Document:

NuVox, Inc. Form 8-K Exhibit 10.1

Exhibit 10.1

AMENDMENT NO. 1
TO
CREDIT AND GUARANTY AGREEMENT

        
AMENDMENT  NO. 1, dated as of September 11, 2001 (this  "Amendment"),  to the Credit and Guaranty
Agreement (the "Credit  Agreement"),  dated as of October 31, 2000, (as it may be amended,  restated,  supplemented
or  otherwise  modified  from time to time),  by and among  GABRIEL  COMMUNICATIONS  FINANCE  COMPANY,  a  Delaware
corporation  ("Borrower "),  as Borrower and,  NUVOX,  INC.,  (formerly  known as Gabriel  Communications,  Inc.) a
Delaware corporation ("Parent"), as a Guarantor,  GABRIEL COMMUNICATIONS  PROPERTIES,  INC., a Delaware corporation
("Holding Company"),  as a Guarantor,  certain Subsidiaries of Borrower,  as Guarantors,  the Lenders party thereto
from time to time,  GOLDMAN SACHS CREDIT  PARTNERS L.P., as Sole Lead Arranger,  Sole Book Runner,  and Syndication
Agent,  FIRST  UNION  NATIONAL  BANK,  as  Administrative  Agent  and  Collateral  Agent,  BARCLAYS  BANK  PLC,  as
Documentation Agent, and CIT LENDING SERVICES CORPORATION, as Co-Documentation Agent.

RECITALS:

        
WHEREAS,  the terms used herein,  including in the preamble and recitals  hereto,  not  otherwise
defined herein or otherwise amended hereby shall have the meanings ascribed thereto in the Credit Agreement;

        
WHEREAS,  Parent,  Holding  Company,  Borrower,  the  Lenders and Agents wish to amend the Credit
Agreement on certain terms as described herein;

        
WHEREAS,  the Parent expects to raise  aggregate net cash proceeds of no less than $75 million by
the  issuance  of  certain  preferred  stock  and  warrants  as more  particularly  described  in the  Confidential
Preliminary  Private  Placement  Memorandum  dated August 24,  2001,  the  principal  terms of which are set out in
Exhibit A hereto (the "Equity Issuance");

        
WHEREAS,  in consideration of the Parent  contributing  such net cash proceeds to Holding Company
as Paid-In Borrower Capital, the Lenders and Agents agree to amend the Credit Agreement as hereinafter described;

        
 NOW,  THEREFORE,  in consideration  of the premises and the agreements,  provisions and covenants
herein contained, each Credit Party, each Lender and each Agent party hereto agrees as follows:

SECTION 1.     AMENDMENT

        
As of the Amendment No. 1 Effective Date (as defined in Section 2 hereof),  the Credit  Agreement
shall be amended as set forth in this Section 1.

        
1.1              Section  1.1 of the  Credit  Agreement  is  hereby  amended  by  inserting  each  of the following
definitions in the appropriate alphabetical order:

	  
	        ""Access Lines Per New Customer"  means,  for any Fiscal Quarter,  the ratio of
                           (i) the  number of Access  Lines  installed  in such  Fiscal  Quarter  which are for New
                           Customers divided by (ii) the number of New Customers added in such Fiscal Quarter."

	 
	        ""Adjusted  Revenues"  means,  for any Fiscal  Quarter,  the  revenues for such
                           Fiscal Quarter,  minus the sum of (i) resale  revenues other than revenues  generated by
                           services  provided by UNE-P  lines,  (ii)  carrier  access  billing  revenues  and (iii)
                           reciprocal compensation revenues."

	 
	        ""Amendment  No.  1"  means  Amendment  No.  1 to this  Agreement,  dated as of
                           September  11,  2001,  by  and  among  Borrower,   Holding  Company,   Parent,   certain
                           Subsidiaries of the Borrower and the Lenders and Agents party thereto."

	 
	        ""Amendment  No. 1 Effective  Date" means the "Amendment No. 1 Effective  Date"
                           as such term is defined in Amendment No. 1, Section 2."

	 
	        ""Available  Cash" means the sum as at each  calculation date of (i) the unused
                           Commitments  and  (ii)  Cash  and  Cash  Equivalents  on hand at  Borrower  and  Holding
                           Company."

	 
	        ""Days Sales Outstanding" means for any Fiscal Quarter (i) accounts  receivable
                           as of the end of such  Fiscal  Quarter  multiplied  by (ii) 365  divided  by  (iii)  the
                           product of (a) 4 multiplied by (b) the Revenues for such Fiscal Quarter.

	 
	        ""Equity  Issuance"  means the Parent's  issuance of certain units of preferred
                           stock  and  warrants  at  $1.50  per  unit,  as  more  particularly   described  in  the
                           Confidential  Preliminary  Private Placement  Memorandum dated August 24, 2001, to raise
                           aggregate  net cash proceeds of no less than $75 million,  the principal  terms of which
                           are set out in Exhibit A to Amendment No. 1."

	 
	        ""Gross  Profit"  means for any Fiscal  Quarter the Revenues  minus the cost of
                           sales for such Fiscal Quarter as determined in accordance with GAAP."

	 
	        ""New  Customer"  means each new billing name  activated  for customer  billing
                           purposes."

	 
	        ""Total  Acquisition  Cost Per New Customer"  means for any Fiscal  Quarter the
                           ratio of (i)  Total  Acquisition  Costs  for such  Fiscal  Quarter  divided  by (ii) the
                           number of New Customers added in such Fiscal Quarter."

	 
	                ""Total  Acquisition  Costs"  means  for  any  Fiscal  Quarter  all  sales  and
                           marketing  expenses  for such Fiscal  Quarter  plus the actual cost of customer  premise
                           equipment installed for New Customers in such Fiscal Quarter."

        1.2
        The following  definitions  in Section 1.1 of the Credit  Agreement  are hereby  deleted and replaced with the following:

	 
	        ""Access Lines" shall mean the total number of DS-O equivalent  lines installed
                           and activated,  for customer billing  purposes,  that are being used to provide voice or
                           data  telecommunications  service  to  non-residential  customers  of  Borrower  and its
                           Subsidiaries,  including  on-switch lines and UNE-P lines,  but excluding any other form
                           of resale lines."

	 
	        ""Applicable  Margin"   means 4.50% per annum with respect to  Eurodollar  Rate
                           Loans and 3.50% per annum  with  respect to Base Rate  Loans  provided  that at any time
                           (i) when the Borrower has delivered a Compliance  Certificate  and applicable  financial
                           statements  confirming  that the Borrower  EBITDA for the most recent Fiscal  Quarter is
                           greater  than  zero  or (ii)  after  the  later  of (a) the  date  on  which  commercial
                           operation has been  commenced in at least  twenty-one  (21) markets and the Borrower has
                           delivered a Compliance  Certificate and applicable financial statements  confirming that
                           the annualized  quarterly  gross revenues of the Borrower and its  Subsidiaries  exceeds
                           $175,000,000  and (b) twelve months after the Closing Date, the Applicable  Margin shall
                           be adjusted in accordance with the following  pricing grid,  based on the Total Borrower
                           Leverage Ratio:

	Total Borrower
 Leverage Ratio 	Applicable Margin
for Eurodollar
Rate Loans 	Applicable Margin
for Base Rate
 Loans
	>  10.0:1.00	4.25%	3.25%
	 <  10.0:1.00
>   8.0:1.00	4.00%	3.00%
	<   8.0:1.00
>  6.00:1.00	3.75%	2.75%
	<  6.00:1.00
>  4.00:1.00	3.50%	2.50%
	<  4.00:1.00	3.25% 	2.25% 

	  
	        No change in the  Applicable  Margin  shall be  effective  until  three
                           Business  Days after the date on which  Administrative  Agent  shall have  received  the
                           applicable  financial  statements  and a  Compliance  Certificate  pursuant  to  Section
                           5.1(d)  calculating  the Total  Leverage  Ratio.  At any time when the  Borrower has not
                           submitted  to  Administrative  Agent the  applicable  information  as and when  required
                           under  Section  5.1(d),  the  Applicable  Margin  shall be  determined  as if the  Total
                           Borrower  Leverage  Ratio  were in excess  of  10.0:1.00.  Within  one  Business  Day of
                           receipt  of the  applicable  information  as and when  required  under  Section  5.1(d),
                           Administrative   Agent  shall  give  each  Lender  telefacsimile  or  telephonic  notice
                           (confirmed in writing) of the Applicable Margin in effect from such date."

	 
	        ""Asset Sale" means a sale,  lease or sub-lease (as lessor or sublessor),  sale
                           and  leaseback,  assignment,  conveyance,  transfer  or  other  disposition  to,  or any
                           exchange  of  property   with,   any  Person  (other  than  Borrower  or  any  Guarantor
                           Subsidiary),  in one transaction or a series of transactions,  of all or any part of (i)
                           Borrower's  or any of its  Subsidiaries'  businesses,  assets or properties of any kind,
                           whether real, personal,  or mixed and whether tangible or intangible,  whether now owned
                           or  hereafter  acquired,  including,  without  limitation,  the Capital  Stock of any of
                           Borrower's  Subsidiaries  and (ii) Holding  Company's  Telecommunications  Assets (other
                           than any Securities or assets of any Unrestricted  Subsidiary),  in each case other than
                           (x) inventory  (or other  assets,  including  surplus  capacity on a  telecommunications
                           network  or dark  fiber in the  ordinary  course  of  business)  sold or  leased  in the
                           ordinary  course of business,  (y) disposals of obsolete,  worn out or surplus  property
                           which Parent deems no longer  needed or useful in the conduct of the  Telecommunications
                           Business  of  Holding  Company  and  its  Subsidiaries  and  (z)  sales  of  assets  for
                           consideration of less than $1,000,000 in the aggregate in any Fiscal Year."

	 
	        ""Available  Proceeds Amount" means, as of any date of  determination,  without
                           double  counting  and in respect of each  Investment,  after  having given effect to all
                           other  Investments  to be  effected  on such  date,  an  amount  equal to (i) 50% of the
                           aggregate  net cash  proceeds of equity  issuances by Parent after the  Amendment  No. 1
                           Effective  Date  contributed as common equity to Holding  Company;  plus (ii) the sum of
                           (a) the net cash  proceeds  received  by  Holding  Company in respect of the sale of any
                           Unrestricted  Subsidiary  and (b) the  proceeds of cash  dividends  declared and paid to
                           Holding  Company by any  Unrestricted  Subsidiary;  minus (iii) the  Available  Proceeds
                           Usage Amount.  Notwithstanding  the foregoing,  the Available  Proceeds  Amount shall be
                           deemed  to be reset  to zero on the  Amendment  No. 1  Effective  Date,  and the  Equity
                           Issuance shall not be deemed to give rise to any Available Proceeds Amount."

	 
	        ""Available  Proceeds  Usage Amount"  means,  as of any date of  determination,
                           without double  counting,  a cumulative  amount equal to the sum of : (i) the cumulative
                           amount of  Capital  Expenditures  made by  Holding  Company  after the  Amendment  No. 1
                           Effective  Date  pursuant  to the  final  proviso  of  Section  6.6(e);  plus  (ii)  the
                           cumulative  amount of  Investments  made by Holding  Company  after the  Amendment No. 1
                           Effective  Date  pursuant  to  Section  6.5(l);  plus  (iii)  the  cumulative  amount of
                           Investments  made by Holding  Company in Unrestricted  Subsidiaries  after the Amendment
                           No. 1  Effective  Date  pursuant  to  Sections  6.5(m),  6.18 and  6.21;  plus  (iv) the
                           aggregate  cash  portion  of the  purchase  price  paid  in  connection  with  Permitted
                           Acquisitions  after the Amendment No. 1 Effective Date made in the amounts  described in
                           clause (viii)(b) of the definition of Permitted Acquisition."

	 
	        ""Borrower Net Income" means,  for any period,  (i) the net income (or loss) of
                           Holding Company and its Subsidiaries  (other than GCI Transportation  Company L.L.C.) on
                           a consolidated  basis for such period taken as a single  accounting period determined in
                           conformity  with GAAP,  minus, to the extent included in (i), (ii) (a) the income of any
                           Person  (other than a Subsidiary  of  Borrower)  in which any other  Person  (other than
                           Borrower or any of its Subsidiaries)  has a joint interest,  except to the extent of the
                           amount of  dividends  or other  distributions  actually  paid to  Borrower or any of its
                           Subsidiaries  by such Person during such period,  (b) the income (or loss) of any Person
                           accrued  prior to the date it becomes a  Subsidiary  of  Borrower  or is merged  into or
                           consolidated  with  Borrower  or any of its  Subsidiaries  or that  Person's  assets are
                           acquired by Borrower or any of its  Subsidiaries,  (c) the income of any  Subsidiary  of
                           Borrower  to the  extent  that the  declaration  or  payment  of  dividends  or  similar
                           distributions  by that  Subsidiary  of  that  income  is not at the  time  permitted  by
                           operation of the terms of its charter or any agreement,  instrument,  judgment,  decree,
                           order, statute, rule or governmental  regulation applicable to that Subsidiary,  (d) any
                           after-tax  gains or losses  attributable  to Asset Sales or returned  surplus  assets of
                           any  Pension  Plan,  and (e) (to the extent not  included  in clauses  (a)  through  (d)
                           above) any net extraordinary gains or net non-cash extraordinary losses."

	 
	
        ""Delayed  Draw Term Loan Maturity Date" means the earlier of (i) September 30,
                           2006 and (ii) the date that all  Delayed  Draw Term Loans  shall  become due and payable
                           in full hereunder, whether by acceleration or otherwise."

	 
	        ""Nortel  Networks  Loans Maturity Date" means the earlier of (i) September 30,
                           2006 and (ii) the date that all Nortel  Networks  Loans shall  become due and payable in
                           full hereunder, whether by acceleration or otherwise."

	 
	        ""Permitted  Acquisition"  means the acquisition of the three acquired entities
                           referred to in the letter from Parent to Lenders  dated June 11,  2001,  a copy of which
                           is attached as Exhibit B to Amendment No. 1, and any other  acquisition  by the Borrower
                           or any Wholly Owned  Subsidiary,  whether by purchase,  merger or  otherwise,  of all or
                           substantially  all of the assets of, all of the Capital  Stock of, or a business line or
                           unit or a division of, any Person; provided, with respect to such other acquisitions,

	 
	        (i)        
      immediately  prior to, and after  giving  effect  thereto,  no
                                    Default or Event of Default  shall have  occurred  and be  continuing  or would
                                    result therefrom;

	 
	        (ii)        all   transactions   in   connection    therewith   shall   be
                                    consummated in accordance  with all applicable  laws and in conformity with all
                                    applicable Governmental Authorizations;

	 	        
(iii)        
in the case of the acquisition of Capital Stock, (A) all of the Capital Stock
(except for any such Securities in the nature of directors’ qualifying
shares required pursuant to applicable law), acquired or otherwise issued by
such Person or any newly formed Subsidiary of Borrower in connection with such
acquisition shall be owned 100% by Borrower or a Guarantor Subsidiary thereof,
and (B) Parent, Holding Company and Borrower shall have taken, or caused to be
taken, as of the date such Person becomes a Subsidiary of Borrower, each of the
actions set forth in Section 5.9, as applicable;

	 	        
(iv)        
Parent and its Subsidiaries shall be in compliance with, immediately before and
after giving pro forma effect to such acquisition, Sections 6.6, 6.7, 6.8
and 6.22, as applicable;

	 	        
(v)        
Borrower shall have delivered to Administrative Agent (which Administrative
Agent shall promptly furnish to the Lenders) (A) at least 10 Business Days prior
to such proposed acquisition, a Compliance Certificate evidencing pro
forma compliance with Sections 6.6, 6.7, 6.8 and 6.22, as applicable, as
required under clause (iv) above, together with all relevant financial
information with respect to such acquired assets, including, without limitation,
the aggregate consideration for such acquisition and any other information
required to demonstrate pro forma compliance with Sections 6.6, 6.7, 6.8
and 6.22, as applicable;

	 	        
(vi)        
any Person or assets or division as acquired in accordance herewith shall be in
same business or lines of business in which Borrower and/or its Subsidiaries are
engaged as of the Amendment No. 1 Effective Date or such other lines of business
as may be consented to by Requisite Lenders;

	 	        
(vii)        
the principal operations of all Persons, assets or divisions acquired shall be
located either (I) in the Initial Borrower Markets or (II) in one of the
Pre-approved Borrower Markets (other than those located in New Mexico, Texas,
Wisconsin or Minnesota) designated in writing by the Borrower to the
Administrative Agent or (III) in an Other Market or Pre-approved Borrower Market
located in New Mexico, Texas, Wisconsin or Minnesota designated by Borrower in
writing to Administrative Agent and approved by Requisite Lenders in their
absolute discretion; provided in each case (A) the principal operations,
assets or divisions acquired are related to Borrower’s Telecommunications
Business, (B) the Borrower shall provide the Syndication Agent and the
Administrative Agent with a revised Financial Plan in form and substance
reasonably satisfactory to the Syndication Agent and Administrative Agent, which
revised Financial Plan demonstrates that (1) the Borrower’s business in all
proposed and existing Geographic Markets, as described in such revised Financial
Plan, is fully financed and (2) each of the Borrower and the Parent is in pro
forma compliance with its financial covenants as required pursuant to clause
(iv) and (v) above, and (C) that the acquisition does not reduce Consolidated
EBITDA on a pro forma basis as to any future Fiscal Quarter based on actual
historical results with such adjustments as are consistent with Regulation S-X;
and

	 	        
(viii)        
the aggregate cash portion of the purchase price paid in connection with all
such acquisitions since the Amendment No. 1 Effective Date does not exceed an
amount equivalent to the sum of (a) 100% of the net proceeds of the Equity
Issuance in excess of $75,000,000 up to $80,000,000, plus 50% of the net
proceeds of the Equity Issuance in excess of $80,000,000 in aggregate, and (b)
the Available Proceeds Amount.”

