Document:

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                                                                  EXHIBIT 10.103

                                                                  EXECUTION COPY

                              AMENDED AND RESTATED
                           MASTER REPURCHASE AGREEMENT

                                                        DATED AS OF JUNE 1, 2000

BETWEEN:

BEAR STEARNS MORTGAGE CAPITAL CORPORATION

AND

DORAL FINANCIAL CORPORATION

1.       Applicability

         From time to time the parties hereto may enter into transactions in
which Doral Financial Corporation ("Seller") agrees to transfer to Bear Stearns
Mortgage Capital Corporation ("Buyer") Mortgage Loans against the transfer of
funds by Buyer, with a simultaneous agreement by Buyer to transfer to Seller
such Mortgage Loans at a date certain or on demand, against the transfer of
funds by Seller. Each such transaction shall be referred to herein as a
"Transaction" and shall be governed by this Agreement, as the same shall be
amended from time to time.

2.       Definitions

         (a)      "Act of Insolvency", with respect to either Buyer or Seller,
(i) the commencement by such party as debtor of any case or proceeding under any
bankruptcy, insolvency, reorganization, liquidation, dissolution or similar law,
or such party seeking the appointment of a receiver, trustee, custodian or
similar official for such party or any substantial part of its property, or (ii)
the commencement of any such case or proceeding against such party, or another
seeking such an appointment, or the filing against a party of an application for
a protective decree under the provisions of the Securities Investor Protection
Act of 1970, which (A) is consented to or not timely contested by such party,
(B) results in the entry of an order for relief, such an appointment, the
issuance of such a protective decree or the entry of an order having a similar
effect, or (C) is not dismissed within 15 days, (iii) the making by a party of a
general assignment for the benefit of creditors, or (iv) the admission in
writing by a party of such party's inability to pay such party's debts as they
become due;

         (b)      "Additional Purchased Mortgage Loans", Mortgage Loans provided
by Seller to Buyer pursuant to Paragraph 4(a) hereof;

         (c)      "Agency" shall refer to GNMA, FNMA or FHLMC, as the case may
be;

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         (d)      "Agency Documentation" shall refer collectively to the Guides
and parts or chapters thereof and to GNMA, FNMA and FHLMC forms and schedules;

         (e)      "Agency Registration Form" shall refer to Form HUD 11705
(Schedule of Subscriber), Fannie Mae Form 2014 (Delivery Schedule), FHLMC Form
939 (Settlement and Information Multiple Registration Form) or FHLMC Form 987
(Warehouse Delivery Form) as applicable, on which it is indicated that the
related Agency Security shall be issued to, and in the name of, Bear, Stearns &
Co. Inc.;

         (f)      "Agency Security" shall refer to a GNMA Security, a FNMA
Security or a FHLMC Security;

         (g)      "Approvals" shall refer to the approvals of FHLMC, FNMA and
GNMA described in Paragraph 11(b)(xi) of these Supplemental Terms;

         (h)      "Business Day", any day other than a Saturday, Sunday and any
day on which banks located in the State of New York are authorized or required
to close for business;

         (i)      "Buyer's Margin Amount", with respect to any Transaction as of
any date, the amount obtained by application of a percentage, agreed to by Buyer
and Seller prior to entering into the Transaction and specified in the related
Request/Confirmation, to the Repurchase Price for such Transaction as of such
date;

         (j)      "Covenant Compliance Certificate" shall have the meaning set
forth in Paragraph 13 hereof;

         (k)      "Custodian", the custodian named in the Custody Agreement and
any permitted successor thereto;

         (l)      "Custody Agreement", the Amended and Restated Tri-Party
Custody Agreement among Buyer, Seller and the Custodian providing for the
custody of records relating to the Purchased Mortgage Loans;

         (m)      "Custodian" shall refer to the Custodian named in the Custody
Agreement;

         (n)      "Custody Receipt" shall refer to the Receipt substantially in
the form attached as an exhibit to the Custody Agreement;

         (o)      "FHA" shall refer to the Federal Housing Administration;

         (p)      "FHLMC" shall refer to the Federal Home Loan Mortgage
Corporation;

         (q)      "FHLMC Guide" shall refer to the Freddie Mac Sellers' and
Servicers' Guide, as such Guide may hereafter from time to time be amended;

         (r)      "FHLMC Security" shall refer to a Mortgage Participation
Certificate issued and guaranteed by FHLMC and backed by a pool of Mortgage
Loans (other than HELs);

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         (s)      "FNMA" shall refer to the Federal National Mortgage
Association;

         (t)      "FNMA Guide" shall refer to the Fannie Mae MBS Selling and
Servicing Guide, as such Guide may hereafter from time to time be amended;

         (u)      "FNMA Security" shall refer to a Guaranteed Mortgage
Pass-Through Certificate issued and guaranteed by FNMA and backed by a pool of
Mortgage Loans (other than HELs);

         (v)      "GAAP" shall refer to generally accepted accounting principles
consistently applied;

         (w)      "GNMA" shall refer to the Government National Mortgage
Association;

         (x)      "GNMA Guide" shall refer to the GNMA Mortgage-Backed
Securities Guide, as such Guide may hereafter from time to time be amended;

         (y)      "GNMA Security" shall refer to (i) fully-modified pass-through
mortgage-backed certificate guaranteed by GNMA and backed by a pool of Mortgage
Loans (other than HELs) and (ii) Mortgage-Backed Serial Notes guaranteed by GNMA
and backed by a pool of Mortgage Loans (other than HELs);

         (z)      "Guide" shall refer to the GNMA Guide, the FNMA Guide or the
FHLMC Guide, as applicable;

         (aa)     "HEL", a home equity loan consisting of a Note secured by a
Mortgage.

         (bb)     "Income", with respect to any Mortgage Loan at any time, any
principal thereof then payable and all payments of interest and principal
together with other distributions thereon or proceeds thereof;

         (cc)     "Loan Schedule", a schedule of Mortgage Loans identifying each
Mortgage Loan: (1) in the case of all Mortgage Loans, by Seller's loan number,
Mortgagor's name and address (including the state and zip code) of the mortgaged
property, whether such Mortgage Loan is a HEL, if it is a HEL, whether such HEL
is a first or second lien home equity loan, whether such Mortgage Loan bears a
fixed or adjustable interest rate, the loan-to-value ratio, the outstanding
principal amount as of a specified date, the initial interest rate borne by such
Mortgage Loan, the original principal balance thereof, the current scheduled
monthly payment of principal and interest, the maturity of the related Note, the
property type, the occupancy status, the appraised value, the original term to
maturity and whether or not the Mortgage Loan (including the related Note) has
been modified; and (2) in the case of adjustable rate Mortgage Loans, the
interest rate borne by such Mortgage Loan on the Purchase Date, the index and
applicable determination date for each adjustment period, the gross margin, the
payment adjustment period (in months), months to next payment adjustment,
periodic payment adjustment cap, lifetime payment adjustment cap, lifetime
payment cap, interest rate adjustment, periodic interest adjustment cap and
lifetime interest rate adjustment cap;

         (dd)     "Margin Deficit", the meaning specified in Paragraph 4(a)
hereof;

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         (ee)     "Market Value", with respect to any Mortgage Loans as of any
date, the fair market value of such Mortgage Loans on such date as determined by
Buyer in its reasonable business judgment from time to time and at such times as
it may elect in its sole discretion; provided, however, that a Market Value of
zero shall be assigned to (i) any Mortgage Loan that has been delinquent for at
least thirty (30) days, (ii) any Mortgage Loan that has been subject to this
Agreement for more than one hundred and eighty (180) days in aggregate or (iii)
any Mortgage Loan with respect to which there is a breach of a representation or
warranty made by Seller in this Agreement or the Custody Agreement that
materially adversely affects Buyer's interests hereunder;

         (ff)     "Mortgage", the mortgage, deed of trust or other instrument
creating a first lien or second lien on an estate in fee simple interest in real
property securing a Note;

         (gg)     "Mortgage Loan", a first lien mortgage loan on single family
residential property consisting of a Note secured by a Mortgage or a HEL;

         (hh)     "Mortgagor", the obligor on a Note;

         (ii)     "Note", the Note or other evidence of indebtedness evidencing
the indebtedness of a Mortgagor under a Mortgage Loan;

         (jj)     "Pooled Mortgage Loan" shall refer to a Mortgage Loan (other
than a HEL) that is included in a pool designated to back an Agency Security and
with respect to which the Custodian has made an initial certification to the
related Agency;

         (kk)     "Prepooled Mortgage Loan" shall refer to a Mortgage Loan
(other than a HEL) for which there is no Takeout Commitment and is identified as
such on the Loan Schedule.

         (ll)     "Price Differential", with respect to any Transaction
hereunder as of any date, the aggregate amount obtained by daily application of
the Pricing Rate for such Transaction to the Purchase Price for such Transaction
on a 360 day per year basis for the actual number of days during the period
commencing on (and including) the Purchase Date for such Transaction and ending
on (but excluding) the date of determination (reduced by any amount of such
Price Differential previously paid by Seller to Buyer with respect to such
Transaction);

         (mm)     "Pricing Rate", the per annum percentage rate for
determination of the Price Differential, which rate shall be specified in the
related Request/Confirmation;

         (nn)     "Prime Rate", the prime rate of U.S. money center commercial
banks as published in The Wall Street Journal;

         (oo)     "Purchase Date", the date with respect to each Transaction on
which Purchased Mortgage Loans are sold by Seller to Buyer hereunder;

         (pp)     "Purchase Price", (i) on the Purchase Date, the price at which
Purchased Mortgage Loans are sold by Seller to Buyer hereunder, and (ii)
thereafter, such price decreased by the amount of any cash transferred by Seller
to Buyer pursuant to Paragraph 4(a) hereof;

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         (qq)     "Purchased HELs", the HELs sold by Seller to Buyer in a
Transaction hereunder, and any HEL substituted therefor in accordance with
Paragraph 9 hereof. The term "Purchased HELs" with respect to any Transaction at
any time also shall include Additional Purchased Mortgage Loans which are HELs
delivered pursuant to Paragraph 4(a);

         (rr)     "Purchased Mortgage Loans", the Mortgage Loans sold by Seller
to Buyer in a Transaction hereunder, and any Mortgage Loans substituted therefor
in accordance with Paragraph 9 hereof. The term "Purchased Mortgage Loans" with
respect to any Transaction at any time also shall include Additional Purchased
Mortgage Loans delivered pursuant to Paragraph 4(a);

         (ss)     "Replacement Mortgage Loans", the meaning specified in
Paragraph 12(e)(ii) hereof;

         (tt)     "Repurchase Date", the date on which Seller is to repurchase
the Purchased Mortgage Loans from Buyer, including any date determined by
application of the provisions of Paragraphs 3(e) or 12 hereof;

         (uu)     "Repurchase Price", the price at which Purchased Mortgage
Loans are to be resold by Buyer to Seller upon termination of a Transaction,
which will be determined in each case (including Transactions terminable upon
demand) as the sum of the Purchase Price and the Price Differential as of the
date of such determination, increased by any amount determined by the
application of the provisions of Paragraph 12 hereof;

         (vv)     "Request/Confirmation", the request and confirmation
substantially in the form of Exhibit A hereto delivered pursuant to Paragraph 3
hereof;

         (ww)     "Security Release Form" shall refer to (i) Freddie Mac Form
996 (Warehouse Lender Release of Security Interest) in the case of a FHLMC
Security, (ii) Fannie Mae Form 2004 (Security Release Certification) in the case
of a FNMA Security and (iii) Form HUD 11711A (Release of Security Interest) in
the case of a GNMA Security.

         (xx)     "Takeout Assignment" shall refer to an assignment,
substantially in the form of Exhibit D hereto, executed by the Seller in favor
of Buyer assigning all of the Seller's rights under a Takeout Commitment;

         (yy)     "Takeout Commitment" shall refer to a trade confirmation from
the Takeout Investor to the Seller confirming the details of a forward trade
between the Takeout Investor and the Seller with respect to one or more Agency
Securities, which trade confirmation shall be valid, binding and in full force
and effect and relate to pools of Mortgage Loans (other than HELs) that satisfy
the "good delivery standard" of the Public Securities Association as set forth
in the Public Securities Association Uniform Practices Guide;

         (zz)     "Takeout Investor" shall refer to a securities dealer or other
financial institution, listed in Exhibit G hereto, who has made a Takeout
Commitment. Such list may be modified from time to time by the Seller in its
sole discretion, upon written notice to the Seller, or by the Seller with the
written consent of the Seller. Such amended list shall be delivered by the
Seller to the Custodian;

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         (aaa)    "VA" shall refer to the Department of Veteran Affairs.

