto, all
Class C Notes shall be substantially in the form set forth in Exhibit D-2
hereto, all Class D Notes shall be substantially in the form set forth in
Exhibit D-3 hereto, and all Class E Notes shall be in substantially the same
form as set forth in Exhibit D-4. Each Note shall be dated the date of its
authentication. Neither the Notes nor the Contracts are insured by the Federal
Deposit Insurance Corporation or any other governmental agency.

                  (b) It is intended that the Offered Notes be registered so as
to participate in a global book-entry system with the Trust, as set forth
herein. The Offered Notes shall, except as otherwise provided in the next
paragraph, be initially issued in the form of a single fully registered Class
A-1 Note, Class A-2 Note, Class A-3 Note, Class A-4 Note and Class B Note, each
with a denomination equal to the Initial Class A-1 Note Principal Balance, the
Initial Class A-2 Note Principal Balance, the Initial Class A-3 Note Principal
Balance the Initial Class A-4 Principal Balance and the Initial Class B Note
Principal Balance, respectively. Upon initial issuance, the ownership of each
such Offered Note shall be registered in the Register in the name of Cede & Co.,
or any successor thereto, as nominee for the Trustee.

                  The Trust and the Indenture Trustee are hereby authorized to
execute and deliver the Representation Letter with the Depository.

                  With respect to Offered Notes registered in the Register in
the name of Cede & Co., as nominee of the Depository, the Trust and the
Indenture Trustee shall have no responsibility or obligation to Direct or
Indirect Participants or beneficial owners for which the Depository holds
Offered Notes from time to time as a trustee. Without limiting the immediately
preceding sentence, the Trust, the Servicer and the Indenture Trustee shall have
no responsibility or obligation with respect to (i) the accuracy of the records
of the Depository, Cede & Co., or any Direct or Indirect Participant with
respect to any ownership interest in any Offered Note, (ii) the delivery to any
Direct or Indirect Participant or any other Person, other than a Noteholder, of
any notice with respect to the Offered Notes or (iii) the payment to any Direct
or Indirect Participant or any other Person, other than a Noteholder, of any
amount with respect to any distribution of principal or interest on the Offered
Notes. No Person other than a Noteholder shall receive a certificate evidencing
such Offered Note.

                                       17
<PAGE>   24

                  Upon delivery by the Depository to the Indenture Trustee of
written notice to the effect that the Depository has determined to substitute a
new nominee in place of Cede & Co., and subject to the provisions hereof with
respect to the payment of interest by the mailing of checks or drafts to the
Noteholders appearing as Noteholders at the close of business on a Record Date,
the name "Cede & Co." in this Indenture shall refer to such new nominee of the
Depository.

                  (c) In the event that (i) the Depository or the Servicer
advises the Indenture Trustee in writing that the Depository is no longer
willing or able to discharge properly its responsibilities as nominee and
depository with respect to the Offered Notes and the Servicer or the Depository
is unable to locate a qualified successor or (ii) the Indenture Trustee at its
sole option elects to terminate the book-entry system through the Depository,
the Offered Notes shall no longer be restricted to being registered in the
Register in the name of Cede & Co. (or a successor nominee) as nominee of the
Depository. At that time, the Servicer may determine that the Offered Notes
shall be registered in the name of and deposited with a successor depository
operating a global book-entry system, as may be acceptable to the Servicer, or
such depository's agent or designee but, if the Servicer does not select such
alternative global book-entry system, then the Offered Notes may be registered
in whatever name or names Noteholders transferring Offered Notes shall
designate, in accordance with the provisions hereof; provided, however, that any
such registration shall be at the expense of the Servicer.

                  (d) Notwithstanding any other provision of this Indenture to
the contrary, so long as any Offered Note is registered in the name of Cede &
Co., as nominee of the Depository, all distributions of principal or interest on
such Offered Notes, as the case may be, and all notices with respect to such
Offered Notes, as the case may be, shall be made and given, respectively, in the
manner provided in the Representation Letter.

                  In the event any Notes are issued in book-entry form with the
Depository: (i) the Indenture Trustee may deal with the Depository as the
authorized representative of the Noteholders; (ii) the rights of the Noteholders
shall be exercised only through the Depository and shall be limited to those
established by law and agreement between the Noteholders and the Depository;
(iii) the Depository will make book-entry transfers among the direct
participants of the Depository and will receive and transmit distributions of
principal and interest on the Notes to such direct participants; and (iv) the
direct participants of the Depository shall have no rights under this Indenture
under or with respect to any of the Notes held on their behalf by the
Depository, and the Depository may be treated by the Indenture Trustee and its
agents, employees, officers and directors as the absolute owner of the Notes for
all purposes whatsoever.

                  (e) No transfer of any Subordinate Note shall be made unless
such transfer is made in a transaction which does not require registration or
qualification under the Securities Act or qualification under any state
securities or "Blue Sky" laws. If such a transfer is to be made in reliance upon
an exemption from the Securities Act other than Rule 144A thereunder, (A) the
Indenture Trustee shall receive an Opinion of Counsel that such transfer may be
made pursuant to an exemption from the Securities Act, describing the applicable
exemption and the basis therefor, which Opinion of Counsel shall not be an
expense of SierraCities.com, the Depositor, the Servicer, the Trust or the
Indenture Trustee or (B) the Indenture Trustee shall require the transferee to
execute a certification, substantially in the form of Exhibit F hereto, setting
forth the

                                       18
<PAGE>   25

facts surrounding such transfer. In the event that a transfer is to be made in
reliance on Rule 144A under the Securities Act, the Subordinate Noteholder shall
cause its prospective transferee to execute and deliver a certificate
substantially in the form of Exhibit G hereto; provided, however, that with
respect to any sale of a Subordinate Note by an investment company registered
under the Investment Company Act of 1940, as amended, made in reliance on Rule
144A, the Subordinate Noteholder may (in lieu of delivering a certificate in the
form of Exhibit G) deliver to the Indenture Trustee a certificate in the form of
Exhibit H hereto with a copy of a Qualified Institutional Buyer Certificate in
the form of Addendum 1 thereto. The Servicer promptly shall furnish to any
Holder, or any prospective purchaser designated by a Holder, the information
required to be delivered to Holders and prospective purchasers of Subordinate
Notes in connection with the resale of the Subordinate Notes to permit
compliance with Rule 144A in connection with such resale. No Subordinate Note
may be subdivided for resale or other transfer into a unit smaller than a unit
the initial offering price of which would have been in the aggregate $1,000,000.

                  (f) Notwithstanding anything else contained in this Indenture,
neither the Indenture Trustee nor the Note Registrar shall effect the
registration of any transfer of a Subordinate Note (i) unless, prior to such
transfer, the Indenture Trustee shall have received from the Subordinate
Noteholder (with a copy to each Rating Agency) an Opinion of Counsel to the
effect that such transfer will not result in the Trust becoming subject to
taxation as an association taxable as a corporation or (ii) if following such
transfer the sum of (a) the number of Holders of a Subordinate Note and (b) the
number of Holders of the Trust Certificate, would be more than 99. Ownership of
the Trust Certificate shall be nontransferable, but may be pledged to secure
non-recourse debt of the Depositor.

                  Section 5.02 Initial Issuance of Notes. The Indenture Trustee
shall, upon the written instruction of the Trust, in exchange for the Pledged
Property, authenticate and deliver the Class A Notes and the Subordinate Notes
executed by the Trust in authorized denominations equaling in the aggregate the
Initial Class A Note Principal Balance, the Initial Class B Note Principal
Balance, the Initial Class C Note Principal Balance, the Initial Class D Note
Principal Balance and the Initial Class D Note Principal Balance.

                  Section 5.03 Registration of Transfer and Exchange of Notes.
(a) The Indenture Trustee, as initial Note Registrar, shall maintain, or cause
to be maintained, at the Corporate Trust Office, a register (the "Register") in
which the Indenture Trustee shall provide for the registration of Notes and of
transfers and exchanges of Notes as herein provided. All Notes shall be so
registered.(b) Upon surrender for registration of transfer of any Note at the
Corporate Trust Office, the Trust shall execute, and the Indenture Trustee shall
authenticate and deliver, subject to the requirements of Sections 5.01(e) and
(f) hereof in the case of the Subordinate Notes, in the name of the designated
transferee or transferees, one or more new Notes in authorized denominations of
the same class, of a like aggregate Class A-1 Percentage Interest, Class A-2
Percentage Interest, Class A-3 Percentage Interest, Class A-4 Percentage
Interest, Class B Percentage Interest, Class C Percentage Interest, Class D
Percentage Interest or Class E Percentage Interest, as the case may be, dated
the date of such authentication.

                  (c) At the option of a Noteholder, Notes may be exchanged for
other Notes of the same class (of authorized denominations in the case of Class
A Notes and Subordinate Notes) of

                                       19
<PAGE>   26

a like aggregate Class A-1 Percentage Interest, Class A-2 Percentage Interest,
Class A-3 Percentage Interest, Class A-4 Percentage Interest, Class B Percentage
Interest, Class C Percentage Interest, Class D Percentage Interest or Class E
Percentage Interest, as the case may be, upon surrender of the Notes to be
exchanged at any such office or agency. Whenever any Notes are so surrendered
for exchange, the Trust shall execute, and the Indenture Trustee shall
authenticate and deliver the Notes that the Noteholder making the exchange is
entitled to receive. Every Note presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer
substantially in the form of Exhibit H hereto, duly executed by the Noteholder
thereof or its attorney duly authorized in writing.

                  (d) No service charge shall be made for any registration of
transfer of any Note or for the exchange of any Note, but the Indenture Trustee
may require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer of any Note or exchange of
any Note.

                  (e) All Notes surrendered for registration of transfer and all
Notes surrendered for exchange shall be delivered to the Indenture Trustee and
cancelled and subsequently destroyed by the Indenture Trustee in accordance with
its customary practices in effect from time to time.

                  (f) The Note Registrar shall not register the transfer of any
Note (other than the transfer of an Offered Note to the nominee of the
Depository or a successor depository) unless the transferee has executed and
delivered to the Indenture Trustee a certification to the effect that either (i)
the transferee is not (A) an employee benefit plan (as defined in Section 3(3)
of ERISA) that is subject to the provisions of Title I of ERISA or (B) a plan
(as defined in Section 4975(e)(1) of the Code) that is subject to Section 4975
of the Code (each of the foregoing, a "Benefit Plan"), and is not acting on
behalf of or investing the assets of a Benefit Plan, or (ii) with respect to the
transfer of any Note other than a Class D Note and a Class E Note, that the
transferee's acquisition and continued holding of the Note will be entitled to
exemptive relief pursuant to a U.S. Department of Labor prohibited transaction
class exemption. Each transferee of a beneficial interest in a Note that is
registered in the name of, and deposited with, a depository operating a global
book-entry system shall be deemed to make one of the foregoing representations.
No Class D Note or Class E Note may be sold or transferred (including, without
limitation, by pledge or hypothecation) if the sale or transfer thereof
increases the number of the sum of (A) the number of holders of Class D Notes,
(B) the number of holders of Class E Notes, and (C) the number of holders of
trust certificates of the Issuer, to more than 99.

                  Section 5.04 Mutilated, Destroyed, Lost or Stolen Notes. If
any mutilated Note is surrendered to the Indenture Trustee, or the Indenture
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, and (a) there is delivered to the Trust, the Owner Trustee, the
Servicer and the Indenture Trustee such security or indemnity satisfactory to
each of them as may be required by them to save each of them harmless (provided,
that with respect to a Subordinate Noteholder which is an insurance company
whose long-term debt or claims paying ability is rated investment grade or
better by the Rating Agencies at such time, a letter of indemnity furnished by
it shall be sufficient for this purpose), then, in the absence of notice to the
Indenture Trustee that any such Note has been acquired by a bona fide purchaser,
the Trust shall execute and the Indenture Trustee shall authenticate and deliver
in exchange for

                                       20
<PAGE>   27

or in lieu of any such mutilated, destroyed, lost or stolen Note
a new Note of like Class and Percentage Interest. In connection with the
issuance of any new Note under this Section 5.04, the Indenture Trustee may
require the payment by the Noteholder of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto. Any other
expenses (including the fees and expenses of the Indenture Trustee) in
connection therewith shall be paid by the Servicer. Any duplicate Note issued
pursuant to this Section 5.04 shall constitute a Note duly issued by the Trust,
as if originally issued, whether or not the lost, stolen or destroyed Note shall
be found at any time.

                  Section 5.05 Persons Deemed Owners. The Indenture Trustee may
treat the Person in whose name any Note is registered as the owner of such Note
for the purpose of receiving distributions pursuant to Section 3.05 hereof and
for all other purposes whatsoever, and the Indenture Trustee shall not be
affected by any notice to the contrary.

                  Section 5.06 Access to List of Noteholders' Names and
Addresses. The Indenture Trustee will furnish or cause to be furnished to the
Servicer within 15 days after receipt by the Indenture Trustee of a request
therefor from the Servicer in writing, a list of the names and addresses of the
Noteholders as of the most recent Record Date. If one or more Noteholders
representing a Class A Percentage Interest, a Class B Percentage Interest, a
Class C Percentage Interest, a Class D Percentage Interest or a Class E
Percentage Interest of not less than 25% (an "Applicant") shall apply in writing
to the Indenture Trustee, and such application shall state that the Applicant
desires to communicate with other Noteholders with respect to its rights under
this Indenture or under the Notes, then the Indenture Trustee shall, within five
Business Days after the receipt of such application, send such notice to the
current list of Noteholders. Every Noteholder, by receiving and holding a Note,
agrees with the Trust, the Owner Trustee, the Servicer and the Indenture Trustee
that none of the Trust, the Owner Trustee, the Servicer nor the Indenture
Trustee shall be held accountable by reason of the disclosure of any such
information, regardless of the source from which such information was derived.

                  Section 5.07 Acts of Noteholders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Noteholders in person or by an 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 Indenture Trustee and, where
required, to the Trust or the Servicer. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Section 7.01 hereof) conclusive in
favor of the Indenture Trustee, the Trust, SierraCities.com and the Servicer, if
made in the manner provided in this Section 5.07.

                  (b) The fact and date of the execution by any Noteholder of
any such instrument or writing may be proven in any reasonable manner which the
Indenture Trustee deems sufficient.

                  (c) The ownership of Notes shall be proven by the Register.

                                       21
<PAGE>   28

                  (d) Any request, demand, authorization, direction, notice,
consent, waiver or other act by a Noteholder shall bind every holder of every
Note issued upon the registration of transfer thereof or in exchange therefor or
in lieu thereof, in respect of anything done or omitted to be done by the
Indenture Trustee, the Owner Trustee, the Trust or the Servicer in reliance
thereon, whether or not notation of such action is made upon such Note.

                  Section 5.08 No Proceedings. By its acceptance of a Note, each
Noteholder shall be deemed to have agreed that it will not directly or
indirectly institute, or cause to be instituted, against the Trust Certificate
Holder or the Trust any bankruptcy or insolvency proceeding so long as there
shall not have elapsed one year plus one day since the maturity date of the
latest maturing securities of the Trust.

                                   ARTICLE VI.

                                    THE TRUST

                  Section 6.01 Liability of the Trust. The Trust shall be liable
for payments in respect of the Notes in accordance herewith only to the extent
of the obligations specifically undertaken by the Trust herein.

                  Section 6.02 Limitation on Liability of the Trust. Neither the
Owner Trustee nor the directors, officers, employees or agents of the Trust or
the Owner Trustee shall be under any liability to the Indenture Trustee, the
Noteholders, SierraCities.com, the Servicer, the Trust Certificate Holder or any
other Person hereunder or pursuant to any document delivered hereunder, it being
expressly understood that all such liability is expressly waived and released as
a condition of, and as consideration for, the Trust's execution and delivery of
this Indenture and the issuance of the Notes. The Trust shall not be under any
liability to the Indenture Trustee, the Noteholders, SierraCities.com, the
Servicer, the Trust Certificate Holder or any other Person for any action taken
or for refraining from the taking of any action in its capacity as Trust
pursuant to this Indenture whether arising from express or implied duties under
this Indenture; provided, however, that this provision shall not protect the
Trust against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith, misrepresentation or gross negligence in the
performance of duties or by reason of reckless disregard of obligations and
duties hereunder. The Trust may rely in good faith on any document of any kind
prima facie properly executed and submitted by any other Person respecting any
matters arising hereunder.

                                       22
<PAGE>   29

                  Section 6.03 Indemnity for Liability Claims. The Trust
Certificate Holder on behalf of the Trust shall be deemed to have agreed to
indemnify, defend and hold harmless the Indenture Trustee (which shall include
any of its directors, employees, officers and agents), the Owner Trustee (which
shall include any of its directors, employees, officers and agents), the
Noteholders against and from any and all costs, expenses, losses, damages,
claims and liabilities arising out of or resulting from the use, repossession or
operation of the Equipment to the extent not covered by the Servicer's indemnity
provided by Section 5.01 of the Servicing Agreement; provided, however, that
such amounts shall be payable solely from amounts payable to the Trust
Certificate Holder pursuant to Section 3.05(b)(xviii) hereof.

                  Section 6.04 Liabilities. Notwithstanding any provision of
this Indenture, by entering into this Indenture, the Trust and the Trust
Certificate Holder agrees to be liable, directly to the injured party, for the
entire amount of any losses, claims, damages or liabilities (other than those
losses incurred by a Class A Noteholder, a Class B Noteholder, a Class C
Noteholder, a Class D Noteholder or a Class E Noteholder in the capacity of an
investor in the Class A Notes, the Class B Notes, the Class C Notes, the Class D
Notes or the Class E Notes) imposed on or asserted against the Trust or
otherwise arising out of or based on the arrangements created by this Indenture
(to the extent of the Trust assets remaining after the Class A Noteholders and
the Subordinate Noteholders have been paid in full are insufficient to pay such
losses, claims, damages or liabilities).

                  Section 6.05 [Reserved.]

                  Section 6.06. Annual Statement as to Compliance. The Servicer
on behalf of the Trust will deliver to the Indenture Trustee and the Rating
Agencies, within 90 days after the end of each fiscal year of the Trust
(commencing with the fiscal year ended December 31, 2000), and otherwise in
compliance with the requirements of TIA Section 314(a)(4) an Officer's
Certificate stating, as to the Authorized Officer signing such Officer's
Certificate, that

                           (i) a review of the activities of the Trust during
         such year and of performance under this Indenture has been made under
         such Authorized Officer's supervision; and

                           (ii) to the best of such Authorized Officer's
         knowledge, based on such review, the Trust has complied with all
         conditions and covenants under this Indenture throughout such year, or,
         if there has been a default in the compliance of any such condition or
         covenant, specifying each such default known to such Authorized Officer
         and the nature and status thereof.

                  Section 6.07 Payment of Principal and Interest. The Indenture
Trustee on behalf of the Trust will pay or cause to be duly and punctually paid
the principal of and interest on the Notes in accordance with the terms of the
Notes and this Indenture. Amounts properly withheld under the Code by any Person
from a payment to any Noteholder of interest and/or principal shall be
considered as having been paid by the Trust to such Noteholder for all purposes
of this Indenture.

                                       23
<PAGE>   30

                  Section 6.08 Maintenance of Office or Agency. The Note
Registrar shall, and the Indenture Trustee, as initial Note Registrar agrees to,
maintain in New York, New York, an office or agency where Notes may be
surrendered for registration of transfer or exchange, and where notices and
demands to or upon the Trust in respect of the Notes and this Indenture may be
served. The Indenture Trustee will give prompt written notice to the Trust of
the location, and of any change in the location, of any such office or agency.

                  Section 6.09 Money for Payments to be Held in Trust. On or
before each Payment Date, the Servicer on behalf of the Trust shall deposit or
cause to be deposited in the Collection Account, but only from the sources
described herein, an aggregate sum sufficient to pay the amounts then becoming
due under the Notes, such sum to be held in trust for the benefit of the Persons
entitled thereto and (unless the paying agent is the Indenture Trustee) shall
promptly notify the Indenture Trustee of its action or failure so to act.

                  The Servicer on behalf of the Trust will cause each paying
agent other than the Indenture Trustee to execute and deliver to the Indenture
Trustee an instrument in which such paying agent shall agree with the Indenture
Trustee (and if the Indenture Trustee acts as paying agent, it hereby so
agrees), subject to the provisions of this Section, that such paying agent will:

                           (i) hold all sums held by it for the payment of
         amounts due with respect to the Notes in trust for the benefit of the
         Persons entitled thereto until such sums shall be paid to such Persons
         or otherwise disposed of as herein provided and pay such sums to such
         Persons as herein provided;

                           (ii) give the Indenture Trustee notice of any default
         by the Trust (or any other obligor upon the Notes) of which it has
         actual knowledge in the making of any payment required to be made with
         respect to the Notes;

                           (iii) at any time during the continuance of any such
         default, upon the written request of the Indenture Trustee, forthwith
         pay to the Indenture Trustee all sums so held in trust by such paying
         agent;

                           (iv) immediately resign as a paying agent and
         forthwith pay to the Indenture Trustee all sums held by it in trust for
         the payment of Notes if at any time it ceases to meet the standards
         required to be met by a paying agent at the time of its appointment;
         and

                           (v) comply with all requirements of the Code with
         respect to the withholding from any payments made by it on any Notes of
         any applicable withholding taxes imposed thereon and with respect to
         any applicable reporting requirements in connection therewith.

                  The Trust may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, direct
any paying agent to pay to the Indenture Trustee all sums held in trust by such
paying agent, such sums to be held by the Indenture Trustee upon the same trusts
as those upon which the sums were held by such paying agent; and upon such a
payment by any paying agent to the Indenture Trustee, such paying agent shall be
released from all further liability with respect to such money.