	 
	        ""Revolving  Loan Commitment  Termination  Date" means the earliest to occur of
                           (i) September 30, 2006,  (ii) the date the Revolving Loan  Commitments  are  permanently
                           reduced to zero pursuant to Sections  2.10,  2.11(b) or 2.12,  and (iii) the date of the
                           termination of the Revolving Loan Commitments pursuant to Section 8.1."

	 
	        ""Revolving  Loan  Maturity  Date" means the earlier of (i)  September 30, 2006
                           and (ii) the date  that  all  Revolving  Loans  shall  become  due and  payable  in full
                           hereunder, whether by acceleration or otherwise."

	 
	       ""Subject  Acquisition"  means a  Permitted  Acquisition  or series of  related
                           Permitted  Acquisitions  by  Borrower  or  any  of  its  Subsidiaries  for  which  total
                           consideration,  when  aggregated  with the  consideration  paid in  respect of all other
                           Permitted   Acquisitions  (A)  since  the  Amendment  No.  1  Effective  Date,   exceeds
                           $5,000,000  in the  aggregate or (B) since the date of the last  occurrence of a Subject
                           Acquisition, exceeds $5,000,000 in the aggregate."

	 
	        ""Subject  Asset Sale" means an Asset Sale or series of related  Asset Sales by
                           Borrower or any of its  Subsidiaries  for which  total  consideration,  when  aggregated
                           with  the  consideration  paid in  respect  of all  other  Asset  Sales  (A)  since  the
                           Amendment  No. 1 Effective  Date,  exceeds  $5,000,000 in the aggregate or (B) since the
                           date  of the  last  occurrence  of a  Subject  Asset  Sale,  exceeds  $5,000,000  in the
                           aggregate."

	 
	        ""Tranche A Term Loan  Maturity  Date" means the earlier of (i)  September  30,
                           2006 and (ii) the date that all  Tranche A Term Loans  shall  become due and  payable in
                           full hereunder, whether by acceleration or otherwise."

        
1.3        Section  2.1(a)(v) of the Credit  Agreement is hereby amended by inserting the following
at the beginning thereof:

        "Notwithstanding  the  following  provisions of this Section  2.1(a)(v),  such  provisions  shall
terminate and be permanently unavailable to the Borrower after and including the Amendment No. 1 Effective Date."

        1.4        
      Section 2.4 of the Credit  Agreement is hereby  amended by deleting the last sentence of such Section and replacing such sentence in its entirety with the following:

	 	        “The
proceeds of Nortel Networks Loans drawn on the Closing Date shall have been used
solely to repay amounts owing under item (iii) of the definition of Existing
Indebtedness, and the proceeds of Nortel Networks Loans thereafter shall be used
solely to provide financing for the purchase of equipment licensed, manufactured
or supplied by Nortel Networks and related services (including, without
limitation, the installation and construction services in respect of such
equipment) from Nortel Networks and related fees, charges and expenses in
respect thereof to the extent incurred subsequent to the Closing Date or
pursuant to TriVergent’s equipment purchase commitment contained in that
certain TriVergent Amendment No. 2 to the Master Purchase Agreement dated March
7, 2000, between TriVergent and Nortel Networks; provided  that after the
Amendment No. 1 Effective Date the proceeds of Nortel Networks Loans shall be
used solely to provide financing for the purchase of equipment licensed,
manufactured or supplied by Nortel Networks and related services (including,
without limitation, the installation and construction services in respect of
such equipment) from Nortel Networks and related fees, charges and expenses in
respect thereof to the extent incurred subsequent to the Amendment No. 1
Effective Date. After the Amendment No. 1 Effective Date, the proceeds of Loans
other than Nortel Networks Loans shall not be used to purchase or reimburse the
purchase cost of equipment licensed, manufactured or supplied by Nortel Networks
and related services and related fees, charges and expenses in respect thereof
at a time when Nortel Networks Loans are otherwise available to be borrowed for
such purpose.” 

        1.5
        Section  2.10 of the Credit  Agreement  is hereby  deleted in its  entirety and replaced
with the following:

	 
	
"2.10     Commitment Reductions/Scheduled Payments.

	 
	        (a)   Scheduled   Revolving   Commitment   Reductions.   The   Revolving   Loan
                           Commitments  hereunder shall be permanently  reduced in the percentages of the aggregate
                           Revolving  Loan  Commitments  as of December  31,  2003 set forth  below in  consecutive
                           quarterly installments (each, a "Reduction") on the dates set forth below:

	Date	Revolving Loan
Commitment Reductions
	December 31, 2003 	2.50% 
	March 31, 2004  	2.50% 
	June 30, 2004 	 2.50% 
	September 30, 2004 	2.50%
	December 31, 2004 	3.75% 
	March 31, 2005  	3.75%
	June 30, 2005  	3.75%
	September 30, 2005 	3.75%
	December 31, 2005	 5.00%
	March 31, 2006	5.00% 
	June 30, 2006	5.00%
	September 30, 2006	60.00%

	 	
Notwithstanding
the foregoing, (i) such Reductions shall be reduced in connection with any
voluntary or mandatory reductions of the Revolving Loan Commitments in
accordance with Sections 2.11, 2.12 or 2.13 and (ii) the Revolving Loans,
together with all amounts owing hereunder with respect thereto, shall be
permanently repaid in full no later than the Revolving Loan Maturity Date.

	 
	
        (b)  Scheduled  Tranche  A Term  Loan  Installments,  Delayed  Draw  Term Loan
Installments  and  Nortel  Networks  Loan  Installments.  The  principal  amounts of the
                           Tranche A Term Loan,  Delayed Draw Term Loans and Nortel  Networks Loans shall be repaid
                           in the  percentages  of such Loans  outstanding  as of December 31, 2003 set forth below
                           in  consecutive  quarterly  installments  (each,  a "Tranche  A Term Loan  Installment",
                           "Delayed  Draw  Term  Loan  Installment",  or " Nortel  Networks  Loan  Installment"  as
                           applicable) on the dates set forth below:

	Date	Tranche A Term Loan,
Delayed Draw Term Loan and Nortel
 Networks Loan Installments
	December 31, 2003 	2.50% 
	March 31, 2004  	2.50% 
	June 30, 2004 	 2.50% 
	September 30, 2004 	2.50%
	December 31, 2004 	3.75% 
	March 31, 2005  	3.75%
	June 30, 2005  	3.75%
	September 30, 2005 	3.75%
	December 31, 2005	 5.00%
	March 31, 2006	5.00% 
	June 30, 2006	5.00%
	September 30, 2006	60.00%

	 	
Notwithstanding
the foregoing, (i) such Tranche A Term Loan Installments, Delayed Draw Term Loan
Installments and Nortel Networks Loan Installments shall be reduced in
connection with any voluntary or mandatory reduction or prepayments of the
Tranche A Term Loans, Delayed Draw Term Loans or Nortel Networks Loans, as
applicable, in accordance with Sections 2.11, 2.12 or 2.13 and (ii) the Tranche
A Term Loans, Delayed Draw Term Loans and Nortel Networks Loans, together with
all other amounts owed hereunder with respect thereto, shall be permanently
repaid in full no later than the Tranche A Term Loan Maturity Date, or Delayed
Draw Term Loan Maturity Date or Nortel Networks Loan Maturity Date, as the case
may be.”

        
1.6        Section  2.12 of the  Credit  Agreement  is  hereby  amended  by the  addition  of a new
subsection (f) as follows:

	 
	        
                                    "(f)    Permitted  Parent Debt.  Borrower  shall  immediately  prepay Loans and
                           permanently  reduce  Commitments,  all as set forth in Section 2.13(b),  in an aggregate
                           amount equal to the net proceeds of any issuance of Permitted Parent Debt."

        
1.7        Section  2.12(a)  of the  Credit  Agreement  is hereby  deleted  and  replaced  with the
following:

	 
	        
                                    "(a) Asset  Sales.  After the receipt by  Borrower or any of its  Subsidiaries,
                           Holding  Company or Parent of Net Asset Sale Proceeds,  Borrower shall (and Parent shall
                           cause Borrower to) prepay Loans and  permanently  reduce  Commitments,  all as set forth
                           in  Section  2.13(b),  (i)  within 5 days of  receipt,  with 100% of any Net Asset  Sale
                           Proceeds  in excess of  $20,000,000  in  aggregate  from the  Amendment  No. 1 Effective
                           Date,  (ii)  within 5 days of  receipt,  with 50% of any Net Asset  Sale  Proceeds  (not
                           exceeding  $20,000,000 in aggregate  from the Amendment No. 1 Effective  Date) and (iii)
                           within 270 days after  receipt  and to the extent  Borrower  has not repaid  pursuant to
                           (ii) above or reinvested in  Telecommunications  Assets (of the general type used in the
                           business  of Parent  and its  Subsidiaries,  as  certified  to  Administrative  Agent by
                           Parent),   with  any  portion  of  such  Net  Asset  Sale  Proceeds  not  so  repaid  or
                           reinvested.  Pending a  determination  whether  any Net  Asset  Sale  Proceeds  shall be
                           applied  to  prepay  outstanding  Loans  and/or  reduce  Commitments   pursuant  to  the
                           preceding   sentence,   such  Net  Asset  Sale  Proceeds  shall  be  applied  to  prepay
                           outstanding  Revolving  Loans  (without a reduction in the  Revolving  Loan  Commitments
                           pending such  determination).  Further,  to the extent such Net Asset Sale  Proceeds are
                           reinvested  as provided  above,  replacement  Liens  shall be granted to the  Collateral
                           Agent pursuant to Section 1.3 of the Pledge and Security Agreement."

        
1.8        Section  2.13(b) of the Credit  Agreement  is hereby  amended  by the  insertion  in the
first sentence thereof, following the phrase "through 2.12(c)," of the following:

	 
	        "and 2.12(f)"

        
1.9        Section  3.2(a)  of the  Credit  Agreement  is hereby  amended  by the  addition  of the
following at the end thereof:

	 
	        "(ix)  the Chief  Financial  Officer  of the  Parent  shall  have  delivered  a
                           certificate  demonstrating  to the  satisfaction of the  Administrative  Agent that, and
                           further representing and warranting that:

	 	        
(1)        
Parent and Borrower expect, after giving effect to the proposed borrowing, and
based upon good faith determinations and projections consistent with the current
Financial Plan, to be in compliance with all operating and financial covenants
at the end of the current period;

	 	        
(2)        
after giving effect to the proposed borrowing, the sum of aggregate outstanding
Loans and the Letters of Credit Usage shall not exceed $175 million prior to
April 1, 2002 and $200 million between April 1, 2002 and June 30, 2002 (such
availability subject to the delivery of a Compliance Certificate demonstrating
compliance with all operating and financial covenants as of the end of the prior
period as required by Section 3.2(a)(viii) of this Agreement); and

	 	        
(3)         
proceeds of Loans (other than Nortel Loans) are not being used to fund or
reimburse the purchase cost of equipment and services from Nortel Networks, Inc.
at a time when Nortel Loans are otherwise available to be borrowed for such
purpose.”

        
1.10        Section  5.1(a) of the  Credit  Agreement  is hereby  amended by the  addition  of a new
subsection (v) as follows:

	 
	        
                                            "(v)  Additional  Quarterly  Reports.  As soon as  practicable,  and in
                           any event no later than  forty-five  (45) days after the end of each Fiscal  Quarter,  a
                           quarterly  operational  progress report in form satisfactory to the Administrative Agent
                           setting  out the number of New  Customers,  Access  Lines Per New  Customer,  Days Sales
                           Outstanding,  Total  Acquisition  Cost per New  Customer,  quantity and cost of customer
                           premise  equipment  installed and number of "local loops" installed  (measured by adding
                           T-1's and "EELs", excluding conversions of existing lines to "EELs")."

        
1.11        Section  5.1(d) of the Credit  Agreement  is hereby  amended by deleting  the ";" on the
last line thereof and adding:

	 	
“and
together with each delivery of monthly reports of Parent and its Subsidiaries
pursuant to Section 5.1(a), a duly executed and completed Compliance Certificate
demonstrating compliance with Section 6.22;"

        
1.12        Section  5.1(j) of the Credit  Agreement is hereby  amended by inserting  the  following
after a "Financial Plan":

	 
	", in form and  substance  reasonably  satisfactory  to the  Syndication  Agent  and the
                           Administrative Agent,"

        
1.13        Section  5.12  of  the  Credit  Agreement  is  hereby  amended  by the  addition  of the
following at the end thereof:

	 	
“Parent
shall contribute the aggregate net cash proceeds of all future equity and debt
issuances to Holding Company as Paid-In Borrower Capital and Holding Company
shall contribute such proceeds of debt issuances to Borrower, which proceeds
Borrower shall immediately apply as a mandatory prepayment as required under
Section 2.12(f).”

        
1.14        Section  5.15  of  the  Credit  Agreement  is  hereby  amended  by the  addition  of the
following at the end thereof:

	 	
“Holding
Company shall (i) at all times ensure that all Cash and Cash Equivalents at any
time held by it are subject to a valid and perfected first priority Lien in
favor of the Lenders, and (ii) ensure that at all times such Cash and Cash
Equivalents are in bank accounts subject to the account control agreements or
are otherwise subject to the securities control agreements, which agreements
exist as of the Amendment No. 1 Effective Date.”

        
1.15        Section  6.1 of  the  Credit  Agreement  is  hereby  amended  by  adding  the  following
subsection:

	 
	
"(h) any Interest Rate Agreements required pursuant to Section 5.11."

        
1.16        Section  6.1(f) of the Credit  Agreement is hereby  deleted in its entirety and replaced
with the following:

	 
	        
                                    "(f)  Indebtedness with respect to Capital Leases in an aggregate amount not to
                           exceed at any time  $15,000,000,  provided that no more than  $5,000,000 in aggregate of
                           such  amount at any time shall be in respect  of Capital  Leases of items  which are not
                           customer premise equipment."

        
1.17       Section  6.1B of the Credit  Agreement is hereby  amended by deleting the last  sentence
of such Section and replacing such sentence in its entirety with:

	 
	"Notwithstanding the foregoing,  but subject always to Section 6.8, except with
                           the Requisite Lenders' consent,  Unrestricted  Subsidiaries of Holding Company shall not
                           be able to create,  incur,  assume or  guaranty,  or otherwise  become or remain  liable
                           with  respect  to any  secured  or  unsecured  Indebtedness,  except  in the case of GCI
                           Transportation  Company  L.L.C.  which shall be permitted to incur secured  Indebtedness
                           up to $2,760,000 on or prior to September 30, 2001."