         (bbb)    "Warehouse Facilities" shall refer to warehouse facilities
(relating to mortgage loans only) in excess of $10,000,000 listed on Exhibit B
hereto.

3.       Initiation; Request/Confirmation; Termination; Transactions Optional

         (a)      Any agreement to enter into a Transaction shall be made in
writing at the initiation of Seller. In the event that Seller desires to enter
into a Transaction hereunder, Seller shall deliver to Buyer prior to 5:00 p.m.,
New York City time, on the Business Day prior to the proposed Purchase Date, a
Request/Confirmation complete in every respect except for the signature of an
authorized representative of Buyer. Buyer shall, upon its receipt and approval
thereof, promptly execute and return the signed Request/Confirmation to Seller.

         (b)      The Request/Confirmation shall describe the Purchased Mortgage
Loans in a manner satisfactory to Buyer (which may be by attaching a Loan
Schedule thereto), identify Buyer and Seller and set forth (i) the Purchase
Date, (ii) the Purchase Price, (iii) the Repurchase Date, unless the Transaction
is to be terminable on demand, (iv) the Pricing Rate or Repurchase Price
applicable to the Transaction, and (v) any additional terms or conditions of the
Transaction mutually agreeable to Buyer and Seller.

         (c)      Each Request/Confirmation shall be binding upon the parties
hereto unless written notice of objection is given by the objecting party to the
other party within one (1) Business Day after Buyer has delivered the completed
Request/Confirmation to Seller.

         (d)      In the event of any conflict between the terms of a
Request/Confirmation and this Agreement, such Request/Confirmation shall
prevail.

         (e)      In the case of Transactions terminable upon demand, such
demand shall be made by Buyer or Seller, no later than such time as is customary
in accordance with market practice, by telephone or otherwise on or prior to the
Business Day on which such termination will be effective. On the date specified
in such demand, or on the date fixed for termination in the case of Transactions
having a fixed term, termination of the Transaction will be effected by resale
by Buyer to Seller or its agent of the Purchased Mortgage Loans and any Income
in respect thereof received by Buyer (and not previously credited or transferred
to, or applied to the obligations of, Seller hereunder) against the transfer of
the Repurchase Price to an account of Buyer.

         (f)      The adjustment mechanism and the index for any adjustable rate
Mortgage Loan must be satisfactory to Buyer in its sole discretion.

         (g)      Notwithstanding any provision of this Agreement or the Custody
Agreement to the contrary, the initiation of each Transaction is subject to the
approval of Buyer in its sole discretion. Buyer may, in its sole discretion,
reject any Mortgage Loan from inclusion in a Transaction hereunder for any
reason.

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4.       Margin Maintenance

         (a)      If at any time the aggregate Market Value of all Purchased
Mortgage Loans subject to all Transactions hereunder is less than the aggregate
Buyer's Margin Amount for all such Transactions (a "Margin Deficit"), then Buyer
may by notice to Seller require Seller in such Transactions, at Buyer's option,
to transfer to Buyer cash or additional Mortgage Loans reasonably acceptable to
Buyer ("Additional Purchased Mortgage Loans"), so that the cash and aggregate
Market Value of the Purchased Mortgage Loans, including any such Additional
Purchased Mortgage Loans, will thereupon equal or exceed such aggregate Buyer's
Margin Amount.

         (b)      If the notice to be given by Buyer to Seller under
subparagraph (a) above is given at or prior to 10:00 a.m. New York city time on
a Business Day, Seller shall transfer cash or Additional Purchased Mortgage
Loans to Buyer prior to the close of business in New York City on the date of
such notice, and if such notice is given after 10:00 a.m. New York City time,
Seller shall transfer cash or Additional Purchased Mortgage Loans prior to the
close of business in New York City on the Business Day following the date of
such notice.

         (c)      Any cash transferred pursuant to this Paragraph shall be held
by Buyer as though it were Additional Purchased Mortgage Loans and, unless Buyer
shall otherwise consent, shall not reduce the Repurchase Price of the related
Transaction.

5.       Income Payments

         Where a particular Transaction's term extends over an Income payment
date on the Mortgage Loans subject to that Transaction, all payments and
distributions, whether in cash or in kind, made on or with respect to the
Purchased Mortgage Loans shall, unless otherwise mutually agreed by Buyer and
Seller, be paid, delivered or transferred: (a) in the case of Agency Securities,
directly to Bear, Stearns & Co. Inc. as agent for the Buyer pursuant to the
instructions set forth at Exhibit E and (b) in the case of Mortgage Loans, so
long as an Event of Default on the part of Seller shall not have occurred and be
continuing, be paid directly to Seller by the related Mortgagor. Buyer shall not
be obligated to take any action pursuant to the preceding sentence to the extent
that such action would result in the creation of a Margin Deficit, unless prior
thereto or simultaneously therewith Seller transfers to Buyer, at Buyer's
option, cash or Additional Purchased Mortgage Loans sufficient to eliminate such
Margin Deficit.

6.       Security Interest

         Although the parties intend that all Transactions hereunder be sales
and purchases and not loans, in the event any such Transactions are deemed to be
loans, Seller shall be deemed to have pledged to Buyer as security for the
performance by Seller of its obligations under each such Transaction, and shall
be deemed to have granted to Buyer a security interest in, all of the Purchased
Mortgage Loans with respect to all Transactions hereunder and all proceeds
thereof. Seller shall pay all fees and expenses associated with perfecting such
security interest including, without limitation, the cost of filing financing
statements under the Uniform Commercial Code and recording assignments of
mortgage as and when required by Buyer in its sole discretion.

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7.       Payment and Transfer

         Unless otherwise mutually agreed, all transfers of funds hereunder
shall be in immediately available funds. All Mortgage Loans transferred by one
party hereto to the other party shall be transferred by notice to the Custodian
to the effect that the Custodian is now holding for the benefit of the
transferee the related documents and assignment forms delivered to it under the
Custody Agreement.

8.       Segregation of Documents Relating to Purchased Mortgage Loans

         All documents relating to Purchased Mortgage Loans in the possession of
Seller shall be segregated from other documents and securities in its possession
and shall be identified as being subject to this Agreement. Ownership of all
Purchased Mortgage Loans shall pass to Buyer and nothing in this Agreement shall
preclude Buyer from engaging in repurchase transactions with the Purchased
Mortgage Loans or otherwise pledging or hypothecating the Purchased Mortgage
Loans, but no such transaction shall relieve Buyer of its obligations to resell
and transfer Purchased Mortgage Loans to Seller pursuant to the terms hereof.

9.       Substitution

         Seller may, subject to agreement with and acceptance by Buyer,
substitute other Mortgage Loans for any Purchased Mortgage Loans. Such
substitution shall be made by transfer to Buyer of such other Mortgage Loans and
transfer to Seller of such Purchased Mortgage Loans. After substitution, the
substituted Mortgage Loans shall be deemed to be Purchased Mortgage Loans.

10.      Delivery of Additional Documents

         (a)      The Seller shall, prior to or simultaneously with the funding
of each Transaction, deliver to Buyer through the Custodian a fully executed
Custody Receipt, and all other applicable documents required by the Custody
Agreement.

         (b)      The Seller shall, within ninety (90) days of a Mortgage Loan
(other than a HEL) becoming subject to this Agreement, deliver to Buyer (i) a
duly authorized and originally executed Takeout Assignment relating to a Takeout
Commitment covering such Mortgage Loan naming Buyer as the assignee, relating to
a pool of Mortgage Loans (other than HELs) of which such Mortgage Loan forms a
part and in form and substance satisfactory to Buyer and (ii) a copy of the
related Agency Registration Form in form and substance satisfactory to Buyer.

         (c)      The Seller shall, simultaneously with the funding of the
initial Transaction under this Agreement relating to each type of Agency
Security and from time to time thereafter upon the request of Buyer, deliver to
Buyer evidence of the commitment of FHLMC, FNMA or GNMA, as appropriate,
pursuant to which the related Agency Securities shall be issued.

         (d)      The Seller shall deliver to Buyer on a monthly basis (or more
frequently if requested by Buyer), an investor commitment report, substantially
in the form attached hereto as Exhibit F, listing the existing commitments of
GNMA, FHLMC and FNMA (for securitizations and sales) relating to all outstanding
Request/Confirmations.

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         (e)      Buyer, simultaneously with the funding of each Transaction
involving Mortgage Loans (other than HELs), shall cause the Custodian to be
provided with an executed Security Release Form appropriate for the related
Agency Security indicating that Seller releases its interest in the related
Mortgage Loans into one or more Agency Securities, upon the issuance of such
Agency Security or Securities. Such form shall be prepared by the Seller and
provided to the Custodian on behalf of Buyer in advance of the date on which
delivery thereof is required hereby. The Custodian shall execute such form on
behalf of Buyer.

11.      Representations, Warranties and Covenants

         (a)      Buyer and Seller each represents and warrants, and shall on
and as of the Purchase Date of any Transaction be deemed to represent and
warrant, to the other that:

                  (i)      it is duly authorized to execute and deliver this
         Agreement, to enter into the Transactions contemplated hereunder and to
         perform its obligations hereunder and has taken all necessary action to
         authorize such execution, delivery and performance;

                  (ii)     it will engage in such Transactions as principal (or,
         if agreed in writing in advance of any Transaction by the other party
         hereto, as agent for a disclosed principal);

                  (iii)    the person signing this Agreement on its behalf is
         duly authorized to do so on its behalf (or on behalf of any such
         disclosed principal);

                  (iv)     it has obtained all authorizations of any
         governmental body required in connection with this Agreement and the
         Transactions hereunder and such authorizations are in full force and
         effect; and

                  (v)      the execution, delivery and performance of this
         Agreement and the Transactions hereunder will not violate any law,
         ordinance, charter, by-law or rule applicable to it or any agreement by
         which it is bound or by which any of its assets are affected.

         (b)      Seller represents and warrants to Buyer, and shall on and as
of the Purchase Date of any Transaction be deemed to represent and warrant, as
follows:

                  (i)      The documents disclosed by Seller to Buyer pursuant
         to this Agreement are either original documents or genuine and true
         copies thereof;

                  (ii)     Seller is a separate and independent corporate entity
         from the Custodian, Seller does not own a controlling interest in the
         Custodian either directly or through affiliates and no director or
         officer of Seller is also a director or officer of the Custodian;

                  (iii)    None of the Purchase Price for any Mortgage Loan will
         be used either directly or indirectly to acquire any security, as that
         term is defined in Regulation T of the Regulations of the Board of
         Governors of the Federal Reserve System, and Seller has not taken any
         action that might cause any Transaction to violate any regulation of
         the Federal Reserve Board;

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                  (iv)     Each Mortgage Loan was underwritten in accordance
         with the written underwriting standards of Seller furnished by Seller
         to Buyer, and no change to such underwriting standards has occurred
         since the date of the last written revision to such standards was
         furnished to Buyer by Seller;

                  (v)      Seller shall be at the time it transfers to Buyer any
         Mortgage Loans for any Transaction the legal and beneficial owner of
         such Mortgage Loans, free of any lien, security interest, option or
         encumbrance; and

                  (vi)     Seller used no selection procedures that identified
         the Mortgage Loans relating to a Transaction as being less desirable or
         valuable than other comparable assets in Seller's portfolio on the
         related Purchase Date.