                                       24
<PAGE>   31

                  Subject to applicable laws with respect to the escheat of
funds, any money held by the Indenture Trustee or any paying agent in trust for
the payment of any amount due with respect to any Note and remaining unclaimed
for two years after such amount has become due and payable shall be discharged
from such trust and be paid to the Trust and shall be deposited by the Indenture
Trustee in the Collection Account; and the Holder of such Note shall thereafter,
as an unsecured general creditor, look only to the Trust for payment thereof
(but only to the extent of the amounts so paid to the Trust), and all liability
of the Indenture Trustee or such paying agent with respect to such trust money
shall thereupon cease; provided, however, that the Indenture Trustee or such
paying agent, before being required to make any such repayment, shall at the
expense of the Trust cause to be published once, in a newspaper published in the
English language, customarily published on each Business Day and of general
circulation in The City of New York, notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such publication, any unclaimed balance of such money then
remaining will be repaid to the Trust. The Indenture Trustee shall also adopt
and employ, at the expense of the Trust, any other reasonable means of
notification of such repayment (including, but not limited to, mailing notice of
such repayment to Holders whose Notes have been called but have not been
surrendered for redemption or whose right to or interest in moneys due and
payable but not claimed is determinable from the records of the Indenture
Trustee or of any paying agent, at the last address of record for each such
Holder).

                  Section 6.10 Existence. Except as otherwise permitted by the
provisions of Section 6.13, the Owner Trustee, on behalf of the Trust, will keep
in full effect the Trust's existence, rights and franchises as a common law
trust under the laws of the State of Delaware (unless the Trust becomes, or any
successor Trust hereunder is or becomes, organized under the laws of any other
state or of the United States of America, in which case the Owner Trustee or a
successor Owner Trustee, on behalf of the Trust, will keep in full effect the
Trust's existence, rights and franchises under the laws of such other
jurisdiction) and the Servicer, on behalf of the Trust, will obtain and preserve
the Trust's qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes and each other instrument or
agreement included in the Pledged Property.

                  Section 6.11 Protection of Pledged Property. The Trust intends
the security interest granted pursuant to this Indenture in favor of the
Indenture Trustee and the Noteholders, as their interests appear herein, to be
prior to all other liens in respect of the Pledged Property, and the Servicer on
behalf of the Trust shall take all actions necessary to obtain and maintain, in
favor of the Indenture Trustee, for the benefit of the Noteholders, a first lien
on and a first priority, perfected security interest in the Pledged Property.
The Servicer on behalf of the Trust will from time to time prepare (or shall
cause to be prepared), execute and deliver all such supplements and amendments
hereto and all such financing statements, continuation statements, instruments
of further assurance and other instruments, and will take such other action
necessary or advisable to:

                           (i) grant more effectively all or any portion of the
         Pledged Property;

                           (ii) maintain or preserve the lien and security
         interest (and the priority thereof) in favor of the Indenture Trustee
         for the benefit of the Noteholders, created by this Indenture or carry
         out more effectively the purposes hereof;

                                       25
<PAGE>   32

                           (iii) perfect, publish notice of or protect the
         validity of any grant made or to be made by this Indenture;

                           (iv) enforce any of the Pledged Property;

                           (v) preserve and defend title to the Pledged Property
         and the rights of the Indenture Trustee in such Pledged Property
         against the claims of all persons and parties; and

                           (vi) pay all taxes or assessments levied or assessed
         upon the Pledged Property when due.

The Trust hereby designates the Indenture Trustee its agent and attorney-in-fact
to execute any financing statement, continuation statement or other instrument
required by the Indenture Trustee pursuant to this Section 6.11.

                  Section 6.12 Performance of Obligations; Servicing of
Receivables. (a) The Trust will not take any action and will use its best
efforts not to permit any action to be taken by others that would release any
Person from any of such Person's material covenants or obligations under any
instrument or agreement included in the Pledged Property or that would result in
the amendment, hypothecation, subordination, termination or discharge of, or
impair the validity or effectiveness of, any such instrument or agreement,
except as ordered by any bankruptcy or other court or as expressly provided in
this Indenture, the other Transaction Documents or any other instrument or
agreement.

                  (b) The Trust may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Indenture Trustee in an Officer's Certificate of
the Trust shall be deemed to be action taken by the Trust. Initially, the Trust
has contracted with the Servicer to substantially perform the Trust's duties
under this Indenture, and in such regard, the Trust may rely upon information
provided by the Servicer in connection with any Officer's Certificates of the
Trust to be provided pursuant to this Indenture and any other action to be take
by the Trust pursuant to this Indenture.

                  (c) The Trust will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the other Transaction
Documents and in the instruments and agreements included in the Pledged
Property, including, but not limited to, preparing (or causing to be prepared)
and filing (or causing to be filed) all UCC financing statements and
continuation statements required to be filed by the terms of this Indenture and
the Servicing Agreement in accordance with and within the time periods provided
for herein and therein.

                  (d) If a Responsible Officer of the Owner Trustee shall have
actual knowledge of the occurrence of an Event of Servicing Termination under
the Servicing Agreement, the Trust shall promptly notify the Indenture Trustee
and the Rating Agencies in writing thereof, and shall specify in such notice the
action, if any, the Trust is taking in respect of such default. If a Servicer
Termination Event shall arise from the failure of the Servicer to perform any of
its duties or obligations under the Servicing Agreement with respect to the
Contracts, the Trust shall take all reasonable steps available to it to remedy
such failure.

                                       26
<PAGE>   33

                  Section 6.13 Negative Covenants. So long as any Notes are
Outstanding, the Trust shall not:

                           (i) except as expressly permitted by this Indenture
         or the Transaction Documents, sell, transfer, exchange or otherwise
         dispose of any of the properties or assets of the Trust, including
         those included in the Pledged Property;

                           (ii) claim any credit on, or make any deduction from
         the principal or interest payable in respect of, the Notes (other than
         amounts properly withheld from such payments under the Code) or assert
         any claim against any present or former Noteholder by reason of the
         payment of the taxes levied or assessed upon any part of the Pledged
         Property; or

                           (iii) (A) permit the validity or effectiveness of
         this Indenture to be impaired, or permit the lien in favor of the
         Indenture Trustee created by this Indenture to be amended,
         hypothecated, subordinated, terminated or discharged, or permit any
         Person to be released from any covenants or obligations with respect to
         the Notes under this Indenture except as may be expressly permitted
         hereby, (B) permit any lien, charge, excise, claim, security interest,
         mortgage or other encumbrance (other than the lien of this Indenture)
         to be created on or extend to or otherwise arise upon or burden the
         Pledged Property or any part thereof or any interest therein or the
         proceeds thereof (other than tax liens, mechanics' liens and other
         liens that arise by operation of law, in each case on Equipment and
         arising solely as a result of an action or omission of the related
         Obligor), or (C) permit the lien of this Indenture not to constitute a
         valid first priority (other than with respect to any such tax,
         mechanics' or other lien) security interest in the Pledged Property;

                  Section 6.14 Trust May Consolidate, Etc. Only on Certain
Terms. (a) The Trust shall not consolidate or merge with or into any other
Person, unless

                           (i) the Person (if other than the Trust) formed by or
         surviving such consolidation or merger shall be a Person organized and
         existing under the laws of the United States of America or any state
         and shall expressly assume, by an indenture supplemental hereto,
         executed and delivered to the Indenture Trustee, in form satisfactory
         to the Indenture Trustee, the due and punctual payment of the principal
         of and interest on all Notes and the performance or observance of every
         agreement and covenant of this Indenture on the part of the Trust to be
         performed or observed, all as provided herein;

                           (ii) immediately after giving effect to such
         transaction, no Event of Default shall have occurred and be continuing;

                           (iii) the Trust shall have received an Opinion of
         Counsel (and shall have delivered copies thereof to the Indenture
         Trustee) to the effect that such transaction will not have any material
         adverse tax consequence to the Trust or any Noteholder;

                           (iv) any action as is necessary to maintain the lien
         and security interest created by this Indenture shall have been taken;

                                       27
<PAGE>   34

                           (v) the Trust shall have delivered to the Indenture
         Trustee an Officer's Certificate and an Opinion of Counsel each stating
         that such consolidation or merger and such supplemental indenture
         comply with this Article VI and that all conditions precedent herein
         provided for relating to such transaction have been complied with
         (including any filing required by the Exchange Act); and

                           (vi) the Rating Agencies have confirmed that such
         transaction will not result in the reduction or withdrawal of any
         rating on any class of Notes.

                  (b) The Trust shall not convey or transfer all or
substantially all of its properties or assets, including those included in the
Pledged Property, to any Person, unless

                           (i) the Person that acquires by conveyance or
         transfer the properties and assets of the Trust the conveyance or
         transfer of which is hereby restricted shall (A) be a United States
         citizen or a Person organized and existing under the laws of the United
         States of America or any state, (B) expressly assume, by an indenture
         supplemental hereto, executed and delivered to the Indenture Trustee,
         in form satisfactory to the Indenture Trustee, the due and punctual
         payment of the principal of and interest on all Notes and the
         performance or observance of every agreement and covenant of this
         Indenture and each of the Transaction Documents on the part of the
         Trust to be performed or observed, all as provided herein, (C)
         expressly agree by means of such supplemental indenture that all right,
         title and interest so conveyed or transferred shall be subject and
         subordinate to the rights of Holders of the Notes, (D) unless otherwise
         provided in such supplemental indenture, expressly agree to indemnify,
         defend and hold harmless the Trust against and from any loss, liability
         or expense arising under or related to this Indenture and the Notes and
         (E) expressly agree by means of such supplemental indenture that such
         Person (or if a group of persons, then one specified Person) shall
         prepare (or cause to be prepared) and make all filings with the
         Commission (and any other appropriate Person) required by the Exchange
         Act in connection with the Notes;

                           (ii) immediately after giving effect to such
         transaction, no Event of Default shall have occurred and be continuing;

                           (iii) the Trust shall have received an Opinion of
         Counsel (and shall have delivered copies thereof to the Indenture
         Trustee) to the effect that such transaction will not have any material
         adverse tax consequence to the Trust or any Noteholder;

                           (iv) any action as is necessary to maintain the lien
         and security interest created by this Indenture shall have been taken;

                           (v) the Trust shall have delivered to the Indenture
         Trustee an Officers' Certificate and an Opinion of Counsel each stating
         that such conveyance or transfer and such supplemental indenture comply
         with this Article VI and that all conditions precedent herein provided
         for relating to such transaction have been complied with (including any
         filing required by the Exchange Act); and

                                       28
<PAGE>   35

                           (vi) the Rating Agencies have confirmed that such
         transaction will not result in the reduction or withdrawal of any
         rating on any class of Notes.

                  Section 6.15 Successor or Transferee. (a) Upon any
consolidation or merger of the Trust in accordance with Section 6.14, the Person
formed by or surviving such consolidation or merger (if other than the Issuer)
shall succeed to, and be substituted for, and may exercise every right and power
of, the Trust under this Indenture with the same effect as if such Person had
been named as the Trust herein.

                  (b) Upon a conveyance or transfer of all the assets and
properties of the Trust pursuant to Section 6.14(b), the Trust will be released
from every covenant and agreement of this Indenture to be observed or performed
on the part of the Trust with respect to the Notes immediately upon the delivery
of written notice to the Indenture Trustee stating that the Trust is to be so
released.

                  Section 6.16 No Other Business. The Trust shall not engage in
any business other than financing, purchasing, owning, selling and managing the
Receivables in the manner contemplated by this Indenture and the other
Transaction Documents and activities incidental thereto.

                  Section 6.17 No Borrowing. The Trust shall not issue, incur,
assume, guarantee or otherwise become liable, directly or indirectly, for any
Indebtedness except for (i) the Notes and (ii) any other Indebtedness permitted
by or arising under the Transaction Documents. The proceeds of the Notes shall
be used exclusively to fund the Trust's purchase of the Contracts and the other
assets constituting the Pledged Property and to pay the Trust's organizational,
transactional and start-up expenses.

                  Section 6.18 Guarantees, Loans, Advances and Other
Liabilities. Except as contemplated by the Servicing Agreement or this
Indenture, the Trust shall not make any loan or advance or credit to, or
guarantee (directly or indirectly or by an instrument having the effect of
assuring another's payment or performance on any obligation or capability of so
doing or otherwise), endorse or otherwise become contingently liable, directly
or indirectly, in connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree contingently to do so) any stock,
obligations, assets or securities of, or any other interest in, or make any
capital contribution to, any other Person.

                  Section 6.19 Capital Expenditures. The Trust shall not make
any expenditure (by long-term or operating lease or otherwise) for capital
assets (either realty or personal).

                  Section 6.20 Compliance with Laws. The Trust shall comply with
the requirements of all applicable laws, the non-compliance with which would,
individually or in the aggregate, materially and adversely affect the ability of
the Trust to perform its obligations under the Notes, this Indenture or any
other Transaction Document.

                  Section 6.21 Further Instruments and Acts. Upon request of the
Indenture Trustee, the Trust will execute and deliver such further instruments
and do such further acts as may be reasonably necessary or proper to carry out
more effectively the purpose of this Indenture and the other Transaction
Documents.

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<PAGE>   36

                                  ARTICLE VII.

                              THE INDENTURE TRUSTEE

                  Section 7.01 Duties of Indenture Trustee. (a) The Indenture
Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture. If an Event of Default of which a
Responsible Officer of the Indenture Trustee shall have actual knowledge has
occurred and has not been cured or waived, the Indenture Trustee shall exercise
such of the rights and powers vested in it by this Indenture, and use the same
degree of care and skill in their exercise as a prudent Person would exercise or
use under the circumstances in the conduct of such Person's own affairs.

                  (b) The Indenture Trustee, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Indenture Trustee that are specifically required to
be furnished pursuant to any provision of this Indenture, shall examine them to
determine whether they conform as to form to the requirements of this Indenture.
No acceptance of, or reliance on, any such item by the Indenture Trustee shall
constitute a representation by the Indenture Trustee of the enforceability or
sufficiency of such item.

                  (c) No provision of this Indenture shall be construed to
relieve the Indenture Trustee from liability for its own grossly negligent
action, its own grossly negligent failure to act or its own willful misconduct;
provided, however, that:

                           (i) Prior to the occurrence of an Event of Default,
         and after the curing of all such Events of Default that may have
         occurred, the duties and obligations of the Indenture Trustee shall be
         determined solely by the express provisions of this Indenture; the
         Indenture Trustee shall not be liable except for the performance of
         such duties and obligations as are specifically set forth in this
         Indenture; no implied covenants or obligations shall be read into this
         Indenture against the Indenture Trustee; and in the absence of bad
         faith on the part of the Indenture Trustee, the Indenture Trustee may
         conclusively rely, as to the truth of the statements and the
         correctness of the opinions expressed therein, upon any certificates or
         opinions furnished to the Indenture Trustee and, if specifically
         required to be furnished pursuant to any provision of this Indenture,
         conforming to the requirements of this Indenture;

                           (ii) The Indenture Trustee shall not be liable for an
         error of judgment made in good faith by a Responsible Officer of the
         Indenture Trustee unless it shall be proved that the Indenture Trustee
         was grossly negligent in ascertaining the pertinent facts;

                           (iii) The Indenture Trustee shall not be personally
         liable with respect to any action taken, suffered or omitted to be
         taken by it in good faith in accordance with this Indenture, pursuant
         to the direction of the Notes evidencing Percentage Interests in the
         related Class of not less than 25% of the Outstanding Amount of the
         related Class of Notes, relating to the time, method and place of
         conducting any proceeding for any

                                       30
<PAGE>   37

         remedy available to the Indenture Trustee, or exercising, suffering or
         omitting to take any trust or power conferred upon the Indenture
         Trustee, under this Indenture;

                           (iv) The Indenture Trustee shall not be charged with
         knowledge of any Event of Servicing Termination or any Event of Default
         unless a Responsible Officer of the Indenture Trustee obtains actual
         knowledge of such failure or event or the Indenture Trustee receives
         written notice of such failure or event from the Servicer, the Trust or
         any Noteholder; and

                           (v) The Indenture Trustee shall have no duty to
         monitor the performance of the Servicer (as custodian or otherwise),
         nor shall it have any liability in connection with the malfeasance or
         nonfeasance by the Servicer. The Indenture Trustee shall have no
         liability in connection with compliance of the Servicer or the Trust
         with statutory or regulatory requirements related to the Contracts or
         the related Equipment. The Indenture Trustee shall not make or be
         deemed to have made any representations or warranties with respect to
         the Contracts or related Equipment or the validity or sufficiency of
         any assignment of the Contracts to the Trust or the Indenture Trustee.
         The Indenture Trustee shall have no obligation or liability in respect
         of the maintenance of casualty or liability insurance in connection
         with the Contracts or the related Equipment.

                  (d) The Indenture Trustee shall not be required to expend or
risk its own funds or otherwise incur financial liability in the performance of
any of its duties hereunder, or in the exercise of any of its rights or powers,
if there is reasonable ground for believing that the repayment of such funds or
indemnity satisfactory to it against such risk or liability is not assured to
it, and none of the provisions contained in this Indenture shall in any event
require the Indenture Trustee to perform, or be responsible for the manner of
performance of, any of the obligations of the Servicer under this Indenture or
the Servicing Agreement except during such time, if any, as the Indenture
Trustee shall be the successor to, and be vested with the rights, duties, powers
and privileges of, the Servicer in accordance with the terms of this Indenture.

                  (e) On each Determination Date, the Indenture Trustee shall
give notice, by facsimile, to a Servicing Officer of the Servicer if the total
amount then on deposit in the Collection Account in respect of the related
Collection Period is less than the amount indicated in the Monthly Statement.

                  Section 7.02 Eligible Investments. The Servicer shall direct
the Indenture Trustee to invest in Eligible Investments, as further specified
from time to time by written notice to the Indenture Trustee executed by a
Servicing Officer, any cash amounts deposited in the Collection Account pursuant
to the terms of this Indenture or the Servicing Agreement, immediately upon
deposit of any such cash amounts; provided, however, that each such Eligible
Investment (i) shall mature no later than the Business Day immediately preceding
the Payment Date in respect of the Collection Period during which such deposit
was made and (ii) shall not be sold or disposed of prior to its maturity. The
Indenture Trustee shall not be liable or responsible for the selection of or
losses on any investments made by it pursuant to and in compliance with such
instructions of the Servicer pursuant to this Section 7.02. The Indenture
Trustee shall have no obligation to initiate any investments in the absence of
such written direction.

                                       31
<PAGE>   38

                  Section 7.03 Indenture Trustee's Assignment of Contracts. If
in any enforcement suit or legal proceeding it is held, or in connection with
the collection of a Defaulted Contract the Servicer or its assigns reasonably
anticipates, that the Servicer or its assigns may not or will not be able to
enforce a Contract on the ground that neither the Servicer nor its assigns are a
real party in interest or a holder entitled to enforce the Contract, then the
Indenture Trustee shall, at the Servicer's or its assigns' expense, take such
steps as the Indenture Trustee deems necessary to enforce the Contract,
including (i) bringing suit in the Indenture Trustee's name or the names of the
Noteholders and (ii) executing and delivering all such instruments or documents
as shall be required to transfer title to a Contract to the Servicer or its
assigns or otherwise enforce such Contract.

                  Section 7.04 Certain Matters Affecting the Indenture Trustee.
Except as otherwise provided in Section 7.01:

                           (i) The Indenture Trustee may conclusively rely and
         shall be fully 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 by
         it to be genuine and to have been signed or presented by the proper
         party or parties;

                           (ii) The Indenture Trustee may consult with counsel
         and any Opinion of Counsel or advice shall constitute 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
         Opinion of Counsel or advice;

                           (iii) The Indenture Trustee shall be under no
         obligation to exercise any of the rights or powers vested in it by this
         Indenture, or to institute, conduct or defend any litigation hereunder
         or in relation hereto, at the request, order or direction of any of the
         Noteholders, pursuant to the provisions of this Indenture unless such
         Noteholders shall have offered to the Indenture Trustee such security
         or indemnity satisfactory to it against the costs, expenses, and
         liabilities that may be incurred therein or thereby that are reasonable
         in the opinion of the Indenture Trustee; provided, however, that
         nothing contained herein shall relieve the Indenture Trustee of the
         obligations, upon the occurrence of an Event of Default (that has not
         been cured), to exercise such of the rights and powers vested in it by
         this Indenture and to use the same degree of skill and care in their
         exercise as a prudent Person would exercise under the circumstances in
         the conduct of such Person's own affairs;

                           (iv) The Indenture Trustee 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 or rights
         or powers conferred upon it by this Indenture;

                           (v) Prior to the occurrence of an Event of Default of
         which a Responsible Officer of the Indenture Trustee shall have actual
         knowledge and after the curing of all Events of Default that may have
         occurred, the Indenture Trustee shall not be bound to make any
         investigation into the facts or matters stated in any resolution,
         certificate, statement, instrument, opinion, report, notice, request,
         consent, order, approval, bond or

                                       32
<PAGE>   39

         other paper or document, unless requested in writing to do so by the
         Holders of Notes of any Class evidencing Percentage Interests of not
         less than 25% of such Class; provided, however, that if the payment
         within a reasonable time to the Indenture Trustee of the costs,
         expenses or liabilities likely to be incurred by it in the making of
         such investigation is, in the opinion of the Indenture Trustee, not
         reasonably assured to the Indenture Trustee by the security afforded to
         it by the terms of this Indenture, the Indenture Trustee may require
         indemnity satisfactory to it against such cost, expense or liability as
         a condition to so proceeding. The reasonable expense of every such
         examination shall be paid by the requesting party or, if paid by the
         Indenture Trustee, shall be reimbursed by the Servicer upon demand.
         Nothing in this clause (v) shall derogate from the obligation of the
         Servicer to observe any applicable law prohibiting disclosure of
         information regarding the Obligors; and

                           (vi) The Indenture Trustee may execute any of the
         trusts or powers or perform any duties hereunder either directly or by
         or through agents or attorneys or a custodian. The Indenture Trustee
         shall not be responsible for the misconduct, negligence or for the
         supervision of any of the Indenture Trustee's agents or attorneys
         appointed with due care by the Indenture Trustee hereunder or that of
         SierraCities.com, the Servicer or the Trust.