        
1.18        Section  6.4(a) of the Credit  Agreement is hereby amended by deleting  subsection  (iv)
in its entirety and inserting the phrase:

	 
	         
"(reserved); and"

        
1.19          Sections  6.5(k),  (l),  and (m) of the Credit  Agreement  are  hereby  deleted in their
entirety and replaced with the following:

	 
	
        "(k)  in  the  case  of  Borrower,  promissory  notes  and  other  Indebtedness
                           received  in  connection  with Asset  Sales  permitted  by Section  6.9 to an  aggregate
                           amount not to exceed  $3,000,000  at any one time  outstanding;  provided  that any such
                           promissory note (or series of related  promissory  notes) payable in a principal  amount
                           equal to or greater  than  $250,000  shall  have been  delivered  to the  Administrative
                           Agent to be held as Collateral  pursuant to the Pledge and Security  Agreement;  and, in
                           the case of  Holding  Company,  promissory  notes and  other  Indebtedness  received  in
                           connection with the sale of any Unrestricted Subsidiary;

	 
	
         (l)  other  cash   Investments  by  Holding  Company  (other  than  Investments
                           referred  to in Section  6.5(m)) in an amount not to exceed the lesser of the  Available
                           Proceeds  Amount or  $7,500,000;  provided  that (i)  immediately  prior  to,  and after
                           giving  effect  thereto,  no  Default or Event of Default  shall  have  occurred  and be
                           continuing  or would  result  therefrom,  (ii) Parent and its  Subsidiaries  shall be in
                           compliance  with,  immediately  before  and  after  giving  pro  forma  effect  to  such
                           Investment,  Sections 6.6, 6.7, 6.8 and 6.22, as  applicable,  (iii) such  Investment is
                           subject to a Lien  (junior  only to Permitted  Encumbrances)  granted to the  Collateral
                           Agent  pursuant to Section 1.3 of the Pledge and Security  Agreement,  and (iv) the sale
                           or  transfer of such  Investment  is not  subject to any  restrictions  other than those
                           imposed by this Agreement or applicable law or regulation; and

	 
	
        (m) in  the  case  of the  Holding  Company,  following  the  Amendment  No.  1
                           Effective  Date,  Investments  in  Unrestricted  Subsidiaries  established  or  acquired
                           pursuant to Sections 6.18 or 6.21,  respectively,  so long as such  Investments  are for
                           the  routine  operation  and  maintenance  of the  aircraft  currently  operated  by GCI
                           Transportation  Company  L.L.C.  in an aggregate  total amount in any Fiscal Year not to
                           exceed $100,000."

        
1.20         Section  6.6(a) of the Credit  Agreement is hereby  deleted in its entirety and replaced
with the following:

	 
	
        "(a)    Minimum   Adjusted   Revenues.   Borrower  shall  not  permit  Adjusted
                           Revenues as of the last day of any Fiscal  Quarter,  beginning  with the Fiscal  Quarter
                           ending  September  30, 2001,  to be less than the  correlative  amount  indicated as set
                           forth on  Schedule  6.6(a) (in each case as such  amount  may be  adjusted  pursuant  to
                           Section 6.6(g))."

        
1.21        Schedules  6.6(a),  (b),  (c) and (e) of the Credit  Agreement  are hereby  deleted  and
replaced with the  corresponding  schedules  attached as Annex I hereto.  New Schedules  6.6(h) and 6.6(i) attached
hereto as Annexes II and III, respectively, are hereby added to the Credit Agreement.

        
1.22        Section  6.6(d) of the Credit  Agreement is hereby  deleted in its entirety and replaced
with the following:

	 
	
        "(d)  Total  Borrower  Debt  to  Total  Borrower  Capitalization.  At any  time
                           during  Stage 1,  Borrower  shall not permit the ratio of Total  Borrower  Debt to Total
                           Borrower Capitalization to exceed 0.40:1.00."

        
1.23        Section  6.6(g) of the Credit  Agreement is hereby  deleted in its entirety and replaced
with the following:

	 
	
        "(g)    Certain  Calculations.     (i) (1) For purposes of determining  compliance
                           with the  financial  covenants  set forth in Sections  6.6(a),  (b),  (c),  and (h), the
                           minimum Adjusted Revenues,  minimum Access Lines,  minimum  EBITDA/maximum  EBITDA loss,
                           and minimum Gross Profits  specified in such Sections  shall be increased for any period
                           in which a Subject  Acquisition  has occurred and each succeeding  period  thereafter by
                           100% of the Adjusted Revenues,  Access Lines,  Consolidated  EBITDA and Gross Profits of
                           the  entity  or  assets  being  acquired  for the then most  recently  completed  Fiscal
                           Quarter  prior  to  the  date  of  such  acquisition  using  the  historical   financial
                           statements of such entity,  and the  consolidated  financial  statements of Borrower and
                           its  Subsidiaries  shall be  restated on a pro forma  basis as if such  transaction  had
                           been  consummated  at the beginning of such period;  and all such pro forma  adjustments
                           shall be  accompanied  by a Financial  Officer  Certification;  (2) for the  purposes of
                           determining  compliance  with the financial  covenant set forth in Section  6.6(i),  the
                           minimum  Available  Cash  specified  in such Section  shall be reduced by the  aggregate
                           amount of all mandatory  prepayments (and resulting  Commitment  reductions) pursuant to
                           Section 2.12, but in no event shall such specified  minimum  Available Cash be less than
                           $5,000,000.

	 
	
               
(ii)  For  purposes  of  determining   compliance  with  the  financial
                           covenants  set  forth in  Sections  6.6(a),  (b),  (c) and  (h),  the  minimum  Adjusted
                           Revenues,  Access Lines,  Consolidated  EBITDA,  and minimum Gross Profits  specified in
                           such  Sections  shall be  decreased  for any  period in which a Subject  Asset  Sale has
                           occurred  and  each  succeeding  period  thereafter  by 100% of the  Adjusted  Revenues,
                           Access  Lines (if any),  Consolidated  EBITDA and Gross  Profits of the entity or assets
                           being sold for the then most  recently  completed  Fiscal  Quarter  prior to the date of
                           such sale and the  consolidated  financial  statements of Borrower and its  Subsidiaries
                           shall be restated on a pro forma basis as if such  transaction  had been  consummated at
                           the beginning of such period;  and all such pro forma  adjustments  shall be accompanied
                           by a Financial Officer Certification.

        
1.24         Section  6.6 of the  Credit  Agreement  is  hereby  amended  to add  the  following  new
sub-sections:

	 
	
        "(h) Minimum  Gross  Profits.  Borrower  shall not permit  Gross  Profits as of
                           the last day of any Fiscal Quarter,  beginning with the Fiscal Quarter ending  September
                           30, 2001, to be less than the  correlative  amount set forth on Schedule 6.6(h) (in each
                           case as such amount may be adjusted pursuant to Section 6.6(g)).

	 
	
         
(i)  Minimum  Available  Cash.  During  Stage 1, the  Borrower  shall not permit
                           the  amount  of  Available  Cash to be less  than the  correlative  amount  set forth on
                           Schedule  6.6(i),  (A) as of any  Credit  Date,  (B) as of the  last  day of any  Fiscal
                           Quarter  and (C) for any period of more than ten  consecutive  Business  Days during any
                           Fiscal Quarter."

        
1.25        Section  6.18(a) of the Credit  Agreement is hereby  amended by inserting  the following
at the beginning thereof before the phrase "Holding Company":

	 
	"Without the  Requisite  Lenders'  consent,  Holding  Company may not  establish any new
                           Unrestricted Subsidiaries.  Subject to the prior sentence,"

        
1.26        Section 6 of the Credit  Agreement  is hereby  amended by the  addition of a new Section
6.22 as follows:

	 
	
        "6.22   Stage 1 Operating  Covenant.  At any time during  Stage 1, the Borrower
                           shall not  permit  the  number  of Access  Lines at the end of any month to be less than
                           the number of Access Lines as of the end of the prior month.

        
1.27        Section  10.5(a) of the Credit  Agreement is hereby  amended by inserting  the following
phrase immediately after the words "Credit Documents":

	 
	
",  other than  Hedge  Agreements  with any  Lender  Counterparty  pursuant  to
                           Section 5.11".

SECTION 2.     CONDITIONS PRECEDENT

        The  provisions  set forth in Section 1 hereof shall be effective as of the date (the  "Amendment
No. 1  Effective  Date") on which  each of the  following  conditions  shall  have  been  satisfied  (or  waived in
accordance with Section 10.5 of the Credit Agreement):

        2.1     
Parent shall have  received  aggregate  net cash proceeds of no less than $75 million as
a result of the Equity  Issuance.  The net of all such proceeds shall have been  contributed to the Holding Company
as Paid-In  Borrower  Capital,  and the  Borrower  shall have  repaid any Loans made after July 31,  2001 with such
proceeds.

        
2.2     All necessary governmental and/or third party approvals shall have been obtained.

        
2.3     The payment on the Amendment No. 1 Effective Date of:

	 	        (i)     
the reasonable fees, expenses and disbursements in connection with the
negotiation, preparation and execution of this Amendment No.1 and all
outstanding fees owing Skadden, Arps, Slate, Meagher & Flom LLP; 

	  
	
        (ii)          the  fees,  expenses  and  disbursements  of   PricewaterhouseCoopers   LLP  in
                  connection with due diligence relating to revised projections provided by the Borrower; and

	 	        (iii)     
such fees as shall have been agreed by the Borrower, the Syndication Agent and
the Administrative Agent including, without limitation, a fee payable to each
Lender consenting to and executing this Amendment No. 1 in an amount equal to
0.25% of such Lender’s aggregate Commitments; and 

        
2.4        No Default  or Event of  Default  shall have  occurred  under the  Credit  Agreement  or
result as a consequence of the amendments and transactions contemplated hereby.

        
2.5        Since  December  31,  1999 no event or change  shall  have  occurred  that has caused or
evidences, either in any case or in the aggregate, a Material Adverse Effect.

        
2.6        The  Syndication  Agent and the  Administrative  Agent shall have completed and continue
to be satisfied with their due diligence review of the Parent and its Subsidiaries.

         
2.7        The  execution  and  delivery  in form  and  substance  reasonably  satisfactory  to the
Administrative  Agent  and the  Syndication  Agent of  opinions  of  counsel  to the  Parent  as may be  reasonably
requested.

        
2.8        The  execution  and  delivery  of  definitive  documentation  in  respect  of the Equity
Issuance that the  Administrative  Agent and  Syndication  Agent shall have  acknowledged is  substantially  on the
terms set out in Exhibit A hereto (such acknowledgement not to be unreasonably withheld or delayed).

SECTION 3.     REPRESENTATIONS AND WARRANTIES

         In order to induce the Agents and Lenders to enter into this  Amendment  No. 1, each Credit Party
represents and warrants to each Agent and each Lender, that:

        
3.1        As of the Amendment No. 1 Effective  Date,  each of the  representations  and warranties
contained  in each of the Credit  Documents  is true,  correct and  complete in all  material  respects to the same
extent  as  though  made  on and as of  that  date,  except  to the  extent  such  representations  and  warranties
specifically  relate to an earlier date, in which case such  representations  and warranties  shall have been true,
correct and complete in all material respects on and as of such earlier date.

        
3.2         As of the  Amendment  No.  1  Effective  Date,  each  and  every  Credit  Party  has all
requisite  power to own and operate its  properties,  to carry on its business as now  conducted and as proposed to
be  conducted,  to enter into this  Amendment No. 1, and to carry out the  transactions  contemplated  hereby.  The
execution,  delivery and  performance of this Amendment No. 1 has been duly  authorized by all necessary  action on
the part of each Credit Party that is a party to this Amendment No. 1.

        
3.3        The  execution,  delivery  and  performance  by  each  of the  Credit  Parties  to  this
Amendment No. 1 and the consummation of the  transactions  contemplated by this Amendment No. 1 do not and will not
(a) violate  any  provision  of any law or any  governmental  rule or  regulation  applicable  to any of the Credit
Parties,  any  Governmental  Authorization,   any  of  the  Organizational  Documents  of  Parent  or  any  of  its
Subsidiaries,  or any order,  judgment or decree of any court or other agency of  government  binding on any of the
Credit Parties,  (b) conflict with,  result in a breach of or constitute (with due notice or lapse of time or both)
a default  under any  Contractual  Obligation  of any  Credit  Party,  (c)  result in or require  the  creation  or
imposition  of any  Lien  upon  any of the  material  properties  or  assets  of  any  Credit  Party  or any of its
Subsidiaries  (other than any Liens  created  under this  Amendment  No. 1 or any of the other Credit  Documents in
favor of  Collateral  Agent on behalf of the Secured  Parties) or (d) require  any  registration  with,  consent or
approval  of, or notice to, or other  action to, with or by, any  Governmental  Authority  or any Person  under any
Contractual  Obligation;  except for such  registration,  consent  or  approval  obtained  by the  Amendment  No. 1
Effective Date and disclosed in writing to Lenders.

        
3.4        This  Amendment  No. 1 has been duly  executed and delivered by each Credit Party and is
the  legally  valid and  binding  obligation  of such  Credit  Party,  enforceable  against  such  Credit  Party in
accordance  with its  respective  terms,  except  as may be  limited  by  bankruptcy,  insolvency,  reorganization,
moratorium  or similar  laws  relating  to or limiting  creditors'  rights  generally  or by  equitable  principles
relating to enforceability.

SECTION 4.      MISCELLANEOUS

        
4.1        This  Amendment  No.1  shall be binding  upon the  parties  hereto and their  respective
successors  and assigns and shall inure to the  benefit of the  parties  hereto and the  successors  and assigns of
Lenders.  No Credit Party rights or obligations  hereunder or any interest  therein may be assigned or delegated by
any Credit Party without the prior written consent of all Lenders.

        
4.2        Except as  expressly  amended  hereby,  the Credit  Agreement  and all other  documents,
agreements and instruments  relating thereto are and shall remain  unmodified and in full force and effect.  On and
after  the  Amendment  No.  1  Effective  Date,  each  reference  in the  Credit  Agreement  to  "this  Agreement",
"hereunder",  "hereof",  "herein" or words of like import, and each reference in the Notes to the Credit Agreement,
shall mean and be a reference to the Credit  Agreement as amended  hereby,  and this Amendment No. 1 and the Credit
Agreement  shall be read  together and  construed as a single  instrument.  Each Credit Party hereby (a)  reaffirms
and admits the validity and  enforceability  of the Credit  Agreement  and the other  Credit  Documents  (including
without  limitation all guarantees and grants of security  interests  contained therein) and all of its obligations
thereunder,  and (b) agrees and admits that it has no defenses to or offsets  against any of its obligations to any
Agent or any Lender under the Credit Documents.

        
4.3        In case any provision in or obligation  hereunder or any Note shall be invalid,  illegal
or unenforceable in any jurisdiction,  the validity,  legality and  enforceability  of the remaining  provisions or
obligations,  or of such  provision or  obligation in any other  jurisdiction,  shall not in any way be affected or
impaired thereby.

        
4.4        Section  headings  herein are included  herein for  convenience  of  reference  only and
shall not constitute a part hereof for any other purpose or be given any substantive effect.

        
4.5        THIS AMENDMENT NO. 1 AND THE RIGHTS AND  OBLIGATIONS OF THE PARTIES  HEREUNDER  SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE  WITH, THE LAWS OF THE STATE OF NEW YORK  (INCLUDING
SECTION  5-1401 AND  SECTION  5-1402 OF THE GENERAL  OBLIGATIONS  LAW OF THE STATE OF NEW YORK)  WITHOUT  REGARD TO
CONFLICTS OF LAWS PRINCIPLES THEREOF EXCEPT AS TO MATTERS OF CORPORATE  GOVERNANCE,  WHICH SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE  JURISDICTION OF  INCORPORATION OR ORGANIZATION OF THE
SUBJECT PERSON.

        
4.6        To facilitate  reference to the provisions of the Credit  Agreement,
 as amended by this Amendment  No. 1, each Lender  executing  this  Amendment  No. 1 hereby  authorizes  Administrative  Agent,  on its
behalf, to enter into an amendment and restatement of the Credit Agreement,  at the Administrative  Agent's option,
as amended by this Amendment No. 1; provided that any such amendment and  restatement  shall be distributed to each
Lender.

        
4.7        This Amendment No. 1 may be executed in any number of  counterparts,  each of which when
so executed and delivered  shall be deemed an original,  but all such  counterparts  together shall  constitute but
one and the same  instrument.  As set forth herein,  this Amendment No. 1 shall become effective upon the execution
of a  counterpart  hereof  by each of the  Borrower,  each  other  Credit  Party,  the  Administrative  Agent,  the
Syndication Agent and Requisite Lenders and receipt by Borrower and  Administrative  Agent of written or telephonic
notification of such execution and authorization of delivery thereof.