                  (vii)    All information provided by the Seller to Buyer
         concerning the Mortgage Loans is true and correct;

                  (viii)   All data and other information provided by or on
         behalf of the Seller to the Custodian, whether in writing, by
         electronic transmission or on computer tape or diskette or otherwise,
         is true and correct;

                  (ix)     The Seller is servicing each Mortgage Loan in strict
         conformity with the servicing standards described in Paragraph 14 of
         this Agreement;

                  (x)      The consummation of the Transaction as contemplated
         herein and in the Custody Agreement will not violate any policy,
         regulation or guideline of the FHA or VA or result in the voiding or
         reduction of the FHA insurance, VA guarantee or any other insurance or
         guarantee in respect of any Mortgage Loan, and such insurance or
         guarantee is in full force and effect or shall be in full force and
         effect as required by the applicable GNMA Guide, FNMA Guide or FHLMC
         Guide;

                  (xi)     The Seller is a GNMA-approved issuer, a GNMA-approved
         servicer, a FHA-approved mortgagee, a VA-approved lender, a
         FNMA-approved issuer, a FNMA-approved servicer and a FHLMC-approved
         seller/servicer in good standing ("Approvals");

                  (xii)    Each Mortgage Loan (other than the HELs) conforms to
         the requirements and specifications (including, without limitation, all
         representations and warranties required in respect thereof) set forth
         in the GNMA Guide, FNMA Guide or FHLMC Guide, as applicable, and is
         eligible to be sold to any Agency to back an Agency Security;

                  (xiii)   Each and every document, certificate, instrument,
         insurance policy, escrow and any other item necessary to satisfy the
         final delivery requirements of FHLMC, FNMA or GNMA as required by the
         FHLMC Guide, the FNMA Guide or the GNMA Guide, as applicable, for the
         issuance of the related Agency Security are in form and substance
         acceptable to FHLMC, FNMA or GNMA, as appropriate, and have been
         delivered to the Custodian;

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                  (xiv)    The Seller has no notice or knowledge of any fact,
         event or circumstance whatsoever on the basis of which FHLMC, FNMA or
         GNMA, as applicable, may delay the issuance of, or refuse to issue, the
         related Agency Security;

                  (xv)     Each copy of the document or documents evidencing the
         Agency commitment delivered to Seller through the Custodian pursuant to
         Paragraph 10(c) hereof is a true and correct copy, and such GNMA, FHLMC
         or FNMA commitment has not been withdrawn, amended or supplemented
         except as has been theretofore disclosed to Buyer in writing;

                  (xvi)    Other than the Prepooled Mortgage Loans identified as
         such on the Loan Schedule and the HELs, each Mortgage Loan that is
         intended to back an Agency Security conforms in all respects with all
         requirements of the Takeout Commitment applicable to the Agency
         Security to be backed by such Mortgage Loans;

                  (xvii)   Each Takeout Commitment with respect to Pooled
         Mortgage Loans is a legal, valid and binding obligation of the Seller
         enforceable against it in accordance with its terms, subject to
         applicable bankruptcy, insolvency and similar laws affecting creditors'
         rights generally and subject, as to enforceability, to general
         principles of equity (regardless of whether enforcement is sought in a
         proceeding in equity or at law);

                  (xviii)  Each Takeout Commitment with respect to Pooled
         Mortgage Loans is enforceable by the Seller against the related Takeout
         Investor;

                  (xix)    Each Takeout Commitment with respect to Pooled
         Mortgage Loans is, by virtue of the related Takeout Assignment,
         enforceable by Buyer against the related Takeout Investor;

                  (xx)     Each Takeout Assignment with respect to Pooled
         Mortgage Loans is a legal, valid and binding obligation of the Seller
         enforceable against it in accordance with its terms, subject to
         applicable bankruptcy, insolvency and similar laws affecting creditors'
         rights generally and subject, as to enforceability, to general
         principles of equity (regardless of whether enforcement is sought in a
         proceeding in equity or at law); and

                  (xxi)    Each Mortgage is secured by a negotiable promissory
         note.

         (c)      Seller hereby makes to Buyer, its successors and assigns each
of the representations and warranties regarding Seller and the Mortgage Loans
which Seller makes to the Agency in connection with its issuance of Agency
Securities backed by the related Pooled Mortgage Loans.

         (d)      Seller makes the representations and warranties set forth in
Exhibit H with respect to the HELs as of the related Purchase Date.

         (e)      Seller covenants with Buyer, from and after the date hereof,
as follows:

                  (i)      Seller shall immediately notify Buyer if an Event of
         Default shall have occurred;

                                       11
<PAGE>   12

                  (ii)     Seller shall deliver to Buyer a current Loan Schedule
         with respect to all Mortgage Loans subject to this Agreement with such
         frequency as Buyer may require but in no event less frequently than
         weekly; and

                  (iii)    No Mortgage Loan shall be subject to this Agreement
         for more than one hundred and eighty (180) days in aggregate.

                  (iv)     The Seller shall immediately notify Buyer if any
         Approvals are withdrawn or modified;

                  (v)      The Seller shall notify Buyer of any changes in the
         terms of, or the parties to, the Warehouse Facilities within one (1)
         Business Day of the Seller becoming aware of such changes, whether or
         not such changes have yet become effective;

                  (vi)     In the case of a Transaction involving Mortgage Loans
         (other than HELs) that will back an Agency Security, the Seller shall
         not alter or amend the Agency Registration Form relating to such
         Transaction following the initial preparation thereof without the
         express approval of Buyer;

                  (vii)    Without Buyer's express prior written approval, the
         Seller shall not execute, in favor of any third party, any assignment
         of rights held or purportedly held by the Seller under a given Takeout
         Commitment;

                  (viii)   All financial and other covenants made by the Seller
         under the Warehouse Facilities shall be deemed to be made directly to
         Buyer as though fully set forth herein; provided, however, that any
         such covenants that require the Seller to obtain Buyer's consent prior
         to entering into financing arrangements (other than the Transactions
         contemplated hereby) shall be deemed to merely require prior written
         notice by the Seller to Buyer of such financing arrangements without
         any requirement for the consent of Buyer;

                  (ix)     The Seller shall be at the time it delivers any
         Purchased Mortgage Loans to the Custodian or Buyer for any Transaction,
         and shall continue to be, through the Purchase Date relating to each
         such Transaction, the legal and beneficial owner of such Purchased
         Mortgage Loans free and clear of any lien, security interest, option or
         encumbrance except for the security interest created by this Agreement;

                  (x)      The Seller shall deliver to Buyer the Covenant
         Compliance Certificate referred to in Paragraph 13 on the last day of
         each calendar quarter;

                  (xi)     The Seller shall service the Mortgage Loans in
         accordance with the provisions of Paragraph 14 hereof;

                  (xii)    The Seller shall promptly notify Buyer after the
         occurrence of any change that it reasonably believes would be
         contemplated by Paragraph 12 hereof;

                  (xiii)   Notwithstanding any other provision of this
         Agreement, no Mortgage Loan (other than a HEL) shall be subject to this
         Agreement or to the Custody Agreement for

                                       12
<PAGE>   13

         more than ninety (90) days in aggregate unless such Mortgage Loan is a
         Pooled Mortgage Loan and the Seller shall have delivered to Buyer a
         Takeout Assignment relating to a Takeout Commitment covering such
         Mortgage Loan; and

                  (xiv)    Notwithstanding any other provision of this
         Agreement, no Mortgage Loan shall be subject to this Agreement or to
         the Custody Agreement for more than one hundred and eighty (180) days
         in aggregate.

         (f)      With respect to each Prepooled Mortgage Loan which becomes a
Pooled Mortgage Loan, the Seller shall represent and warrant to Buyer, and shall
on and as of the date on which such Prepooled Mortgage Loan became a Pooled
Mortgage Loan be deemed to represent each of the representations, warranties and
covenants set forth in this Section 11.

12.      Events of Default; Event of Termination

         (a)      The following events shall constitute events of default (each
an "Event of Default") hereunder with respect to Buyer or Seller, as applicable:

                  (i)      Seller fails to repurchase or Buyer fails to transfer
         Purchased Mortgage Loans upon the applicable Repurchase Date pursuant
         to the terms hereof;

                  (ii)     Seller or Buyer fails, after one (1) Business Day's
         notice, to comply with Paragraph 4 hereof;

                  (iii)    An Act of Insolvency occurs with respect to Seller or
         Buyer or any controlling entity thereof;

                  (iv)     Any representation or warranty made by Seller or
         Buyer in this Agreement or the Custody Agreement shall have been
         incorrect or untrue in any material respect when made or repeated or
         deemed to have been made or repeated; provided, however, that in the
         case of representations and warranties made with respect to the
         Purchased Mortgage Loans, such circumstance shall not constitute an
         Event of Default if, after determining the Market Value of the
         Purchased Mortgage Loans without taking into account the Purchased
         Mortgage Loans with respect to which such circumstance has occurred, no
         other Event of Default shall have occurred and be continuing;

                  (v)      Any covenant in this Agreement or the Custody
         Agreement shall have been breached in any material respect; provided,
         however, that in the case of covenants made with respect to the
         Purchased Mortgage Loans, such circumstance shall not constitute an
         Event of Default if, after determining the Market Value of the
         Purchased Mortgage Loans without taking into account the Purchased
         Mortgage Loans with respect to which such circumstance has occurred, no
         other Event of Default shall have occurred and be continuing;

                  (vi)     Buyer shall have reasonably determined that Seller is
         or will be unable to meet its commitments under this Agreement, shall
         have notified Seller of such determination and Seller shall not have
         responded with appropriate information to the contrary to the
         satisfaction of Buyer within twenty-four (24) hours;

                                       13
<PAGE>   14

                  (vii)    This Agreement shall for any reason cease to create a
         valid, first priority security interest in any of the Purchased
         Mortgage Loans purported to be covered hereby;

                  (viii)   A final judgment by any competent court in the United
         States of America for the payment of money in an amount of at least
         $500,000 is rendered against Seller, and the same remains undischarged
         for a period of sixty (60) days during which execution of such judgment
         is not effectively stayed;

                  (ix)     Any event of default or any event which with notice,
         the passage of time or both shall constitute an event of default shall
         occur and be continuing under any repurchase or other financing
         agreement for borrowed funds or indenture for borrowed funds by which
         Seller is bound or affected shall occur and be continuing;

                  (x)      In the reasonable judgment of Buyer a material
         adverse change shall have occurred in the business, operations,
         properties, prospects or condition (financial or otherwise) of Seller;

                  (xi)     Seller shall be in default with respect to any normal
         and customary covenants under any debt contract or agreement, any
         servicing agreement or any lease to which it is a party, which default
         (a) permits acceleration of the obligations of the Seller under such
         contract or agreement by any other party thereto or (b) could
         materially adversely affect the financial condition of Seller (which
         covenants include, but are not limited to, an Act of Insolvency of
         Seller or the failure of Seller to make required payments under such
         contract or agreement as they become due);

                  (xii)    Seller shall fail to promptly notify Buyer of (i) the
         acceleration of any debt obligation or the termination of any credit
         facility of Seller; (ii) the amount and maturity of any such debt
         assumed after the date hereof; (iii) any adverse developments with
         respect to pending or future litigation involving Seller which could
         reasonably be expected to have a material adverse effect on the
         financial condition of the Seller; and (iv) any other developments
         which might materially and adversely affect the financial condition of
         Seller; or

                  (xiii)   Seller shall have failed to comply in any material
         respect with its obligations under the Custody Agreement.

                  (xiv)    Any Approvals of the Seller are materially adversely
         modified or revoked.

         (b)      If an Event of Default shall have occurred and be continuing,
then, at the option of the nondefaulting party, exercised by written notice to
the defaulting party (which option shall be deemed to have been exercised, even
if no notice is given, immediately upon the occurrence of an Act of Insolvency),
the Repurchase Date for each Transaction hereunder shall be deemed immediately
to occur.