                  Section 7.05 Indenture Trustee Not Liable for Notes or
Contracts. The Notes do not represent an obligation issued by the Indenture
Trustee or any Affiliate thereof. The promise to pay the Notes according to
their terms and the terms of this Indenture set forth in the Notes and in
Section 2.05 hereof provides recourse to the Pledged Property only. The
Indenture Trustee does not assume any responsibility for the accuracy of the
statements herein or in the Notes (other than as set forth in Section 7.17 and
the certificate of authentication on the Notes). The Indenture Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Notes (other than the certificate of authentication on the Notes) or of any
Contract or related document. The Indenture Trustee shall at no time have any
responsibility or liability for or with respect to the legality, validity or
enforceability of any security interest in any Equipment or any Contract, to the
perfection or priority thereof, or to the efficacy of the Trust or any portion
thereof to pay any Note, the existence or validity of any Contract, the validity
of the assignment of any Contract or the related Pledged Property to the Trust
or of any intervening assignment, the review of any Contract, any Contract File
or the Computer Tape (it being understood that neither the Indenture Trustee nor
any of its agents have reviewed or intend to review such matters, the sole
responsibility for such review being vested in the Trust), the completeness of
any Contract File, the receipt by it or its custodian of any Contract, the
performance or enforcement of any Contract, subject to Section 4.01 of the
Servicing Agreement, the compliance by the Trust with any covenant or the breach
by SierraCities.com or the Trust of any warranty or representation made under
the Servicing Agreement, the Receivables Transfer Agreement or in any related
document or the accuracy of any such warranty or representation, any investment
of monies in the Collection Account (except to the extent that the Indenture
Trustee, in its individual capacity, is an obligor with respect to any such
investment) or any loss resulting therefrom, the acts or omissions of the
Servicer, or any Obligor, any action of the Servicer taken in the name of the
Indenture Trustee, any action by the Indenture Trustee taken at the instruction
of the Servicer or the preparation and filing of tax returns for the Trust. No
recourse shall be had for any claim based on any provision of this Indenture,
the Notes or any Contract or assignment thereof against

                                       33
<PAGE>   40

Bankers Trust Company in its individual capacity, and Bankers Trust Company
shall not have any personal obligation, liability or duty whatsoever to any
Noteholder or any other Person with respect to any such claim, and any such
claim shall be asserted solely against the Trust or any indemnitor who shall
furnish indemnity as provided herein, except for such liability as is determined
to have resulted from its own gross negligence or willful misconduct. The
Indenture Trustee shall not be accountable for the use or application by
SierraCities.com or the Trust of any of the Notes or of the proceeds of such
Notes or for the use or application of any funds paid to the Servicer in respect
of the Contracts.

                  Section 7.06 Indenture Trustee May Own Notes. The Indenture
Trustee in its individual or any other capacity may become the owner or pledge
of Notes with the same rights as it would have if it were not Indenture Trustee,
subject to the definition of the term "Noteholder" in Annex A hereto.

                  Section 7.07 Indenture Trustee's Fees and Expenses. (a) The
Servicer on behalf of the Trust Certificate Holder agrees:

                           (i) to pay to the Indenture Trustee, pursuant to
         Section 3.05(b)(v), as applicable, on each Payment Date reasonable
         compensation for all services rendered by it hereunder (which
         compensation shall not be limited by any provision of law in regard to
         the compensation of a Indenture Trustee of an express trust);

                           (ii) except to the extent otherwise expressly
         provided herein, to reimburse the Indenture Trustee, pursuant to
         Section 3.05(b)(vi), as applicable, upon its request, for all
         reasonable expenses, disbursements and advances incurred or made by the
         Indenture Trustee in accordance with any provision of this Indenture
         (including the reasonable compensation and expenses and disbursements
         of any of its agents and counsel), except any such expense,
         disbursement or advance as may be attributable to its gross negligence
         or willful misconduct; provided, however, that for purposes of this
         clause (ii), such expenses, disbursements and advances shall be limited
         to an aggregate amount of $75,000; and

                           (iii) to cause the Indenture Trustee to be reimbursed
         pursuant to Section 3.05(b)(xviii), as applicable, for all reasonable
         expenses, disbursements and advances that would have been paid pursuant
         to Section 7.07(a)(ii) but for the $75,000 limitation.

                  (b) The Servicer's obligations under this Section 7.07 shall
survive the termination of this Indenture or the earlier resignation or removal
of the Indenture Trustee. The Indenture Trustee shall not be entitled to any
other or additional compensation or reimbursement, except as expressly provided
herein or as otherwise agreed from time to time.

                  (c) Subject to Section 7.10 hereof, the failure by the
Servicer to pay to the Indenture Trustee any compensation or other expenses
shall not relieve the Indenture Trustee of its obligations hereunder.

                  (d) In the event the Indenture Trustee performs services or
incurs expenses in the context of a proceeding described in Sections
6.01(a)(iv), 6.01(a)(v) or 6.01(a)(vii) of the Servicing Agreement, the fees for
such services and such expenses shall be considered expenses

                                       34
<PAGE>   41

of administration for the purposes of any bankruptcy laws or laws relating to
creditors rights generally.

                  Section 7.08 Eligibility Requirements for Indenture Trustee.
The Indenture Trustee shall at all times satisfy the requirements of TIA Section
310(a). The Indenture Trustee hereunder shall at all times be a corporation
having its principal office in a State, organized and doing business under the
laws of any State or the United States of America, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000 and subject to supervision or examination by federal or State
authority; provided, however, that no entity shall qualify as Indenture Trustee
hereunder to the extent that such qualification would, in itself, affect any
then current rating of the Offered Notes or the Subordinate Notes by the Rating
Agencies. If such corporation publishes reports of condition at least annually,
pursuant to law or the requirements of the aforesaid supervising or examining
authority, then for the purpose of this Section 7.08, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. Any
successor Indenture Trustee's deposit ratings shall be at least "investment
grade" by the Rating Agencies. In case at any time the Indenture Trustee shall
cease to be eligible in accordance with the provisions of this Section 7.08, the
Indenture Trustee shall resign immediately in the manner and with the effect
specified in Section 7.10 hereof. The Indenture Trustee shall comply with TIA
Section 310(b), including the optional provision permitted by the second
sentence of TIA Section 310(b)(9); provided, however, that there shall be
excluded from the operation of TIA Section 310(b)(1) any indenture or indentures
under which other securities of the Trust are outstanding if the requirements
for such exclusion set forth in TIA Section 310(b)(1) are met.

                  Section 7.09 Preferential Collection of Claims Against Issuer.
The Indenture Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). An Indenture Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated.

                  Section 7.10 Resignation or Removal of Indenture Trustee. (a)
The Indenture Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Servicer, the Trust and
each Noteholder, which resignation will not become effective until such time as
a successor Indenture Trustee has been appointed in accordance with the
provisions of this Section 7.10. Upon receiving such notice of resignation, the
Servicer shall promptly appoint a successor Indenture Trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to the
resigning Indenture Trustee and one copy to the successor Indenture Trustee. If
no successor Indenture Trustee shall have been so appointed and have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Indenture Trustee may petition any court of competent jurisdiction for
the appointment of a successor Indenture Trustee.

                  (b) If at any time the Indenture Trustee shall cease to be
eligible in accordance with the provisions of Section 7.08 hereof and shall fail
to resign after written request therefor by the Servicer, or the Holders of
Notes of any Class evidencing Percentage Interests of more than 25% of such
Class, or, if at any time the Indenture Trustee shall be legally unable to act,
or shall be adjudged a bankrupt or insolvent, or a receiver of the Indenture
Trustee or of its property shall be appointed, or any public officer shall take
charge or control of the Indenture Trustee or of its

                                       35
<PAGE>   42

property or affairs for the purpose of rehabilitation, conservation, or
liquidation, then the Servicer shall, at the direction of the Holders of Notes
of any Class evidencing Percentage Interests of more than 25% of the related
Class remove the Indenture Trustee. If the Servicer or Noteholders remove the
Indenture Trustee, the Servicer or such Noteholders shall promptly appoint a
successor Indenture Trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the Indenture Trustee so removed and one
copy to the successor Indenture Trustee.

                  (c) Any resignation or removal of the Indenture Trustee and
appointment of a successor Indenture Trustee pursuant to this Section 7.10 shall
not become effective until acceptance of appointment by the successor Indenture
Trustee as provided in Section 7.11 hereof. Notice of the resignation or removal
of the Indenture Trustee shall be given in writing to the Rating Agencies by the
Servicer. In the event no successor Indenture Trustee has been appointed within
30 days of the resignation or removal of the Indenture Trustee, the Indenture
Trustee or the Majority Holders of the Notes may petition a court of competent
jurisdiction to appoint a successor Indenture Trustee.

                  Section 7.11 Successor Indenture Trustee. (a) Any successor
Indenture Trustee appointed as provided in Section 7.10 hereof shall execute,
acknowledge and deliver to the Servicer, the Trust and the predecessor Indenture
Trustee an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor Indenture Trustee shall become
effective and such successor Indenture Trustee, 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 Indenture Trustee. The predecessor Indenture Trustee shall deliver to
the successor Indenture Trustee all documents and statements held by it
hereunder. The Servicer, the Trust and the predecessor Indenture Trustee shall
execute and deliver such instruments and do such other things as may reasonably
be required for fully and certainly vesting and confirming in the successor
Indenture Trustee all such rights, powers, duties and obligations. The
predecessor Indenture Trustee shall not be liable for the acts or omissions of
any successor Indenture Trustee hereunder.

                  (b) No successor Indenture Trustee shall accept appointment as
provided in this Section 7.11 unless at the time of such acceptance such
successor Indenture Trustee shall be eligible as the Indenture Trustee under the
provisions of Section 7.08 hereof, and as a successor Servicer under the
provisions of Section 6.02 of the Servicing Agreement.

                  (c) Upon acceptance of appointment by a successor Indenture
Trustee as provided in this Section 7.11, the Servicer shall mail notice of the
succession of such Indenture Trustee hereunder to all Noteholders at their
addresses as shown in the Note Register. If the Servicer fails to mail such
notice within 10 days after acceptance of appointment by such successor
Indenture Trustee, then the successor Indenture Trustee shall cause such notice
to be mailed at the expense of the Servicer.

                  Section 7.12 Merger or Consolidation of Indenture Trustee. Any
corporation into which the Indenture Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion, or consolidation to which the Indenture Trustee shall be a party, or
any corporation succeeding to the corporate trust

                                       36
<PAGE>   43

business of the Indenture Trustee, shall be the successor of the Indenture
Trustee hereunder, provided such corporation shall be eligible under the
provisions of Section 7.08 hereof, 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.

                  Section 7.13 Appointment of Co-Indenture Trustee or Separate
Indenture Trustee. (a) Notwithstanding any other provisions of this Indenture,
at any time, for the purpose of meeting any legal requirements of any
jurisdiction in which any part of the Trust or any Equipment may at the time be
located, the Indenture Trustee shall execute and deliver all instruments to
appoint one or more Persons approved by the Indenture Trustee to act as
co-Indenture Trustee or co-Indenture Trustees, jointly with the Indenture
Trustee, or separate Indenture Trustee or separate Indenture Trustees, of all or
any part of the Trust, and to vest in such Person or Persons, in such capacity
and for the benefit of the Noteholders, such title to the Trust, or any part
thereof, and, subject to the other provisions of this Section 7.13, such powers,
duties, obligations, rights and trusts as the Servicer, the Trust and the
Indenture Trustee may consider necessary or desirable. If the Servicer shall not
have joined in such appointment within 15 days after the receipt by it of a
request so to do, or in the case an Event of Servicing Termination shall have
occurred and be continuing, the Indenture Trustee alone shall have the power to
make such appointment; provided, however, that if the Trust shall not have
joined in such appointment within 15 days after the receipt by it of a request
so to do, the Indenture Trustee alone shall have the power to make such
appointment. No co-Indenture Trustee or separate Indenture Trustee hereunder
shall be required to meet the terms of eligibility as a successor Indenture
Trustee under Section 7.08 hereof, and no notice to Noteholders of the
appointment of any co-Indenture Trustee or separate Indenture Trustee shall be
required under Section 7.12 hereof.

                  (b) Every separate Indenture Trustee and co-Indenture Trustee
shall, to the extent permitted by law, be appointed and act subject to the
following provisions and conditions:

                           (i) All rights, powers, duties and obligations
         conferred or imposed upon the Indenture Trustee shall be conferred or
         imposed upon and exercised or performed by the Indenture Trustee and
         such separate Indenture Trustee or co-Indenture Trustee jointly (it
         being understood that such separate Indenture Trustee or co-Indenture
         Trustee is not authorized to act separately without the Indenture
         Trustee joining in such act), except to the extent that under any law
         of any jurisdiction in which any particular act or acts are to be
         performed (whether as Indenture Trustee hereunder or as successor to
         the Servicer hereunder), the Indenture 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
         Pledged Property or any portion thereof in any such jurisdiction) shall
         be exercised and performed singly by such separate Indenture Trustee or
         co-Indenture Trustee but solely at the direction of the Indenture
         Trustee;

                           (ii) No separate Indenture Trustee or co-Indenture
         Trustee hereunder shall be personally liable by reason of any act or
         omission of any other separate Indenture Trustee or co-Indenture
         Trustee hereunder; and

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<PAGE>   44

                           (iii) The Indenture Trustee may at any time accept
         the resignation of or remove any separate Indenture Trustee or
         co-Indenture Trustee.

                  (c) Any notice, request or other writing given to the
Indenture Trustee shall be deemed to have been given to each of the then
separate Indenture Trustees and co-Indenture Trustees, as effectively as if
given to each of them. Every instrument appointing any separate Indenture
Trustee or co-Indenture Trustee shall refer to this Indenture and the conditions
of this Article VII. Each separate Indenture Trustee and co-Indenture 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
Indenture Trustee or separately, as may be provided therein, subject to all the
provisions of this Indenture, specifically including every provision of this
Indenture relating to the conduct of, affecting the liability of, or affording
protection to, the Indenture Trustee. Every such instrument shall be filed with
the Indenture Trustee and a copy thereof given to the Servicer and the Trust.

                  (d) Any separate Indenture Trustee or co-Indenture Trustee may
at any time constitute the Indenture 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 Indenture on its behalf and in its name.
If any separate Indenture Trustee or co-Indenture Trustee shall die, become
incapable of acting, resign or be removed, then all of its estates, properties,
rights, remedies and trusts shall vest in and be exercised by the Indenture
Trustee, to the extent permitted by law, without the appointment of a new or
successor separate Indenture Trustee or successor co-Indenture Trustee.

                  (e) The Servicer shall be responsible for the payment of any
fees or expenses of any separate Indenture Trustee or co-Indenture Trustee.

                  Section 7.14 Indenture Trustee May Enforce Claims Without
Possession of Note. All rights of action and claims under this Indenture or the
Notes may be prosecuted and enforced by the Indenture Trustee without the
possession of any of the Notes or the production thereof in any proceeding
relating thereto, and any such proceeding instituted by the Indenture Trustee
shall be brought in its own name or in its capacity as Indenture Trustee. Any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Indenture Trustee, its
agents and counsel, be for the ratable benefit of the Noteholders in respect of
which such judgment has been recovered.

                  Section 7.15 Suits for Enforcement. In case an Event of
Servicing Termination or other default by the Servicer under the Servicing
Agreement or under this Indenture shall occur and be continuing, the Indenture
Trustee, in its discretion, may, subject to the provisions of 6.04 of the
Servicing Agreement, proceed to protect and enforce its rights and the rights of
the Noteholders under this Indenture by a suit, action or proceeding in equity
or at law or otherwise, whether for the specific performance of any covenant or
agreement contained in this Indenture or in aid of the execution of any power
granted in this Indenture or for the enforcement of any other legal, equitable
or other remedy, as the Indenture Trustee, being advised by counsel, shall deem
most effectual to protect and enforce any of the rights of the Indenture Trustee
and the Noteholders.

                                       38
<PAGE>   45

                  Section 7.16 Undertaking for Costs. All parties to this
Indenture agree (and each holder of any Note by its acceptance thereof shall be
deemed to have agreed) that any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this Indenture, or in any suit
against the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Indenture Trustee, to any suit instituted by any Noteholder, or group of
Noteholders, holding in the aggregate more than 10% of the then outstanding
principal balance of the Notes, or to any suit instituted by any Noteholder for
the enforcement of the payment of the principal of or interest on any Note on or
after the maturities for such payments, including the stated maturity as
applicable.

                  Section 7.17 Representations and Warranties of Indenture
Trustee. The Indenture Trustee represents and warrants for the benefit of the
Noteholders that:

                  (a) Organization and Good Standing. The Indenture Trustee is a
banking corporation duly organized, validly existing and in good standing under
the laws of the state of New York.

                  (b) Authorization. The Indenture Trustee has the power,
authority and legal right to execute, deliver and perform this Indenture, and
the execution, delivery and performance of this Indenture have been duly
authorized by the Indenture Trustee by all necessary corporate action.

                  (c) Binding Obligations. This Indenture, assuming due
authorization, execution and delivery by all other parties thereto, constitutes
the legal, valid and binding obligation of the Indenture Trustee, enforceable
against the Indenture Trustee in accordance with its terms, except that (i) such
enforcement may be subject to bankruptcy, insolvency, reorganization, moratorium
or other similar laws (whether statutory, regulatory or decisional) now or
hereafter in effect relating to creditors' rights generally and the rights of
trust companies in particular and (ii) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to certain
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought, whether in a proceeding at law or in equity.

                  Section 7.18 Tax Returns. In the event the Trust shall be
required to file tax returns, the Servicer shall prepare or shall cause to be
prepared any tax returns required to be filed by the Trust and shall remit such
returns to the Owner Trustee for signature at least five days before such
returns are due to be filed. The Indenture Trustee, upon request, will furnish
the Servicer with all such information known to the Indenture Trustee as may be
reasonably required in connection with the preparation of all tax returns of the
Trust. In no event shall the Indenture Trustee or the Owner Trustee in their
respective individual capacities be liable for any liabilities, costs or
expenses of the Trust, the Noteholders or the Servicer arising under any tax law
or regulation, including, without limitation, federal, state or local income or
excise taxes or any other tax imposed on or measured by income (or any interest
or penalty with respect thereto or arising from any failure to comply
therewith).

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<PAGE>   46

                                 ARTICLE VIII.

                           EVENTS OF DEFAULT; REMEDIES

                  Section 8.01 Events of Default. "Event of Default" wherever
used herein means any one of the following events (whatever the reason for such
Event of Default and without regard to whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):

                  (a) failure to distribute or cause to be distributed to the
Indenture Trustee, for the benefit of the Noteholders, all or part of any
payment of interest required to be made under the terms of such Notes or this
Indenture on each monthly Payment Date when such amount is due and payable;

                  (b) failure to distribute or cause to be distributed to the
Indenture Trustee, for the benefit of the Noteholders (x) on any Payment Date,
an amount equal to the principal due on the Outstanding Notes as of such Payment
Date to the extent that sufficient Available Funds are on deposit in the
Collection Account or (y) on the Class A-1 Maturity Date, the Class A-2 Maturity
Date, the Class A-3 Maturity Date, the Class A-4 Maturity Date, the Class B
Maturity Date, the Class C Maturity Date, the Class D Maturity Date or the Class
E Maturity Date, as the case may be, any remaining principal owed on the
Outstanding Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4 Notes,
Class B Notes, Class C Notes, Class D Notes or Class E Notes, as the case may
be;

                  (c) any failure on the part of the Trust duly to observe or
perform in any material respect any other covenants or agreements of the Trust
set forth in the Notes, in this Agreement or in any of the Transaction
Documents, as the case may be, or any breach of a representation or warranty of
the Trust set forth in the Transaction Documents, which failure or breach (A)
materially and adversely affects the rights of the Indenture Trustee or the
Noteholders and (B) continues unremedied for a period of 30 days after the
earlier to occur of (x) the date on which written notice of such failure or
breach, requiring the situation giving rise to such failure or breach to be
remedied, shall have been given to an Authorized Officer by the Indenture
Trustee or to an Authorized Officer or a Responsible Officer of the Indenture
Trustee by the Servicer or any Noteholders or (y) the date on which any
Authorized Officer is required pursuant to the terms of the Transaction
Documents to provide notice to the Noteholders of any such failure or breach;

                  (d) the Trust shall consent to the appointment of a custodian,
receiver, trustee or liquidator (or other similar official) of itself, or of a
substantial part of its property, or shall admit in writing its inability to pay
its debts generally as they come due, a court of competent jurisdiction shall
determine that the Trust is generally not paying its debts as they come due or
the Trust shall make a general assignment for the benefit of creditors;

                  (e) the Trust shall file a voluntary petition in bankruptcy or
a voluntary petition or an answer seeking reorganization in a proceeding under
any bankruptcy laws (as now or hereafter in effect) or an answer admitting the
material allegation of a petition filed against the

                                       40
<PAGE>   47

Trust in any such proceeding, or the Trust shall, by voluntary petition, answer
or consent, seek relief under the provisions of any now existing or future
bankruptcy or other similar law providing for the reorganization or winding up
of debtors, or providing for an agreement, composition, extension or adjustment
with its creditors; or

                  (f) a petition against the Trust in a proceeding under
applicable bankruptcy laws or other insolvency laws, as now or hereafter in
effect, shall be filed and shall be consented to by the Trust or shall not be
stayed, withdrawn or dismissed within 60 days thereafter, or if, under the
provisions of any law providing for reorganization or winding-up of debtors
which may apply to the Trust, any court of competent jurisdiction shall assume
jurisdiction, custody or control of the Trust, or any substantial part of its
property, and such jurisdiction, custody or control shall remain in force
unrelinquished, unstayed or unterminated for a period of 60 days.