        
4.8        The Lenders  executing this Amendment No. 1 hereby  acknowledge  that they are not aware
of the existence of any Default or Event of Default as of the Amendment No. 1 Effective Date.

[The remainder of this page is intentionally left blank.]

        IN
WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above. 

	 	

GABRIEL COMMUNICATIONS FINANCE COMPANY,
as Borrower

	 	By:	 

	 	 	Name:
Title:
	 	

NUVOX, INC.

(formerly known as GABRIEL COMMUNICATIONS, INC.),
as Parent

	 	By:	 

	 	 	Name:
Title:
	 	

GABRIEL COMMUNICATIONS PROPERTIES, INC.,
as Holding Company

	 	By:	 

	 	 	Name:
Title:
	 	

NUVOX COMMUNICATIONS OF ARKANSAS, INC.

	 	By:	 

	 	 	Name:
Title:

S-1

	 	

NUVOX COMMUNICATIONS OF ILLINOIS, INC.

	 	By:	 

	 	 	Name:
Title:
	 	

NUVOX COMMUNICATIONS OF INDIANA, INC.

	 	By:	 

	 	 	Name:
Title:
	 	

NUVOX COMMUNICATIONS OF KANSAS, INC.

	 	By:	 

	 	 	Name:
Title:
	 	

NUVOX COMMUNICATIONS OF MISSOURI, INC.

	 	By:	 

	 	 	Name:
Title:
	 	

NUVOX COMMUNICATIONS OF OHIO, INC.

	 	By:	 

	 	 	Name:
Title:

S-2

	 	

NUVOX COMMUNICATIONS OF OKLAHOMA, INC.

	 	By:	 

	 	 	Name:
Title:
	 	

NUVOX COMMUNICATIONS OF TENNESSEE, INC.

	 	By:	 

	 	 	Name:
Title:
	 	

NUVOX COMMUNICATIONS OF TEXAS, INC.

	 	By:	 

	 	 	Name:
Title:
	 	

TRIVERGENT CORPORATION

	 	By:	 

	 	 	Name:
Title:
	 	

CAROLINA ONLINE, INC.

	 	By:	 

	 	 	Name:
Title:

S-3

	 	

INTERNET/MCR CORPORATION

	 	By:	 

	 	 	Name:
Title:
	 	

ISAAC ACQUISITION CORP.

	 	By:	 

	 	 	Name:
Title:
	 	

TELECO ACQUISITION CORP.

	 	By:	 

	 	 	Name:
Title:
	 	

NUVOX COMMUNICATIONS, INC.

	 	By:	 

	 	 	Name:
Title:
	 	

TRIVERGENT LEASING, LLC
Manager: TriVergent Communications, Inc.

	 	By:	 

	 	 	Name:
Title:

S-4

	 	

TRIVERGENT LEASING SOUTH, LLC
Manager: TriVergent Communications South, Inc.

	 	By:	 

	 	 	Name:
Title:
	 	

AMTEL ACQUISITION CORP.

	 	By:	 

	 	 	Name:
Title:
	 	

CCN ACQUISITION CORP.

	 	By:	 

	 	 	Name:
Title:
	 	

SHARED TELECOM SERVICES, INC.

	 	By:	 

	 	 	Name:
Title:

S-5

	 	

GOLDMAN SACHS CREDIT PARTNERS L.P.,

as Sole Lead Arranger, Syndication Agent, Sole Book Runner and a Lender

	 	By:	 

	 	 	Authorized Signatory

S-6

	 	

FIRST UNION NATIONAL BANK,
as Administrative Agent, Issuing Bank and a Lender

	 	By:	 

	 	 	Name:
Title:

S-7

	 	

BARCLAYS BANK PLC,
as Documentation Agent and a Lender

	 	By:	 

	 	 	Name:
Title:

S-8

	 	

CIT LENDING SERVICES CORPORATION,
as Co-Documentation Agent and a Lender

	 	By:	 

	 	 	Name:
Title:

S-9

	 	

NORTEL NETWORKS INC.,
as a Lender

	 	By:	 

	 	 	Name:
Title:

S-10

	 	

CIBC INC.,
as a Lender

	 	By:	 

	 	 	Name:
Title:

S-11

	 	

GENERAL ELECTRIC CAPITAL CORPORATION,
as a Lender

	 	By:	 

	 	 	Name:
Title:

S-12

ANNEX I

Schedule 6.6(a) - Stage 1 Minimum Adjusted Revenues

	Fiscal Quarter Ending	Minimum Adjusted Revenues
($)
	 September 30, 2001	15,200,000 
	December 31, 2001	 19,600,000
	 March 31, 2002	 25,700,000
	 June 30, 2002	31,400,000 
	September 30, 2002	37,700,000
	December 31, 2002 	44,400,000 
	March 31, 2003	51,800,000
	June 30, 2003 	59,000,000

Schedule 6.6(b) - Stage 1 Minimum Access Lines

	Fiscal Quarter Ending	Minimum Access Lines
	 September 30, 2001	107,000 
	December 31, 2001	132,000
	 March 31, 2002	 162,000
	 June 30, 2002	196,000 
	September 30, 2002	233,000
	December 31, 2002 	272,000 
	March 31, 2003	313,000
	June 30, 2003 	356,000

A-1

Schedule 6.6(c) - Stage 1 Minimum EBITDA/Maximum EBITDA Loss

	Fiscal Quarter Ending	Maximum EBITDA Loss/
Minimum EBITDA
($)
	 September 30, 2001	(21,500,000) 
	December 31, 2001	 (18,500,000)
	 March 31, 2002	(14,100,000)
	 June 30, 2002	(9,800,000) 
	September 30, 2002	(5,300,000)
	December 31, 2002 	100,000 
	March 31, 2003	8,900,000
	June 30, 2003 	13,000,000

Schedule 6.6(e) - Maximum Borrower Capital Expenditures

	Fiscal Year Ended	Maximum Borrower Capital
Expenditures
($)
	December 31, 2001	55,000,000 
	December 31, 2002	56,000,000
	 December 31, 2003	58,000,000

A-2

ANNEX II

Schedule 6.6(h) - New Stage 1 Financial Covenant

	Fiscal Quarter Ending	 Gross Profit ($)
	 September 30, 2001	3,500,000
	December 31, 2001	5,800,000
	 March 31, 2002	11,500,000
	 June 30, 2002	14,900,000 
	September 30, 2002	18,800,000
	December 31, 2002 	23,200,000
	March 31, 2003	30,400,000
	June 30, 2003 	34,400,000

A-3

ANNEX III

Schedule 6.6(i) - Stage 1 Minimum Available Cash Covenant

	Fiscal Quarter Ending	Minimum Available Cash
($)
	 September 30, 2001	125,000,000
	December 31, 2001	95,000,000
	 March 31, 2002	67,000,000
	 June 30, 2002	43,500,000 
	September 30, 2002	23,500,000
	December 31, 2002 	7,000,000
	March 31, 2003	5,000,000
	June 30, 2003 	5,000,000Exhibit 4.1

                                SERIES SUPPLEMENT

                       CORPORATE BACKED TRUST CERTIFICATES

                  CORNING DEBENTURE-BACKED SERIES 2001-35 TRUST

                                     between

                             LEHMAN ABS CORPORATION,

                                  as Depositor

                                       and

                      U.S. BANK TRUST NATIONAL ASSOCIATION,

                                   as Trustee

                       CORPORATE BACKED TRUST CERTIFICATES

                         Dated as of September 21, 2001

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----
Section 1. Incorporation of Standard Terms ................................    1

Section 2. Definitions ....................................................    1

Section 3. Designation of Trust and Certificates ..........................    7

Section 4. Trust Certificates .............................................    8

Section 5. Distributions ..................................................    8

Section 6. Trustee's Fees .................................................   10

Section 7. Optional Exchange; Optional Call ...............................   11

Section 8. Notices of Events of Default ...................................   13

Section 9. Miscellaneous ..................................................   13

Section 10. Governing Law .................................................   16

Section 11. Counterparts ..................................................   16

Section 12. Termination of the Trust ......................................   16

Section 13. Sale of Underlying Securities; Optional Exchange ..............   16

Section 14. Amendments ....................................................   16

Section 15. Voting of Underlying Securities, Modification of Indenture ....   17

Section 16. Additional Depositor Representation ...........................   18

SCHEDULE I     SERIES 2001-35 UNDERLYING SECURITIES SCHEDULE
SCHEDULE II    CLASS A-2 CERTIFICATE CALL SCHEDULE
EXHIBIT A-1    FORM OF TRUST CERTIFICATE CLASS A-1
EXHIBIT A-2    FORM OF TRUST CERTIFICATE CLASS A-2
EXHIBIT B      FORM OF WARRANT AGENT AGREEMENT
EXHIBIT C      FORM OF INVESTMENT LETTER

<PAGE>

                                SERIES SUPPLEMENT

                       CORPORATE BACKED TRUST CERTIFICATES

                  CORNING DEBENTURE-BACKED SERIES 2001-35 TRUST

     SERIES SUPPLEMENT, Series 2001-35, dated as of September 21, 2001 (the
"Series Supplement"), by and between LEHMAN ABS CORPORATION, as Depositor (the
"Depositor"), and U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee (the
"Trustee").

                              W I T N E S S E T H:

     WHEREAS, the Depositor desires to create the Trust designated herein (the
"Trust") by executing and delivering this Series Supplement, which shall
incorporate the terms of the Standard Terms for Trust Agreements, dated as of
January 16, 2001 (the "Standard Terms"; together with this Series Supplement,
the "Trust Agreement"), by and between the Depositor and the Trustee, as
modified by this Series Supplement;

     WHEREAS, the Depositor desires to deposit into the Trust the Underlying
Securities set forth on Schedule I attached hereto (the "Underlying Securities
Schedule"), the general terms of which are described in the Prospectus
Supplement under the heading "Description of the Deposited Assets - Underlying
Securities;"

     WHEREAS, in connection with the creation of the Trust and the deposit
therein of the Underlying Securities, it is desired to provide for the issuance
of trust certificates (the "Certificates") evidencing undivided interests in the
Trust; and

     WHEREAS, the Trustee has joined in the execution of the Standard Terms and
this Series Supplement to evidence the acceptance by the Trustee of the Trust;

     NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants expressed herein, it is hereby agreed by and between the Depositor and
the Trustee as follows:

     Section 1. INCORPORATION OF STANDARD TERMS. Except as otherwise provided
herein, all of the provisions of the Standard Terms are hereby incorporated
herein by reference in their entirety, and this Series Supplement and the
Standard Terms shall form a single agreement between the parties. In the event
of any inconsistency between the provisions of this Series Supplement and the
provisions of the Standard Terms, the provisions of this Series Supplement will
control with respect to the Corning Debenture-Backed Series 2001-35 Certificates
and the transactions described herein.

     Section 2. DEFINITIONS. (a) Except as otherwise specified herein or as the
context may otherwise require, the following terms shall have the respective
meanings set forth below for all purposes under this Series Supplement. (Section
2(b) below sets forth terms listed in the Standard Terms which are not
applicable to this Series.) Capitalized terms used but not defined herein shall
have the meanings assigned to them in the Standard Terms.

                                       1

<PAGE>

     "Accreted Principal Amount" for the Class A-2 Certificates means for each
six month period from and including each date specified in Schedule II hereof to
but excluding the next such date, the amount specified in Schedule II as the
"Ending Balance" for such beginning date.

     "Available Funds" shall have the meaning specified in the Standard Terms,
except that proceeds of any redemption of the Underlying Securities shall be
included in Available Funds.

     "Business Day" shall mean any day other than (i) Saturday and Sunday or
(ii) a day on which banking institutions in New York City, New York are
authorized or obligated by law or executive order to be closed for business or
(iii) a day that is not a business day for the purposes of the Indenture.

     "Call Date" shall mean any Business Day on or after September 21, 2006, or
after the announcement of any unscheduled payment on the Underlying Securities
on which the Call Warrants are exercised and the proceeds of an Optional Call
are distributed to holders of the Certificates pursuant to Section 7 hereof.

     "Call Notice" shall have the meaning specified in Section 1.1 of the
Warrant Agent Agreement.

     "Call Price" shall mean, for each related Call Date, (i) in the case of the
Class A-1 Certificates, the par value of the Class A-1 Certificates being
purchased pursuant to the exercise of the Call Warrants, plus any accrued and
unpaid interest on such amount to but excluding the Call Date and (ii) in the
case of the Class A-2 Certificates being purchased pursuant to the exercise of
the Call Warrants, the Accreted Principal Amount of the Class A-2 Certificates.

     "Call Request" shall have the meaning specified in Section 7(b) hereof.

     "Call Warrants" shall have the meaning specified in Section 3 hereof.

     "Certificate Account" shall have the meaning specified in the Standard
Terms.

     "Certificate Principal Amount" shall have the meaning specified in Section
3 hereof.

     "Certificates" shall have the meaning specified in Section 3 hereof.

     "Class A-1 Allocation" shall mean the sum of the present values (discounted
at the rate of 8.00% per annum) of (i) any unpaid interest due or to become due
on the Class A-1 Certificates and (ii) the outstanding principal amount of the
Class A-1 Certificates (in each case assuming that the Class A-1 Certificates
were paid when due and were not redeemed prior to their stated maturity).

     "Class A-1 Certificates" shall mean the Certificates, in the form attached
hereto as Exhibit A-1, to be issued by the Trust representing a proportionate
undivided beneficial

                                       2
<PAGE>

ownership interest in certain distributions to be made by the Trust and having
the characteristics described herein and in the Certificates.

     "Class A-2 Allocation" shall mean the present value (discounted at the rate
of 8.00% per annum) of any unpaid amounts due or to become due on the Class A-2
Certificates (assuming that the Class A-2 Certificates were paid when due and
were not redeemed prior to their stated maturity).

     "Class A-2 Certificates" shall mean the Certificates, in the form attached
hereto as Exhibit A-2, to be issued by the Trust representing a proportionate
undivided beneficial ownership interest in certain distributions to be made by
the Trust and having the characteristics described herein and in the
Certificates.

     "Closing Date" shall mean September 21, 2001.

     "Collection Period" shall mean, (i) with respect to each September
Distribution Date, the period beginning on the day after the March Distribution
Date and ending on such September Distribution Date, inclusive and, (ii) with
respect to each March Distribution Date, the period beginning on the day after
the September Distribution Date of the prior year and ending on such March
Distribution Date of the following year, inclusive; provided, however, that
clauses (i) and (ii) shall be subject to Section 9(f) hereof.

     "Corporate Trust Office" shall mean the office of U.S. Bank Trust National
Association located at 100 Wall Street, New York, New York 10005.

     "Currency" shall mean United States Dollars.

     "Depository" shall mean The Depository Trust Company.

     "Distribution Date" shall mean September 1st and March 1st of each year (or
if such date is not a Business Day, the next succeeding Business Day),
commencing on March 1, 2002 and ending on the earlier of the Final Scheduled
Distribution Date and any date on which Underlying Securities are redeemed
pursuant to the Indenture.

     "Eligible Account" shall have the meaning specified in the Standard Terms.

     "Event of Default" shall mean (i) a default in the payment of any interest
on any Underlying Security after the same becomes due and payable (subject to
any applicable grace period), (ii) a default in the payment of the principal of
or any installment of principal of any Underlying Security when the same becomes
due and payable, and (iii) any other event specified as an "Event of Default" in
the Indenture.

     "Exchange Act" shall mean the Securities and Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.

     "Extraordinary Trust Expenses" shall have the meaning specified in the
Standard Terms.

                                       3

<PAGE>

     "Final Scheduled Distribution Date" shall mean March 1, 2029.

     "Indenture" shall mean the indenture pursuant to which the Underlying
Securities were issued.

     "Interest Accrual Period" shall mean for any Distribution Date, the period
from and including the preceding Distribution Date (or in the case of the first
Interest Accrual Period, from and including September 21, 2001) to but excluding
the current Distribution Date.

     "Liquidation Price" shall mean the price at which the Trustee sells the
Underlying Securities.

     "Liquidation Proceeds" shall have the meaning specified in the Standard
Terms.

     "Maturity Date" shall have the meaning specified in Schedule I hereto.

     "Moody's" shall mean Moody's Investors Service, Inc.

     "Optional Call" shall mean the call of the Certificates by the Warrant
Holder, in whole or in part, resulting from the exercise of Call Warrants by the
Warrant Holder, pursuant to Section 7(b) hereof.