         (c)      In all Transactions in which the defaulting party is Seller,
if Buyer is deemed to have exercised the option referred to in subparagraph (b)
of this Paragraph, (i) Seller's obligations hereunder to repurchase all
Purchased Mortgage Loans in such Transactions shall thereupon become immediately
due and payable, (ii) to the extent permitted by applicable law,

                                       14
<PAGE>   15

the Repurchase Price with respect to each such Transaction shall be increased by
the aggregate amount obtained by daily application of (x) the greater of the
Pricing Rate for such Transaction and the Prime Rate to (y) the Repurchase Price
for such Transaction as of the Repurchase Date as determined pursuant to
subparagraph (b) of this Paragraph (decreased as of any day by (A) any amounts
retained by Buyer with respect to such Repurchase Price pursuant to clause (iii)
of this subparagraph, (B) any proceeds from the sale of Purchased Mortgage Loans
pursuant to subparagraph (e)(i) of this Paragraph, and (C) any amounts credited
to the account of Seller pursuant to subparagraph (f) of this Paragraph) on a
360 day per year basis for the actual number of days during the period from and
including the date of the Event of Default giving rise to such option to but
excluding the date of payment of the Repurchase Price as so increased, (iii) all
Income paid after such exercise or deemed exercise shall be payable to and
retained by Buyer applied to the aggregate unpaid Repurchase Prices owed by
Seller, and (iv) Seller shall immediately deliver or cause the Custodian to
deliver to Buyer any documents relating to Purchased Mortgage Loans subject to
such Transactions then in Seller's possession.

         (d)      In all Transactions in which the defaulting party is Buyer,
upon tender by Seller of payment of the aggregate Repurchase Prices for all such
Transactions, Buyer's right, title and interest in all Purchased Mortgage Loans
subject to such Transactions shall be deemed transferred to Seller, and Buyer
shall deliver or cause the Custodian to deliver all documents relating to such
Purchased Mortgage Loans to Seller.

         (e)      After one (1) Business Day's notice to the defaulting party
(which notice need not be given if an Act of Insolvency shall have occurred, and
which may be the notice given under subparagraph (b) of this Paragraph or the
notice referred to in clause (ii) of the first sentence of subparagraph (a) of
this Paragraph), the nondefaulting party may:

                  (i)      as to Transactions in which the defaulting party is
         Seller, (A) immediately sell on a servicing released or servicing
         retained basis as Buyer deems desirable, in a recognized market at such
         price or prices as Buyer may in its sole discretion deem satisfactory,
         any or all Purchased Mortgage Loans subject to such Transactions and
         apply the proceeds thereof to the aggregate unpaid Repurchase Prices
         and any other amounts owing by Seller hereunder or (B) in its sole
         discretion elect, in lieu of selling all or a portion of such Purchased
         Mortgage Loans, to give Seller credit for such Purchased Mortgage Loans
         in an amount equal to the Market Value therefor on such date against
         the aggregate unpaid Repurchase Prices and any other amounts owing by
         Seller hereunder; and

                  (ii)     as to Transactions in which the defaulting party is
         Buyer, (A) purchase mortgage loans ("Replacement Mortgage Loans")
         having substantially the same outstanding principal amount, maturity
         and interest rate as any Purchased Mortgage Loans that are not
         transferred by Buyer to Seller as required hereunder or (B) in its sole
         discretion elect, in lieu of purchasing Replacement Mortgage Loans, to
         be deemed to have purchased Replacement Mortgage Loans at the price
         therefor on such date, calculated as the average of the prices obtained
         from three (3) nationally recognized registered broker/dealers that buy
         and sell comparable mortgage loans in the secondary market.

                                       15
<PAGE>   16

         (f)      As to Transactions in which the defaulting party is Buyer,
Buyer shall be liable to Seller (i) with respect to Purchased Mortgage Loans
(other than Additional Purchased Mortgage Loans), for any excess of the price
paid (or deemed paid) by Seller for Replacement Mortgage Loans therefor over the
Repurchase Price for such Purchased Mortgage Loans and (ii) with respect to
Additional Purchased Mortgage Loans, for the price paid (or deemed paid) by
Seller for the Replacement Mortgage Loans therefor. In addition, Buyer shall be
liable to Seller for interest on such remaining liability with respect to each
such purchase (or deemed purchase) of Replacement Mortgage Loans from the date
of such purchase (or deemed purchase) until paid in full by Buyer. Such interest
shall be at a rate equal to the greater of the Pricing Rate for such Transaction
or the Prime Rate.

         (g)      For purposes of this Paragraph 12, the Repurchase Price for
each Transaction hereunder in respect of which the defaulting party is Buyer
shall not increase above the amount of such Repurchase Price for such
Transaction determined as of the date of the exercise or deemed exercise by
Seller of its option under subparagraph (b) of this Paragraph.

         (h)      The defaulting party shall be liable to the nondefaulting
party for the amount of all reasonable legal or other expenses incurred by the
nondefaulting party in connection with or as a consequence of an Event of
Default, together with interest thereon at a rate equal to the greater of the
Pricing Rate for the relevant Transaction or the Prime Rate. Expenses incurred
in connection with an Event of Default shall include without limitation those
costs and expenses incurred by the nondefaulting party as a result of the early
termination of any repurchase agreement or reverse repurchase agreement entered
into by the nondefaulting party in connection with the Transaction then in
default.

         (i)      The nondefaulting party shall have, in addition to its rights
hereunder, any rights otherwise available to it under any other agreement or
applicable law.

         (j)      At the option of Buyer, exercised by written notice to Seller,
the Repurchase Date for any or all Transactions shall be deemed to immediately
occur in the event that the senior debt obligations or short-term debt
obligations of Bear Stearns & Co. Inc. shall be rated below the four highest
generic grades (without regard to any pluses or minuses reflecting gradations
within such generic grades) by any nationally recognized statistical rating
organization.

         (k)      The exercise by any party of remedies after the occurrence of
an Event of Default shall be conducted in a commercially reasonable manner.

13.      Financial Statements

         (a)      The Seller shall deliver to Buyer a quarterly certificate (the
"Covenant Compliance Certificate") signed by an authorized officer of the Seller
to the effect that as of such date, the Seller is in compliance with all
covenants set forth in this agreement and all covenants set forth in the
Warehouse Facilities.

         (b)      Each delivery of Purchased Securities by the Seller to Buyer
hereunder will constitute a representation by the Seller that there has been no
material adverse change in the Seller's financial condition not disclosed to
Buyer since the date of the Seller's most recent unaudited balance sheet or
income statement delivered to Buyer. The Seller shall provide Buyer,

                                       16
<PAGE>   17

from time to time at the Seller's expense, with such information of a financial
or operational nature as Buyer may reasonably request promptly upon receipt of
such request.

14.      Servicing of the Purchased Mortgage Loans

         (a)      The parties hereto agree and acknowledge that, notwithstanding
the purchase and sale of the Purchased Mortgage Loans contemplated hereby,
Seller shall service the Purchased Mortgage Loans for the benefit of Buyer and,
if Buyer shall exercise its rights to sell the Purchased Mortgage Loans pursuant
to this Agreement prior to the related Repurchase Date, Buyer's assigns;
provided, however, that the obligation of Seller to service Purchased Mortgage
Loans for the benefit of Buyer as aforesaid shall cease upon the securitization
of Mortgage Loans into Agency Securities.

         (b)      The Seller shall service and administer the Mortgage Loans in
accordance with prudent mortgage loan servicing standards and procedures
generally accepted in the mortgage banking industry and in accordance with the
standards incorporated (with respect to the GNMA securitization program) the
GNMA Guide or (with respect to the FNMA securitization program) the FNMA Guide
or (with respect to the FHLMC securitization program) the FHLMC Guide; provided,
however, that the Seller shall at all times comply with applicable law and FHA
regulations and VA regulations so that the FHA insurance, VA guarantee or any
other applicable insurance or guarantee, if any, in respect of any Mortgage Loan
is not voided or reduced. The Seller shall at all times maintain accurate and
complete records of its servicing of the Mortgage Loans.

         (c)      Seller will provide Buyer with monthly reports, substantially
identical in form to FNMA's standard form of remittance report with respect to
all Purchased Mortgage Loans then involved in any Transaction hereunder.

         (d)      Buyer may, in its sole discretion if an Event of Default shall
have occurred and be continuing, without payment of any termination fee or any
other amount to Seller, sell the Mortgage Loans on a servicing released basis
without the payment of any termination fee to the Seller or terminate Seller as
the servicer of the Purchased Mortgage Loans with or without cause.

15.      Single Agreement

         Buyer and Seller acknowledge that, and have entered hereinto and will
enter into each Transaction hereunder in consideration of and in reliance upon
the fact that, all Transactions hereunder constitute a single business and
contractual relationship and have been made in consideration of each other.
Accordingly, each of Buyer and Seller agrees (i) to perform all of its
obligations in respect of each Transaction hereunder, and that a default in the
performance of any such obligations shall constitute a default by it in respect
of all Transactions hereunder, (ii) that each of them shall be entitled to set
off claims and apply property held by them in respect of any Transaction against
obligations owing to them in respect of any other Transactions hereunder and
(iii) that payments, deliveries and other transfers made by either of them in
respect of any Transaction shall be deemed to have been made in consideration of
payments, deliveries and other transfers in respect of any other Transactions
hereunder, and the obligations to make any such payments, deliveries and other
transfers may be applied against each other and netted.

                                       17
<PAGE>   18

16.      Notices and Other Communications

         Except as otherwise expressly provided herein, all such notices or
communications shall be in writing (including, without limitation, telegraphic,
facsimile or telex communication) or confirmed in writing and such notices and
other communications shall, when mailed, telegraphed, communicated by facsimile
transmission or telexed, be effective when received at the address for notices
for the party to whom such notice or communications is to be given as follows:

         if to Seller:

                  Doral Financial Corporation
                  1159 F.D. Roosevelt Avenue
                  Puerto Nuevo, PR 00920
                  Attention: Mario S. Levis
                  Telephone: (787) 749-7108
                  Telecopy: (787) 749-8267

         if to Buyer:

                  Bear Stearns Mortgage Capital Corporation
                  245 Park Avenue
                  17th Floor
                  New York, New York  10167
                  Attention: John Garzone
                  Telephone: (212) 272-3853
                  Telecopy:  (212) 272-5736

Notwithstanding the foregoing, however, that a facsimile transmission shall be
deemed to be received when transmitted so long as the transmitting machine has
provided an electronic confirmation of such transmission, and provided further,
however, that all financial statements delivered shall be hand-delivered or sent
by first-class mail. Either party may revise any information relating to it by
notice in writing to the other party, which notice shall be effective on the
third business day following receipt thereof.

17.      Payment of Expenses

         Seller shall pay on demand all reasonable fees and expenses (including,
without limitation, the reasonable fees and expenses for legal services of any
kind whatsoever) incurred by Buyer or the Custodian in connection with this
Agreement and the Custody Agreement and the transactions contemplated hereby and
thereby, whether or not any Transactions are entered into hereunder, including,
by way of illustration and not by way of limitation, the fees and expenses
incurred in connection with (i) the preparation, reproduction and distribution
of this Agreement and the Custody Agreement and any opinions of counsel,
certificates of officers or other documents contemplated by the aforementioned
agreements and (ii) any Transaction under this Agreement; provided, however,
that Seller shall not be required to pay the fees and expenses of Buyer incurred
as a result of Buyer's default under this Agreement. The obligation of Seller

                                       18
<PAGE>   19

to pay such fees and expenses incurred prior to or in connection with the
termination of this Agreement shall survive the termination of this Agreement.

18.      Opinions of Counsel

         Seller shall, on the Purchase Date of the first Transaction hereunder
and, upon the request of Buyer, on the Purchase Date of any subsequent
Transaction, cause to be delivered to Buyer, with reliance thereon permitted as
to any person or entity that purchases the Mortgage Loans from Buyer in a
repurchase transaction, a favorable opinion of counsel with respect to the
matters set forth in Exhibit C hereto, in form and substance acceptable to Buyer
and its counsel.

19.      Further Assurances; Additional Information

         (a)      Seller shall promptly provide such further assurances or
agreements as Buyer may request in order to effect the purposes of this
Agreement and any Takeout Assignment.

         (b)      At any reasonable time, Seller shall permit Buyer, its agents
or attorneys, to inspect and copy any and all documents and data in its
possession pertaining to each Purchased Mortgage Loan that is the subject of
such Transaction. Such inspection shall occur upon the request of Buyer at a
mutually agreeable location during regular business hours and on a date not more
than two (2) Business Days after the date of such request.

         (c)      Seller agrees to provide Buyer or its agents, from time to
time, with such information concerning Seller of a financial or operational
nature as Buyer may reasonably request.