                  Section 8.02 Acceleration of Maturity, Rescission and
Annulment. (a) If an Event of Default occurs and is continuing, then and in
every such case the Indenture Trustee, at the written direction of the Majority
Holders, shall declare the principal of all of the Notes to be immediately due
and payable, by a notice in writing to the Servicer, and upon any such
declaration such principal (together with all accrued and previously unpaid
interest) shall become immediately due and payable. The Indenture Trustee shall
give notice to each Noteholder and the Rating Agencies of such declaration.(b)
At any time, after such a declaration of acceleration has been made, but before
any sale of the Pledged Property has been made or a judgment or decree for
payment of the money due has been obtained by the Indenture Trustee as
hereinafter in this Article VIII provided, the Majority Holders, by written
notice to the Servicer and the Indenture Trustee, may rescind and annul such
declaration and its consequence if monies have been paid or deposited with the
Indenture Trustee in a sum sufficient to pay:

                           (i) all overdue installments of interest on all
         Notes;

                           (ii) the principal of any of the Notes which has
         become due otherwise than by such declaration of acceleration and
         interest thereon at the applicable Note Rate;

                           (iii) to the extent that payment of such interest is
         lawful, interest upon overdue installments of interest on the Notes at
         the rate specified therefor in the applicable Notes; and

                           (iv) all sums paid or advanced, together with
         interest thereon, by the Indenture Trustee hereunder and the reasonable
         compensation, expenses, disbursements and advances of the Indenture
         Trustee and its agents and counsel.

No such rescission shall affect any subsequent default or impair any right
consequent thereon.

Subsequent to any such declaration of acceleration and so long as such
declaration and its consequences have not been rescinded and annulled, prior to
the exercise by the Indenture Trustee of the remedies set forth in Section
8.03(b) or (c) hereof, the Indenture Trustee shall give the Noteholders ten days
notice of its intention to take such actions.

                                       41
<PAGE>   48

                  Section 8.03 Remedies. (a) If an Event of Default shall have
occurred and be continuing, the Indenture Trustee, at the written direction of
the Majority Holders, may do one or more of the following:

                  (b) institute, in its own name and as Indenture Trustee,
Proceedings for the collection of the entire amount of principal and interest
remaining unpaid on the Notes, or under this Indenture in respect of the Notes,
whether by declaration or otherwise, enforce any judgment obtained, and collect
from the Pledged Property securing the Notes the monies adjudged due;

                  (c) sell the Pledged Property or any portion thereof or rights
or interest therein, at one or more sales called and conducted in any manner
permitted by law;

                  (d) institute Proceedings from time to time for the complete
or partial foreclosure of this Indenture with respect to the Pledged Property
securing the Notes; or

                  (e) exercise any remedies of a secured party under the UCC or
other applicable law and take any other appropriate action to protect and
enforce the rights and remedies of the Indenture Trustee or the Noteholders
hereunder.

                  Section 8.04 Notice of Event of Default. Within two Business
Days after a Responsible Officer obtains actual knowledge of the occurrence of
any Event of Default, the Indenture Trustee shall transmit, by certified mail
return receipt requested, hand delivery or overnight courier, to all Noteholders
and the Rating Agencies, as their names and addresses appear in the Register,
notice of such Event of Default, unless such Event of Default shall have been
cured or waived.

                  Section 8.05 Exercise of Power by Indenture Trustee. In case
an Event of Default has occurred and is continuing to the actual knowledge of a
Responsible Officer of the Indenture Trustee, the Indenture Trustee shall
exercise such of the rights and powers vested in it by this Indenture, and 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 his own affairs.

                  Section 8.06 Indenture Trustee May File Proofs of Claim. In
case of the pendency of any receivership, insolvency, liquidation,
reorganization, arrangement, adjustment, composition or other judicial
Proceeding, relating to the Trust or any other obligor upon the Notes or the
property of the Trust or of such other obligor or their creditors, the Indenture
Trustee (irrespective of whether the principal of any class of Notes shall then
be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Indenture Trustee shall have made any demand for the
payment of overdue principal or interest) shall be entitled and empowered, to
intervene in such proceeding or otherwise:

                  (a) to file and prove a claim for all amounts owing and unpaid
in respect of the Notes and to file such other papers or documents and take such
other action including participating as a member, voting or otherwise, in any
committee of creditors appointed in the matter, as may be necessary or advisable
in order to have the claims of the Indenture Trustee (including, in each case,
any claim for the reasonable compensation, expenses, disbursements and advances
of the Indenture Trustee and its agents and counsel) and the Noteholders allowed
in such judicial Proceeding;

                                       42
<PAGE>   49

                  (b) to petition for lifting of the automatic stay and
thereupon to foreclose upon the Pledged Property as elsewhere provided herein;
and

                  (c) to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same;

and any receiver, assignee, trustee, liquidator, or sequestrator (or other
similar official) in any such judicial Proceeding is hereby authorized by each
Noteholder to make such payments to the Indenture Trustee, and in the event that
the Indenture Trustee shall consent to the making of such payments directly to
the Noteholders, to pay to the Indenture Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Indenture
Trustee, its agents and counsel.

Nothing herein contained shall be deemed to authorize the Indenture Trustee to
authorize or to consent or accept or adopt on behalf of any Noteholder any plan
of reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Indenture Trustee to vote
in respect of the claim of any Noteholder in any such Proceeding.

                  Section 8.07 Allocation of Money Collected. Any money
collected by the Indenture Trustee with respect to the Notes pursuant to the
remedies set forth in Section 8.03 (and any funds then held or thereafter
received by the Indenture Trustee) shall be applied in the following order, at
the date or dates fixed by the Indenture Trustee; provided, however, that the
provisions of this Section 8.07 shall not preclude the Indenture Trustee from
receiving indemnities satisfactory to it from the Noteholders against the costs,
expenses and liabilities it may incur in acting in compliance with the written
directions of any Noteholder or Noteholders:

                                    FIRST: To the payment of all amounts due the
Indenture Trustee under Section 7.07 hereof and any amounts then owing to the
Owner Trustee in respect of Owner Trustee fees and expenses;

                                    SECOND: To the payment of Class A-1 Note
Interest to the Class A-1 Noteholders, Class A-2 Note Interest to the Class A-2
Noteholders, Class A-3 Note Interest to the Class A-3 Noteholders and Class A-4
Note Interest to the Class A-4 Noteholders, pari passu;

                                    THIRD: To the payment of the Class B Note
Interest to the Class B Noteholders;

                                    FOURTH: To the payment of Class C Note
Interest to the Class C Noteholders;

                                    FIFTH: To the payment of Class D Note
Interest to the Class D Noteholders;

                                    SIXTH: To the payment of the outstanding
Class A Note Principal Balance to the Class A Noteholders, pari passu;

                                       43
<PAGE>   50

                                    SEVENTH: To the payment of the outstanding
Class B Note Principal Balance to the Class B Noteholders;

                                    EIGHTH: To the payment of the outstanding
Class C Note Principal Balance to the Class C Noteholders;

                                    NINTH: To the payment of the outstanding
Class D Note Principal Balance to the Class D Noteholders;

                                    TENTH: To the payment of Class E Note
Interest to the Class E Noteholders

                                    ELEVENTH: To the payment of the outstanding
Class E Note Principal Balance to the Class E Noteholders

                                    TWELFTH: To the payment of all reasonable
costs and expenses incurred by any Noteholder in connection with the enforcement
of its rights hereunder or under the Notes, ratably, without preference or
priority of any kind; and

                                    THIRTEENTH: To the payment of any surplus to
or at the written direction of the Trust Certificate Holder.

                  Section 8.08 Waiver of Events of Default. (a) The Holders of
66-2/3% of the then outstanding principal balance of the Notes may, by one or
more instruments in writing, waive any Event of Default hereunder and its
consequences, except a continuing Event of Default:

                           (i) in respect of the payment of the principal of or
         interest on any Note (which may only be waived by the Holder of such
         Note), or

                           (ii) in respect of a covenant or provision hereof
         which under Article XI cannot be modified or amended without the
         consent of the Holder of each Note outstanding affected (which only may
         be waived by the Holders of all Notes outstanding affected).

                  (b) A copy of each waiver pursuant to Section 8.08(a) shall be
furnished by SierraCities.com to the Indenture Trustee. Upon any such waiver,
such Event of Default shall cease to exist and shall be deemed to have been
cured, for every purpose of this Indenture; but no such waiver shall extend to
any subsequent or other Event of Default or impair any right consequent thereon.

                  Section 8.09 Limitation On Suits. No Holder shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:

                  (a) such Holder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;

                                       44
<PAGE>   51

                  (b) the Majority Holders shall have made written request to
the Indenture Trustee to institute Proceedings in respect of such Event of
Default in its own name as Indenture Trustee hereunder;

                  (c) such Holder or Holders have offered to the Indenture
Trustee indemnity reasonably satisfactory to it against the costs, expenses and
liabilities to be incurred in compliance with such request;

                  (d) the Indenture Trustee for 30 days after its receipt of
such notice, request and offer of indemnity has failed to institute any such
Proceeding; and

                  (e) no direction inconsistent with such written request has
been given to the Indenture Trustee during such 30 day period by the Majority
Holders;

it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided.

                  Section 8.10 Unconditional Right of Noteholders to Receive
Principal and Interest. Notwithstanding any other provision in this Indenture,
the Noteholders shall have the right, which is absolute and unconditional, to
receive payment of the principal of and interest on such Note as such principal
and interest becomes due and payable in accordance with the terms of this
Indenture (including, without limitation, the limitation on such payments to the
extent of Available Funds on each Payment Date) and to institute suit for the
enforcement of any such payment, and such right shall not be impaired without
the consent of such Noteholder.

                  Section 8.11 Restoration of Rights and Remedies. If the
Indenture Trustee or any Noteholder has instituted any Proceeding to enforce any
right or remedy in accordance with the terms of this Indenture and such
Proceeding has been discontinued or abandoned for any reason, or has been
determined adverse to the Indenture Trustee or to such Noteholder, then and in
every such case, the Indenture Trustee and the Noteholders shall, subject to any
determination in such Proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies
hereunder shall continue as though no such Proceeding has been instituted.

                  Section 8.12 Rights and Remedies Cumulative. No right or
remedy herein conferred upon or reserved to the Indenture Trustee or the
Noteholders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.

                  Section 8.13 Delay or Omission Not Waiver. No delay or
omission of the Indenture Trustee or any Noteholder to exercise any right or
remedy accruing upon any Event of Default shall impair any such right or remedy
or constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article or by law to the

                                       45
<PAGE>   52

Indenture Trustee or the Noteholders, or any of them, may be exercised from time
to time, as often as may be deemed expedient, by the Indenture Trustee or the
Noteholders.

                  Section 8.14 Control by Majority Holders. The Majority Holders
shall have the right to direct in writing the decision whether to conduct, and
the time, method and place of conducting, any Proceeding for any remedy
available to the Indenture Trustee with respect to the Notes or exercising any
trust or power conferred on the Indenture Trustee with respect to the Notes;
provided, that:

                  (a) such direction shall not be in conflict with any rule of
law or with this Indenture; and

                  (b) the Indenture Trustee may take any other action deemed
proper by the Indenture Trustee which is not inconsistent with such direction;
provided, however, that the Indenture Trustee need not take any action which it
determines might involve it in liability or be unjustly prejudicial to the
Holders not consenting.

                  Section 8.15 Sale of Pledged Property. (a) The power to effect
any sale pursuant to Section 8.03 hereof shall not be exhausted by any one or
more sales as to any portion of the Pledged Property remaining unsold, but shall
continue unimpaired until the entire Pledged Property securing the Notes shall
have been sold or all amounts payable under this Indenture with respect thereto
shall have been paid. The Indenture Trustee may from time to time postpone any
sale by public announcement made at the time and place of such sale.

                  (b) Any Noteholder may bid for and acquire any portion of the
Pledged Property securing the Notes in connection with any sale thereof.

                  (c) Each of the parties hereby covenants and agrees that a
sale of the entirety of the Contracts and the Equipment by a public sale held
not less than ten days after notice thereof is commercially reasonable.

                  (d) The Indenture Trustee shall execute and deliver an
appropriate instrument of conveyance, provided to it by the Servicer,
transferring its interest in any portion of the Pledged Property in connection
with a sale thereof. In addition, the Indenture Trustee is hereby irrevocably
appointed the agent and attorney-in-fact of the Trust to transfer and convey its
interest in any portion of the Pledged Property in connection with a sale
thereof, and to take all action necessary to effect such sale. No purchaser or
transferee at such a sale shall be bound to ascertain the Indenture Trustee's
authority, inquire into the satisfaction of any conditions precedent or see to
the application of any monies.

                  Section 8.16 Action on Notes. The Indenture Trustee's right to
seek and recover judgment on the Notes or under this Indenture shall not be
affected by the seeking, obtaining or application of any other relief under or
with respect to this Indenture. Neither the lien of this Indenture nor any
rights or remedies of the Indenture Trustee or the Noteholders shall be impaired
by the recovery of any judgment by the Indenture Trustee against the Trust or
the Depositor or by the levy of any execution under such judgment upon any
portion of the Pledged Property or upon any of the assets of the Trust or the
Depositor.

                                       46
<PAGE>   53

                                   ARTICLE IX.

                                   TERMINATION

                  Section 9.01 Termination of Obligations and Responsibilities.
The respective obligations and responsibilities of SierraCities.com, the
Servicer, the Indenture Trustee and the Trust created hereby shall terminate (i)
at the option of the Trust Certificate Holder, at any time which is 123 days
after the payment to Noteholders of all amounts required to be paid to them
pursuant to this Indenture, reducing the Class A Note Principal Balance, the
Class B Note Principal Balance, the Class C Note Principal Balance, the Class D
Note Balance and the Class E Note Principal Balance to zero or (ii) after the
120th day following the Class A-4 Maturity Date; provided that all amounts then
owing to the Indenture Trustee pursuant to the Transaction Documents have been
paid to such parties; and provided, however, 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 living on the date of this Indenture of Joseph
P. Kennedy, late Ambassador to the Court of St. James. Notwithstanding the
foregoing, the representations and warranties and indemnification obligations of
SierraCities.com and the Servicer hereunder and under the Servicing Agreement
shall survive the termination of the Trust and of this Indenture. Upon
termination of the Trust, the Indenture Trustee shall release any remaining
Pledged Property to the Trust Certificate Holder but not if the Class A Note
Principal Balance, the Class B Note Principal Balance, the Class C Note
Principal Balance, the Class D Note Principal Balance and the Class E Note
Principal Balance have not been reduced to zero or any amounts are owing to the
Indenture Trustee.

                  Section 9.02 Optional Redemption of Notes; Final Disposition
of Funds. (a) On any Payment Date following any Calculation Date on which the
Aggregate Discounted Contract Principal Balance is less than fifteen percent
(15%) of the Aggregate Discounted Contract Principal Balance as of the Closing
Date, the Trust Certificate Holder shall have the option to redeem the Notes by
depositing or causing to be deposited into the Collection Account the greater of
(x) the sum of (1) the Class A Note Principal Balance, the Class B Note
Principal Balance, the Class C Note Principal Balance, the Class D Note
Principal Balance and the Class E Note Principal Balance, as applicable and (2)
the Class A Note Interest, the Class B Note Interest, the Class C Note Interest,
the Class D Note Interest and the Class E Note Interest, as applicable and (y)
the Repurchase Amount for each Contract that was not a Defaulted Contract as of
the close of business on the second preceding Collection Period, by two Business
Days prior to such Payment Date; it being understood that in the event the
purchase price paid is equal to the amount in clause (y) above, any Defaulted
Contracts and any related recoveries shall remain property of the Trust. In the
event that the Trust Certificate Holder elects to redeem the Notes in accordance
with this Section 9.02(a), the Trust Certificate Holder shall be required to
notify the Indenture Trustee in writing by no later than two (2) Business Days
prior to a notice required to be sent by the Indenture Trustee pursuant to
Section 9.02(b).

                  (b) Notice of any termination pursuant to Section 9.02(a)
shall be given promptly by the Indenture Trustee, by letter to Noteholders
mailed not later than the 10th day of the month immediately preceding the month
of such final Payment Date specifying (i) the Payment Date upon which final
payment of the Notes will be made, (ii) the scheduled amount of any such final
payment, (iii) that interest shall cease to accrue on the Notes being redeemed
on such final

                                       47
<PAGE>   54

Payment Date and (iv) the address for presentation of the Notes for final
payment. On such final Payment Date, the Indenture Trustee shall cause to be
distributed the amounts otherwise distributable on such Payment Date pursuant to
Section 3.05 hereof, taking into account the purchase pursuant to Section
9.02(a). After such Payment Date, interest on the redeemed Notes shall cease to
accrue.

                  (c) The final payment on any Note shall only be made upon the
presentation of such Note to the Indenture Trustee at the office specified in
the notice described in Section 9.02(b) above.

                  (d) In the event that any amount due to any Noteholder remains
unclaimed, the Servicer shall, at its expense, cause to be published once, in
the eastern edition of The Wall Street Journal, notice that such money remains
unclaimed. If, within two years after such publication, such amount remains
unclaimed, the Servicer shall be entitled to all unclaimed funds and other
assets which remain subject hereto, and the Indenture Trustee upon written
direction from the Servicer shall transfer such funds and shall be discharged of
any responsibility for such funds and, the Noteholders shall look to the
Servicer for payment.

                                   ARTICLE X.

                         NOTEHOLDERS' LISTS AND REPORTS

                  Section 10.01 Note Registrar To Furnish To Indenture Trustee
Names and Addresses of Noteholders. The Note Registrar will furnish or cause to
be furnished to the Indenture Trustee (a) not more than five days after the
earlier of (i) each Record Date and (ii) three months after the last Record
Date, a list, in such form as the Indenture Trustee may reasonably require, of
the names and addresses of the Holders as of such Record Date, (b) at such other
times as the Indenture Trustee may request in writing, within 30 days after
receipt by the Issuer of any such request, a list of similar form and content as
of a date not more than 10 days prior to the time such list is furnished;
provided, however, that so long as the Indenture Trustee is the Note Registrar,
no such list shall be required to be furnished. The Indenture Trustee or, if the
Indenture Trustee is not the Note Registrar, the Note Registrar shall furnish to
the Trust in writing upon their written request and at such other times as the
Trust may request a copy of the list of Noteholders.

                  Section 10.02 Preservation of Information; Communications to
Noteholders. (a) The Indenture Trustee shall preserve, in as current a form as
is reasonably practicable, the names and addresses of the Noteholders contained
in the most recent list furnished to the Indenture Trustee and the names and
addresses of Noteholders received by the Indenture Trustee in its capacity as
Note Registrar.

                  (b) Noteholders may communicate pursuant to TIA Section 312(b)
with other Noteholders with respect to their rights under this Indenture or
under the Notes.

                  (c) The Issuer, the Indenture Trustee and the Note Registrar
shall have the protection of TIA Section 312(c).

                                       48
<PAGE>   55

                  Section 10.03 Reports by the Trust. (a) The Servicer, on
behalf of the Trust, shall:

                           (i) file with the Indenture Trustee, within 15 days
         after the Trust is required to file the same with the Commission,
         copies of the annual reports and copies of the information documents
         and other reports (or copies of such portions of any of the foregoing
         as the Commission may from time to time by rules and regulations
         prescribe) which the Trust may be required to file with the Commission
         pursuant to Section 13 or 15(d) of the Exchange Act;

                           (ii) file with the Indenture Trustee and the
         Commission in accordance with rules and regulations prescribed from
         time to time by the Commission such additional information, documents
         and reports with respect to compliance by the Issuer with the
         conditions and covenants of this Indenture as may be required from time
         to time by such rules and regulations;

                           (iii) supply to the Indenture Trustee (and the
         Indenture Trustee shall transmit by mail to all Noteholders described
         in TIA Section 313(c)) such summaries of any information, documents and
         reports required to be filed by the Trust pursuant to clauses (i) and
         (ii) of this Section 10.03(a) as may be required by rules and
         regulations prescribed from time to time by the Commission; and

                           (iv) supply to the Indenture Trustee a report that
         complies with TIA Section 314(a)(4), as set forth in Section 6.06
         hereof.

                  (b) Unless the Trust otherwise determines, the fiscal year of
the Trust shall end as of December 31 of each year for purposes of this section.

                  Section 10.04 Reports by Indenture Trustee. If required by TIA
Section 313(a), within 60 days after each August 31, beginning with August 31,
2000, the Indenture Trustee shall mail to each Noteholder as required by TIA
Section 313(c) a brief report dated as of such date that complies with TIA
Section 313(a). The Indenture Trustee also shall comply with TIA Section 313(b).

                  A copy of each report at the time of its mailing to
Noteholders shall be filed by the Indenture Trustee with the Commission and each
stock exchange, if any, on which the Notes are listed. The Trust shall notify
the Indenture Trustee if and when the Notes are listed on any stock exchange.

                  Section 10.05 Compliance Certificates and Opinions, etc. Upon
any application or request by the Trust to the Indenture Trustee to take any
action under any provision of this Indenture, the Trust shall furnish to the
Indenture Trustee (i) an Officer's Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with, (ii) an Opinion of Counsel stating that in the
opinion of such counsel all such conditions precedent, if any, have been
complied with and (iii) (if required by the TIA) an Independent Certificate from
a firm of certified public accountants meeting the applicable requirements of
this Section, except that, in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Indenture, no additional certificate or opinion need be furnished.

                                       49
<PAGE>   56

                  Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:

                           (i) a statement that each signatory of such
         certificate or opinion has read or has caused to be read such covenant
         or condition and the definitions herein relating thereto;

                           (ii) a brief statement as to the nature and scope of
         the examination or investigation upon which the statements or opinions
         contained in such certificate or opinion are based;

                           (iii) a statement that, in the opinion of each such
         signatory, such signatory has made such examination or investigation as
         is necessary to enable such signatory to express an informed opinion as
         to whether or not such covenant or condition has been complied with;
         and

                           (iv) a statement as to whether, in the opinion of
         each such signatory such condition or covenant has been complied with.