     "Optional Exchange" shall mean the exchange of the Certificates by the
Trust for the Underlying Securities pursuant to Section 7(a) hereof.

     "Optional Exchange Date" shall mean any Distribution Date on which
Underlying Securities subject to Optional Exchange are distributed to a
Certificateholder.

     "Ordinary Expenses" shall mean the Trustee's ordinary expenses and overhead
in connection with its services as Trustee, including the items referred to in
the definition of Ordinary Expenses in the Standard Terms.

     "Prepaid Ordinary Expenses" shall be zero for this Series.

     "Prospectus Supplement" shall mean the Prospectus Supplement, dated
September 10, 2001, relating to the Certificates, as supplemented.

     "Rating Agency" shall mean Moody's and S&P.

     "Rating Agency Condition" shall have the meaning specified in the Standard
Terms.

     "Record Date" shall mean, with respect to each Distribution Date, the day
immediately preceding the related Distribution Date.

     "Required Interest" shall have the meaning specified in the Standard Terms.

     "Required Percentage-Amendment" shall be 66-2/3% of the aggregate Voting
Rights, unless the subject amendment requires the vote of holders of only one
class of

                                       4

<PAGE>

Certificates pursuant to the Standard Terms, in which case 66-2/3% of the
Certificate Principal Amount of such Class.

     "Required Percentage-Direction of Trustee" shall be 66-2/3% of the
aggregate Voting Rights.

     "Required Percentage-Remedies" shall be 66-2/3% of the aggregate Voting
Rights.

     "Required Percentage-Removal" shall be 66-2/3% of the aggregate Voting
Rights.

     "Required Rating" shall mean, in the case of Moody's, the rating assigned
to the Underlying Securities by Moody's as of the Closing Date, and, in the case
of S&P, the rating assigned to the Underlying Securities by S&P as of the
Closing Date.

     "S&P" shall mean Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc.

     "Series" shall mean Corning Debenture-Backed Series 2001-35.

     "Trustee Fee" shall mean the amount paid to the Trustee by the Depositor on
the Closing Date.

     "Trust Property" shall mean the Underlying Securities described on Schedule
I hereto and the Certificate Account.

     "Underlying Securities" shall mean $29,430,000 aggregate principal amount
of 6.85% Debentures due March 1, 2029 issued by the Underlying Securities
Issuer, as set forth in Schedule I attached hereto (subject to Section 3(d)
hereof).

     "Underlying Securities Issuer" shall mean Corning Incorporated and any
successor in respect of the Underlying Securities.

     "Underlying Securities Trustee" shall mean United States Trust Company of
New York.

     "Underwriters" shall mean Lehman Brothers Inc., an affiliate of the
Depositor, Prudential Securities Incorporated and Raymond James & Associates,
Inc.

     "Voting Rights" shall, in the entirety, be allocated among all Class A-1
Certificateholders and Class A-2 Certificateholders in proportion to the then
unpaid principal amounts of their respective Certificates.

     "Warrant Agent" shall mean initially, U.S. Bank Trust National Association.

     "Warrant Agent Agreement" shall mean that certain Warrant Agent Agreement,
dated as of the date hereof, between the Depositor and U.S. Bank Trust National
Association, as Warrant Agent and as Trustee, as the same may be amended from
time to time.

                                       5

<PAGE>

     "Warrant Holder" shall mean the holder of a Call Warrant.

     (b) The terms listed below are not applicable to this Series.

               "Accounting Date"

               "Administrative Fees"

               "Advance"

               "Allowable Expense Amounts"

               "Basic Documents"

               "Calculation Agent"

               "Call Premium Percentage"

               "Credit Support"

               "Credit Support Instrument"

               "Credit Support Provider"

               "Cut-off Date"

               "Eligible Expense"

               "Eligible Investment"

               "Exchange Rate Agent"

               "Fixed Pass-Through Rate"

               "Floating Pass-Through Rate"

               "Guaranteed Investment Contract"

               "Letter of Credit"

               "Limited Guarantor"

               "Limited Guaranty"

               "Minimum Wire Denomination"

               "Notional Amount"

               "Pass-Through Rate"

                                       6

<PAGE>

               "Place of Distribution"

               "Purchase Price"

               "Required Premium"

               "Required Principal"

               "Requisite Reserve Amount"

               "Retained Interest"

               "Sale Procedures"

               "Sub-Administration Account"

               "Sub-Administration Agreement"

               "Sub-Administration Agent"

               "Surety Bond"

               "Swap Agreement"

               "Swap Counterparty"

               "Swap Distribution Amount"

               "Swap Guarantee"

               "Swap Guarantor"

               "Swap Receipt Amount"

               "Swap Termination Payment"

     Section 3. DESIGNATION OF TRUST AND CERTIFICATES. The Trust created hereby
shall be known as the "Corporate-Backed Trust Certificates, Corning
Debenture-Backed Series 2001-35 Trust." The Certificates evidencing certain
undivided ownership interests therein shall be known as "Corporate Backed Trust
Certificates, Corning Debenture-Backed Series 2001-35." The Certificates shall
consist of the Class A-1 Certificates and the Class A-2 Certificates (together,
the "Certificates"). The Trust is also issuing call warrants with respect to the
Certificates ("Call Warrants").

     (a) The Certificates shall be held through the Depository in book-entry
form and shall be substantially in the forms attached hereto as Exhibits A-1 and
A-2. The Class A-1 Certificates shall be issued in denominations of $25. The
Class A-2 Certificates shall be issued in minimum denominations of $1,000 and
integral multiples of $1 in excess thereof. Except as

                                       7

<PAGE>

provided in the Standard Terms and in paragraph (d) in this Section, the Trust
shall not issue additional Certificates or incur any indebtedness.

     (b) The Class A-1 Certificates have an initial aggregate certificate
principal amount of $25,199,425, and the Class A-2 Certificates have an initial
aggregate certificate principal amount of $4,230,575 (each, a "Certificate
Principal Amount").

     (c) The holders of the Class A-1 Certificates will be entitled to receive
on each Distribution Date the interest, if any, received on the Underlying
Securities, to the extent necessary to pay interest at a rate of 8.00% per annum
on the outstanding Certificate Principal Amount of the Class A-1 Certificates.
The Class A-2 Certificates shall not bear interest. On March 1, 2002, the
Trustee will pay to the Depositor the amount of interest accrued and paid on the
Underlying Securities from September 1, 2001, to but not including the Closing
Date. If Available Funds are insufficient to pay such amount, the Trustee will
pay the Depositor its pro rata share, based on the ratio the amount owed to the
Depositor bears to all amounts owed on the Class A-1 Certificates in respect of
accrued interest, of any proceeds from the recovery on the Underlying
Securities.

     (d) The Depositor may sell to the Trustee additional Underlying Securities
on any date hereafter upon at least 3 Business Days notice to the Trustee and
upon (i) satisfaction of the Rating Agency Condition and (ii) delivery of an
Opinion of Counsel to the effect that the sale of such additional Underlying
Securities will not materially increase the likelihood that the Trust would fail
to qualify as a grantor trust under the Code. Upon such sale to the Trustee, the
Trustee shall deposit such additional Underlying Securities in the Certificate
Account, and shall authenticate and deliver to the Depositor, on its order,
Class A-1 Certificates and Class A-2 Certificates in the same proportion as the
original Class A-1 Certificates and Class A-2 Certificates, with an aggregate
Certificate Principal Amount equal to the principal amount of such additional
Underlying Securities, and the Call Warrants related thereto. Any such
additional Class A-1 Certificates and Class A-2 Certificates authenticated and
delivered shall have the same terms and rank pari passu with the corresponding
classes of Certificates previously issued in accordance with this Series
Supplement.

     (e) As a condition precedent for transferring the Call Warrants, the
prospective transferee shall be required to deliver to the Trustee and the
Depositor an executed copy of the Investment Letter (set forth in Exhibit C
hereto).

     Section 4. TRUST CERTIFICATES. The Trustee hereby acknowledges receipt, on
or prior to the Closing Date, of:

     (i)  the Underlying Securities set forth on the Underlying Securities
          Schedule; and

     (ii) all documents required to be delivered to the Trustee pursuant to
          Section 2.01 of the Standard Terms.

     Section 5. DISTRIBUTIONS. (a) Except as otherwise provided in Section 3(c),
on each applicable Distribution Date, the Trustee shall apply Available Funds in
the Certificate Account as follows in the following order of priority:

                                       8

<PAGE>

     (i)  the Trustee will pay the interest portion of Available Funds (subject
          to Section 5(b) below):

          (a) first, to the Trustee, as reimbursement for any Extraordinary
          Trust Expenses incurred by the Trustee in accordance with Section 6(b)
          below and approved by 100% of the Certificateholders; and

          (b) second, to the holders of the Class A-1 Certificates, as interest
          at the rate of 8.00% per annum on the principal amount of the Class
          A-1 Certificates.

     (ii) the Trustee will pay the principal portion of Available Funds:

          (a) first, to the Trustee, as reimbursement for any remaining
          Extraordinary Trust Expenses incurred by the Trustee in accordance
          with Section 6(b) below and approved by 100% of the
          Certificateholders; and

          (b) second, to the holders of the Class A-1 Certificates and the Class
          A-2 Certificates, the remaining available principal portion of
          Available Funds (in an aggregate amount not to exceed the outstanding
          principal amount of the Class A-1 Certificates and the Class A-2
          Certificates) pro rata in the proportion that the outstanding
          principal amount of the Class A-1 Certificates bears to the
          outstanding principal amount of the Class A-2 Certificates, until the
          aggregate Certificate Principal Amounts of such Certificates are paid
          in full.

    (iii) any Available Funds remaining in the Certificate Account after the
          payments set forth in clauses 5(a)(i) and 5(a)(ii) above shall be paid
          to the Trustee as reasonable compensation for services rendered to the
          Depositor, any remainder up to $1,000.

     (iv) the Trustee will pay any Available Funds remaining in the Certificate
          Account after the distributions in clauses 5(a)(i) through 5(a)(iii)
          above to the holders of the Class A-1 Certificates and Class A-2
          Certificates pro rata in proportion to their original principal
          balances.

     (b) Notwithstanding any other provision hereof (other than Section 3(c)) if
the Underlying Securities are redeemed, prepaid or liquidated in whole or in
part for any reason other than due to the occurrence of an Event of Default, the
cessation of the Underlying Securities Issuer to file periodic reports as
required by the Exchange Act or at their maturity, the Trustee shall apply
Available Funds in the manner described in Section 5(f) in the following order
of priority:

     (i)  first, to the Trustee, as reimbursement for any Extraordinary Trust
          Expenses incurred by the Trustee in accordance with Section 6(b) below
          and approved by 100% of the Certificateholders;

                                       9

<PAGE>

     (ii) second, to the holders of the Class A-1 Certificates, an amount equal
          to any accrued and unpaid interest thereon;

    (iii) third, to the holders of the Class A-1 Certificates and Class A-2
          Certificates, pro rata in the proportion that the outstanding
          principal amount of the Class A-1 Certificates bears to the
          outstanding principal amount of the Class A-2 Certificates; and

     (iv) fourth, to the Trustee, as reasonable compensation for services
          rendered to the Depositor, any remainder up to $1,000.

     (c) Notwithstanding the foregoing, if the Underlying Securities are
redeemed, prepaid or liquidated in whole or in part due to the occurrence of an
Event of Default, the Trustee shall apply Available Funds to the holders of the
Class A-1 Certificates and the holders of the Class A-2 Certificates in
accordance with the ratio of the Class A-1 Allocation to the Class A-2
Allocation.

     (d) Unless otherwise instructed by holders of Certificates representing a
majority of the Voting Rights, thirty (30) days after giving notice pursuant to
Section 8 hereof, the Trustee shall sell the Underlying Securities pursuant to
Section 13 hereof and deposit the Liquidation Proceeds, if any, into the
Certificate Account for distribution not later than two (2) Business Days after
the receipt of immediately available funds in accordance with Section 5(b)
hereof.

     (e) If the Trustee receives non-cash property in respect of the Underlying
Securities as a result of a payment default on the Underlying Securities
(including from the sale thereof), the Trustee will promptly give notice to the
Depository, or for any Certificates which are not then held by DTC or any other
depository, directly to the registered holders of the Certificates then
outstanding and unpaid. Such notice shall state that the Trustee shall and the
Trustee shall, not later than 30 days after the receipt of such property,
allocate and distribute such property to the holders of Class A-1 Certificates
and Class A-2 Certificates then outstanding and unpaid, pro rata by principal
amount (after deducting the costs incurred in connection therewith) in
accordance with Section 5(b) hereof. Property other than cash will be liquidated
by the Trustee, and the proceeds thereof distributed in cash, only to the extent
necessary to avoid distribution of fractional securities to Certificateholders.
In-kind distribution of such property to Certificateholders will be deemed to
reduce the principal amount of Certificates on a dollar-for-dollar basis.

     (f) Subject to Section 9(f) hereof, to the extent Available Funds are
insufficient to make any required distributions due to any class of Certificates
on any Distribution Date, any shortfall will be carried over and will be
distributed on the next Distribution Date (or date referred to in Section 5(g)
hereof) on which sufficient funds are available to pay such shortfall.

     (g) If a payment with respect to the Underlying Securities is made to the
Trustee (i) after the payment date of the Underlying Securities on which such
payment was due or (ii) after the Underlying Securities are redeemed, prepaid or
liquidated in whole or in part for any reason other than due to the occurrence
of an Event of Default or at their maturity, then the Trustee will distribute
any such amounts received on the next occurring Business Day (a "Special

                                       10

<PAGE>

Distribution Date") as if the funds had constituted Available Funds on the
Distribution Date immediately preceding such Special Distribution Date;
provided, however, that the Record Date for such Special Distribution Date shall
be five Business Days prior to the day on which the related payment was received
from the Underlying Securities Trustee.

     (h) Notwithstanding Section 3.12 of the Standard Terms, if the Underlying
Securities Issuer ceases to file the periodic reports required under the
Exchange Act, the Depositor shall within a reasonable period of time instruct
the Trustee to sell the Underlying Securities and allocate the proceeds of such
sale in the following order of priority: (i) to the Trustee, reimbursement for
any remaining extraordinary expenses incurred by the Trustee pursuant to the
instructions of all the certificateholders and (ii) to the holders of the Class
A-1 Certificates and the Class A-2 Certificates in accordance with the ratio of
the Class A-1 Allocation to the Class A-2 Allocation; provided, however, the
Depositor shall not instruct the Trustee to distribute or sell the Underlying
Securities pursuant to this clause unless the Underlying Securities Issuer has
either (x) stated in writing that it intends permanently to cease filing reports
required under the Exchange Act or (y) failed to file any required reports for
one full calendar year.

     Section 6. TRUSTEE'S FEES.

     (a) As compensation for its services hereunder, the Trustee shall be
entitled to the Trustee Fee and any amount payable under clause 5(a)(iii) or
5(b)(iv) above. The Trustee Fee shall be paid by the Depositor and not from
Trust Property. The Trustee shall bear all Ordinary Expenses. Failure by the
Depositor to pay such amount shall not entitle the Trustee to any payment or
reimbursement from the Trust, nor shall such failure release the Trustee from
the duties it is required to perform under the Trust Agreement.

     (b) Extraordinary Expenses shall not be paid out of the Trust Property
unless all the holders of the Class A-1 Certificates and Class A-2 Certificates
then outstanding have directed the Trustee to incur such Extraordinary Expenses.
The Trustee may incur other Extraordinary Expenses if any lesser percentage of
the Certificateholders requesting such action pursuant hereto reimburse the
Trustee for the cost thereof from their own funds in advance. If Extraordinary
Expenses are not approved unanimously as set forth in the first sentence of this
Section 6(b), such Extraordinary Expenses shall not be an obligation of the
Trust, and the Trustee shall not file any claim against the Trust therefor
notwithstanding failure of Certificateholders to reimburse the Trustee.

Section 7. OPTIONAL EXCHANGE; OPTIONAL CALL.

     (a)  (i) On any Distribution Date, any holder of Class A-1 Certificates and
Class A-2 Certificates and the related Call Warrants, if Call Warrants related
to such Certificates are outstanding, may exchange such Certificates and, if
applicable, Call Warrants, for a distribution of Underlying Securities
representing the same percentage of the Underlying Securities as such
Certificates represent of all outstanding Certificates.

          (ii) The following conditions shall apply to any Optional Exchange.