         (d)      Seller shall provide Buyer or its agents, with copies of all
filings made by or on behalf of Seller or any entity that controls Seller, with
the Securities and Exchange Commission pursuant to the Securities Exchange Act
of 1934, as amended, promptly upon making such filings.

20.      Buyer as Attorney-in-Fact

         Buyer is hereby appointed the attorney-in-fact of Seller for the
purpose of carrying out the provisions of this Agreement and taking any action
and executing any instruments that Buyer may deem necessary or advisable to
accomplish the purposes hereof, which appointment as attorney-in-fact is
irrevocable and coupled with an interest. Without limiting the generality of the
foregoing, Buyer shall have the right and power during the occurrence and
continuation of any Event of Default to receive, endorse and collect all checks
made payable to the order of Seller representing any payment on account of the
principal of or interest on any of the Purchased Mortgage Loans and to give full
discharge for the same.

21.      Appointment of Agent

         Buyer hereby appoints Bear Stearns Mortgage Capital Corporation as its
agent for purposes of issuing Requests/Confirmations, determining Market Value,
exercising Buyer's rights under any margin maintenance provision of this
Agreement and such other purposes as

                                       19
<PAGE>   20

Buyer may direct. The appointment of such agent shall not relieve Buyer of its
obligations hereunder.

         Buyer hereby appoints Bear, Stearns & Co. Inc. as its agent for
purposes of the receipt, registration and sale of Agency Securities.

22.      Wire Instructions

         (a)      Any amounts to be transferred by Buyer to Seller hereunder
shall be sent by wire transfer in immediately available funds to the account of
Seller at:

                  FEDERAL RESERVE OF N.Y.
                  ABA # 221572838
                  Doral Bank
                  For further credit to:
                  HF Mortgage Bankers
                  Acct. #2-4000011-2

         (b)      Any amounts to be transferred by Seller to Buyer hereunder
shall be sent by wire transfer in immediately available funds to the account of
Buyer at:

                  FNB CHICAGO/BEAR STEARNS MBS
                  ABA #: 071-000-013
                  Acct. No.:  5801230
                  Attention: John Garzone

         (c)      Amounts received after 3:00 p.m., New York City time, on any
Business Day shall be deemed to have been paid and received on the next
succeeding Business Day.

23.      Entire Agreement; Severability

         This Agreement shall supersede any existing agreements between the
parties containing general terms and conditions for repurchase transactions.
Each provision and agreement herein shall be treated as separate and independent
from any other provision or agreement herein and shall be enforceable
notwithstanding the unenforceability of any such other provision or agreement.

24.      Non-assignability; Termination

         (a)      The rights and obligations of the parties under this Agreement
and under any Transaction shall not be assigned by either party without the
prior written consent of the other party. Subject to the foregoing, this
Agreement and any Transactions shall be binding upon and shall inure to the
benefit of the parties and their respective successors and assigns.

         (b)      This Agreement and all Transactions outstanding hereunder
shall terminate automatically without any requirement for notice on the date
occurring three hundred and sixty-four (364) days after the date as of which
this Agreement is entered into; provided, however, that this Agreement and any
Transaction outstanding hereunder may be extended by mutual

                                       20
<PAGE>   21

agreement of Buyer and Seller; and provided further, however, that no such party
shall be obligated to agree to such an extension.

25.      Agency Documentation

         All references in this Agreement to items of Agency Documentation
shall, if such items are amended or superseded from time to time by the related
Agency, be deemed references to such Agency Documentation as so amended or
superseded.

26.      Counterparts

         This Agreement may be executed in any number of counterparts, each of
which counterparts shall be deemed to be an original, and such counterparts
shall constitute but one and the same instrument.

27.      Governing Law

         This Agreement shall be governed by the laws of the State of New York
without giving effect to the conflict of law principles thereof.

28.      No Waivers, Etc.

         No express or implied waiver of any Event of Default by either party
shall constitute a waiver of any other Event of Default and no exercise of any
remedy hereunder by any party shall constitute a waiver of its right to exercise
any other remedy hereunder. No modification or waiver of any provision of this
Agreement and no consent by any party to a departure herefrom shall be effective
unless and until such shall be in writing and duly executed by both of the
parties hereto. Without limitation on any of the foregoing, the failure to give
a notice pursuant to subparagraph 4(a) hereof will not constitute a waiver of
any right to do so at a later date.

29.      Use of Employee Plan Assets

         (a)      If assets of an employee benefit plan subject to any provision
of the Employee Retirement Income Security Act of 1974 ("ERISA") are intended to
be used by either party hereto (the "Plan Party") in a Transaction, the Plan
Party shall so notify the other party prior to the Transaction. The Plan Party
shall represent in writing to the other party that the Transaction does not
constitute a prohibited transaction under ERISA or is otherwise exempt
therefrom, and the other party may proceed in reliance thereon but shall not be
required so to proceed.

         (b)      Subject to the last sentence of subparagraph (a) of this
Paragraph, any such Transaction shall proceed only if Seller furnishes or has
furnished to Buyer its most recent available audited statement of its financial
condition and its most recent subsequent unaudited statement of its financial
condition.

         (c)      By entering into a Transaction pursuant to this Paragraph,
Seller shall be deemed (i) to represent to Buyer that since the date of Seller's
latest such financial statements, there has been no material adverse change in
Seller's financial condition which Seller has not disclosed to Buyer, and (ii)
to agree to provide Buyer with future audited and unaudited statements of its

                                       21
<PAGE>   22

financial condition as they are issued, so long as it is a Seller in any
outstanding Transaction involving a Plan Party.

30.      Intent

         (a)      Each Transaction involving Mortgage Loans (other than HELs) is
entered into in contemplation of the issuance of one or more Agency Securities
backed by the related Mortgage Loans. The parties intend that the Seller will
act as issuer or seller and/or servicer with respect to such Agency Securities,
as applicable, and that each Agency Security will be issued in the name of, and
delivered to or upon the order of, Bear, Stearns & Co. Inc.

         (b)      The parties intend and acknowledge that each Transaction is a
"repurchase agreement" as that term is defined in Section 101 of Title 11 of the
United States Code, as amended (except insofar as the type of Mortgage Loans
subject to such Transaction or the term of such Transaction would render such
definition inapplicable), and a "securities contract" as that term is defined in
Section 741 of Title 11 of the United States Code, as amended.

         (c)      It is understood that either party's right to liquidate
Mortgage Loans delivered to it in connection with Transactions hereunder or to
exercise any other remedies pursuant to Paragraph 12 hereof, is a contractual
right to liquidate such Transaction as described in Sections 555 and 559 of
Title 11 of the United States Code, as amended.

31.      Disclosure Relating to Certain Federal Protections

         The parties acknowledge that they have been advised that:

                  (a)      in the case of Transactions in which one of the
         parties is a broker or dealer registered with the Securities and
         Exchange Commission ("SEC") under Section 15 of the Securities Exchange
         Act of 1934 ("1934 Act"), the Securities Investor Protection
         Corporation has taken the position that the provisions of the
         Securities Investor Protection Act of 1970 ("SAPPY") do not protect the
         other party with respect to any Transaction hereunder;

                  (b)      in the case of Transactions in which one of the
         parties is a government securities broker or a government securities
         dealer registered with the SEC under Section 15C of the 1934 Act, SAPPY
         will not provide protection to the other party with respect to any
         Transaction hereunder; and

                                       22
<PAGE>   23

                  (c)      in the case of Transactions in which one of the
         parties is a financial institution, funds held by the financial
         institution pursuant to a Transaction hereunder are not a deposit and
         therefore are not insured by the Federal Deposit Insurance Corporation,
         the Federal Savings and Loan Insurance Corporation or the National
         Credit Union Share Insurance Fund, as applicable.

BEAR STEARNS MORTGAGE CAPITAL               DORAL FINANCIAL CORPORATION
         CORPORATION

By /s/ John M. Garzone                       By /s/ Mario S. Lewis
  ---------------------------                  -----------------------------
Title Sr. Vice President                     Title E.V.P. and Treasurer
     ------------------------                     --------------------------
Date 5/29/00                                 Date 5/19/00
    -------------------------                    ---------------------------

                                       23
<PAGE>   24
                                                                       EXHIBIT A

                              REQUEST/CONFIRMATION

TO:      Doral Financial Corporation ("Seller")
         1159 F.D. Roosevelt Avenue
         Puerto Nuevo, PR  00920
         Attention: John Garzone

FROM:    Bear Stearns Mortgage Capital Corporation ("Buyer")

Select what is applicable:

[RE:     TRANSACTIONS INVOLVING MORTGAGE LOANS TO BE SECURITIZED INTO AGENCY
         SECURITIES

         AGENCY (check one):  FNMA(TM)     FHLMC(TM)       GNMA(TM)]

[RE:     TRANSACTIONS INVOLVING HELS]

Bear Stearns Mortgage Capital Corporation ("Buyer") is pleased to confirm your
sale and its purchase of the Mortgage Loans described below and listed on the
attached Loan Schedule pursuant to the Amended and Restated Master Repurchase
Agreement dated as of June 1, 2000 between the Seller and Buyer under the
following terms and conditions:

POOL/COMMITMENT NO. [WITH RESPECT TO MORTGAGE LOANS TO BE SECURITIZED INTO
AGENCY SECURITIES]

ORIG. PRINCIPAL AMOUNT OF MORTGAGE LOANS:

CURRENT PRINCIPAL AMOUNT OF MORTGAGE LOANS:

PURCHASE DATE:

REPURCHASE DATE:

PURCHASE PRICE:

PRICING RATE:

MINIMUM REQUIRED MARGIN PERCENTAGE:

PRICE DIFFERENTIAL DUE DATE:

                                       A-1

<PAGE>   25

The Amended and Restated Master Repurchase Agreement is incorporated by
reference into this Request/Confirmation and made a part hereof as if it were
fully set forth herein. All capitalized terms used herein but not otherwise
defined shall have the meanings specified in the Amended and Restated Master
Repurchase Agreement.

                                     BEAR STEARNS MORTGAGE CAPITAL
                                     CORPORATION

                                     BY:
                                        --------------------------------
                                     NAME:
                                          ------------------------------
                                     TITLE:
                                           -----------------------------

                                       A-2

<PAGE>   26

ATTACHMENT I TO EXHIBIT A

                 CONFIRMATION/FUNDING REQUEST FOR MORTGAGE LOANS

                                                                Request No.
                                                                            ---
                                                                Date:
                                                                     ----------

<TABLE>
<CAPTION>
                                                                  Amount
                                                                  Funded
                                                                    to
          Product   Wire    Loan   Borrower    Loan    Purchase  Qualified   Market   Takeout  Note   Commitment  Takeout  Maturity
Investor   Type     Date   Number   Last      Amount    Price    Originator   Value    Date    Rate     Number     Price     Date
--------   ----     ----   ------   ----      ------    -----    ----------   -----    ----    ----     ------     -----     ----
<S>       <C>       <C>    <C>     <C>        <C>      <C>       <C>         <C>       <C>     <C>    <C>         <C>      <C>

</TABLE>

TOTALS:

[SELLER]

By:
       -------------------------------

Title:
       -------------------------------

Date:
       -------------------------------

       Amount to be funded by MLMCI: $
                                       ------------

<PAGE>   27

                                                                       EXHIBIT B

                       List of Warehousing Facilities for
                                Whole loans only
                                  As of 6/4/99

<TABLE>
<CAPTION>
LENDER*                                               SIZE OF CREDIT LINE
-------                                             ------------------------
                                                    (IN MILLIONS OF DOLLARS)
<S>                                                 <C>

Banco Popular                                                  70
Banco Santander                                                60
Government Development Bank                                   100
Economic Development Bank                                      20
Scotiabank                                                     20
First Bank                                                     40
Bankers Trust                                                 313
Citibank                                                       50
PaineWebber                                                   200
Merrill Lynch                                                 600
Bear Stearns                                                  450

         TOTAL                                             $1,923
                                                           ======
</TABLE>

Note: The above lines are in addition to over $1.0 Billion in Repo lines
      available for securities.