                                  ARTICLE XI.

                            MISCELLANEOUS PROVISIONS

                  Section 11.01 Amendment. (a) This Indenture may be amended
from time to time by the Trust, the Servicer, the Originator and the Indenture
Trustee, without the consent of any of the Noteholders, to cure any ambiguity
herein; provided, however, that such action shall not, as evidenced by an
Opinion of Counsel acceptable to the Indenture Trustee, adversely affect in any
respect the interests of any Noteholder.

                  (b) This Indenture may also be amended from time to time by
the Trust, the Servicer, the Originator and the Indenture Trustee with the
consent of the Majority Holders for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or
of modifying in any manner the rights of the Noteholders; provided, however,
that no such amendment shall (i) increase or reduce in any manner the amount of,
or accelerate or delay the timing of, collections of payments on Contracts or
distributions that are required to be made on any Note without the consent of
the Holder of such Note or (ii) reduce the aforesaid percentage required to
consent to any such amendment, without the consent of the Holders of all Notes
then outstanding.

                  (c) Prior to the effectiveness of any amendment under Section
11.01(a) or (b), the Rating Agencies shall have confirmed in writing their
respective ratings of the Notes.

                  (d) Promptly after the execution of any such amendment, the
Indenture Trustee shall furnish a written copy of the text of such amendment
(and any consent required with respect thereto) to each Noteholder and the
Rating Agencies.

                                       50
<PAGE>   57

                  (e) Approval of the particular form of any proposed amendment
or consent shall not be necessary for the consent of the Noteholders under
Section 11.01(b), 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 the Noteholders shall be subject to
such reasonable requirements as the Indenture Trustee may prescribe.

                  (f) The Indenture Trustee shall be entitled to receive an
Officer's Certificate and an Opinion of Counsel to the effect that all
conditions precedent to the amendment of this Indenture have been satisfied. The
Indenture Trustee may, but shall not be obligated to, execute and deliver any
such amendment which affects that Indenture Trustee's rights, powers, immunities
or indemnifications hereunder.

                  Section 11.02 Conformity With Trust Indenture Act. Every
amendment of this Indenture and every supplemental indenture executed pursuant
to this Article XI shall conform to the requirements of the Trust Indenture Act
as then in effect so long as this Indenture shall then be qualified under the
TIA.

                  Section 11.03 Limitation on Rights of Noteholders. (a) The
death or incapacity of any Noteholder shall not operate to terminate this
Indenture or the Trust, nor entitle such Noteholder's legal representatives or
heirs to claim an accounting or to take any action or commence any 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) It is understood and intended, and expressly covenanted by
each Noteholder with every other Noteholder and the Indenture Trustee, that no
one or more Holders of Notes shall have any right in any manner whatever by
virtue or by availing itself or themselves of any provisions of this Indenture
to affect, disturb or prejudice the rights of the Holders of any other of the
Notes, to obtain or seek to obtain priority over or preference to any other
Holder of the same class of Notes or to enforce any right under this Indenture,
except in the manner herein provided and for the equal, ratable and common
benefit of all Noteholders of the same class. For the protection and enforcement
of the provisions of this Section 11.03, each and every Noteholder and the
Indenture Trustee shall be entitled to such relief as can be given either at law
or in equity.

                  Section 11.04 Counterparts. For the purpose of facilitating
the execution of this Indenture and for other purposes, this Indenture may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.

                  Section 11.05 Governing Law. THIS INDENTURE 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 THE CONFLICT OF LAWS PROVISIONS OF
ANY STATE.

                                       51
<PAGE>   58

                  Section 11.06 Notices. All demands, notices, instructions,
directions and communications (other than periodic communications of a routine
nature made in connection with the dissemination of information regarding the
Pledged Property, the Servicer and the Trust required to be delivered hereunder,
which shall be delivered or mailed by first class mail or facsimile
transmission) hereunder shall be in writing, personally delivered or mailed by
overnight courier, and shall be deemed to have been duly given upon receipt (a)
in the case of the Servicer, at 600 Travis Street, Suite 7050, Houston, Texas
77002, Attention: Sandy Ho, telephone (713) 221-8822, telecopy (713) 221-1818,
(b) in the case of the Trust, c/o First Union Trust Company, National
Association at One Rodney Square, 920 King Street, Suite 102, Wilmington,
Delaware 19801, Attention: Corporate Trust Administration, telephone (302)
888-7539, telecopy (302) 888-7544, (c) in the case of the Indenture Trustee, at
Four Albany Street, 10th Floor, New York, New York 10006, Attention: Corporate
Trust and Agency Group Structured Finance Team, telephone 212-250-4237, telecopy
212-250-6439, (d) in the case of S&P, at 55 Water Street, 41st Floor, New York,
NY 10041, Attention: Asset Backed Surveillance, telephone (212) 438-2435,
telecopy (212) 438-2664, (e) in the case of Fitch, 55 East Monroe, Suite 3500,
Chicago, Illinois 60603, Attention: Asset Backed Monitoring Group-Equipment
Leases, telephone (312) 368-3100, telecopy (312) 368-2069, and (g) any notice so
mailed within the time prescribed in this Indenture shall be conclusively
presumed to have been duly given on the fifth Business Day following mailing,
whether or not the Noteholder receives such notice.

                  Section 11.07 Severability of Provisions. If any one or more
of the covenants, agreements, provisions, or terms of this Indenture 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 Indenture and shall in no way affect the
validity or enforceability of the other provisions of this Indenture or of the
Notes or the rights of the Holders thereof.

                  Section 11.08 Conflict with Trust Indenture Act. If any
provision hereof limits, qualifies or conflicts with another provision hereof
that is required to be included in this indenture by any of the provisions of
the Trust Indenture Act, such required provision shall control.

                  The provisions of TIA Section Section 310 through 317 that
impose duties on any person (including the provisions automatically deemed
included herein unless expressly excluded by this Indenture) are a part of and
govern this Indenture, whether or not physically contained herein.

                  Section 11.09 Reserved.

                  Section 11.10 Assignment. Notwithstanding anything to the
contrary contained herein, except as provided in Section 5.02 of the Servicing
Agreement, this Indenture may not be assigned by the Servicer except with the
prior written consent of the Trust and the Holders of the Notes of the
applicable Class evidencing Percentage Interests of not less than 66-2/3%.
Notice of any such assignment received by a Responsible Officer of the Indenture
Trustee shall be given to the Rating Agencies by the Indenture Trustee.

                  Section 11.11 Binding Effect. This Indenture shall inure to
the benefit of, and shall be binding upon the Servicer, the Trust, the Indenture
Trustee and the Noteholders and their

                                       52
<PAGE>   59

respective successors and permitted assigns, subject, however, to the
limitations contained in this Indenture. This Indenture shall not inure to the
benefit of any Person other than the Trust, the Servicer, the Indenture Trustee
and the Noteholders.

                  Section 11.12 Survival of Agreement. All covenants,
agreements, representations and warranties made herein and in the other
documents delivered pursuant hereto shall survive the pledge of the Pledged
Property and the issuance of the Notes and shall continue in full force and
effect until terminated pursuant to Section 9.01 hereof.

                  Section 11.13 Captions. The captions or headings in this
Indenture are for convenience only and in no way define, limit or describe the
scope or intent of any provisions or sections of this Indenture.

                  Section 11.14 Exhibits. The Exhibits to this Indenture are
hereby incorporated herein and made a part hereof and are an integral part of
this Indenture.

                  Section 11.15 Calculations. Except as otherwise provided in
this Indenture, including, without limitation, with respect to the calculation
of interest on the Class A-1 Notes, all interest rate calculations under this
Indenture, including those with respect to the Contracts, will be made on the
basis of a 360-day year and twelve 30-day months (i.e., each Interest Accrual
Period shall be deemed to be equal 30 day periods) and will be carried out to at
least seven decimal places.

                  Section 11.16 No Proceedings. The Servicer, the Originator,
the Trust and the Indenture Trustee each hereby agrees that it will not directly
or indirectly institute, or cause to be instituted, against the Trust
Certificate Holder or the Trust any bankruptcy or insolvency proceeding so long
as there shall not have elapsed one year plus one day since the maturity date of
the latest maturing securities of the Trust.

                                       53
<PAGE>   60

                  IN WITNESS WHEREOF, the Trust, the Servicer, the Originator
and the Indenture Trustee have caused this Indenture to be duly executed by
their respective officers, all as of the day and year first above written.

                                  FIRSTSIERRA EQUIPMENT CONTRACT
                                     TRUST 2000-2, a common law trust acting
                                     through its trustee, FIRST UNION TRUST
                                     COMPANY, NATIONAL ASSOCIATION, not in its
                                     individual capacity but solely as owner
                                     trustee, as Issuer

                                  By /s/ Sterling C. Correia
                                    ------------------------
                                     Name:  Sterling C. Correia
                                     Title: Vice President

                                  SIERRACITIES.COM INC., as Servicer and as
                                     Originator

                                  By /s/ E. Roger Gebhart
                                    ------------------------
                                     Name:  E. Roger Gebhart
                                     Title: Executive Vice President

                                  BANKERS TRUST COMPANY, not in its individual
                                     capacity but solely as Indenture Trustee

                                  By /s/ Jenna Kaufman
                                    ------------------------
                                     Name:  Jenna Kaufman
                                     Title: Vice President

                          [Signature Page to Indenture]<PAGE>   1
                                                                    EXHIBIT 10.1

                                                               EXECUTION VERSION

                         RECEIVABLES TRANSFER AGREEMENT

                          ---------------------------

                                      AMONG

                              SIERRACITIES.COM INC.

                       FIRST SIERRA RECEIVABLES III, INC.,

                           FIRST UNION NATIONAL BANK,

                      VARIABLE FUNDING CAPITAL CORPORATION,

                  FIRST SIERRA EQUIPMENT CONTRACT TRUST 1999-H,

                          FAIRWAY FINANCE CORPORATION,

                              BANKERS TRUST COMPANY

                                       AND

           FIRST SIERRA EQUIPMENT CONTRACT TRUST 2000-2, A COMMON LAW
            TRUST ACTING THROUGH FIRST UNION TRUST COMPANY, NATIONAL
            ASSOCIATION, NOT IN ITS INDIVIDUAL CAPACITY BUT SOLELY AS
                                  OWNER TRUSTEE

                          ---------------------------

                                   DATED AS OF

                                  JUNE 1, 2000

<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                 PAGE
                                                                                                 ----
<S>                <C>                                                                           <C>
ARTICLE I DEFINITIONS.............................................................................3

   SECTION 1.01    Definitions....................................................................3
   SECTION 1.02    Other Definitional Provisions..................................................3

ARTICLE II TRANSFER OF CONVEYED ASSETS............................................................4

   SECTION 2.01    Direction; Acquisition of Initial Conveyed Assets..............................4
   SECTION 2.02    Reserved.......................................................................6
   SECTION 2.03    Custody of Contract Files......................................................6
   SECTION 2.04    Intention of the Parties; Grant of Security Interest...........................6

ARTICLE III REPRESENTATIONS AND WARRANTIES........................................................6

   SECTION 3.01    Representations and Warranties.................................................6
   SECTION 3.02    Removal of Non-Conforming Contracts by SierraCities.com.......................18
   SECTION 3.03    Substitution of Contracts and Equipment by SierraCities.com...................18

ARTICLE IV COVENANTS.............................................................................19

   SECTION 4.01    Seller and SierraCities.com Covenants.........................................19
   SECTION 4.02    Receivables III Covenants.....................................................22
   SECTION 4.03    Transfer of Conveyed Assets...................................................25

ARTICLE V CONDITIONS PRECEDENT...................................................................25

   SECTION 5.01    Conditions to Trust Obligations...............................................25

ARTICLE VI TERMINATION...........................................................................26

   SECTION 6.01    Termination...................................................................26
   SECTION 6.02    Effect of Termination.........................................................26

ARTICLE VII MISCELLANEOUS PROVISIONS.............................................................27

   SECTION 7.01    Amendment.....................................................................27
   SECTION 7.02    GOVERNING LAW.................................................................27
   SECTION 7.03    Notices.......................................................................27
   SECTION 7.04    Severability of Provisions....................................................28
   SECTION 7.05    Assignment....................................................................28
   SECTION 7.06    Further Assurances............................................................28
   SECTION 7.07    No Waiver; Cumulative Remedies................................................28
   SECTION 7.08    Counterparts..................................................................28
   SECTION 7.09    Binding Effect: Third-Party Beneficiaries.....................................28
   SECTION 7.10    Merger and Integration........................................................28
   SECTION 7.11    Headings......................................................................29
   SECTION 7.12    Schedules and Exhibits........................................................29
   SECTION 7.13    No Bankruptcy Petition Against Receivables III or the Trust...................29
</TABLE>

<PAGE>   3

                          Exhibits, Schedules & Annexes

Schedule 1        LIST OF INITIAL CONTRACTS
Annex A           DEFINED TERMS
<PAGE>   4

                         RECEIVABLES TRANSFER AGREEMENT

               THIS RECEIVABLES TRANSFER AGREEMENT (this "Agreement"), dated as
of June 1, 2000, is entered into among SIERRACITIES.COM INC., formerly First
Sierra Financial Inc. ("SierraCities.com"), a Delaware corporation located at
600 Travis Street, Suite 7050, Houston, Texas 77002, in its individual capacity,
FIRST SIERRA RECEIVABLES III, INC. ("Receivables III"), a Delaware corporation
located at 600 Travis Street, Suite 7050, Houston, Texas 77002, FIRST UNION
NATIONAL BANK (formerly First Union National Bank of North Carolina) ("First
Union"), a Delaware corporation located at One First Union Center, 301 South
College Street, Charlotte, North Carolina 28288, VARIABLE FUNDING CAPITAL
CORPORATION ("VFCC"), a Delaware corporation located at One First Union Center,
301 South College Street, Charlotte, North Carolina 28288 0610, FAIRWAY FINANCE
CORPORATION ("FFC"), a Delaware corporation located at 11 West Monroe, Floor 20
East, Chicago, Illinois 60603, BANKERS TRUST COMPANY (the "Indenture Trustee") a
New York banking corporation located at Four Albany Street, New York, New York
10006, not in its individual capacity but as Trustee of the First Sierra
Equipment Lease Trust 1997-A, the First Sierra Equipment Lease Trust 1997-B and
the First Sierra Equipment Lease Trust 1998-E (each as defined herein), FIRST
SIERRA EQUIPMENT CONTRACT TRUST 1999-H, a Delaware business trust (the "Series
1999-H Trust"), located at Christiana Bank & Trust Company, Greenville Center,
3801 Kennett Pike, Greenville, Delaware 19807 and FIRST SIERRA EQUIPMENT
CONTRACT TRUST 2000-2 (the "Issuer" or the "Trust"), a Delaware common law trust
acting through First Union Trust Company, National Association, not in its
individual capacity but solely as Owner Trustee, located at One Rodney Square,
920 King Street, Suite 102, Wilmington, Delaware 19801. The First Sierra
Equipment Lease Trust 1997-A, the First Sierra Equipment Lease Trust 1997-B, the
First Sierra Equipment Lease Trust 1998-E and the First Sierra Equipment
Contract Trust 1999-H are collectively referred to herein as the "Warehouse
Trusts." Receivables III and each Warehouse Trust are collectively referred to
herein as the "Sellers." First Union, VFCC and FCC are collectively referred to
herein as the "Investors."

                                   WITNESSETH:

               WHEREAS, SierraCities.com in the ordinary course of its business
acquires and originates equipment contracts and commercial loans in the United
States; and

               WHEREAS, Receivables III, SierraCities.com and Bankers Trust
Company have entered into an Amended and Restated Master Investment Pooling and
Servicing Agreement, dated as of March 25, 1998 (the "Investment Agreement"),
whereby Receivables III may, from time to time, sell pools of contracts,
contract receivables, equipment and certain rights related thereto and arising
therefrom ("Assets") to one or more trusts to be formed pursuant to the
Investment Agreement and a supplement thereto; and

<PAGE>   5

               WHEREAS, pursuant to the Investment Agreement, the parties
thereto may, from time to time, execute a supplement to the Investment Agreement
and form a trust for the purpose of (i) accepting the transfer of a specific
pool of Assets from Receivables III, (ii) issuing one or more senior
certificates ("Senior Certificates"), junior certificates ("Junior
Certificates") and residual certificates ("Residual Certificates" and, together
with the Senior Certificates, the "Certificates") representing beneficial
ownership interests in the assets of each trust and (iii) selling the Senior
Certificates to investors; and

               WHEREAS, pursuant to a Series 1997-A Supplement, dated as of June
30, 1997, as amended (the "Series 1997-A Supplement"), among Receivables III,
SierraCities.com, Bankers Trust Company and First Union, the parties thereto
formed a trust (the "First Sierra Equipment Lease Trust 1997-A"), issued a
Senior Certificate to First Union representing the senior beneficial ownership
interest in the Assets conveyed by Receivables III to the First Sierra Equipment
Lease Trust 1997-A (the "1997-A Assets") and issued a Residual Certificate to
Receivables III representing the residual beneficial ownership interest in the
1997-A Assets conveyed to the First Sierra Equipment Lease Trust 1997-A; and

               WHEREAS, First Union and Receivables III, as the beneficial
owners of the 1997-A Assets in the First Sierra Equipment Lease Trust 1997-A,
have directed that Bankers Trust Company, as the Trustee of such trust, convey
the 1997-A Assets to the Trust; and

               WHEREAS, pursuant to a Series 1997-B Supplement, dated as of June
26, 1997, as amended (the "Series 1997-B Supplement"), among Receivables III,
SierraCities.com, Bankers Trust Company, VFCC and First Union, the parties
thereto formed a trust (the "First Sierra Equipment Lease Trust 1997-B", issued
a Senior Certificate to VFCC representing the senior beneficial ownership
interest in the Assets conveyed by Receivables III to the First Sierra Equipment
Lease Trust 1997-B (the "1997-B Assets") and issued a Residual Certificate to
Receivables III representing the residual beneficial ownership interest in the
1997-B Assets conveyed to the First Sierra Equipment Lease Trust 1997-B; and

               WHEREAS, VFCC and Receivables III, as the beneficial owners of
the 1997-B Assets in the First Sierra Equipment Lease Trust 1997-B, have
directed that Bankers Trust Company, as trustee of such trust, convey the 1997-B
Assets to the Trust; and

               WHEREAS, pursuant to a Series 1998-E Supplement, dated as of
December 21, 1998 (the "Series 1998-E Supplement"), among Receivables III,
SierraCities.com, Bankers Trust Company, FFC and Nesbitt Burns Securities, Inc.,
the parties thereto formed a trust (the "First Sierra Equipment Lease Trust
1998-E"), issued a Senior Certificate to FFC representing a senior beneficial
ownership interest in the Assets conveyed by Receivables III to the First Sierra
Equipment Lease Trust 1998-E and issued a junior certificate representing a
junior beneficial ownership interest in the Assets conveyed by Receivables III
to the First Sierra Equipment Lease Trust 1998-E (the

                                       2
<PAGE>   6

"1998-E Assets") and a Residual Certificate to Receivables III representing the
residual beneficial ownership interest in the 1998-E Assets conveyed to the
First Sierra Equipment Lease Trust 1998-E; and

               WHEREAS, FFC and Receivables III, as the beneficial owners of the
1998-E Assets in the First Sierra Equipment Lease Trust 1998-E, have directed
that Bankers Trust Company, as trustee of such trust, convey the 1998-E Assets
to the Trust; and

               WHEREAS, pursuant to a Facility Agreement, dated as of August 1,
1999 (the "Series 1999-H Facility Agreement"), among Receivables III,
SierraCities.com, the Series 1999-H Trust, Bankers Trust Company, issued a
secured note to Merrill Lynch Mortgage Capital Inc., secured by the Assets
conveyed by Receivables III to the Series 1999-H Trust (the "1999-H Assets") and
a trust certificate to Receivables III representing the beneficial ownership
interest in the Series 1999-H Trust and the 1999-H Assets; and

               WHEREAS, Receivables III, as the holder of the trust certificate
issued by the Series 1999-H Trust, desire to convey the 1999-H Assets to the
Trust; and

               WHEREAS, each of the Warehouse Trusts, on behalf of and at the
request of Receivables III, have agreed to, and Receivables III desires to
convey, transfer, contribute and assign all of its right, title and interest in
and to the 1997-A Assets, the 1997-B Assets, the 1998-E Assets and the 1999-H
Assets, as applicable, to the Owner Trustee, on behalf of the Trust, upon the
terms and conditions hereinafter set forth; and

               WHEREAS, each of the Sellers and the Trust agree that all
representations, warranties, covenants and agreements made by it herein shall be
for the benefit of the Noteholders, the Trust Certificateholder, the Owner
Trustee and Indenture Trustee.

               NOW, THEREFORE, in consideration of the mutual covenants
contained herein, and other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties hereto agree as follows:

                                   ARTICLE I

                                   DEFINITIONS

               SECTION 1.01 Definitions. Whenever used in this Agreement,
capitalized terms used and not defined herein shall have the meanings set forth
in Annex A to the Indenture.

               SECTION 1.02 Other Definitional Provisions.

               (a) Terms used in Related Documents. Each term defined in this
Agreement will have the meaning assigned to such term in this Agreement when
used in

                                       3
<PAGE>   7

any certificate or other document made or delivered pursuant to this Agreement,
unless such term is otherwise defined therein.

               (b) Accounting Terms. As used in this Agreement, accounting terms
which are not defined pursuant to Section 1.01 have the respective meanings
given to them under generally accepted accounting principles, as in effect on
the date of this Agreement. To the extent that the definitions of accounting
terms in this Agreement are inconsistent with the meanings of such terms under
generally accepted accounting principles, the definitions contained in this
Agreement will control.