               (a) A notice specifying the number of Certificates being
               surrendered and the Optional Exchange Date shall be delivered to
               the Trustee no less than

                                       11

<PAGE>

               5 days (or such shorter period acceptable to the Trustee) but not
               more than 30 days before the Optional Exchange Date.

               (b) Certificates and, if applicable, the Call Warrants, shall be
               surrendered to the Trustee no later than 10:00 a.m. (New York
               City time) on the Optional Exchange Date.

               (c) Class A-1 Certificates and Class A-2 Certificates
               representing a like percentage of all Class A-1 Certificates and
               Class A-2 Certificates shall be surrendered.

               (d) The Trustee shall have received an opinion of counsel stating
               that the Optional Exchange would not affect the characterization
               of the Trust as a "grantor trust" for federal income tax
               purposes.

               (e) If the Certificateholder is the Depositor or any Affiliate of
               the Depositor, (1) the Trustee shall have received a
               certification from the Certificateholder that any Certificates
               being surrendered have been held for at least six months, and (2)
               the Certificates being surrendered may represent no more than 5%
               (or 25% in the case of Certificates acquired by the Underwriter
               but never distributed to investors) of the then outstanding
               Certificates.

         (iii) The Trustee shall not be obligated to determine whether an
               Optional Exchange complies with the applicable provisions for
               exemption under Rule 3a-7 of the Investment Company Act of 1940,
               as amended, or the rules or regulations promulgated thereunder.

          (iv) The provisions of Section 4.07 of the Standard Terms shall not
               apply to an Optional Exchange pursuant to this Section 7(a). This
               Section 7(a) shall not provide any person with a lien against, an
               interest in or a right to specific performance with respect to
               the Underlying Securities.

     (b)  (i) Concurrently with the execution of this Series Supplement, the
Trustee, on behalf of the Trust, shall execute the Warrant Agent Agreement and
the Call Warrants, dated as of the date hereof and substantially in the form of
Exhibit B hereto, initially evidencing all of the Call Warrants. The Trustee
shall perform the Trust's obligations under the Warrant Agent Agreement and the
Call Warrants in accordance with their respective terms.

          (ii) Call Warrants may be exercised by the Warrant Holder in whole or
               in part on any Call Date. In addition to the conditions set forth
               in Section 1.1 of the Warrant Agent Agreement, the following
               conditions shall apply to any Optional Call.

               (a) An opinion of counsel to the Warrant Holder shall have been
               delivered to the Trustee, in form satisfactory to the Trustee,
               indicating that payment of the Call Price shall not be
               recoverable as a preferential transfer or

                                       12

<PAGE>

               fraudulent conveyance under the United States Bankruptcy Code.
               Such opinion may contain customary assumptions and
               qualifications.

               (b) The Warrant Holder shall have provided a certificate of
               solvency to the Trustee.

         (iii) Upon receipt of a Call Notice, the Trustee shall provide a
               conditional call notice to the Depository not less than 3
               Business Days prior to the Call Date.

          (iv) Delivery of a Call Notice does not give rise to an obligation on
               part of the Warrant Holder to pay the Call Price. If, by 10:00
               a.m. (New York City time) on the Call Date, the Warrant Holder
               has not paid the Call Price, then the Call Notice shall
               automatically expire and none of the Warrant Holder, the Warrant
               Agent or the Trustee shall have any obligation with respect to
               the Call Notice. The expiration of a Call Notice shall in no way
               affect the Warrant Holder's right to deliver a Call Notice at a
               later date.

          (v)  Subject to receipt of the Call Price, the Trustee shall pay the
               Call Price to the Certificateholders on the Call Date. The Call
               Price for class of Certificates in respect of partial calls shall
               be allocated pro rata to the Certificateholders of such Class.

          (vi) The Trustee shall not consent to any amendment or modification of
               this Agreement (including the Standard Terms) which would alter
               the timing or amount of any payment of the Call Price without the
               prior written consent of 100% of the Warrant Holders.

         (vii) The Trustee shall not be obligated to determine whether an
               Optional Call complies with the applicable provisions for
               exemption under Rule 3a-7 of the Investment Company Act of 1940,
               as amended, or the rules or regulations promulgated thereunder.

        (viii) This Section 7 shall not provide the Warrant Holder with a lien
               against, an interest in or a right to specific performance with
               respect to the Underlying Securities.

          (ix) The Warrant Holder shall initially be the Depositor.

Section 8. NOTICES OF EVENTS OF DEFAULT.

     As promptly as practicable after, and in any event within 30 days after,
the occurrence of any Event of Default actually known to the Trustee, the
Trustee shall give notice of such Event of Default to the Depository, or, if any
Certificates are not then held by DTC or any other depository, directly to the
registered holders of such Certificates. However, except in the case of an Event
of Default relating to the payment of principal of or interest on any of the
Underlying Securities, the Trustee will be protected in withholding such notice
if in good faith it determines that the withholding of such notice is in the
interest of the Certificateholders.

                                       13

<PAGE>

Section 9. MISCELLANEOUS.

     (a) The provisions of Section 4.04, Advances, of the Standard Terms shall
not apply to the Corning Debenture-Backed Series 2001-35 Certificates.

     (b) The provisions of Section 4.07, Optional Exchange, of the Standard
Terms shall not apply to the Corning Debenture-Backed Series 2001-35
Certificates.

     (c) The Trustee shall simultaneously forward reports to Certificateholders
pursuant to Section 4.03 of the Standard Terms and to the New York Stock
Exchange.

     (d) Except as expressly provided herein, the Certificateholders shall not
be entitled to terminate the Trust or cause the sale or other disposition of the
Underlying Securities.

     (e) The provisions of Section 3.07(d) of the Standard Terms shall not apply
to the Corning Debenture-Backed Series 2001-35 Certificates.

     (f) If the Trustee has not received payment with respect to a Collection
Period on the Underlying Securities on or prior to the related Distribution
Date, such distribution will be made promptly upon receipt of such payment. No
additional amounts shall accrue on the Certificates or be owed to
Certificateholders as a result of such delay; provided, however, that any
additional interest owed and paid by the Underlying Securities Issuer as a
result of such delay shall be paid to the Class A-1 Certificateholders pro rata
in proportion to their respective entitlements to interest.

     (g) The outstanding principal balance of the Certificates shall not be
reduced by the amount of any Realized Losses (as defined in the Standard Terms).

     (h) The Trust may not engage in any business or activities other than in
connection with, or relating to, the holding, protecting and preserving of the
Trust Property and the issuance of the Certificates, and other than those
required or authorized by the Trust Agreement or incidental and necessary to
accomplish such activities. The Trust may not issue or sell any certificates or
other obligations other than the Certificates or otherwise incur, assume or
guarantee any indebtedness for money borrowed. Notwithstanding Section 3.05 of
the Standard Terms, funds on deposit in the Certificate Account shall not be
invested.

     (i) Notwithstanding anything in the Trust Agreement to the contrary, the
Trustee may be removed upon 60 days prior written notice delivered by the
holders of Class A-1 Certificates and Class A-2 Certificates representing the
Required Percentage-Removal.

     (j) In the event that the Internal Revenue Service challenges the
characterization of the Trust as a grantor trust, the Trustee shall then file
such forms as the Depositor may specify to establish the Trust's election
pursuant to Section 761 of the Code to exclude the Trust from the application of
Subchapter K of the Code and is hereby empowered to execute such forms on behalf
of the Certificateholders.

     (k) Notwithstanding anything in the Standard Terms to the contrary, the
Trustee, upon written direction by the Depositor, will execute the Certificates.

                                       14

<PAGE>

     (l) In relation to Section 7.01(f) of the Standard Terms, any periodic
reports filed by the Trustee pursuant to the Exchange Act in accordance with the
customary practices of the Depositor, need not contain any independent reports.

     (m) Notwithstanding anything in the Trust Agreement to the contrary, the
Trustee will have no recourse to the Underlying Securities.

     (n) [Reserved].

     (o) The Trust will not merge or consolidate with any other entity without
confirmation from each Rating Agency that such merger or consolidation will not
result in the qualification, reduction or withdrawal of its then-current rating
on the Certificates.

     (p) All directions, demands and notices hereunder or under the Standard
Terms shall be in writing and shall be delivered as set forth below (unless
written notice is otherwise provided to the Trustee).

                  If to the Depositor, to:

                           Lehman ABS Corporation
                           One Broadgate
                           London, EC2M 7HA
                           United Kingdom

                           Attention:  Structured Credit Trading
                           Telephone:  (212) 526-6570
                           Facsimile:  (212) 526-1546

                  If to the Trustee, to:

                           U.S. Bank Trust National Association
                           100 Wall Street
                           New York, New York  10005
                           Attention:  Corporate Trust
                           Telephone:  (212) 361-2500
                           Facsimile:  (212) 809-5459

                  If to the Rating Agencies, to:

                           Moody's Investors Service, Inc.
                           99 Church Street 21W
                           New York, New York  10007
                           Attention:  CBO/CLO Monitoring Department
                           Telephone:  (212) 553-1494
                           Facsimile:  (212) 553-0355

                                       15

<PAGE>

         and to:

                           Standard & Poor's
                           55 Water Street
                           New York, New York  10041

                           Attention:  Structured Finance Surveillance Group
                           Telephone:  (212) 438-2482
                           Facsimile:  (212) 438-2664

                  If to the New York Stock Exchange, to:

                           New York Stock Exchange, Inc.
                           20 Broad Street
                           17th Floor
                           New York, New York  10005
                           Attention:  Vincent Patten
                           Telephone:  (212) 656-5276
                           Facsimile:  (212) 656-5780

     Section 10. GOVERNING LAW. THIS SERIES SUPPLEMENT AND THE TRANSACTIONS
DESCRIBED HEREIN SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED WITHIN
THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CHOICE OF LAWS PROVISIONS
THEREOF.

     Section 11. COUNTERPARTS. This Series Supplement may be executed in any
number of counterparts, each of which shall be deemed to be an original, and all
such counterparts shall constitute but one and the same instrument.

     Section 12. TERMINATION OF THE TRUST. The Trust shall terminate upon the
earliest to occur of (i) the payment in full at maturity or sale by the Trust
after a payment default or an acceleration or other early payment of the
Underlying Securities and the distribution in full of all amounts due to the
Class A-1 Certificateholders and Class A-2 Certificateholders; (ii) the exercise
of all outstanding Call Warrants by the Warrant Holder; (iii) the Final
Scheduled Distribution Date and (iv) the expiration of 21 years from the death
of the last survivor of the descendants of Joseph P. Kennedy, the late
Ambassador of the United States to the Court of St. James, living on the date
hereof.

     Section 13. SALE OF UNDERLYING SECURITIES; OPTIONAL EXCHANGE. In the event
of a sale of the Underlying Securities pursuant to Section 5(c) hereof or
pursuant to the instructions of the Warrant Agent under Section 1.2 of the
Warrant Agent Agreement, the Trustee shall solicit bids for the sale of the
Underlying Securities with settlement thereof on or before the third (3rd)
Business Day after such sale from three leading dealers in the relevant market.
Any of the following dealers (or their successors) shall be deemed to qualify as
leading dealers: (1) Credit Suisse First Boston Corporation, (2) Goldman, Sachs
& Co., (3) Merrill Lynch, Pierce, Fenner & Smith Incorporated, (4) UBS Warburg
LLC, (5) Salomon Smith Barney Inc., and (6) except in the case of a sale related
to the exercise of Call Warrants by the Depositor or any Affiliate

                                       16

<PAGE>

thereof, Lehman Brothers Inc. The Trustee shall not be responsible for the
failure to obtain a bid so long as it has made reasonable efforts to obtain
bids. If a bid for the sale of the Underlying Securities has been accepted by
the Trustee but the sale has failed to settle on the proposed settlement date,
the Trustee shall request new bids from such leading dealers. In the event of an
Optional Exchange, the Trustee shall only deliver the Underlying Securities to
the purchaser of such Underlying Securities or sell the Underlying Securities
pursuant to this Section 13, as the case may be, against payment in same day
funds deposited into the Certificate Account.

     Section 14. AMENDMENTS. Notwithstanding anything in the Trust Agreement to
the contrary, in addition to the other restrictions on modification and
amendment contained therein, the Trustee shall not enter into any amendment or
modification of the Trust Agreement which would adversely affect in any material
respect the interests of the holders of any class of Certificates without the
consent of the holders of 100% of such class of Certificates; provided, however,
that no such amendment or modification will be permitted which would alter the
status of the Trust as a grantor trust for federal income tax purposes. Further,
no amendment shall be permitted which would adversely affect in any material
respect the interests of any Class of Certificateholders without confirmation by
each Rating Agency that such amendment will not result in a downgrading or
withdrawal of its rating of such class of Certificates.

     Section 15. VOTING OF UNDERLYING SECURITIES, MODIFICATION OF INDENTURE. The
Trustee, as holder of the Underlying Securities, has the right to vote and give
consents and waivers in respect of the Underlying Securities as permitted by the
Depository and except as otherwise limited by the Trust Agreement. In the event
that the Trustee receives a request from the Depository, the Underlying
Securities Trustee or the Underlying Securities Issuer for its consent to any
amendment, modification or waiver of the Underlying Securities, the Indenture or
any other document thereunder or relating thereto, or receives any other
solicitation for any action with respect to the Underlying Securities, the
Trustee shall mail a notice of such proposed amendment, modification, waiver or
solicitation to each Certificateholder of record as of such date. The Trustee
shall request instructions from the Certificateholders as to whether or not to
consent to or vote to accept such amendment, modification, waiver or
solicitation. The Trustee shall consent or vote, or refrain from consenting or
voting, in the same proportion (based on the relative outstanding principal
balances of the Certificates) as the Certificates of the Trust were actually
voted or not voted by the Certificateholders thereof as of a date determined by
the Trustee prior to the date on which such consent or vote is required;
provided, however, that, notwithstanding anything in the Trust Agreement to the
contrary, the Trustee shall at no time vote on or consent to any matter (i)
unless such vote or consent would not (based on an opinion of counsel) alter the
status of the Trust as a grantor trust for federal income tax purposes or result
in the imposition of tax upon the Certificateholders, (ii) which would alter the
timing or amount of any payment on the Underlying Securities, including, without
limitation, any demand to accelerate the Underlying Securities, except in the
event of a default under the Underlying Securities or an event which with the
passage of time would become an event of default under the Underlying Securities
and with the unanimous consent of all outstanding Class A-1 Certificateholders
and the Class A-2 Certificateholders, or (iii) which would result in the
exchange or substitution of any of the outstanding Underlying Securities
pursuant to a plan for the refunding or refinancing of such Underlying
Securities except in the event of a default under the Indenture and only with
the consent of Certificateholders representing 100% of the Class A-1
Certificates and 100% of the Class A-2 Certificates. The Trustee shall have no
liability for any

                                       17

<PAGE>

failure to act resulting from Certificateholders' late return of, or failure to
return, directions requested by the Trustee from the Certificateholders.

     In the event that an offer is made by the Underlying Securities Issuer to
issue new obligations in exchange and substitution for any of the Underlying
Securities, pursuant to a plan for the refunding or refinancing of the
outstanding Underlying Securities or any other offer is made for the Underlying
Securities, the Trustee shall notify the Class A-1 Certificateholders and Class
A-2 Certificateholders of such offer promptly. The Trustee must reject any such
offer unless the Trustee is directed by the affirmative vote of the holders of
100% of the Class A-1 Certificates and Class A-2 Certificates to accept such
offer and the Trustee has received the tax opinion described above. If pursuant
to the preceding sentence, the Trustee accepts any such offer the Trustee shall
promptly notify the Rating Agencies.

     If an event of default under the Indenture occurs and is continuing, and if
directed by a majority of the outstanding Class A-1 Certificateholders and Class
A-2 Certificateholders, the Trustee shall vote the Underlying Securities in
favor of directing, or take such other action as may be appropriate to direct,
the Underlying Securities Trustee to declare the unpaid principal amount of the
Underlying Securities and any accrued and unpaid interest thereon to be due and
payable.