-------------------------
* In addition, Morgan Stanley has committed to a facility of $450,000,000
  but final documentation is still pending.

                                       B-1

<PAGE>   28

                                                                       EXHIBIT C

                          OPINION OF COUNSEL TO SELLER

         1.       Seller is duly organized and validly existing as a corporation
in good standing under the laws of the Commonwealth of Puerto Rico and has power
and authority to enter into and perform its obligations under this Agreement and
the Custody Agreement. Seller is duly qualified to do business and is in good
standing in each jurisdiction in which the character of the business transacted
by it requires such qualification and in which the failure so to qualify would
have a material adverse effect on the business, properties, assets or condition
(financial or other) of Seller and its subsidiaries, considered as a whole.

         2.       This Agreement and the Custody Agreement have each been duly
authorized, executed and delivered by Seller, and each constitutes a valid and
legally binding obligation of Seller enforceable against Seller in accordance
with its terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or affecting
creditors' rights generally and to general equity principles.

         3.       No consent, approval, authorization or order of any state or
federal court or government agency or body is required to be obtained by Seller
for the consummation of the transactions contemplated by this Agreement or the
Custody Agreement.

         4.       The consummation of any of the transactions contemplated by
this Agreement and the Custody Agreement will not conflict with, result in a
breach of, or constitute a default under the articles of incorporation or bylaws
of Seller or the terms of any indenture or other agreement or instrument known
to us to which Seller is party or bound, or any order known to such counsel to
be applicable to Seller or any regulations applicable to Seller, of any state or
federal court, regulatory body, administrative agency, governmental body or
arbitrator having jurisdiction over Seller.

         5.       There is no pending or threatened action, suit or proceeding
before any court or governmental agency, authority or body or any arbitrator
involving Seller or relating to the transaction contemplated by this Agreement
or the Custody Agreement which, if adversely determined, would have a material
adverse effect on Buyer.

         6.       Seller is duly registered as a finance company in each state
in which Mortgage Loans were originated, to the extent such registration is
required by applicable law.

         7.       Each Mortgage Loan will have been endorsed in a manner which
satisfies any requirement of endorsement in order to transfer all right, title
and interest in and to that Mortgage Loan from Seller to Buyer. This Agreement
together with (a) the delivery of such related Mortgage Loans to Custodian and
(b) the endorsement of such Mortgage Loans to Buyer, creates a valid, perfected
security interest in such Mortgage Loans in favor of Buyer. As holder of the
Mortgage Loans by endorsement, Buyer shall, subject to the terms of the
Agreement, be entitled to the same security interest and liens with respect to
the Mortgage Loans as Seller, without the necessity of recording any assignments
of mortgage in the Registry of Property of Puerto Rico.

         8.       [In connection with the sale of Mortgage Loans to Buyer and
Buyer's holding of such Mortgage Loans, Buyer is not required to be licensed
under the laws of Puerto Rico. No consent, approval, authorization or order of
any state or federal court or government agency or body is required to be
obtained by Buyer for the consummation of the transactions contemplated by this
Agreement or the Custody Agreement.]

                                      C-1

<PAGE>   29

                                                                       EXHIBIT D

                              [TAKEOUT ASSIGNMENT]

                      ("Takeout Investor")
---------------------
(Address)
Attention:
           --------------------
Gentlemen:

         Attached hereto is a correct and complete copy of your confirmation of
commitment (the "Commitment"), trade-dated ___________, 19__, to purchase
$____________ of _____% ____ year:

(Check Box)

             (a)      Government National Mortgage Association;

             (b)      Federal National Mortgage Association; or

             (c)      Federal Home Loan Mortgage Corporation;

         mortgage-backed pass-through securities ("Securities") at a purchase
price of ____________ from _________________. This is to confirm that (i) the
Commitment is in full force and effect, (ii) the Commitment has been assigned to
_____________________ ("Assignee") whose acceptance of such assignment is
indicated below, (iii) you will accept delivery of such Securities directly from
Assignee and (iv) you will pay Assignee for such Securities. Payment will be
made "delivery versus payment (DVP)" to Assignee in immediately available funds.
Assignee shall have the right to require you to fulfill your obligation to
purchase the Securities.

         Notwithstanding the foregoing, the obligation to deliver the Securities
to you shall be that of [Seller] and your sole recourse for the failure of such
delivery shall be against [Seller].

                                      D-1

<PAGE>   30

         If you have any questions, please call ____________________ of the
Assignee at __________________ immediately.

                                        Very truly yours,

                                        [SELLER]

                                        By:
                                            -------------------------------
                                        Title:
                                              -----------------------------
                                        Date:
                                              -----------------------------

Agreed to:

[ASSIGNEE]

By:
    ------------------------
Title:
       ---------------------
Date:
      ----------------------

                                      D-2

<PAGE>   31

                                                                       EXHIBIT E

                   PAYMENT INSTRUCTIONS FOR AGENCY SECURITIES

         FED FNMA AND FHLMC SECURITY INSTRUCTIONS:
                                                     ----------------
                                                            ABA
                                                                -----------
PTC GNMA SECURITY INSTRUCTIONS:
                                                      ------------

                                      E-1

<PAGE>   32

                                                                       EXHIBIT F

                           INVESTOR COMMITMENT REPORT

<TABLE>
<CAPTION>
                                                                        MORTGAGE LOANS
                                                                       (SECURITIZATION)

  Confirmation/
 Funding Request     Trade                     Delivery   MBS    Note/Coupon   Delivery            Trade   Commitment
(Listed by Number)   Date   Takeout Investor    Month     Type      Rate        Price     Amount   Number    Number     Reason
------------------   ----   ----------------    -----     ----      ----        -----     ------   ------    ------     ------
<S>                  <C>    <C>                <C>        <C>    <C>           <C>        <C>      <C>     <C>          <C>
</TABLE>

                                      F-1

<PAGE>   33

                                                                       EXHIBIT G

                                TAKEOUT INVESTORS

                                      G-1

<PAGE>   34

                                                                       EXHIBIT H

                         REPRESENTATIONS AND WARRANTIES
                         RELATING TO THE PURCHASED HELS

         (i)      The information with respect to each HEL set forth in the
related Loan Schedule is true and correct;

         (ii)     All documentation required to be delivered to the Custodian
under the Custodial Agreement has been so delivered;

         (iii)    Each Purchased HEL is a Mortgage;

         (iv)     Each mortgaged property is improved by a single (one-to-four)
family residential dwelling;

         (v)      No more than 5% by original principal balance of the Purchased
HEL had loan-to-value ratios in excess of 100%;

         (vi)     Each Purchased HEL is being serviced by Seller in accordance
with the terms of this Agreement;

         (vii)    The Note related to each Purchased HEL bears a fixed or
adjustable interest rate;

         (viii)   Each Mortgage is a valid and subsisting first or second lien
of record (or is in the process of being recorded) on the mortgaged property
subject in the case of any second-lien HEL only to a single senior lien on such
mortgaged property and subject in all cases to the exceptions to title set forth
in the title insurance policy or attorney's opinion of title, with respect to
the related HEL, which exceptions are generally acceptable to banking
institutions in connection with their regular mortgage lending activities, and
such other exceptions to which similar properties are commonly subject and which
do not individually, or in the aggregate, materially and adversely affect the
benefits of the security intended to be provided by such Mortgage;

         (ix)     Immediately prior to the transfer and assignment of the HELs
by Seller to Buyer as contemplated by this Agreement, Seller held good and
indefeasible title to, and was the sole owner of, each HEL (including the
related Note) conveyed by Seller subject to no liens, charges, mortgages,
encumbrances or rights of others except as set forth in clause (ix) or other
liens which will be released simultaneously with such transfer and assignment;
and immediately upon the transfer of the Purchased HELs as contemplated in this
Agreement, Buyer will be the sole owner of each Purchased HEL subject to no
liens, charges, mortgages, encumbrances or rights of others except as set forth
in paragraph (ix) or other liens which will be released simultaneously with such
transfer;

         (x)      No Purchased HEL is thirty (30) days or more delinquent;

                                      H-1
<PAGE>   35

         (xi)     There is no delinquent tax or assessment lien on any mortgaged
property, and each mortgaged property is free of substantial damage and is in
good repair;

         (xii)    There is no valid and enforceable offset, defense or
counterclaim to any Note or Mortgage, including the obligation of the related
Mortgagor to pay the unpaid principal of or interest on such Note;

         (xiii)   There is no mechanics' lien or claim for work, labor or
material affecting any mortgaged property which is or may be a lien prior to, or
equal with, the lien of the related Mortgage except those which are insured
against by any title insurance policy referred to in paragraph (xvi) below;

         (xiv)    Each Purchased HEL at the time it was made complied in all
material respects with applicable state and federal laws and regulations,
including, without limitation, the federal Truth-in-Lending Act (including the
Riegle Community Development Act of 1994) and other consumer protection laws,
usury, equal credit opportunity, disclosure and recording laws;

         (xv)     With respect to each Purchased HEL either (a) an attorney's
opinion of title has been obtained but no title policy has been obtained or (b)
a lender's title insurance policy, issued in standard American Land Title
Association form by a title insurance company authorized to transact business in
the state in which the related mortgaged property is situated, in an amount at
least equal to the original balance of such Purchased HEL together, in the case
of a second-lien HEL, with the then-original principal amount of the mortgage
note relating to the senior lien, insuring the mortgagee's interest under the
related HEL as the holder of a valid first or second mortgage lien of record on
the real mortgaged property described in the related Mortgage, as the case may
be, subject only to exceptions of the character referred to in paragraph (ix)
above, was effective on the date of the origination of such HEL, and such policy
is valid and thereafter such policy shall continue in full force and effect;

         (xvi)    The improvements upon each mortgaged property are covered by a
valid and existing hazard insurance policy with a carrier generally acceptable
to Seller that provides for fire and extended coverage representing coverage not
less than the least of (A) the outstanding principal balance of the related
Purchased HEL (together, in the case of a second-lien HEL, with the outstanding
principal balance of the senior lien), (B) the minimum amount required to
compensate for damage or loss on a replacement cost basis or (C) the full
insurable value of the mortgaged property;

         (xvii)   If any mortgaged property is in an area identified in the
Federal Register by the Federal Emergency Management Agency as having special
flood hazards, a flood insurance policy in a form meeting the requirements of
the current guidelines of the Flood Insurance Administration is in effect with
respect to such mortgaged property with a carrier generally acceptable to Seller
in an amount representing coverage not less than the least of (A) the
outstanding principal balance of the related Purchased HEL (together, in the
case of a second-lien HEL, with the outstanding principal balance of the senior
lien), (B) the minimum amount

                                      H-2
<PAGE>   36

required to compensate for damage or loss on a replacement cost basis or (C)
the maximum amount of insurance that is available under the Flood Disaster
Protection Act of 1973;

         (xviii)  Each Mortgage and Note is the legal, valid and binding
obligation of the maker thereof and is enforceable in accordance with its terms,
except only as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity (whether
considered in a proceeding or action in equity or at law), and all parties to
each Purchased HEL had full legal capacity to execute all documents relating to
such HEL and convey the estate therein purported to be conveyed;

         (xix)    Seller has caused and will cause to be performed any and all
acts required to be performed to preserve the rights and remedies of Buyer in
any insurance policies applicable to any Purchased HELs transferred by Seller
including, without limitation, any necessary notifications of insurers,
assignments of policies or interests therein, and establishments of co-insured,
joint loss payee and mortgagee rights in favor of Buyer;

         (xx)     Each original Mortgage was recorded or is in the process of
being recorded, and all subsequent assignments of the original Mortgage have
been delivered for recordation or have been recorded in the appropriate
jurisdictions wherein such recordation is necessary to perfect the lien thereof
as against creditors of or purchasers from Seller;

         (xxi)    The terms of each Note and each Mortgage have not been
impaired, altered or modified in any respect, except by a written instrument
which has been recorded, if necessary, to protect the interest of Buyer and
which has been delivered to the Custodian. The substance of any such alteration
or modification is reflected on the related Loan Schedule;