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

               (d) Number and Gender. Each defined term used in this Agreement
has a comparable meaning when used in its plural or singular form. Each
gender-specific term used in this Agreement has a comparable meaning whether
used in a masculine, feminine or gender-neutral form.

               (e) Including. Whenever the term "including" (whether or not that
term is followed by the phrase "but not limited to" or "without limitation" or
words of similar effect) is used in this Agreement in connection with a listing
of items within a particular classification, that listing will be interpreted to
be illustrative only and will not be interpreted as a limitation on, or
exclusive listing of, the items within that classification.

                                   ARTICLE II

                           TRANSFER OF CONVEYED ASSETS

               SECTION 2.01 Direction; Acquisition of Initial Conveyed
         Assets.

               (a) (i) (i) In accordance with the terms of the Investment
    Agreement, each of the Investors, as the Senior Certificateholders of the
    related Warehouse Trust, and Receivables III, as the Junior
    Certificateholder and the Residual Certificateholder of the Warehouse
    Trusts, together representing all of the beneficial ownership interests in
    the Warehouse Trusts, hereby direct Bankers Trust Company to convey to the
    Trust those assets of each Warehouse Trust and Receivables III which
    comprise the Initial Conveyed Assets. Upon receipt of the consideration
    specified below, each of the Investors hereby release all of its right,
    title and interest in, to and under the Initial Conveyed Assets, such
    receipt being hereby acknowledged by execution of this Agreement by each
    Investor.

                                       4
<PAGE>   8

               (ii) Receivables III, as the Residual Certificateholder of the
    Warehouse Trusts, hereby requests the Warehouse Trusts to join in the
    conveyance of the Initial Conveyed Assets.

               (iii) Merrill Lynch Mortgage Capital, Inc., as lender to the
    Series 1999-H Trust, and Receivables III, as the holder of the trust
    certificate issued by the Series 1999-H Trust, hereby direct Christiana Bank
    & Trust Company, as owner trustee of the Series 1999-H Trust, to execute
    this Agreement on behalf of the Series 1999-H Trust, thereby conveying to
    the Trust those assets of the Series 1999-H Trust which comprise the Initial
    Conveyed Assets. Upon receipt of the consideration specified below, Merrill
    Lynch Mortgage Capital, Inc. hereby releases all of its right, title and
    interest in, to and under the Initial Conveyed Assets, such receipt being
    hereby acknowledged by execution of this Agreement by Merrill Lynch Mortgage
    Capital, Inc.

               (b) In consideration for (w) the issuance to Receivables III of
the trust certificate to be issued by the Holding Trust pursuant to the Holding
Trust Agreement, (x) the issuance to the Holding Trust of the trust certificate
to be issued by the Trust pursuant to the Trust Agreement, (y) the receipt of
$2,860,003.25 by First Sierra Equipment Lease Trust 1997-A, $88,705,957.06 by
First Sierra Equipment Lease Trust 1997-B, $72,717,183.35 by First Sierra
Equipment Lease Trust 1998-E and $36,143,116.26 by the Series 1999-H Trust on
behalf of Merrill Lynch Mortgage Capital, Inc. and (z) other good and valuable
consideration, each of the Sellers hereby sells, transfers, assigns, sets over
and conveys to the Trust all of its right, title and interest in, to and under
the Initial Conveyed Assets (with respect to each Seller individually, to the
extent of such Seller's interest in such Initial Conveyed Assets, whether now
existing or hereinafter arising, without recourse (except as may be set forth in
the Servicing Agreement)).

               (c) In connection with such sale and conveyance, each Seller
agrees to record and file, at the expense of the Servicer, financing statements
(and thereafter will file continuation statements with respect to such financing
statements) with respect to the related Initial Conveyed Assets contributed and
to be transferred to the Trust pursuant to this Agreement and the Substitute
Conveyed Assets, meeting the requirements of applicable state law and the Filing
Requirements in such manner and in such jurisdictions as are necessary to
perfect and to maintain the perfection of, the transfer, conveyance and
contribution of the related Initial Conveyed Assets and the related Substitute
Conveyed Assets (subject to the Filing Requirements with respect to the
Equipment) from each of the Sellers to the Trust and the transfer, assignment
and pledge of the Pledged Property from the Trust to the Indenture Trustee on
behalf of the Noteholders, pursuant to the Indenture, and to deliver an executed
copy of such financing statements or other evidence of such filings to the Trust
(and copies to the Indenture Trustee) on or prior to each Conveyance Date;
provided, however, that the Contract Files (including each original executed
Contract) will not be physically delivered to the Trust but instead will be
delivered to and held by the Indenture Trustee on behalf of the Trust.

                                       5
<PAGE>   9

               (d) In connection with such assignment and conveyance,
SierraCities.com shall, at its own expense, on or prior to the related
Conveyance Date, and with respect to Substitute Contracts, as soon as possible,
but in no event later than two (2) Business Days after the related Conveyance
Date (i) cause the Contract Management System to be marked with a specified code
(the "Contract Management Code") to show that the Initial Conveyed Assets or the
Substitute Conveyed Assets, as the case may be, have been assigned and
transferred to the Trust in accordance with this Agreement and pledged to the
Indenture Trustee on behalf of the Noteholders, pursuant to the Indenture and
(ii) prepare and hold in its capacity as Servicer, as agent of the Trust and the
Indenture Trustee the List of Initial Contracts on or prior to the Closing Date.
Pursuant to Section 3.03 hereof, SierraCities.com from time to time may convey
Substitute Contracts to the Trust at any time by delivering a List of Substitute
Contracts to the Trust on each Conveyance Date containing for each Substitute
Contract transferred on such Conveyance Date the information set forth in the
definition of List of Substitute Contracts.

               (e) The sale and conveyance of the Conveyed Assets will be
without recourse to the Sellers.

               SECTION 2.02 Reserved.

               SECTION 2.03 Custody of Contract Files. In connection with the
sale, assignment, transfer and conveyance of the Contracts to the Trust pursuant
to this Agreement, the Indenture Trustee will retain the Contract Files and any
related evidence of insurance and payments in accordance with the terms of the
Indenture.

               SECTION 2.04 Intention of the Parties; Grant of Security
Interest. It is the intention of the parties hereto that each transfer of the
Conveyed Assets to be made pursuant to the terms hereof shall constitute an
absolute assignment and a sale of such Contract by each Seller to the Trust and
not a loan. In the event, however, that a court of competent jurisdiction were
to hold that any such transfer constitutes a loan and not a sale, it is the
intention of the parties hereto that this Agreement is deemed to be a security
agreement and that each Seller shall be deemed to have granted to the Trust as
of the related Conveyance Date a first priority perfected security interest in
all of such Seller's right, title and interest in, to and under each Conveyed
Asset, and all income and proceeds thereof. Such grant is made to secure the
payment of all amounts payable under this Agreement.

                                  ARTICLE III

                         REPRESENTATIONS AND WARRANTIES

               SECTION 3.01 Representations and Warranties.

               (a) SierraCities.com hereby makes the following representations
and warranties for the benefit of the Owner Trustee, the Indenture Trustee, the
Noteholders and the Trust. Such representations and warranties are made as of
any Conveyance Date

                                       6
<PAGE>   10

with respect to Contracts transferred to the Trust on such date and shall
survive each assignment, transfer and conveyance by SierraCities.com of the
Conveyed Assets to the Trust and its successors and assigns.

               (i) Organization and Good Standing. SierraCities.com is a
         corporation duly organized, validly existing and in good standing,
         under the laws of the State of Delaware, with corporate power and
         authority to own its properties and to conduct its business as such
         properties are currently owned and such business is currently
         conducted, and had at all relevant times, and now has, power,
         authority, and legal right to acquire and own the Conveyed Assets;

               (ii) Due Qualification. SierraCities.com is qualified as a
         foreign corporation in any state where it is required to be so
         qualified to conduct its business, to enforce the Source Agreements to
         which it is a party, and to service the Contracts as required by the
         Servicing Agreement and has obtained all necessary licenses, consents
         and approvals as required under federal and state law, in each case,
         where the failure to be so qualified, licensed, consented to or
         approved could reasonably be expected materially and adversely to
         affect the ability of SierraCities.com to comply with the terms of this
         Agreement or any other Transaction Document to which it is a party;

               (iii) Legal Name. The legal name of SierraCities.com is as set
         forth on the signature line of this Agreement and, other than the
         change from First Sierra Financial, Inc. to SierraCities.com Inc.,
         SierraCities.com has not changed its name since its incorporation and
         since its incorporation, SierraCities.com did not use, nor does
         SierraCities.com now use, any trade names, fictitious names, assumed
         name of "doing business as" names;

               (iv) Power and Authority. SierraCities.com has the corporate
         power and authority to execute and deliver this Agreement, the Source
         Agreements to which it is a party and the Contracts and any other
         Transaction Document to which it is a party, and to carry out their
         respective terms; and the execution, delivery, and performance of this
         Agreement, the Source Agreements, the Contracts and any other
         Transaction Document to which it is a party has been duly authorized by
         SierraCities.com by all necessary corporate action;

               (v) Due Execution and Delivery. This Agreement and each of the
         other Transaction Documents to which it is a party have been duly
         executed and delivered on behalf of SierraCities.com;

               (vi) Valid Assignment; Binding Obligations. This Agreement and
         the other Transaction Documents to which SierraCities.com is a party,
         when duly executed and delivered, will constitute legal, valid, and
         binding obligations of SierraCities.com enforceable against
         SierraCities.com in accordance with their respective terms subject as
         to enforceability to applicable bankruptcy, reorganization, insolvency,
         moratorium or other laws affecting creditors' rights

                                       7
<PAGE>   11

         generally and to general principles of equity (regardless of whether
         enforcement is sought in a proceeding in equity or at law);

               (vii) Insolvency. SierraCities.com is not insolvent and will not
         be rendered insolvent by the transactions contemplated by this
         Agreement and has an adequate amount of capital to conduct its business
         in the ordinary course and to carry out its obligations hereunder and
         under each other Transaction Document to which it is a party;

               (viii) No Violation. The consummation of the transactions
         contemplated by and the fulfillment of the terms of this Agreement and
         each Transaction Document to which it is a party will not conflict
         with, result in any breach of any of the terms and provisions of, or
         constitute (with or without notice or lapse of time) a default under,
         the articles of incorporation or bylaws of SierraCities.com, or any
         material term of any indenture, agreement, mortgage, deed of trust, or
         other instrument to which SierraCities.com is a party or by which it is
         bound, or result in the creation or imposition of any Lien upon any of
         its properties pursuant to the terms of any such indenture, agreement,
         mortgage, deed of trust, or other instrument, other than this Agreement
         or each Transaction Document to which it is a party or violate any law
         or any order, injunction, writ, rule, or regulation applicable to
         SierraCities.com of any court or of any federal or state regulatory
         body, administrative agency, or other Governmental Authority having
         jurisdiction over SierraCities.com or any of its properties which would
         have a material adverse effect on the Conveyed Assets;

               (ix) Ability to Perform. No event has occurred which adversely
         affects SierraCities.com's operations or its ability to perform its
         obligations under the Transaction Documents to which it is a party;

               (x) No Proceedings. There are no Proceedings or investigations
         pending, or, to the knowledge of SierraCities.com, threatened, before
         any court, regulatory body, administrative agency, or other tribunal or
         Governmental Authority (A) asserting the invalidity of this Agreement
         or each other Transaction Document to which it is a party, (B) seeking
         to prevent the consummation of any of the transactions contemplated by
         this Agreement, or (C) seeking any determination or ruling that might
         (in the reasonable judgment of SierraCities.com) materially and
         adversely affect the performance by SierraCities.com of its obligations
         under, or the validity or enforceability of, this Agreement or each
         other Transaction Document to which it is a party;

               (xi) No Consent Required. SierraCities.com is not required to
         obtain the consent of any other Person, or any consent, license,
         approval or authorization or registration or declaration with, any
         governmental authority, bureau or agency in connection with the
         execution, delivery or performance of this Agreement and the other
         Transaction Documents to which it is a party, except for such as have
         been obtained, effected or made;

                                       8
<PAGE>   12

               (xii) Consolidated Return Taxable Income from the Equipment and
         the Related Contracts. The Depositor and SierraCities.com are members
         of an affiliated group within the meaning of Section 1504 of the Code
         which has filed, and will continue to file, a consolidated return for
         federal income tax purposes at all times until satisfaction in full of
         all obligations (i) of SierraCities.com hereunder and (ii) of
         SierraCities.com and the Depositor under the Transaction Documents or
         other documents relating to the financing contemplated hereby. The
         Depositor shall treat the Contracts as owned by it for federal, state
         and local income tax purposes, and the affiliated group of which the
         Depositor is a member within the meaning of Section 1504 of the Code
         shall treat the Contracts as owned by the Depositor and shall report
         and include the rental and other income from the Equipment and the
         Contracts in gross income;

               (xiii) Principal Place of Business. The principal place of
         business and chief executive office of SierraCities.com is located at
         600 Travis Street, Suite 7050, Houston, Texas 77002 and, there are now
         no, and during the past four months there have not been, any other
         locations where SierraCities.com is located (as that term is used in
         the UCC in the state of such location) except that, with respect to
         such changes occurring after the date of this Agreement, as shall have
         been specifically disclosed to the Servicer and the Indenture Trustee
         in writing;

               (xiv) Tax Returns. SierraCities.com has filed on a timely basis
         all tax returns (federal, state and local) required to be filed and has
         paid or made adequate provisions for the payment of all taxes,
         assessments and other governmental charges due from SierraCities.com;
         and

               (xv) Pensions. Each pension plan or profit sharing plan to which
         SierraCities.com is a party has been fully funded in accordance with
         the obligations of SierraCities.com set forth in such plan.

               (b) Receivables III, on its own behalf and as beneficial owner of
the trust certificate issued by the Series 1999-H Trust, hereby makes the
following representations and warranties for the benefit of the Indenture
Trustee, the Owner Trustee, the Noteholders and the Trust. Such representations
and warranties are made as of each Conveyance Date and shall survive each sale,
assignment, transfer and conveyance by the Sellers of the respective Conveyed
Assets to the Trust and its successors and assigns.

               (i) Organization and Good Standing. Receivables III is a
         corporation duly organized, validly existing and in good standing,
         under the laws of the State of Delaware, with corporate power and
         authority to own its properties and to conduct its business as such
         properties are currently owned and such business is currently
         conducted, and had at all relevant times, and now has, power,
         authority, and legal right to acquire and own the Conveyed Assets.
         Receivables III has no subsidiaries other than special purpose trusts
         created to finance the acquisition of Contracts and Equipment;

                                       9
<PAGE>   13

               (ii) Due Qualification. Receivables III is qualified as a foreign
         corporation in any state where it is required to be so qualified to
         conduct its business and has obtained all necessary licenses, consents
         and approvals as required under federal and state law, in each case,
         where the failure to be so qualified, licensed, consented to or
         approved could reasonably be expected materially and adversely to
         affect the ability of Receivables III to comply with the terms of this
         Agreement or any other Transaction Document to which it is a party;

               (iii) Legal Name. The legal name of Receivables III is as set
         forth in the signature line of this Agreement and Receivables III has
         not changed its name since its incorporation and since its
         incorporation, Receivables III did not use, nor does Receivables III
         now use, any trade names, fictitious names, assumed name of "doing
         business as" names;

               (iv) Power and Authority. Receivables III has the corporate power
         and authority to execute and deliver this Agreement and any other
         Transaction Document to which it is a party, and to carry out their
         respective terms; Receivables III has duly authorized the sale and
         assignment to the Owner Trustee, on behalf of the Trust, of all of its
         right, title and interest, if any, in the Conveyed Assets by all
         necessary corporate action; and the execution, delivery, and
         performance of this Agreement and any other Transaction Document to
         which it is a party has been duly authorized by Receivables III by all
         necessary corporate action;

               (v) Due Execution and Delivery. This Agreement has been duly
         executed and delivered on behalf of Receivables III;

               (vi) Valid Assignment; Binding Obligations. This Agreement
         constitutes a valid assignment, transfer and conveyance to the Owner
         Trustee, on behalf of the Trust, of all right, title, and interest of
         Receivables III in, to and under the Conveyed Assets, and the Conveyed
         Assets will be held by the Trust free and clear of any Lien of any
         Person claiming through or under Receivables III, except the lien on
         the Conveyed Assets in favor of the Indenture Trustee granted pursuant
         to the Indenture; and this Agreement, when duly executed and delivered,
         will constitute the legal, valid, and binding obligation of Receivables
         III enforceable against Receivables III in accordance with their
         respective terms subject as to enforceability to applicable bankruptcy,
         reorganization, insolvency, moratorium or other laws affecting
         creditors' rights generally and to general principles of equity
         (regardless of whether enforcement is sought in a proceeding in equity
         or at law);

               (vii) Insolvency. Receivables III is not insolvent and will not
         be rendered insolvent by the transactions contemplated by this
         Agreement and has an adequate amount of capital to conduct its business
         in the ordinary course and to carry out its obligations hereunder and
         under each other Transaction Document to which it is a party;

                                       10
<PAGE>   14

               (viii) No Violation. The consummation of the transactions
         contemplated by and the fulfillment of the terms of this Agreement and
         each Transaction Document to which it is a party will not conflict
         with, result in any breach of any of the terms and provisions of, or
         constitute (with or without notice or lapse of time) a default under,
         the articles of incorporation or bylaws of Receivables III, or any
         material term of any indenture, agreement, mortgage, deed of trust, or
         other instrument to which Receivables III is a party or by which it is
         bound, or result in the creation or imposition of any Lien upon any of
         its properties pursuant to the terms of any such indenture, agreement,
         mortgage, deed of trust, or other instrument, other than this Agreement
         and each Transaction Document to which it is a party, or violate any
         law or any order, injunction, writ, rule, or regulation applicable to
         Receivables III of any court or of any federal or state regulatory
         body, administrative agency, or other Governmental Authority having
         jurisdiction over Receivables III or any of its properties which would
         have a material adverse effect on the Conveyed Assets;

               (ix) No Proceedings. There are no proceedings or investigations
         pending, or, to the knowledge of Receivables III, threatened, before
         any court, regulatory body, administrative agency, or other tribunal or
         Governmental Authority (A) asserting the invalidity of this Agreement
         or any Transaction Document to which it is a party, (B) seeking to
         prevent the consummation of any of the transactions contemplated by
         this Agreement, or (C) seeking any determination or ruling that might
         (in the reasonable judgment of Receivables III) materially and
         adversely affect the performance by Receivables III of its obligations
         under, or the validity or enforceability of, this Agreement or any
         Transaction Document to which it is a party;

               (x) No Consent Required. Receivables III is not required to
         obtain the consent of any other Person, or any consent, license,
         approval or authorization or registration or declaration with, any
         governmental authority, bureau or agency in connection with the
         execution, delivery or performance of this Agreement and the
         Transaction Documents to which it is a party, except for such having
         been obtained, effected or made;

               (xi) Fair Consideration. The consideration received by
         Receivables III as set forth herein is fair consideration having value
         reasonably equivalent to or in excess of the value of the Conveyed
         Assets conveyed by it and the performance of Receivables III's
         obligation hereunder;

               (xii) Principal Place of Business. The principal place of
         business and chief executive office of Receivables III is located at
         600 Travis Street, Suite 7050, Houston, Texas 77002 and, there are now
         no, and during the past four months there have not been, any other
         locations where Receivables III is located (as that term is used in the
         UCC in the state of such location) except that, with respect to such
         changes occurring after the date of this Agreement, as shall have been
         specifically disclosed to the Servicer and the Indenture Trustee in
         writing. The principal place of business and chief executive office of
         each of the

                                       11
<PAGE>   15

         Warehouse Trusts (other than the Series 1999-H Trust) is located in
         care of Bankers Trust Company, Four Albany Street, New York, New York
         10006 and the principal place of business of the Series 1999-H Trust is
         located in care of Christiana Bank & Trust Company, 3801 Kennett Pike,
         Greenville, Delaware 19807 and, there are now no, and during the past
         four months there have not been, any other locations where each
         Warehouse Trust is located (as that term is used in the UCC in the
         state of such location).

               (xiii) Valid Business Reasons. Receivables III has valid business
         reasons for selling its interest in the Conveyed Assets rather than
         obtaining a loan with the Conveyed Assets as collateral;

               (xiv) Absence of Event. No event has occurred which adversely
         affects Receivables III's operations or its ability to perform its
         obligations under the Transaction Documents to which it is a party; and

               (xv) Non Consolidation. Receivables III is operated in such a
         manner that it will not be consolidated in the estate of
         SierraCities.com such that the separate existence of Receivables III
         and SierraCities.com would be disregarded in the event of a bankruptcy
         or insolvency of SierraCities.com.