     Section 16. ADDITIONAL DEPOSITOR REPRESENTATION. It is the express intent
of the parties hereto that the conveyance of the Underlying Securities by the
Depositor to the Trustee be, and be construed as, a sale of the Underlying
Securities by the Depositor and not a pledge of any Underlying Securities by the
Depositor to secure a debt or other obligation of the Depositor. In the event
that, notwithstanding the aforementioned intent of the parties, any Underlying
Securities are held to be property of the Depositor, then, it is the express
intent of the parties that such conveyance be deemed a pledge of such Underlying
Securities by the Depositor to the Trustee to secure a debt or other obligation
of the Depositor, pursuant to Section 10.07 of the Standard Terms. In connection
with any such grant of a security interest in the Underlying Securities,
Depositor hereby represents and warrants to Trustee as follows:

          (i)  In the event the Underlying Securities are held to be property of
               the Depositor, then the Trust Agreement creates a valid and
               continuing security interest (as defined in the applicable
               Uniform Commercial Code) in the Underlying Securities in favor of
               the Trustee which security interest is prior to all other liens,
               and is enforceable as such as against creditors of, and
               purchasers from, the Depositor.

          (ii) The Underlying Securities have been credited to a trust account
               (the "Securities Account") of the Trustee, or its authorized
               agent, in accordance with Section 2.01 of the Standard Terms. The
               Trustee, as securities intermediary for the Securities Account,
               has agreed to treat the Underlying Securities as "financial
               assets" within the meaning of the Uniform Commercial Code.

         (iii) Immediately prior to the transfer of the Underlying Securities
               to the Trust, Depositor owned and had good and marketable title
               to the Underlying Securities free and clear of any lien, claim or
               encumbrance of any Person.

                                       18

<PAGE>

          (iv) Depositor has received all consents and approvals required by the
               terms of the Underlying Securities to the transfer to the Trustee
               of its interest and rights in the Underlying Securities as
               contemplated by the Trust Agreement.

          (v)  Depositor has taken all steps necessary to cause the Trustee, as
               securities intermediary for the Securities Account, to identify
               on its records that the Trustee, as the trustee of the Trust, is
               the Person having a security entitlement against the securities
               intermediary in the Securities Account.

          (vi) Depositor has not assigned, pledged, sold, granted a security
               interest in or otherwise conveyed any interest in the Underlying
               Securities (or, if any such interest has been assigned, pledged
               or otherwise encumbered, it has been released). Depositor has not
               authorized the filing of and is not aware of any financing
               statements against Depositor that includes a description of the
               Underlying Securities. Depositor is not aware of any judgment or
               tax lien filings against Depositor.

         (vii) The Securities Account is not in the name of any Person other
               than the Trust. Depositor has not consented to the compliance by
               the Trustee, as securities intermediary, with entitlement orders
               of any Person other than the Trustee, as trustee of the Trust.

                                       19

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Series Supplement
to be duly executed by their respective authorized officers as of the date first
written above.

                             LEHMAN ABS CORPORATION,
                                 as Depositor

                             By:
                                 -----------------------------------------------
                                  Name: Rene Canezin
                                  Title: Senior Vice President

                             U.S. BANK TRUST NATIONAL ASSOCIATION,
                                not in its individual capacity
                                but solely as Trustee on behalf
                                of the Corporate Backed Trust
                                Corning Debenture-Backed Series 2001-35
                                 Trust

                             By:
                                 -----------------------------------------------
                                  Name:  Marlene Fahey
                                  Title: Vice President and Assistant Secretary

                                       20

<PAGE>

                                                                      SCHEDULE I

                                 SERIES 2001-35

                         UNDERLYING SECURITIES SCHEDULE

Underlying Securities:                    6.85% Debentures due March 1, 2029.

Underlying Securities Issuer:             Corning Incorporated.

CUSIP Number:                             219350 AH 8.

Principal Amount Deposited:               $29,430,000.

Original Issue Date:                      March 3, 1999.

Principal Amount of
Underlying Securities
Originally Issued:                        $150,000,000.

Maturity Date:                            March 1, 2029.

Principal Payment Date:                   March 1, 2029.

Interest Rate:                            6.85% per annum.

Interest Payment Dates:                   March 1st and September 1st.

                                      I-1
<PAGE>

                                                                    SCHEDULE II

                       CLASS A-2 CERTIFICATE CALL SCHEDULE

         Date Ending Balance             Value
                   9/21/2006            $473,406
                    3/1/2007            $494,389
                    9/1/2007            $519,108
                    3/1/2008            $545,064
                    9/1/2008            $572,317
                    3/1/2009            $600,933
                    9/1/2009            $630,979
                    3/1/2010            $662,528
                    9/1/2010            $695,655
                    3/1/2011            $730,438
                    9/1/2011            $766,960
                    3/1/2012            $805,307
                    9/1/2012            $845,573
                    3/1/2013            $887,851
                    9/1/2013            $932,244
                    3/1/2014            $978,856
                    9/1/2014           $1,027,799
                    3/1/2015           $1,079,189
                    9/1/2015           $1,133,148
                    3/1/2016           $1,189,806
                    9/1/2016           $1,249,296
                    3/1/2017           $1,311,761
                    9/1/2017           $1,377,349
                    3/1/2018           $1,446,217
                    9/1/2018           $1,518,527
                    3/1/2019           $1,594,454
                    9/1/2019           $1,674,176
                    3/1/2020           $1,757,885
                    9/1/2020           $1,845,779
                    3/1/2021           $1,938,068
                    9/1/2021           $2,034,972
                    3/1/2022           $2,136,720
                    9/1/2022           $2,243,557
                    3/1/2023           $2,355,734
                    9/1/2023           $2,473,521
                    3/1/2024           $2,597,197
                    9/1/2024           $2,727,057
                    3/1/2025           $2,863,410
                    9/1/2025           $3,006,580
                    3/1/2026           $3,156,909
                    9/1/2026           $3,314,755
                    3/1/2027           $3,480,493

                                      II-1

<PAGE>

         Date Ending Balance             Value
                    9/1/2027           $3,654,517
                    3/1/2028           $3,837,243
                    9/1/2028           $4,029,105
                    3/1/2029           $4,230,560

                                      II-2

<PAGE>

                                                                     Exhibit A-1

                          FORM OF CLASS A-1 CERTIFICATE

NUMBER 1                                          1,007,977 $25 PAR CERTIFICATES
                                                           CUSIP NO. 21988G 56 9

                       SEE REVERSE FOR CERTAIN DEFINITIONS

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

     THIS CERTIFICATE REPRESENTS A PROPORTIONATE UNDIVIDED BENEFICIAL OWNERSHIP
INTEREST IN THE TRUST AND DOES NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN,
AND IS NOT GUARANTEED BY THE DEPOSITOR OR THE TRUSTEE OR ANY OF THEIR RESPECTIVE
AFFILIATES. NEITHER THIS CERTIFICATE OR THE TRUST ASSETS ARE INSURED OR
GUARANTEED BY ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON.

                                     A-1-1

<PAGE>

                             LEHMAN ABS CORPORATION

                                1,007,977 $25 PAR

                      CORPORATE BACKED TRUST CERTIFICATES,

                     CORNING DEBENTURE-BACKED SERIES 2001-35

                               8.00% INTEREST RATE

evidencing a proportionate undivided beneficial ownership interest in the Trust,
as defined below, the property of which consists principally of $29,430,000
aggregate principal amount of 6.85% Debentures due March 1, 2029, issued by
Corning Incorporated (the "Underlying Securities Issuer") and all payments
received thereon (the "Trust Property"), deposited in trust by Lehman ABS
Corporation (the "Depositor").

THIS CERTIFIES THAT CEDE & CO. is the registered owner of $25,199,425
nonassessable, fully-paid, proportionate undivided beneficial ownership interest
in the Corporate Backed Trust Certificates, Corning Debenture-Backed Series
2001-35 Trust, formed by the Depositor.

The Trust was created pursuant to a Standard Terms for Trust Agreements, dated
as of January 16, 2001 (the "Standard Terms"), between the Depositor and U.S.
Bank Trust National Association, a national banking association, not in its
individual capacity but solely as Trustee (the "Trustee"), as supplemented by
the Series Supplement, Series 2001-35, dated as of September 10, 2001 (the
"Series Supplement" and, together with the Standard Terms, the "Trust
Agreement"), between the Depositor and the Trustee. This Certificate does not
purport to summarize the Trust Agreement and reference is hereby made to the
Trust Agreement for information with respect to the interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
obligations of the Trustee with respect hereto. A copy of the Trust Agreement
may be obtained from the Trustee by written request sent to the Corporate Trust
Office. Capitalized terms used but not defined herein have the meanings assigned
to them in the Trust Agreement.

This Certificate is one of the duly authorized Certificates designated as the
"Corporate Backed Trust Certificates, Corning Debenture-Backed Series 2001-35,
Class A-1" (herein called the "Certificates"). This Certificate is issued under
and is subject to the terms, provisions and conditions of the Trust Agreement,
to which Trust Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound. The Trust Property
consists of: (i) Underlying Securities described in the Trust Agreement; (ii)
all payments on or collections in respect of the Underlying Securities accrued
on or after September 21, 2001 together with any proceeds thereof; and (iii) all
funds from time to time deposited with the Trustee relating to the Certificates,
together with any and all income, proceeds and payments with respect thereto;
provided, however, that any income from the investment of Trust funds in certain
permitted investments ("Eligible Investments") does not constitute Trust
Property.

                                     A-1-2

<PAGE>

Subject to the terms and conditions of the Trust Agreement (including the
availability of funds for distributions) and until the obligation created by the
Trust Agreement shall have terminated in accordance therewith, distributions
will be made on each Distribution Date, to the Person in whose name this
Certificate is registered on the applicable Record Date, in an amount equal to
such Certificateholder's proportionate undivided beneficial ownership interest
in the amount required to be distributed to the Holders of the Certificates on
such Distribution Date. The Record Date applicable to any Distribution Date is
the close of business on the day immediately preceding such Distribution Date
(whether or not a Business Day). If a payment with respect to the Underlying
Securities is made to the Trustee after the date on which such payment was due,
then the Trustee will distribute any such amounts received on the next occurring
Business Day (a "Special Distribution Date").

Each Certificateholder, by its acceptance of a Certificate, covenants and agrees
that such Certificateholder will not at any time institute against the Trust, or
join in any institution against the Trust of, any bankruptcy proceedings under
any United States Federal or state bankruptcy or similar law in connection with
any obligations relating to the Certificates or the Trust Agreement.

Distributions made on this Certificate will be made as provided in the Trust
Agreement by the Trustee by wire transfer in immediately available funds, or
check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Certificate or the making of any
notation hereon, except that with respect to Certificates registered on the
Record Date in the name of the nominee of the Clearing Agency (initially, such
nominee shall be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Except as
otherwise provided in the Trust Agreement and notwithstanding the above, the
final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the Corporate Trust Office or such other
location as may be specified in such notice.

Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.

Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual signature, this Certificate shall not entitle
the Holder hereof to any benefit under the Trust Agreement or be valid for any
purpose.

THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE HOLDER HEREOF SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.

                                     A-1-3

<PAGE>

IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed
as of the date set forth below.

                                    CORPORATE BACKED TRUST CERTIFICATES,
                                    CORNING DEBENTURE-BACKED
                                    SERIES 2001-35 TRUST

                                    By: U.S. BANK TRUST NATIONAL ASSOCIATION
                                    not in its individual capacity but solely as
                                    Trustee,

                                By:
                                    -------------------------------------------
                                     Authorized Signatory

Dated: September 21, 2001

                     TRUSTEE'S CERTIFICATE OF AUTHENTICATION

This is one of the Corporate Backed Trust Certificates, Corning Debenture-Backed
Series 2001-35, described in the Trust Agreement referred to herein.

U.S. BANK TRUST NATIONAL ASSOCIATION
not in its individual capacity but solely as
Trustee,

By:
    ---------------------------------
     Authorized Signatory

                                     A-1-4

<PAGE>

                            (REVERSE OF CERTIFICATE)

The Certificates are limited in right of distribution to certain payments and
collections respecting the Underlying Securities, all as more specifically set
forth herein and in the Trust Agreement. The registered Holder hereof, by its
acceptance hereof, agrees that it will look solely to the Trust Property (to the
extent of its rights therein) for distributions hereunder.

The Trust Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor and the Trustee and the rights of the Certificateholders under the
Trust Agreement at any time by the Depositor and the Trustee with the consent of
the Holders of Class A-1 Certificates in the manner set forth in the Series
Supplement and the Standard Terms. Any such consent by the Holder of this
Certificate (or any predecessor Certificate) shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange hereof or in lieu
hereof whether or not notation of such consent in made upon this Certificate.
The Trust Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

The Certificates are issuable in fully registered form only in denominations of
$25.

As provided in the Trust Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registerable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies of the Certificate Registrar maintained by the Trustee in
the Borough of Manhattan, the City of New York, duly endorsed by or accompanied
by an assignment in the form below and by such other documents as required by
the Trust Agreement, and thereupon one or more new Certificates of the same
class in authorized denominations evidencing the same principal amount will be
issued to the designated transferee or transferees. The initial Certificate
Registrar appointed under the Trust Agreement is U.S. Bank Trust National
Association.

No service charge will be made for any registration of transfer or exchange, but
the Trustee may require exchange of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.

The Depositor and the Trustee and any agent of the Depositor or the Trustee may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and neither the Depositor, the Trustee, nor any such
agent shall be affected by any notice to the contrary.

It is the intention of the parties to the Trust Agreement that the Trust created
thereunder shall constitute a fixed investment trust for federal income tax
purposes under Treasury Regulation Section 301.7701-4, and the Certificateholder
agrees to treat the Trust, any distributions therefrom and its beneficial
interest in the Certificates consistently with such characterization.

The Trust and the obligations of the Depositor and the Trustee created by the
Trust Agreement with respect to the Certificates shall terminate upon the
earliest to occur of (i) the payment in full at maturity or sale by the Trust
after a payment default or an acceleration or other early payment of the
Underlying Securities and the distribution in full of all amounts due to the
Class A-1 Certificateholders and Class A-2 Certificateholders; (ii) the exercise
of all outstanding Call

                                     A-1-5

<PAGE>

Warrants by the Warrant Holder; (iii) the Final Scheduled Distribution Date and
(iv) the expiration of 21 years from the death of the last survivor of the
descendants of Joseph P. Kennedy, the late Ambassador of the United States to
the Court of St. James, living on the date hereof.

An employee benefit plan subject to the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), a plan described in Section 4975(e) of the Code,
an entity whose underlying assets include plan assets by reason of any such
plan's investment in the entity, including an individual retirement account or
Keogh plan (any such, a "Plan") may purchase and hold Certificates if the Plan
can represent and warrant that its purchase and holding of the Certificates
would not be prohibited under ERISA or the Code.

                                     A-1-6

<PAGE>

                                   ASSIGNMENT

FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto

PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE

(Please print or type name and address, including postal zip code, of assignee)
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing ______________________ Attorney to transfer said
Certificate on the books of the Certificate Register, with full power of
substitution in the premises.

Dated:

                                                            *

                                                  Signature Guaranteed:

                                                            *

*  NOTICE: The signature to this assignment must correspond with the name as
   it appears upon the face of the within Certificate in every particular,
   without alteration, enlargement or any change whatever. Signatures must be
   guaranteed by an "eligible guarantor institution" meeting the requirements
   of the Certificate Registrar, which requirements include membership or
   participation in the Security Transfer Agent Medallion Program ("STAMP") or
   such other "signature guarantee program" as may be determined by the
   Certificate Registrar in addition to, or in substitution for, STAMP, all in
   accordance with the Securities Exchange Act of 1934, as amended.

                                     A-1-7

<PAGE>

                                                                     Exhibit A-2

                          FORM OF CLASS A-2 CERTIFICATE

NUMBER 1                                                              $4,230,575
                                                           CUSIP NO. 21988G BH 8

                       SEE REVERSE FOR CERTAIN DEFINITIONS

THIS CLASS A-2 CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF
EXCEPT WHILE A REGISTRATION UNDER SUCH ACT IS IN EFFECT OR PURSUANT TO AN
EXEMPTION THEREFROM UNDER SUCH ACT. THE CLASS A-2 CERTIFICATE REPRESENTED HEREBY
MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF THE SERIES SUPPLEMENT.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS CERTIFICATE REPRESENTS A PROPORTIONATE UNDIVIDED BENEFICIAL OWNERSHIP
INTEREST IN THE TRUST AND DOES NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN,
AND IS NOT GUARANTEED BY THE DEPOSITOR OR THE TRUSTEE OR ANY OF THEIR RESPECTIVE
AFFILIATES. NEITHER THIS CERTIFICATE OR THE TRUST ASSETS ARE INSURED OR
GUARANTEED BY ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON.