         (xxii)   The proceeds of each Purchased HEL have been fully disbursed,
and there is no obligation on the part of the mortgagee to make future advances
thereunder; any and all requirements as to completion of any on-site or off-site
improvements and as to disbursements of any escrow funds therefor have been
complied with; all costs, fees and expenses incurred in making or closing or
recording such HELs were paid;

         (xxiii)  The related Note is not and has not been secured by any
collateral, pledged account or other security except the lien of the
corresponding Mortgage;

         (xxiv)   No Purchased HEL has a shared appreciation feature, or other
contingent interest feature;

         (xxv)    Each mortgaged property is located in the state identified in
the respective Loan Schedule and consists of one or more parcels of real
mortgaged property with a residential dwelling erected thereon;

                                      H-3
<PAGE>   37

         (xxvi)   Each Mortgage contains a provision for the acceleration of the
payment of the unpaid principal balance of the related Purchased HEL in the
event the related mortgaged property is sold without the prior consent of the
mortgagee thereunder;

         (xxvii)  There is no proceeding pending or threatened for the total or
partial condemnation of any mortgaged property, nor is such a proceeding
currently occurring, and each mortgaged property is undamaged by waste, fire,
water, flood, earthquake or earth movement;

         (xxviii) All of the improvements which were included for the purposes
of determining the appraised value of any mortgaged property lie wholly within
the boundaries and building restriction lines of such mortgaged property, and no
improvements on adjoining properties encroach upon such mortgaged property, and
are stated in the title insurance policy and affirmatively insured;

         (xxix)   No improvement located on or being part of any mortgaged
property is in violation of any applicable zoning law or regulation; all
inspections, licenses and certificates required to be made or issued with
respect to all occupied portions of each mortgaged property and, with respect to
the use and occupancy of the same, including but not limited to certificates of
occupancy and fire underwriting certificates, have been made or obtained from
the appropriate authorities and such mortgaged property is lawfully occupied
under the applicable law;

         (xxx)    With respect to each Mortgage constituting a deed of trust, a
trustee, duly qualified under applicable law to serve as such, has been properly
designated and currently so serves and is named in such Mortgage, and no fees or
expenses are or will become payable by the owner of the HEL to the trustee under
the deed of trust, except in connection with a trustee's sale after default by
the related Mortgagor;

         (xxxi)   Each Mortgage contains customary and enforceable provisions
which render the rights and remedies of the holder thereof adequate for the
realization against the related mortgaged property of the benefits of the
security, including (A) in the case of a Mortgage designated as a deed of trust,
by trustee's sale and (B) otherwise by judicial foreclosure. There is no
homestead or other exemption other than any applicable Mortgagor redemption
rights available to the related Mortgagor which would materially interfere with
the right to sell the related mortgaged property at a trustee's sale or the
right to foreclose the related Mortgage;

         (xxxii)  There is no default, breach, violation or event of
acceleration existing under any Mortgage or the related Note and no event which,
with the passage of time or with notice and the expiration of any grace or cure
period, would constitute a default, breach, violation or event of acceleration;
and Seller has not waived any default, breach, violation or event of
acceleration;

         (xxxiii) No instrument of release or waiver has been executed in
connection with any Purchased HEL, and no Mortgagor has been released, in whole
or in part, except in connection with an assumption agreement which has been
approved by the primary mortgage guaranty insurer, if any, and which has been
delivered to the Custodian;

                                      H-4
<PAGE>   38

         (xxxiv)  The maturity date of each Purchased HEL is at least twelve
months prior to the maturity date of the related first home equity loan if such
first home equity loan provides for a balloon payment;

         (xxxv)   Each Purchased HEL was originated based upon a full appraisal,
which included an interior inspection of the subject mortgaged property;

         (xxxvi)  No more than 10% of the aggregate original outstanding
principal balance is secured by mortgaged properties that are non-owner occupied
mortgaged properties (i.e., investor-owned and vacation);

         (xxxvii) There do not exist any hazardous substances, hazard wastes or
solid wastes, as such terms are defined in the Comprehensive Environmental
Response Compensation and Liability Act, the Resource Conservation and Recovery
Act of 1976, or other federal, state or local environmental legislation on any
mortgaged property;

         (xxxviii) Seller was properly licensed or otherwise authorized, to the
extent required by applicable law, to originate or purchase each Purchased HEL;
and the consummation of the transactions herein contemplated, including, without
limitation, the ownership of the Purchased HELs by Buyer will not involve the
violation of such laws;

         (xxxix)  Seller has not received a notice of default of any first-lien
HEL secured by any mortgaged property which has not been cured by a party other
than Seller;

         (xl)     No Purchased HEL is subject to a temporary rate reduction
pursuant to a buydown program;

         (xli)    The interest rate on each Purchased HEL is calculated on the
basis of a year of 360 days with twelve 30-day months.

                                      H-5<PAGE>   1

                         CONTRIBUTION/EXCHANGE AGREEMENT

                                       of

                                 AUGUST 11, 2000

                                      among

                           TELDAFAX AKTIENGESELLSCHAFT

                                       and

                         NETNET TELEKOMMUNIKATIONS GMBH

                                       and

                           NEWTEL COMMUNICATIONS GMBH

<PAGE>   2
                                      -2-

This CONTRIBUTION / EXCHANGE AGREEMENT (the "Agreement") is made on 11 August
2000 (the "Signing Date") by

1.       TelDaFax Aktiengesellschaft, a public stock corporation under the laws
         of Germany, ( "TDF")

and

2.       Netnet Telekommunikations GmbH, a company with limited liability under
         the laws of Germany, ("Netnet"),

and

3.       NewTel Communications GmbH, a company with limited liability under the
         laws of Germany, ("NewTel"),

                                                     (together the "Companies").

                                    PREAMBLE

A.       World Access, Inc., a public stock corporation under the laws of
         Delaware, U.S.A., ("WA") intends to acquire a majority stake in TDF. WA
         has entered into a share purchase and transfer agreement with certain
         shareholders of TDF, dated June 14, 2000, (the "Purchase and Transfer
         Agreement") for the acquisition of 41.62% of the issued shares in TDF
         (the "Share Purchase and Transfer Agreement").

B.       TDF supports WA's intention as it is convinced that the acquisition by
         WA of such majority stake and the combination of their respective
         German businesses is for the benefit of, and in the best interests of,
         both companies and their shareholders.

C.       The Companies are wholly owned subsidiaries of WA.

<PAGE>   3
                                      -3-

D.       TDF is registered in the commercial register in the local court of
         Marburg under HR B 2174. The share capital of TDF currently amounts to
         EURO 87,954,360, divided into 33,828,600 non par value shares. TDF has
         an authorised capital (genehmigtes Kapital) in an aggregate nominal
         amount of EURO 42,900,000 and a conditional capital in the amount of
         EURO 42,900,000 to cover the issue of convertible bonds. The shares of
         TDF are admitted to the Frankfurt Stock Exchange and listed on the
         segment Neuer Markt and on EASDAQ.

E.       The management board (Vorstand) of TDF with the consent of the
         supervisory board (Aufsichtsrat) is entitled to increase the capital of
         TDF by the amount of the authorised capital to the exclusion of
         subscription rights of the existing shareholders if, inter alia, the
         newly issued shares are used to acquire other businesses. The Vorstand
         now intends to make use of this authority to acquire the businesses
         operated by the Companies.

F.       WA intends to cause the businesses operated by the Companies to be
         contributed to TDF against the issue of the shares available under the
         authorised capital (genehmigtes Kapital) of TDF to the Companies.

G.       For German tax purposes the contribution of the businesses operated by
         the Companies shall constitute a transfer of each of the Company's
         entire business (Geschaftsbetrieb im Ganzen). For purposes of applying
         U.S. federal income tax law under the United States Internal Revenue
         Code of 1986, as amended (the "Internal Revenue Code") and the
         regulations issued thereunder to the transactions set forth in this
         Agreement, and depending upon the ultimate percentage of outstanding
         TDF shares WA acquires in TDF, the transfer of the business operated by
         NewTel to TDF in exchange for the issuance of TDF shares may be treated
         as a taxable sale of such assets under Section 1001 of the Internal
         Revenue Code, but the transfer of the assets and liabilities comprising
         the business operated by Netnet in exchange for the issuance of TDF
         shares is intended to and shall be treated as a tax-free
         "reorganisation" under Section 368 (a)(1)(C) of the Internal Revenue
         Code. In this regard, this Agreement is intended and shall constitute a
         "plan of reorganisation" within the meaning of U.S. Treasury Regulation
         Section 1.368-2(g).

<PAGE>   4
                                      -4-

Therefore, the Parties agree as follows:

                                      SS. 1
                                   DEFINITIONS

Agreement                                                             Caption
Application                                                           ss. 2.5
Balance Sheet Assets                                                  ss. 3/2
Business                                                              ss. 2.1
Companies                                                             Caption
Contribution Balance Sheets                                           ss. 3.1
Internal Revenue Code                                              Preamble G
Netnet                                                                Caption
New Shares                                                            ss. 9.1
NewTel                                                                Caption
Purchase and Transfer Agreement                                    Preamble A
Share Purchase and Transfer Agreement                              Preamble A
Signing Date                                                          Caption
TDF                                                                   Caption
Transferred Assets                                                    ss. 3.3
Transfer Date                                                         ss. 2.4
WA                                                                 Preamble A

                                      SS. 2
               CONTRIBUTION OF THE BUSINESSES / ISSUANCE OF SHARES

2.1      Pursuant to the terms and conditions set forth in this Agreement, each
         of the Companies agrees to transfer to TDF and TDF accepts the transfer
         of each Company's entire business (Geschaftsbetrieb im Ganzen) with all
         assets, liabilities

<PAGE>   5
                                      -5-

         and contracts (the "Business") operated by each of the Companies as a
         contribution in kind (Sacheinlage) against the issue of new shares to
         the respective Company. The transfers of the Companies' Businesses are
         set out in more detail in ss.ss. 3 to 8 hereto. The transfer or
         assignment of the Business shall not include such liabilities under
         contracts and any other legal position owed by each of the Companies to
         WA and/or its other subsidiaries.

2.2      The Companies and TDF hereby make all declarations and, unless
         expressly provided otherwise herein, consummate all actions which are
         required to effect the transfer of the Businesses. To the extent that
         certain declarations and actions are specifically mentioned in this
         Agreement, this is done for the purpose of emphasis and clarification
         only.

2.3      The transfers of the Businesses shall become effective between the
         parties (schuldrechtlich) and (unless the consent of any third party is
         required and outstanding at the Transfer Date) also with title effect
         towards third parties (dinglich) upon registration of the capital
         increase in the commercial register of TDF contemplated by this
         Agreement (the "Transfer Date").

2.4      It is understood that (i) the management board (Vorstand) of TDF and
         (ii) the supervisory board (Aufsichtsrat) of TDF each have agreed in
         principle to adopt the capital increase contemplated hereby in order to
         issue the number of shares to the Companies as set forth in ss. 9. TDF
         undertakes to arrange for filing of the registration of the capital
         increase contemplated hereby (the "Application") on or immediately
         after the period for the acceptance of the Tender Offer contemplated by
         the Share Purchase and Transfer Agreement has expired, unless it turns
         out that following the Tender Offer WA will not own 50% of the
         outstanding shares in TDF. TDF further undertakes to consult with the
         competent commercial register in order to ensure registration of the
         capital increase as soon as possible after filing.

2.5      The parties to this Agreement shall have the right to withdraw
         (zurucktreten) from this Agreement (i) if the Closing Conditions of the
         Share Purchase and Transfer Agreement have not been satisfied by
         October 31, 2000 or (ii) if one of the parties

<PAGE>   6
                                      -6-

         of the Share Purchase and Transfer Agreement has withdrawn therefrom,
         or (iii) if the auditor (Sacheinlagenprufer) does not confirm the value
         of the Business to cover the total contribution amount.

                                      SS. 3
                       TRANSFER OF ASSETS OF THE COMPANIES

3.1      As of the Transfer Date, each of the Companies hereby transfers to TDF
         and TDF hereby accepts the transfer of all assets which are included in
         the balance sheet of each Company as of December 31, 1999, which are
         attached as Exhibit 3.1 to 3.3 (the "Contribution Balance Sheets"). In
         particular all moveable assets (bewegliche Sachen) which are located at
         the locations described in Exhibit 3.4 shall be transferred to TDF
         including all furniture and computer hardware.