               (c) First Union hereby makes the following representations and
warranties for the benefit of the Indenture Trustee, the Owner Trustee, the
Noteholders and the Trust. Such representations and warranties are made as of
each Conveyance Date and shall survive each sale, assignment, transfer and
conveyance by the Sellers of the respective Conveyed Assets to the Trust and its
successors and assigns:

               (i) Organization and Good Standing. First Union is a national
         bank duly organized, validly existing and in good standing, under the
         laws of the United States, with corporate power and authority to own
         its properties and to conduct its business as such properties are
         currently owned and such business is currently conducted, and had at
         all relevant times, and now has, power, authority, and legal right to
         acquire and own the Conveyed Assets;

               (ii) Due Qualification. First Union is qualified as a foreign
         corporation in any state where it is required to be so qualified to
         conduct its business and has obtained all necessary licenses, consents
         and approvals as required under federal and state law, in each case,
         where the failure to be so qualified, licensed, consented to or
         approved could reasonably be expected materially and adversely to
         affect the ability of First Union to comply with the terms of this
         Agreement or any other Transaction Document to which it is a party;

               (iii) Power and Authority. First Union has the corporate power
         and authority to execute and deliver this Agreement and each other
         Transaction Document to which it is a party, and to carry out their
         respective terms; and the execution, delivery, and performance of this
         Agreement and any other

                                       12
<PAGE>   16

         Transaction Document to which it is a party has been duly authorized by
         First Union by all necessary corporate action;

               (iv) Due Execution and Delivery. This Agreement has been duly
         executed and delivered on behalf of First Union;

               (v) Valid Assignment; Binding Obligations. This Agreement
         constitutes a valid contribution, assignment, transfer and conveyance
         to the Owner Trustee, on behalf of the Trust, of all right, title, and
         interest of First Union in, to and under the Conveyed Assets and the
         Conveyed Assets will be held by the Trust free and clear of any Lien of
         any Person claiming, through or under First Union, except the lien on
         the Conveyed Assets in favor of the Indenture Trustee granted pursuant
         to the Indenture; and this Agreement, when duly executed and delivered,
         will constitute legal, valid, and binding obligations of First Union
         enforceable against First Union in accordance with their respective
         terms subject as to enforceability to applicable bankruptcy,
         reorganization, insolvency, moratorium or other laws affecting
         creditors' rights generally and to general principles of equity
         (regardless of whether enforcement is sought in a proceeding in equity
         or at law);

               (vi) No Violation. The consummation of the transactions
         contemplated by and the fulfillment of the terms of this Agreement will
         not conflict with, result in any breach of any of the terms and
         provisions of, or constitute (with or without notice or lapse of time)
         a default under, the articles of incorporation or bylaws of First
         Union, or any material term of any indenture, agreement, mortgage, deed
         of trust, or other instrument to which First Union is a party or by
         which it is bound, or result in the creation or imposition of any Lien
         upon any of its properties pursuant to the terms of any such indenture,
         agreement, mortgage, deed of trust, or other instrument, other than
         this Agreement, or violate any law or any order, injunction, writ,
         rule, or regulation applicable to First Union of any court or of any
         federal or state regulatory body, administrative agency, or other
         Governmental Authority having jurisdiction over First Union or any of
         its properties which would have a material adverse effect on the
         Conveyed Assets;

               (vii) Valid Business Reasons. First Union has valid business
         reasons for selling its interest in the Conveyed Assets rather than
         obtaining a loan with the Conveyed Assets as collateral;

               (viii) Absence of Event. No event has occurred which adversely
         affects First Union's operations or its ability to perform its
         obligations under the Transaction Documents to which it is a party;

               (ix) Insolvency. First Union is not insolvent and will not be
         rendered insolvent by the transactions contemplated by this Agreement
         and has an adequate amount of capital to conduct its business in the
         ordinary course and to carry out its obligations hereunder and under
         each other Transaction Document to which it is a party;

                                       13
<PAGE>   17

               (x) No Proceedings. There are no proceedings or investigations
         pending, or, to the knowledge of First Union, threatened, before any
         court, regulatory body, administrative agency, or other tribunal or
         Governmental Authority (A) asserting the invalidity of this Agreement,
         (B) seeking to prevent the consummation of any of the transactions
         contemplated by this Agreement, or (C) seeking any determination or
         ruling that might (in the reasonable judgment of First Union)
         materially and adversely affect the performance by First Union of its
         obligations under, or the validity or enforceability of, this
         Agreement;

               (xi) No Consent Required. First Union is not required to obtain
         the consent of any other Person, or any consent, license, approval or
         authorization or registration or declaration with, any governmental
         authority, bureau or agency in connection with the execution, delivery
         or performance of this Agreement and the Transaction Documents to which
         it is a party, except for such having been obtained, effected or made;

               (xii) Fair Consideration. The consideration received by First
         Union as set forth herein is fair consideration having value reasonably
         equivalent to or in excess of the value of the Conveyed Assets conveyed
         by it and the performance of First Union's obligations hereunder; and

               (xiii) Accounting Treatment. First Union will treat the
         assignment of the Conveyed Assets to the Trust pursuant to Article II
         as a sale of the Conveyed Assets to the Trust for financial reporting
         and accounting purposes.

               (d) VFCC hereby makes the following representations and
warranties for the benefit of the Indenture Trustee, the Noteholders and the
Trust. Such representations and warranties are made as of each Conveyance Date
and shall survive each sale, assignment, transfer and conveyance by the Sellers
of the respective Conveyed Assets to the Trust and its successors and assigns:

               (i) Organization and Good Standing. VFCC is a corporation duly
         organized, validly existing and in good standing, under the laws of the
         State of Delaware, with corporate power and authority to own its
         properties and to conduct its business as such properties are currently
         owned and such business is currently conducted, and had at all relevant
         times, and now has, power, authority, and legal right to acquire and
         own the Conveyed Assets;

               (ii) Due Qualification. VFCC is qualified as a foreign
         corporation in any state where it is required to be so qualified to
         conduct its business and has obtained all necessary licenses, consents
         and approvals as required under federal and state law, in each case,
         where the failure to be so qualified, licensed, consented to or
         approved could reasonably be expected materially and adversely to
         affect the ability of VFCC to comply with the terms of this Agreement
         or any other Transaction Document to which it is a party;

                                       14
<PAGE>   18

               (iii) Power and Authority. VFCC has the corporate power and
         authority to execute and deliver this Agreement and each other
         Transaction Document to which it is a party, and to carry out their
         respective terms; and the execution, delivery, and performance of this
         Agreement and each other Transaction Document to which it is a party
         has been duly authorized by VFCC by all necessary corporate action;

               (iv) Due Execution and Delivery. This Agreement has been duly
         executed and delivered on behalf of VFCC;

               (v) Valid Assignment; Binding Obligations. This Agreement
         constitutes a valid sale, assignment, transfer and conveyance to the
         Owner Trustee, on behalf of the Trust, of all right, title, and
         interest of VFCC in, to and under the Conveyed Assets and the Conveyed
         Assets will be held by the Trust free and clear of any Lien of any
         Person claiming, through or under VFCC, except the lien on the Conveyed
         Assets in favor of the Indenture Trustee granted pursuant to the
         Indenture; and this Agreement, when duly executed and delivered, will
         constitute the legal, valid, and binding obligation of VFCC enforceable
         against VFCC in accordance with their respective terms subject as to
         enforceability to applicable bankruptcy, reorganization, insolvency,
         moratorium or other laws affecting creditors' rights generally and to
         general principles of equity (regardless of whether enforcement is
         sought in a proceeding in equity or at law);

               (vi) No Violation. The consummation of the transactions
         contemplated by and the fulfillment of the terms of this Agreement will
         not conflict with, result in any breach of any of the terms and
         provisions of, or constitute (with or without notice or lapse of time)
         a default under, the articles of incorporation or bylaws of VFCC, or
         any material term of any indenture, agreement, mortgage, deed of trust,
         or other instrument to which VFCC is a party or by which it is bound,
         or result in the creation or imposition of any Lien upon any of its
         properties pursuant to the terms of any such indenture, agreement,
         mortgage, deed of trust, or other instrument, other than this
         Agreement, or violate any law or any order, injunction, writ, rule, or
         regulation applicable to VFCC of any court or of any federal or state
         regulatory body, administrative agency, or other Governmental Authority
         having jurisdiction over VFCC or any of its properties which would have
         a material adverse effect on the Conveyed Assets;

               (vii) Valid Business Reasons. VFCC has valid business reasons for
         selling its interest in the Conveyed Assets rather than obtaining a
         loan with the Conveyed Assets as collateral;

               (viii) Absence of Event. No event has occurred which adversely
         affects VFCC's operations or its ability to perform its obligations
         under the Transaction Documents to which it is a party;

                                       15
<PAGE>   19

               (ix) Insolvency. VFCC is not insolvent and will not be rendered
         insolvent by the transactions contemplated by this Agreement and has an
         adequate amount of capital to conduct its business in the ordinary
         course and to carry out its obligations hereunder and under each other
         Transaction Document to which it is a party;

               (x) No Proceedings. There are no proceedings or investigations
         pending, or, to the knowledge of VFCC, threatened, before any court,
         regulatory body, administrative agency, or other tribunal or
         Governmental Authority (A) asserting the invalidity of this Agreement,
         (B) seeking to prevent the consummation of any of the transactions
         contemplated by this Agreement, or (C) seeking any determination or
         ruling that might (in the reasonable judgment of VFCC) materially and
         adversely affect the performance by VFCC of its obligations under, or
         the validity or enforceability of, this Agreement;

               (xi) No Consent Required. VFCC is not required to obtain the
         consent of any other Person, or any consent, license, approval or
         authorization or registration or declaration with, any governmental
         authority, bureau or agency in connection with the execution, delivery
         or performance of this Agreement and the other Transaction Documents to
         which it is a party except for such having been obtained, effected or
         made;

               (xii) Fair Consideration. The consideration received by VFCC as
         set forth herein is fair consideration having value reasonably
         equivalent to or in excess of the value of the Conveyed Assets conveyed
         by it and the performance of VFCC's obligations hereunder; and

               (xiii) Accounting Treatment. VFCC will treat the assignment of
         the Conveyed Assets to the Trust pursuant to Article II as a sale of
         the Conveyed Assets to the Trust for financial reporting and accounting
         purposes.

               (e) FFC hereby makes the following representations and warranties
for the benefit of the Indenture Trustee, the Noteholders and the Trust. Such
representations and warranties are made as of each Conveyance Date and shall
survive each sale, assignment, transfer and conveyance by the Sellers of the
respective Conveyed Assets to the Trust and its successors and assigns:

               (i) Organization and Good Standing. FFC is a corporation duly
         organized, validly existing and in good standing, under the laws of the
         State of Delaware, with corporate power and authority to own its
         properties and to conduct its business as such properties are currently
         owned and such business is currently conducted, and had at all relevant
         times, and now has, power, authority, and legal right to acquire and
         own the Conveyed Assets;

               (ii) Due Qualification. FFC is qualified as a foreign corporation
         in any state where it is required to be so qualified to conduct its
         business and has obtained all necessary licenses, consents and
         approvals as required under federal

                                       16
<PAGE>   20

         and state law, in each case, where the failure to be so qualified,
         licensed, consented to or approved could reasonably be expected
         materially and adversely to affect the ability of FFC to comply with
         the terms of this Agreement or each Transaction Document to which it is
         a party;

               (iii) Power and Authority. FFC has the corporate power and
         authority to execute and deliver this Agreement and any other
         Transaction Document to which it is a party, and to carry out their
         respective terms; and the execution, delivery, and performance of this
         Agreement and each other Transaction Document to which it is a party
         has been duly authorized by FFC by all necessary corporate action;

               (iv) Due Execution and Delivery. This Agreement has been duly
         executed and delivered on behalf of FFC;

               (v) Valid Assignment; Binding Obligations. This Agreement
         constitute a valid sale, assignment, transfer and conveyance to the
         Owner Trustee, on behalf of the Trust, of all right, title, and
         interest of FFC in, to and under the Conveyed Assets and the Conveyed
         Assets will be held by the Trust free and clear of any Lien of any
         Person claiming, through or under FFC, except the lien on the Conveyed
         Assets in favor of the Indenture Trustee granted pursuant to the
         Indenture; and this Agreement, when duly executed and delivered, will
         constitute the legal, valid, and binding obligation of FFC enforceable
         against FFC in accordance with their respective terms subject as to
         enforceability to applicable bankruptcy, reorganization, insolvency,
         moratorium or other laws affecting creditors' rights generally and to
         general principles of equity (regardless of whether enforcement is
         sought in a proceeding in equity or at law);

               (vi) No Violation. The consummation of the transactions
         contemplated by and the fulfillment of the terms of this Agreement will
         not conflict with, result in any breach of any of the terms and
         provisions of, or constitute (with or without notice or lapse of time)
         a default under, the articles of incorporation or bylaws of FFC, or any
         material term of any indenture, agreement, mortgage, deed of trust, or
         other instrument to which FFC is a party or by which it is bound, or
         result in the creation or imposition of any Lien upon any of its
         properties pursuant to the terms of any such indenture, agreement,
         mortgage, deed of trust, or other instrument, other than this
         Agreement, or violate any law or any order, injunction, writ, rule, or
         regulation applicable to FFC of any court or of any federal or state
         regulatory body, administrative agency, or other Governmental Authority
         having jurisdiction over FFC or any of its properties which would have
         a material adverse effect on the Conveyed Assets;

               (vii) Valid Business Reasons. FFC has valid business reasons for
         selling its interest in the Conveyed Assets rather than obtaining a
         loan with the Conveyed Assets as collateral;

                                       17
<PAGE>   21

               (viii) Absence of Event. No event has occurred which adversely
         affects FFC's operations or its ability to perform its obligations
         under the Transaction Documents to which it is a party;

               (ix) Insolvency. FFC is not insolvent and will not be rendered
         insolvent by the transactions contemplated by this Agreement and has an
         adequate amount of capital to conduct its business in the ordinary
         course and to carry out its obligations hereunder and under each other
         Transaction Document to which it is a party;

               (x) No Proceedings. There are no proceedings or investigations
         pending, or, to the knowledge of FFC, threatened, before any court,
         regulatory body, administrative agency, or other tribunal or
         Governmental Authority (A) asserting the invalidity of this Agreement,
         (B) seeking to prevent the consummation of any of the transactions
         contemplated by this Agreement, or (C) seeking any determination or
         ruling that might (in the reasonable judgment of FFC) materially and
         adversely affect the performance by FFC of its obligations under, or
         the validity or enforceability of, this Agreement;

               (xi) No Consent Required. FFC is not required to obtain the
         consent of any other Person, or any consent, license, approval or
         authorization or registration or declaration with, any governmental
         authority, bureau or agency in connection with the execution, delivery
         or performance of this Agreement and the Transaction Documents to which
         it is a party except for such having been obtained, effected or made;

               (xii) Fair Consideration. The consideration received by FFC as
         set forth herein is fair consideration having value reasonably
         equivalent to or in excess of the value of the Conveyed Assets conveyed
         by it and the performance of FFC's obligations hereunder; and

               (xiii) Accounting Treatment. FFC will treat the assignment of the
         Conveyed Assets to the Trust pursuant to Article II as a sale of the
         Conveyed Assets to the Trust for financial reporting and accounting
         purposes.

               SECTION 3.02 Removal of Non-Conforming Contracts by
SierraCities.com. Upon the occurrence of a Warranty Event with respect to a
Contract, SierraCities.com will repurchase such Contract by depositing (or
causing to be deposited) to the Collection Account the Repurchase Amount with
respect to such Contract in accordance with the terms of Section 4.01 of the
Indenture or replace such Contract with a Substitute Contract pursuant to
Section 3.03 hereof and Section 4.02 of the Indenture.

               SECTION 3.03 Substitution of Contracts and Equipment by
SierraCities.com.

               (a) With respect to a substitution of Contracts in accordance
with the provisions of this Section 3.03 and Section 4.02 of the Indenture, each
proposed

                                       18
<PAGE>   22

Substitute Contract must be an Eligible Contract, and be eligible to be
substituted by SierraCities.com pursuant to Section 4.02 of the Indenture.

               (b) Any substitution of a Contract pursuant to this Agreement
will be effected by (i) delivery to the Indenture Trustee, as custodian of the
original executed counterpart of each such Substitute Contract, (ii) filing of
any UCC financing statements in accordance with the Filing Requirements
necessary to perfect the interest of the Trust and the Indenture Trustee in the
Substitute Contracts, (iii) delivery to the Indenture Trustee of a List of
Substitute Contracts reflecting such substitution and (iv) delivery to the
Indenture Trustee of a release request and the originally executed trust receipt
relating thereto.

               (c) The parties hereto agree that in addition to the obligation
of SierraCities.com to repurchase or to substitute any Contract and the related
Equipment as to which a breach of the representations set forth in the Servicing
Agreement has occurred and is continuing, SierraCities.com will enforce its
remedies against the Source under the Source Agreement. In consideration of the
purchase of the Equipment and the Contract, SierraCities.com shall remit the
Repurchase Amount to the Servicer for allocation of such Repurchase Amount
pursuant to the terms of the Indenture. Except as may be set forth in the other
Transaction Documents, it is understood and agreed that the obligations of
SierraCities.com with respect to a breach as provided in this Section 3.03 and
Section 4.01 of the Indenture constitute the sole remedy against
SierraCities.com for such breach available to the Trust, the Indenture Trustee
and Noteholders. The representations and warranties set forth in Sections 3.01
and 3.02 hereof shall survive the assignment of the Conveyed Assets to the Owner
Trustee, on behalf of the Trust, and the pledge of the Pledged Property to the
Indenture Trustee.

               (d) Except as provided in this Article III, upon each Seller's
transfer of its interest in the Conveyed Assets to the Trust, the Sellers will
not bear any further risk with respect to the ultimate collectibility of the
Contracts or the adequacy of the collateral securing the Contracts or the value
or sufficiency of the Equipment.

                                   ARTICLE IV

                                    COVENANTS

               SECTION 4.01 Seller and SierraCities.com Covenants.
SierraCities.com and the Sellers, as applicable, hereby covenant and agree with
the Trust, the Owner Trustee, the Noteholders and the Indenture Trustee with
respect to itself as follows:

               (a) Preservation of Security Interest. The Sellers shall execute
and file such financing statements and cause to be executed and filed such
continuation statements, all in such manner and in such places as may be
required by the Filing Requirements and by law fully to preserve, maintain, and
protect the respective right, title and interest of the Owner Trustee, on behalf
of the Trust, and the Indenture Trustee in the

                                       19
<PAGE>   23

Conveyed Assets. SierraCities.com shall deliver (or cause to be delivered) to
the Trust file-stamped copies of, or filing receipts for, any document filed as
provided above, as soon as available following such filing.

               (b) Obligations with Respect to Conveyed Assets. Each of the
Sellers and SierraCities.com will duly fulfill all obligations on its part to be
fulfilled under or in connection with each Contract and the Source Agreement,
and will do nothing to impair the rights of the Owner Trustee, on behalf of the
Trust, or the Indenture Trustee in any of the Conveyed Assets.

               (c) Compliance with Law. SierraCities.com will comply, in all
material respects, with all acts, rules, requisitions, orders, decrees and
directions of any Governmental Authority applicable to its business and to the
Conveyed Assets or any part thereof; provided, however, that SierraCities.com
may contest any act, regulation, order, decree or direction in any reasonable
manner which shall not materially and adversely affect the rights of the Trust,
the Indenture Trustee or the Owner Trustee in the Conveyed Assets.

               (d) Conveyance of Conveyed Assets; Security Interests. Except for
the transfers and conveyances hereunder or under any other Transaction Document,
the Sellers will not sell, pledge, assign or transfer to any other Person, or
grant, create, incur, assume or suffer to exist any Lien, on any Conveyed Asset,
or any interest therein and SierraCities.com shall defend the right, title, and
interest of the Owner Trustee, on behalf of the Trust, the Indenture Trustee and
their respective successors and assigns in, to, and under the Conveyed Assets,
against all claims of third parties claiming, through or under the Sellers;
provided, however, that nothing in this Section 4.01(d) shall prevent or be
deemed to prohibit SierraCities.com from suffering to exist upon any of the
Conveyed Assets any Liens for municipal or other local taxes if such taxes shall
not at the time be due and payable or if SierraCities.com shall concurrently be
contesting the validity thereof in good faith by appropriate proceedings and
shall have set aside on its books adequate reserves with respect thereto and
such contests pose no risk of forfeiture.

               (e) Notification of Breach. The Sellers will advise the Trust and
the Indenture Trustee promptly, in reasonable detail, upon discovery of the
occurrence of any breach by SierraCities.com of any of its representations,
warranties and covenants contained herein.

               (f) Further Assurances.

               (i) SierraCities.com will make, execute or endorse, acknowledge
         and file or deliver to the Trust and the Indenture Trustee from time to
         time such schedules, confirmatory assignments, conveyances, transfer
         endorsements, powers of attorney, certificates, reports and other
         assurances or instruments and take such further steps relating to the
         Conveyed Assets and other rights covered by this Agreement, as the
         Trust or the Indenture Trustee may request and reasonably require,
         provided that no UCC filing will be required with respect to the
         Equipment, except as required by the Filing Requirements.

                                       20
<PAGE>   24

               (ii) The Sellers hereby agree to do all acts, transactions, and
         things and to execute and deliver all agreements, documents,
         instruments, and papers by and on behalf of the Sellers as the Trust or
         its counsel may reasonably request in order to consummate the transfer
         of the Conveyed Assets to the Trust and the subsequent pledge thereof
         to the Indenture Trustee for the benefit of the Noteholders, and the
         rating, issuance and sale of the Notes.

               (g) Indemnification. SierraCities.com agrees to indemnify, defend
and hold the Trust, the Owner Trustee and the Indenture Trustee harmless from
and against any and all loss, liability, damage, judgment, claim, deficiency, or
expense (including interest, penalties, reasonable attorneys' fees and amounts
paid in settlement) to which any of them may become subject insofar as such
loss, liability, damage, judgment, claim, deficiency, or expense arises out of
or is based upon a breach by SierraCities.com of its representations and
warranties contained in Section 3.01 or its covenants contained in Section 4.01,
or any information certified or set forth in this Agreement or in any schedule
delivered by SierraCities.com hereunder, being untrue in any material respect at
any time. The obligations of SierraCities.com under this Section 4.01(g) shall
be considered to have been relied upon by the Trust, the Owner Trustee and the
Indenture Trustee and shall survive the execution, delivery, and performance of
this Agreement regardless of any investigation made by the Trust, the Owner
Trustee, the Indenture Trustee or on their respective behalf. THE
INDEMNIFICATION OBLIGATIONS OF SIERRACITIES.COM PURSUANT TO THE PRECEDING
PROVISIONS OF THIS PARAGRAPH SHALL APPLY REGARDLESS OF ANY NEGLIGENCE OR OTHER
FAULT ON THE PART OF THE TRUST, THE OWNER TRUSTEE, THE INDENTURE TRUSTEE OR ANY
OF THEIR RESPECTIVE OFFICERS, EMPLOYEES OR AGENTS.

               (h) Notice of Liens. SierraCities.com shall notify the Trust and
the Indenture Trustee, promptly after becoming aware of any Lien on any Conveyed
Asset.

               (i) Taxes. SierraCities.com shall promptly pay all applicable
taxes required to be paid in connection with the assignment of the Conveyed
Assets and acknowledges that the Trust shall have no responsibility with respect
thereto. SierraCities.com shall promptly pay and discharge, or cause the payment
and discharge of, all federal income taxes (and all other material taxes) when
due and payable by each such Seller, except (i) such as may be paid thereafter
without penalty or (ii) such as may be contested in good faith by appropriate
proceedings and for which an adequate reserve has been established and is
maintained in accordance with GAAP. SierraCities.com shall promptly notify the
Trust, the Indenture Trustee and the Noteholders of any material challenge,
contest or proceeding pending by or against SierraCities.com before any taxing
authority. SierraCities.com and the Depositor shall have entered into a Tax
Sharing Agreement, pursuant to which (i) SierraCities.com shall assume the sole
responsibility for making any required payments of taxes to the Internal Revenue
Service and shall agree to indemnify and hold the Depositor harmless against any
claims of liability for such taxes and (ii) the Depositor shall be required to
make certain payments to SierraCities.com in respect of its separate federal
income tax liability. So long as any Notes remain outstanding, SierraCities.com
and the Depositor shall not terminate or

                                       21
<PAGE>   25

amend such Tax Sharing Agreement without the prior written consent of the
Indenture Trustee, except that SierraCities.com shall not require the Depositor
to make any payments to SierraCities.com, pursuant to the Tax Sharing Agreement,
which exceed the aggregate federal income tax liability of the Depositor, on a
separate return basis for all taxable years covered by the Tax Sharing
Agreement, that would arise if all allowable losses arising at any time during
such period were applied to reduce the Depositor's aggregate separate taxable
income for all such years.

               (j) Taxes and Other Liabilities. SierraCities.com shall promptly
pay and discharge all material taxes, assessments, fees, claims and other
governmental charges when due and payable by SierraCities.com, the First Sierra
Group, or any member of the First Sierra Group, except (i) such as may be paid
thereafter without penalty or (ii) such as may be contested in good faith by
appropriate proceedings and for which an adequate reserve has been established
and is maintained in accordance with GAAP. SierraCities.com shall promptly
notify the Trust and the Indenture Trustee of any material challenge, contest or
proceeding pending by or against SierraCities.com or the First Sierra Group
before any taxing authority.

               (k) Non-Consolidation. SierraCities.com shall be operated in such
a manner that Receivables III and/or the Holding Trust, the holder of the trust
certificate to be issued by the Trust, would not be substantively consolidated
with SierraCities.com, such that the separate corporate existence of
SierraCities.com and Receivables III, on the one hand, and Holding Trust and/or
the Trust, on the other hand, would be ignored in the event of a bankruptcy of
SierraCities.com.

               (l) No Agency. SierraCities.com will not act as an agent of
Receivables III, Holding Trust or the Trust in any capacity except to the
limited extent provided in the Transaction Documents, but instead will present
itself to the public as a corporation separate from Receivables III and/or
Holding Trust or the Trust;

               (m) Financial Statements. The financial statements and books and
records of SierraCities.com reflect the separate existence of Receivables III,
Holding Trust and the Trust.

               SECTION 4.02 Receivables III Covenants. Receivables III hereby
covenants and agrees with the Trust, the Noteholders and the Indenture Trustee
as follows:

               (a) Obligor's Quiet Enjoyment. Receivables III hereby
acknowledges and agrees that its rights in the Equipment are expressly subject
to the rights of the related Obligors in such Equipment pursuant to the
applicable Contracts. Receivables III covenants and agrees that, so long as an
Obligor shall not be in default of any of the provisions of the applicable
Contract, neither Receivables III nor any assignee of Receivables III will
disturb the Obligor's quiet and peaceful possession of the related Equipment and
the Obligor's use thereof for its intended purpose.

                                       22
<PAGE>   26

               (b) Operation of Receivables III. Receivables III shall be
operated in such a manner that it would not be substantively consolidated in the
trust estate of another Person (that is, such that the separate legal existence
of Receivables III and such Person would be disregarded) and in that regard,
Receivables III shall:

               (i) be a limited purpose corporation whose primary activities are
         restricted in its certificate of incorporation;

               (ii) not engage in any action that would cause the separate legal
         identity of Receivables III not to be respected, including, without
         limitation, (a) holding itself out as being liable for the debts of any
         other party or (b) acting other than through its duly authorized
         agents;

               (iii) not be involved in the day-to-day management of
         SierraCities.com and/or Holding Trust;

               (iv) not incur, assume or guarantee any indebtedness except for
         such indebtedness as may be incurred by Receivables III in connection
         with the issuance of the Notes;

               (v) not commingle its funds, assets and records relating thereto
         with those of SierraCities.com or any other entity;

               (vi) entitle the separate creditors of Receivables III to be
         satisfied out of Receivables III's assets prior to any value in
         Receivables III becoming available to Receivable III's equityholders,
         or SierraCities.com's creditors or Holding Trust's creditors;

               (vii) act solely in its own name in the conduct of its business,
         including business correspondence and other communications, and shall
         conduct its business so as not to mislead others as to the identity of
         the entity with which they are concerned;

               (viii) maintain company records and books of account and shall
         not commingle its company records and books of account with the records
         and books of account of any entity;

               (ix) not engage in any business or activity other than in
         connection with or relating to its Certificate of Incorporation and/or
         Bylaws;

               (x) not form, or cause to be formed, any subsidiaries;

               (xi) comply with all restrictions and covenants in, and shall not
         fail to comply with the corporate formalities established in, its
         Certificate of Incorporation and/or Bylaws;

                                       23
<PAGE>   27

               (xii) maintain its assets separately from the assets of
         SierraCities.com, Holding Trust and the First Sierra Equipment Contract
         Trust 2000-2 (including, in each case, through the maintenance of a
         separate bank account);

               (xiii) manage its day-to-day business without the involvement of
         SierraCities.com and/or Holding Trust;

               (xiv) maintain a separate office from that of SierraCities.com
         and/or Holding Trust;

               (xv) not act as an agent of SierraCities.com or Holding Trust,
         except to the limited extent provided in the Transaction Documents; and

               (xvi) maintain at all times two independent directors as required
         by its Certificate of Incorporation and/or Bylaws.

               (c) Merger or Consolidation.

               (i) Receivables III will keep in full effect its existence,
         rights and franchises as a corporation and will obtain and preserve its
         qualification to do business as a foreign corporation in each
         jurisdiction which permits such qualification and in which it is
         necessary to protect the validity and enforceability of this Agreement,
         any other Transaction Document to which it is a party or any of the
         Contracts and to perform its duties under this Agreement and each other
         Transaction Document to which it is a party.

               (ii) Any partnership or corporation (i) into which Receivables
         III may be merged or consolidated, (ii) resulting from any merger,
         conversion, or consolidation to which Receivables III shall be party,
         or (iii) succeeding to Receivables III's business substantially as a
         whole, shall execute an agreement of assumption to perform all of
         Receivables III's obligations under this Agreement and any other
         Transaction Document to which Receivables III is a party, and upon such
         execution will be Receivables III's successor under this Agreement and
         any other such Transaction Document, without the execution or filing of
         any document or any further act on the part of any of the parties to
         this Agreement and any other such Transaction Document, anything in
         this Agreement and any other Transaction Document to the contrary
         notwithstanding; provided, however, that (a) immediately after giving
         effect to such transaction, no covenant made pursuant to Section
         4.02(c) shall have been breached, (b) Receivables III shall have
         delivered to the Trust, the Rating Agencies, the Owner Trustee and the
         Indenture Trustee an Officer's Certificate and an opinion of counsel,
         satisfactory to each of them, each stating that such consolidation,
         conversion, merger, or succession and such agreement of assumption
         comply with this Section 4.02(c) and that all conditions precedent, if
         any, provided for in this Agreement relating to such transaction have
         been complied with, (c) Receivables III shall have delivered to the
         Trust, the Owner Trustee, the Rating Agencies and the Indenture Trustee
         an opinion of counsel, satisfactory to each of them, either (1) stating
         that, in the

                                       24
<PAGE>   28

         opinion of such counsel, all financing statements and continuation
         statements and amendments thereto have been executed and filed that are
         necessary fully to preserve and protect the interest of the Owner
         Trustee, on behalf of the Trust, in the Contracts and reciting the
         details of such filings, or (2) stating that, in the opinion of such
         counsel, no such action shall be necessary to preserve and protect such
         interest and (d) such partnership or corporation shall have
         organizational documents with similar restrictions as those of
         Receivables III.

               (d) Non-Consolidation. Receivables III shall be operated in such
a manner that Holding Trust or the Trust would not be substantively consolidated
with Receivables III, such that the separate corporate existence of Receivables
III, on the one hand, and Holding Trust or the Trust, on the other hand, would
be ignored in the event of a bankruptcy of Receivables III.

               (e) No Agency. Receivables III will not act as an agent of
Holding Trust or the Trust in any capacity except to the limited extent provided
in the Transaction Documents, but instead will present itself to the public as a
corporation separate from Holding Trust or the Trust.

               SECTION 4.03 Transfer of Conveyed Assets. Each Seller,
Receivables III and each Investor understands that the Trust intends to pledge
the Pledged Property to the Indenture Trustee on behalf of the Noteholders,
pursuant to the Indenture. Each Seller, Receivables III and each Investor agrees
that such assignee of the Trust may exercise the rights of the Trust hereunder
and shall be entitled to all of the benefits of the Trust hereunder to the
extent provided for in such assignment.

                                   ARTICLE V

                              CONDITIONS PRECEDENT

               SECTION 5.01 Conditions to Trust Obligations. The obligations of
the Trust to accept the transfer of the Initial Conveyed Assets on the Closing
Date shall be subject to the satisfaction of the following conditions:

               (a) All representations and warranties of SierraCities.com, each
Seller, Receivables III and each Investor contained in this Agreement shall be
true and correct on the Closing Date with the same effect as though such
representations and warranties had been made on such date;

               (b) All information concerning the Initial Conveyed Assets
provided to the Trust shall be true and correct as of the Initial Cut-Off Date
in all material respects;

               (c) Each Seller shall have delivered to the Trust a List of
Initial Contracts with respect to its respective Initial Contracts as of the
Initial Cut-Off Date and shall have substantially performed all other
obligations required to be performed by the provisions of this Agreement;

                                       25
<PAGE>   29

               (d) SierraCities.com and each Seller shall have recorded and
filed, at its expense, any financing statement with respect to the Initial
Contracts and the other Initial Conveyed Assets to be transferred from time to
time to the Owner Trustee, on behalf of the Trust, from each Seller pursuant to
this Agreement meeting the requirements of applicable state law in such manner
in such jurisdictions as are necessary to perfect the transfer of the Initial
Contracts and the other Initial Conveyed Assets from each such Seller to the
Owner Trustee, on behalf of the Trust, and shall deliver a file-stamped copy of
such financing statements or other evidence of such filings to the Trust;

               (e) All corporate and legal proceedings and all instruments in
connection with the transactions contemplated by this Agreement shall be
satisfactory in form and substance to the Trust, and the Trust shall have
received from each Seller copies of all documents (including, without
limitation, records of corporate proceedings) relevant to the transactions
herein contemplated as the Trust may reasonably have requested; and

               (f) All respective conditions necessary to vest in each Seller
good title, free and clear of all Liens (other than Liens permitted in the
proviso contained in Section 4.01(d) hereof), to its respective Initial
Contracts and interests in Original Equipment shall have been satisfied.

                                   ARTICLE VI

                                   TERMINATION

               SECTION 6.01 Termination. The respective obligations and
responsibilities of each Seller, SierraCities.com and the Trust created by this
Agreement shall terminate upon the latest of (i) the maturity or other
liquidation of the last Contract and the disposition of any amounts received
upon disposition of any Defaulted Contracts and any Equipment leased thereunder;
and (ii) the termination of the Indenture in accordance with the terms thereof;
provided, however, that the indemnifications contained in Section 4.01(g) herein
shall survive the termination of this Agreement and the other Transaction
Documents.

               SECTION 6.02 Effect of Termination.

               No termination or rejection or failure to assume the executory
obligations of this Agreement in the bankruptcy of any Seller or the Trust shall
be deemed to impair or affect the obligations pertaining to any executed sale or
executed obligations, including, without limitation, pre-termination breaches of
representations and warranties by any Seller. Without limiting the foregoing,
prior to termination, the failure of SierraCities.com to pay a Repurchase Amount
shall not render such transfer or obligation executory, nor shall the continued
duties of the parties pursuant to Article IV or Section 7.06 of this Agreement
render an executed sale executory.

                                       26
<PAGE>   30

                                  ARTICLE VII

                            MISCELLANEOUS PROVISIONS

               SECTION 7.01 Amendment. This Agreement may be amended from time
to time by the parties hereto only with (i) the prior written consent of the
Servicer and the Indenture Trustee and (ii) prior written notice to the Rating
Agencies by the Servicer and, to the extent such amendment materially affects
the interests of the Owner Trustee, with the prior written consent of the Owner
Trustee.

               SECTION 7.02 GOVERNING LAW. THIS AGREEMENT AND ANY AMENDMENT
HEREOF PURSUANT TO SECTION 7.01 SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED THEREIN AND THE OBLIGATIONS, RIGHTS, AND
REMEDIES OF THE PARTIES UNDER THIS AGREEMENT SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.

               SECTION 7.03 Notices. All demands, notices, and communications
under this Agreement shall be in writing and shall be deemed to have been duly
given, made and received (i) when delivered against receipt of registered or
certified mail or upon actual receipt of registered or certified mail, postage
prepaid, return receipt requested; (ii) when delivered by courier with
appropriate evidence of receipt; or (iii) upon transmission via facsimile or
telex with appropriate evidence of receipt (a) in the case of SierraCities.com,
at the following address: 600 Travis Street, Suite 7050, Houston, Texas 77002,
Fax No.: (713) 221-1818, (b) in the case of Receivables III, at the following
address: 600 Travis Street, Suite 6950, Houston, Texas 77002, Fax No.: (713)
221-1818, (c) in the case of First Union, One First Union Center, 301 South
College Street, Charlotte, North Carolina 28288 0610, (d) in the case of the
Indenture Trustee, Four Albany Street, New York, New York 10006, Attention:
Corporate Trust and Agency Group -- Structure & Finance, Fax No.: (212)
250-6439, (e) in the case of VFCC, One First Union Center, 301 South College
Street, Charlotte, North Carolina 28288-0610, (f) in the case of FFC, c/o
Nesbitt Burns Securities, Inc., 11 West Monroe, Floor 20 East, Chicago, Illinois
60603 (g) in the case of the Trust, c/o First Union Trust Company, National
Association, One Rodney Square, 920 King Street, Suite 102, Wilmington, Delaware
19801, Attention: Corporate Trust Administration, Fax No.: (302) 888-7544, (h)
in the case of the Indenture Trustee at its address set forth in Section 11.06
of the Indenture and (i) in case of the Series 1999-H Trust, c/o Christiana Bank
& Trust Company, Greenville Center, 3801 Kennett Pike, Greenville, Delaware,
19807, Attention: Corporate Trust Administration, Fax No.: (302) 421-5815.
Either party may alter the address to which communications are to be sent by
giving notice of such change of address in conformity with the provisions of
this Section 7.03 for giving notice and by otherwise complying with any
applicable terms of this Agreement, including, but not limited to, subsections
4.01(b) and (c).

                                       27
<PAGE>   31

               SECTION 7.04 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.

               SECTION 7.05 Assignment. Notwithstanding anything to the contrary
contained in this Agreement, this Agreement may not be assigned by the Sellers
or SierraCities.com, without the prior written consent of the Trust and the
Indenture Trustee (acting upon the written direction of the Majority Holders)
and, except as provided in Section 4.03, this Agreement may not be assigned by
the Trust without the prior written consent of SierraCities.com, the Sellers and
the Indenture Trustee. Whether or not expressly stated, all representations,
warranties, covenants and agreements of SierraCities.com, Receivables III, the
Investors and the Trust in this Agreement, or in any document delivered by any
of them in connection with this Agreement, shall be for the benefit of, and
shall be exercisable by, the Owner Trustee and the Indenture Trustee for the
benefit of the Noteholders.

               SECTION 7.06 Further Assurances. Each of the parties hereto
agrees to do such further acts and things and to execute and deliver to the
Indenture Trustee such additional assignments, agreements, powers and
instruments as are required by the Indenture Trustee to carry into effect the
purposes of this Agreement or to better assure and confirm unto the Indenture
Trustee its rights, powers and remedies hereunder.

               SECTION 7.07 No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of the Trust or each Seller,
any right, remedy, power or privilege hereunder, shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise hereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exhaustive of any
rights, remedies, powers and privilege provided by law.

               SECTION 7.08 Counterparts. This Agreement may be executed in two
or more counterparts (and by different parties on separate counterparts), each
of which shall be an original, but all of which shall constitute one and the
same instrument.

               SECTION 7.09 Binding Effect: Third-Party Beneficiaries. This
Agreement will inure to the benefit of and be binding upon the parties hereto.
The Indenture Trustee, the Owner Trustee and the Noteholders are intended third
party beneficiaries of this Agreement.

               SECTION 7.10 Merger and Integration. Except as specifically
stated otherwise herein, this Agreement sets forth the entire understanding of
the parties relating to the subject matter hereof, and all prior understandings,
written or oral, are superseded by this Agreement. This Agreement may not be
modified, amended, waived or supplemented except as provided herein.

                                       28
<PAGE>   32

               SECTION 7.11 Headings. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.

               SECTION 7.12 Schedules and Exhibits. The schedules and exhibits
attached hereto and referred to herein shall constitute a part of this Agreement
and are incorporated into this Agreement for all purposes.

               SECTION 7.13 No Bankruptcy Petition Against Receivables III or
the Trust. Each of the parties hereto agrees that, prior to the date that is one
year and one day after the payment in full of the latest maturing Notes issued
by the Trust, it will not institute against Receivables III or the Trust, or
join any other Person in instituting against Receivables III or the Trust, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
or other proceedings under the laws of the United States or any state of the
United States. This Section 7.13 shall survive the termination of this
Agreement.

                            [Signature Pages Follow]

                                       29
<PAGE>   33

                  IN WITNESS WHEREOF, the parties hereto have caused this
Receivables Transfer Agreement to be duly executed by their respective officers
as of the day and year first above written.

                                     SIERRACITIES.COM INC.,
                                     in its individual capacity

                                     By: /s/ E. Roger Gebhart
                                         -------------------------------
                                         Name:  E. Roger Gebhart
                                         Title: Executive Vice President

                                     FIRST SIERRA RECEIVABLES III, INC., in its
                                      individual capacity and as Junior
                                      Certificateholder of the First Sierra
                                      Equipment Lease Trust 1998-E

                                     By: /s/ E. Roger Gebhart
                                         -------------------------------
                                         Name:  E. Roger Gebhart
                                         Title: Vice President

                                     FIRST UNION NATIONAL BANK,
                                      as Certificateholder of the First Sierra
                                      Equipment Lease Trust 1997-A

                                     By: /s/ Terrence P. Begley
                                         -------------------------------
                                         Name:  Terrence P. Begley
                                         Title: Senior Vice President

                                     VARIABLE FUNDING CAPITAL CORPORATION, as
                                      Certificateholder of the First Sierra
                                      Equipment Lease Trust 1997-B

                                     By: /s/ Darrell R. Barber
                                         -------------------------------
                                         Name:  Darrell R. Barber
                                         Title: Director

<PAGE>   34

                                     FAIRWAY FINANCE CORPORATION, as Senior
                                      Certificateholder of the First Sierra
                                      Equipment Lease Trust 1998-E

                                     By: /s/ Dwight Jenkins
                                         ----------------------
                                         Name:  Dwight Jenkins
                                         Title: Vice President

                                     FIRST SIERRA EQUIPMENT CONTRACT
                                       TRUST 1999-H
                                     By: CHRISTIANA BANK & TRUST COMPANY

                                     By: /s/ Toni L. Lindsay
                                         ----------------------
                                         Name:  Toni L. Lindsay
                                         Title: Vice President

                                     BANKERS TRUST COMPANY, not in its
                                      individual capacity, but solely as Trustee
                                      of each of the First Sierra Equipment
                                      Lease Trust 1997-A, the First Sierra
                                      Equipment Lease Trust 1997-B and the First
                                      Sierra Equipment Lease Trust 1998-E

                                     By: /s/ Jenna Kaufman
                                         ----------------------
                                         Name:  Jenna Kaufman
                                         Title: Vice President

                                     FIRST SIERRA EQUIPMENT CONTRACT TRUST
                                      2000-2, A COMMON LAW TRUST ACTING THROUGH
                                      FIRST UNION TRUST COMPANY, NATIONAL
                                      ASSOCIATION, NOT IN ITS INDIVIDUAL
                                      CAPACITY BUT SOLELY AS OWNER TRUSTEE, as
                                      Issuer

                                     By: /s/ Sterling C. Correia
                                         -----------------------
                                         Name:  Sterling C. Correia
                                         Title: Vice President

<PAGE>   35

Acknowledged and Agreed:

MERRILL LYNCH
 MORTGAGE CAPITAL, INC.

By: /s/ Jeffrey Cohen
    -----------------
    Name:  Jeffrey Cohen
    Title: Authorized Signatory

<PAGE>   36

                                   SCHEDULE 1

                            LIST OF INITIAL CONTRACTS

<PAGE>   37

                                     ANNEX A

                                  DEFINED TERMS

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