3.2      As of the Transfer Date, each of the Companies transfers to TDF and TDF
         hereby accepts the transfer of, title to all assets, which are not,
         need not or cannot be accounted for in the Contribution Balance Sheets,
         but which are directly and indirectly attributable to the Businesses,
         including any and all goods of minor or little value (all these assets
         hereinafter referred to as "Balance Sheet Assets").

3.3      As of the Transfer Date each of the Companies hereby transfers to TDF
         and TDF hereby accepts the transfer of all additions to the Balance
         Sheet Assets since December 31, 1999. Those Balance Sheet Assets which
         have been sold since December 31, 1999 or which no longer assist, are
         not subject to the transfer of assets under this Section 3 (the Balance
         Sheet Assets as adjusted are referred to as the "Transferred Assets").

3.4      As of the Transfer Date ach of the Companies and TDF agree that title
         and rights to usage as well as encumbrances on the Transferred Assets
         shall pass to TDF. To the extent that the Transferred Assets are not
         directly owned by the respective Company, this Company hereby assigns
         to TDF its right to demand delivery and to take possession of the
         respective assets. TDF hereby accepts such assignments.
<PAGE>   7
                                      -7-

3.5      Possession to movable assets which are transferred in accordance with
         this Section shall pass from the respective Company to TDF effective as
         at the Transfer Date. To the extent that movable assets are not in the
         possession of the respective Companies as of the Transfer Date, each
         Company hereby assigns to TDF the right to require redelivery or
         surrender of such assets. TDF hereby accepts such assignment.

3.6.     To the extent that any of the Transferred Assets under this Section are
         subject to reservation of title by supplier or transfer of title for
         security purposes, each Company hereby transfers to TDF as of the
         Transfer Date its contingent right to acquire title to such assets
         (Anwartschaftsrecht). TDF hereby accepts such assignment.

                                      SS. 4
                            ASSIGNMENT OF RECEIVABLES

4.1      As of the Transfer Date each of the Companies hereby assigns to TDF and
         TDF hereby accepts the assignment of, all accounts receivable as well
         as all other rights and claims of each of the Company, accounted for in
         the referenced Balance Sheets taking into account additions, disposals
         and discharges pursuant to ss. 3.3 of this Agreement.

4.2      To the extent that the transfer of receivables pursuant to Subsection 1
         requires the consent of third parties, each Company will take every
         action, in order to obtain such consent. If such consent to the
         transfer of a receivable claims is withheld, the respective Company and
         TDF will treat each other as if the relevant receivable had been
         transferred as of the Transfer Date.

                                      SS. 5
                      ASSIGNMENT OF TRADEMARKS AND SOFTWARE

As of the Transfer Date each of the Companies hereby assigns to TDF and TDF
hereby accepts an assignment of, all trademarks, software and other intellectual
property rights

<PAGE>   8
                                      -8-

which form part of their respective Business as of the Transfer
Date including, without limitation, the trademarks and software listed in
Exhibit 5 together will all rights and obligations relating thereto. In due
course, after the Transfer Date, the respective Company and TDF will take all
this actions reasonably required to have TDF registered as the new owner of
trademarks and other intellectual property rights.

                                      SS. 6
           TRANSFER OF INTANGIBLE ASSETS AND OF ALL BOOKS AND RECORDS

As of the Transfer Date each of the companies hereby assigns to TDF and TDF
hereby accepts the assignment of, all intangible assets forming part of the
business as of the Transfer Date, including without limitation, all goodwill,
customer relations and all rights in the name of the respective Company as well
as all books, records, certificates deeds and other information relating to its
Business.

                                      SS. 7
            ASSIGNMENT OF CONTRACTS, LEGAL POSITIONS AND LIABILITIES

7.1      As of the Transfer Date each of the companies hereby assigns to TDF and
         TDF hereby accepts the assignment of all contracts and, to the extent
         assignable, contract offers, memberships, approvals, licences and other
         legal relations forming part of the business as of the Transfer Date
         except contracts and any other legal positions owed to WA and/or its
         other subsidiaries. The aforementioned assignment of contracts shall
         include but not be limited to the contracts which are listed in Exhibit
         7.1.

7.2      As of the Transfer Date each Company hereby assigns to TDF and TDF
         hereby accepts the assignment of all obligations shown in the balance
         sheets taking into account all additions, disposals and discharges
         since December 31, 1999, except liabilities owed by each of the
         Companies to WA and/or its other subsidiaries under contracts and any
         other legal position. The assignment shall also include liabilities
         under contracts and other legal positions assigned in accordance with

<PAGE>   9
                                      -9-

         Subsection 1, tax liabilities and other liabilities arising from the
         operations of the respective Company.

7.3      To the extent that the assignment of contracts, legal positions,
         liabilities in accordance with this Section requires the consent of the
         relevant creditors and counterparties, respectively, the Company and
         TDF will use reasonable efforts to obtain such consent to wherever
         reasonably possible. If any creditor or counterparty withholds its
         consent, the parties will treat each other as if the relevant liability
         or contract had been transferred as of the Transfer Date not only with
         internal but also with external effect. In particular any liabilities
         and contracts shall be performed by TDF on behalf of the respective
         Company but for the account of TDF and TDF shall indemnify and hold the
         respective Company harmless against all damages, costs and expenses
         suffered or incurred in connection with any contract, legal position
         and liability which is assigned to TDF in accordance with this
         Agreement. If a Company is held liable by any third party for
         fulfilment of any liability or contract which is, or, if they existed
         as stated by the relevant third party, would be assigned by the Company
         to TDF in accordance with this Agreement and, if TDF does therefore not
         fulfil the liability or contract as demanded by the third party, then
         TDF shall be responsible for handling the further proceedings
         including, but not limited to, any litigation and shall advance to the
         Company all funds reasonably required to defend itself against any
         claims stated by the third party without prejudice to its obligation to
         indemnify and hold the Company harmless in accordance with the
         proceeding provisions.

                                      SS. 8
               TRANSFER OF EMPLOYMENTS AND OF PENSION LIABILITIES

8.1      All rights and obligations under any employment agreement to which any
         of the Companies is party as employer as of the Transfer Date shall
         transfer to TDF as at that date in accordance with ss. 613a of the
         German Civil Code (BGB).

8.2      TDF shall indemnify and hold each Company harmless against all damages,
         costs and expenses suffered or incurred in connection with any
         liability towards actually

<PAGE>   10
                                      -10-

         or former employees of the Companies which are transferred to TDF in
         accordance with Subsection 1. The provisions in ss. 7.3 apply
         accordingly.

                                      SS. 9
                                  CONSIDERATION

9.1      As consideration for the contribution of the Businesses of the
         Companies, TDF shall issue in total 2.546.239 non par value shares; of
         these shares TDF shall issue

         9.1.1    to Netnet 1,620,334 non par value shares representing a
                  capital of Euro 1,620,334 at a subscription amount of Euro
                  8,90 per share or a total contribution amount of Euro
                  14,420,972.60;

         9.1.2    to NewTel 925,905 non par value shares representing a capital
                  of Euro 925,905 as a subscription amount of Euro 8.90 per
                  share, or a total contribution amount of Euro 8,240,554.50.

                  The issued shares are hereinafter together referred to as the
                  "New Shares".

9.2      Upon issuance the New Shares will be duly and validly authorised, fully
         paid and non assessable and free of pre-emptive or similar rights or
         encumbrances.

9.3      In its tax balance sheet TDF shall be obliged to continue to account
         for the assets transferred under this Agreement at their book value.

                                     SS. 10
                         REPRESENTATIONS AND WARRANTIES

The Companies and WA do not give any representations and warranties with respect
to their Businesses. Any obligations of the Companies vis-a-vis TDF under the
applicable laws remain unaffected by this exclusion.

<PAGE>   11
                                      -11-

                                     SS. 11
                     CONDUCT OF THE BUSINESSES OF WA AND TDF

Each of the Companies undertakes to TDF and TDF undertakes to each of the
Companies to procure that (i) the Businesses of the Companies and TDF,
respectively, during the period from the date hereof to the registration with
the commercial register of the New Shares, are conducted in the ordinary course
except with the prior written approval of the other party, (ii) no steps are
taken by the Companies and TDF, as the case may be, which are or could be, using
a sound commercial judgment, detrimental to the transaction contemplated by this
Agreement and that (iii) no action is taken by the Companies and / or TDF which
would require their respective shareholders' or supervisory board's approval.

                                     SS. 12
                                      COSTS

Each party shall bear the cost of its own legal and other advisors incurred in
connection with the negotiation, execution and completion of this Agreement and
the transactions contemplated hereby as well as any personal taxes arising
therefrom. All notary's fees relating to the contribution in kind shall be borne
by TDF.

                                     SS. 13
                                     NOTICES

Any notices provided or required under the terms of this Agreement shall be
given in writing and shall be effective immediately when provided by facsimile
transmission or personal delivery, or five days after being sent by
internationally recognised courier, and addressed as follows:

<PAGE>   12
                                      -12-

(a)               If to the Companies:

                  World Access, Inc.
                  c/o GAEDERTZ, Frankfurt office
                  Bockenheimer Landstra(beta)e 98 - 100,
                  60323 Frankfurt am Main,
                  Fax-No.: ++49 69 7941 100

                  with copy to:

                  World Access, Inc.,
                  Attn.: W. Tod Chmar, Executive Vice President
                  945 East Paces Ferry Road, Suite 2200,
                  Atlanta, GA 30326,
                  U.S.A.
                  Fax-No.: ++1 404 233 2280

(b)               If to TDF:

                  TelDaFax AG,
                  Attn.: Dr. Henning F. Klose
                  Rudolf-Breitscheid-Stra(beta)e
                  35010 Marburg/Lahn
                  Fax-No.: ++49 6421 181 1210

                                     SS. 14
                                MUTUAL ASSISTANCE

The parties undertake to co-operate with and to provide each other with all
necessary information required for any regulatory filings, in particular, but
not limited to, all filings with the Securities Exchange Commission.

<PAGE>   13
                                      -13-

                                     SS. 15
                                  MISCELLANEOUS

15.1     This Agreement shall be governed by and construed in accordance with
         the laws of the Federal Republic of Germany. The courts in Frankfurt am
         Main shall have non-exclusive jurisdiction.

15.2.    The authentic text of this Agreement shall be the English text.
         However, if any German translations have been provided in brackets,
         such German terms shall prevail. Each of the Companies confirms that it
         is fully aware of the contents of all Exhibits including those which
         are in the German language. For purposes of the registration, a German
         translation of this Agreement will be prepared.

15.3     The parties to this Agreement shall keep this Agreement confidential
         and shall only make public announcements as to its contents upon mutual
         agreement. This does not apply to any disclosure required under the
         applicable laws, by governmental regulatory bodies, under banking
         covenants or stock exchange regulations (including the U.S. Securities
         Exchange Commission and Nasdaq National Market) to which a party to
         this Agreement is subject to. The content of such disclosure will be
         communicated to either party prior to the disclosure.

15.4     This Agreement, together with the agreements mentioned herein and the
         Side Letter between the Parties and others of even date, sets forth the
         entire agreement and understanding of the Parties with respect to the
         subject matter hereof. This Agreement will be executed in five
         counterparts.

<PAGE>   14
                                      -14-

15.5     No amendment to this Agreement shall be of any effect unless it is in
         writing and signed for or on behalf of the parties hereto. This shall
         also apply to any amendment of the present section.

15.6     If any of the provisions of this Agreement shall be or become invalid,
         this shall not affect the validity of the remaining provisions. The
         parties undertake to replace any invalid provisions by such provisions
         as shall come as close as possible to their commercial intentions in a
         legally valid manner. The same shall apply if this Agreement should
         contain an unintentional gap.

/s/ Dr. Achim Herfs
-----------------------------------
TelDaFax Aktiengesellschaft

/s/ Thomas Sievert
-----------------------------------
Netnet Telekommunikations GmbH

/s/ Thomas Sievert
-----------------------------------
NewTel Communications GmbH

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