                                     A-2-1

<PAGE>

                             LEHMAN ABS CORPORATION

                      CORPORATE BACKED TRUST CERTIFICATES,

                     CORNING DEBENTURE-BACKED SERIES 2001-35

                           $4,230,575 PRINCIPAL AMOUNT

evidencing a proportionate undivided beneficial ownership interest in the Trust,
as defined below, the property of which consists principally of $29,430,000
aggregate principal amount of 6.85% Debentures due March 1, 2029 of Corning
Incorporated (the "Underlying Securities Issuer") and all payments received
thereon (the "Trust Property"), deposited in trust by Lehman ABS Corporation
(the "Depositor").

THIS CERTIFIES THAT CEDE & CO. is the registered owner of $4,230,575
nonassessable, fully-paid, proportionate undivided beneficial ownership interest
in the Corporate Backed Trust Certificates, Corning Debenture-Backed Series
2001-35 Trust, formed by the Depositor.

                                     A-2-2

<PAGE>

The Trust was created pursuant to a Standard Terms for Trust Agreements, dated
as of January 16, 2001 (the "Standard Terms"), between the Depositor and U.S.
Bank Trust National Association, a national banking association, not in its
individual capacity but solely as Trustee (the "Trustee"), as supplemented by
the Series Supplement, Series 2001-35, dated as of September 10, 2001 (the
"Series Supplement" and, together with the Standard Terms, the "Trust
Agreement"), between the Depositor and the Trustee. This Certificate does not
purport to summarize the Trust Agreement and reference is hereby made to the
Trust Agreement for information with respect to the interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
obligations of the Trustee with respect hereto. A copy of the Trust Agreement
may be obtained from the Trustee by written request sent to the Corporate Trust
Office. Capitalized terms used but not defined herein have the meanings assigned
to them in the Trust Agreement.

This Certificate is one of the duly authorized Certificates designated as the
"Corporate Backed Trust Certificates, Corning Debenture-Backed Series 2001-35,
Class A-2" (herein called the "Certificates"). This Certificate is issued under
and is subject to the terms, provisions and conditions of the Trust Agreement,
to which Trust Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound. The Trust Property
consists of: (i) Underlying Securities described in the Trust Agreement; (ii)
all payments on or collections in respect of the Underlying Securities accrued
on or after September 21, 2001 together with any proceeds thereof; and (iii) all
funds from time to time deposited with the Trustee relating to the Certificates,
together with any and all income, proceeds and payments with respect thereto;
provided, however, that any income from the investment of Trust funds in certain
permitted investments ("Eligible Investments") does not constitute Trust
Property.

Subject to the terms and conditions of the Trust Agreement (including the
availability of funds for distributions) and until the obligation created by the
Trust Agreement shall have terminated in accordance therewith, no distributions
of interest will be made on this Certificate on any Distribution Date.

Subject to the terms and conditions of the Trust Agreement (including the
availability of funds for distributions) and until the obligation created by the
Trust Agreement shall have terminated in accordance therewith, the Trust will
distribute on the Final Scheduled Distribution Date, to the Person in whose name
this Certificate is registered on the applicable Record Date, an amount equal to
such Certificateholder's proportionate undivided beneficial ownership interest
in the amount required to be distributed to the Holders of the Certificates on
such Final Scheduled Distribution Date.

The Record Date applicable to the Final Scheduled Distribution Date is the close
of business on the day immediately preceding such Final Scheduled Distribution
Date (whether or not a Business Day). If a payment with respect to the
Underlying Securities is made to the Trustee after the date on which such
payment was due, then the Trustee will distribute any such amounts received on
the next occurring Business Day (a "Special Distribution Date").

Each Certificateholder, by its acceptance of a Certificate, covenants and agrees
that such Certificateholder will not at any time institute against the Trust, or
join in any institution against the Trust of, any bankruptcy proceedings under
any United States Federal or state bankruptcy or

                                     A-2-3

<PAGE>

similar law in connection with any obligations relating to the Certificates or
the Trust Agreement.

Distributions made on this Certificate will be made as provided in the Trust
Agreement by the Trustee by wire transfer in immediately available funds, or
check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Certificate or the making of any
notation hereon, except that with respect to Certificates registered on the
Record Date in the name of the nominee of the Clearing Agency (initially, such
nominee shall be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Except as
otherwise provided in the Trust Agreement and notwithstanding the above, the
final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the Corporate Trust Office or such other
location as may be specified in such notice.

Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.

Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual signature, this Certificate shall not entitle
the Holder hereof to any benefit under the Trust Agreement or be valid for any
purpose.

THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE HOLDER HEREOF SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.

                                     A-2-4

<PAGE>

IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed
as of the date set forth below.

                                  CORPORATE BACKED TRUST
                                  CERTIFICATES, CORNING DEBENTURE
                                  BACKED SERIES 2001-35 TRUST

                                  By: U.S. BANK TRUST NATIONAL
                                  ASSOCIATION
                                  not in its individual capacity but solely as
                                  Trustee,

                                  By:
                                      ----------------------------------------
                                       Authorized Signatory

Dated: September 21, 2001

                     TRUSTEE'S CERTIFICATE OF AUTHENTICATION

This is one of the Corporate Backed Trust Certificates, Corning Debenture-Backed
Series 2001-35, described in the Trust Agreement referred to herein.

U.S. BANK TRUST NATIONAL ASSOCIATION
not in its individual capacity but solely as
Trustee,

By:
    --------------------------------
     Authorized Signatory

                                     A-2-5

<PAGE>

                            (REVERSE OF CERTIFICATE)

The Certificates are limited in right of distribution to certain payments and
collections respecting the Underlying Securities, all as more specifically set
forth herein and in the Trust Agreement. The registered Holder hereof, by its
acceptance hereof, agrees that it will look solely to the Trust Property (to the
extent of its rights therein) for distributions hereunder.

The Trust Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor and the Trustee and the rights of the Certificateholders under the
Trust Agreement at any time by the Depositor and the Trustee with the consent of
the holders of Class A-2 Certificates in the manner set forth in the Series
Supplement and the Standard Terms. Any such consent by the Holder of this
Certificate (or any predecessor Certificate) shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange hereof or in lieu
hereof whether or not notation of such consent in made upon this Certificate.
The Trust Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the holders of any of the Certificates.

The Certificates are issuable in fully registered form only in minimum principal
amounts of $1,000 and integral multiples of $1 in excess thereof.

As provided in the Trust Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registerable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies of the Certificate Registrar maintained by the Trustee in
the Borough of Manhattan, the City of New York, duly endorsed by or accompanied
by an assignment in the form below and by such other documents as required by
the Trust Agreement, and thereupon one or more new Certificates of the same
class in authorized denominations evidencing the same principal amount will be
issued to the designated transferee or transferees. The initial Certificate
Registrar appointed under the Trust Agreement is U.S. Bank Trust National
Association.

No service charge will be made for any registration of transfer or exchange, but
the Trustee may require exchange of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.

The Depositor and the Trustee and any agent of the Depositor or the Trustee may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and neither the Depositor, the Trustee, nor any such
agent shall be affected by any notice to the contrary.

It is the intention of the parties to the Trust Agreement that the Trust created
thereunder shall constitute a fixed investment trust for federal income tax
purposes under Treasury Regulation Section 301.7701-4, and the Certificateholder
agrees to treat the Trust, any distributions therefrom and its beneficial
interest in the Certificates consistently with such characterization.

The Trust and the obligations of the Depositor and the Trustee created by the
Trust Agreement with respect to the Certificates shall terminate upon the
earliest to occur of (i) the payment in full at maturity or sale by the Trust
after a payment default or an acceleration or other early payment of the
Underlying Securities and the distribution in full of all amounts due to the
Class A-1

                                     A-2-6

<PAGE>

Certificateholders and Class A-2 Certificateholders; (ii) the exercise
of all outstanding Call Warrants by the Warrant Holder; (iii) the Final
Scheduled Distribution Date and (iv) the expiration of 21 years from the death
of the last survivor of the descendants of Joseph P. Kennedy, the late
Ambassador of the United States to the Court of St. James, living on the date
hereof.

An employee benefit plan subject to the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), a plan described in Section 4975(e) of the Code,
an entity whose underlying assets include plan assets by reason of any such
plan's investment in the entity, including an individual retirement account or
Keogh plan (any such, a "Plan") may purchase and hold Certificates if the Plan
can represent and warrant that its purchase and holding of the Certificates
would not be prohibited under ERISA or the Code.

                                     A-2-7

<PAGE>

                                   ASSIGNMENT

FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto

PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE

(Please print or type name and address, including postal zip code, of assignee)
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing ____________________ Attorney to transfer said
Certificate on the books of the Certificate Register, with full power of
substitution in the premises.

Dated:

                                                                   *

                                                         Signature Guaranteed:

                                                                   *

*  NOTICE: The signature to this assignment must correspond with the name as
   it appears upon the face of the within Certificate in every particular,
   without alteration, enlargement or any change whatever. Signatures must be
   guaranteed by an "eligible guarantor institution" meeting the requirements
   of the Certificate Registrar, which requirements include membership or
   participation in the Security Transfer Agent Medallion Program ("STAMP") or
   such other "signature guarantee program" as may be determined by the
   Certificate Registrar in addition to, or in substitution for, STAMP, all in
   accordance with the Securities Exchange Act of 1934, as amended.

                                     A-2-8

<PAGE>

                                                                       EXHIBIT B

                         FORM OF WARRANT AGENT AGREEMENT

                       CORPORATE BACKED TRUST CERTIFICATES

                  Corning Debenture-Backed Series 2001-35 Trust

     WARRANT AGENT AGREEMENT, dated as of September 21, 2001 (the "Warrant Agent
Agreement"), by and between LEHMAN ABS CORPORATION, as Depositor (the
"Depositor"), and U.S. BANK TRUST NATIONAL ASSOCIATION, as Warrant Agent (the
"Warrant Agent").

                              W I T N E S S E T H:

     WHEREAS, the Depositor created Corporate Backed Trust Certificates, Corning
Debenture-Backed Series 2001-35 Trust (the "Trust"), a trust created under the
laws of the State of New York pursuant to a Standard Terms for Trust Agreements,
dated as of January 16, 2001 (the "Agreement"), between Lehman ABS Corporation
(the "Depositor") and U.S. Bank Trust National Association, a national banking
association, not in its individual capacity but solely as Trustee (the
"Trustee"), as supplemented by the Series Supplement 2001-35, dated as of
September 21, 2001 (the "Series Supplement" and, together with the Agreement,
the "Trust Agreement"), between the Depositor and the Trustee; and

     WHEREAS, in connection with the creation of the Trust and the deposit
therein of the Underlying Securities, it is desired to provide for the issuance
of trust certificates (the "Certificates") evidencing undivided interests in the
Trust and call warrants with respect to the Certificates ("Call Warrants").

     NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants expressed herein, it is hereby agreed by and between the Depositor and
the Trustee that except as otherwise specified herein or as the context may
otherwise require, capitalized terms used herein but not defined herein shall
have the respective meanings set forth below for all purposes under the Series
Supplement, and as follows:

                                   ARTICLE I

                            Exercise of Call Warrants

     Section 1.1 MANNER OF EXERCISE. (a) Call Warrants may be exercised by any
holder thereof (each, a "Warrant Holder") in whole or in part on any Call Date.
The following conditions shall apply to any exercise of Call Warrants:

          (i) A notice (each, a "Call Notice") specifying the number of Call
     Warrants being exercised and the Call Date shall be delivered to the
     Warrant Agent and the Trustee at least 5 Business Days before such Call
     Date.

          (ii) The Warrant Holder shall surrender the Call Warrants to the
     Warrant Agent at its office specified in Section 6.3 hereof no later than
     10:00 a.m. (New York City time) on such Call Date.

<PAGE>

          (iii) The Warrant Holder shall have made payment to the Warrant Agent,
     by wire transfer or other immediately available funds acceptable to the
     Warrant Agent, in the amount of the Call Price, no later than 10:00 a.m.
     (New York City time) on the Call Date.

          (iv) The Warrant Holder shall exercise Call Warrants relating to Class
     A-1 Certificates and Call Warrants relating to Class A-2 Certificates which
     represent a like percentage of all Class A-1 Certificates and Class A-2
     Certificates.

          (v) The Warrant Holder may not exercise the Call Warrants at any time
     when such Warrant Holder is insolvent, and such Warrant Holder shall be
     required to certify that it is solvent at the time of exercise, by
     completing the Form of Subscription attached to the Call Warrants and
     delivering such completed Form of Subscription to the Trustee on or prior
     to the Call Date and by delivering to the Trustee a form reasonably
     satisfactory to the Trustee of the opinion and the solvency certificate
     required pursuant to Section 7(b)(ii) of the Series Supplement.

          (vi) The Warrant Holder shall have satisfied any other conditions to
     the exercise of Call Warrants set forth in Section 7(b) of the Series
     Supplement.

     (b) Upon exercise of Call Warrants, any Warrant Holder other than the
Depositor or any Affiliate of the Depositor shall be entitled to delivery of the
Called Certificates. The "Called Certificates" shall be, in the case of the
Class A-1 Certificates, Class A-1 Certificates having a Certificate Principal
Amount equal to $25 per Call Warrant, and in the case of the Class A-2
Certificates, Class A-2 Certificates having a Certificate Principal Amount equal
to $1,000 per Call Warrant. Unless otherwise specified therein, such Call Notice
shall be deemed to be notice of an Optional Exchange pursuant to Section 7(a) of
the Series Supplement. Any Warrant Holder which is the Depositor or any
Affiliate of the Depositor shall receive the proceeds of the sale of the Called
Underlying Securities and shall not be entitled to receive the related Called
Certificates. "Called Underlying Securities" are Underlying Securities which
represent the same percentage of the Underlying Securities as the Called
Certificates represent of the Class A-1 Certificates and Class A-2 Certificates.

     (c) The Warrant Agent shall notify the Trustee immediately upon its receipt
of a Call Notice and upon receipt of payment of the Call Price. The Warrant
Agent shall transfer the amount of any paid Call Price to the Trustee in
immediately available funds, for application pursuant to the Trust Agreement on
the applicable Call Date (and, pending such transfer, shall hold such amount for
the benefit of the Warrant Holder in a segregated trust account).

     (d) Delivery of a Call Notice does not give rise to an obligation on part
of the Warrant Holder to pay the Call Price. If, by 10:00 a.m. (New York City
time) on the Call Date, the Warrant Holder has not paid the Call Price, then the
Call Notice shall automatically expire and none of the Warrant Holder, the
Warrant Agent or the Trustee shall have any obligation with respect to the Call
Notice. The expiration of a Call Notice shall in no way affect the Warrant
Holder's right to deliver a Call Notice at a later date.

                                       2

<PAGE>

     Section 1.2 TRANSFER OF CERTIFICATES. As soon as practicable after each
surrender of Call Warrants in whole or in part on the Call Date and upon
satisfaction of all other requirements described in the Call Warrants and in
Section 1.1 hereof, the Warrant Agent shall instruct the Trustee as follows:

     (a) if Call Warrants are being exercised by any Warrant Holder other than
the Depositor or any Affiliate of the Depositor, to cause the Called
Certificates to reflect the holder's beneficial ownership of such Certificates,
or

     (b) if the Call Warrants are being exercised by the Depositor or any
Affiliate of the Depositor, to cause the Called Underlying Securities to be sold
pursuant to Section 13 of the Series Supplement and to distribute the proceeds
of such sale to the Warrant Holder.

     If such exercise is in part only, the Warrant Agent shall instruct the
Trustee to authenticate new Call Warrants of like tenor, representing the
outstanding Call Warrants of the Warrant Holder and the Warrant Agent shall
deliver such Call Warrants to the Warrant Holder.

     Section 1.3 CANCELLATION AND DESTRUCTION OF CALL WARRANTS. All Call
Warrants surrendered to the Warrant Agent for the purpose of exercise (in whole
or in part) pursuant to Section 1.1 and actually exercised, or for the purpose
of transfer or exchange pursuant to Article III, shall be cancelled by the
Warrant Agent, and no Call Warrant shall be issued in lieu thereof. The Warrant
Agent shall destroy all cancelled Call Warrants.

     Section 1.4 NO RIGHTS AS HOLDER OF CERTIFICATES CONFERRED BY CALL WARRANTS.
Prior to the exercise thereof, Call Warrants shall not entitle the Warrant
Holder to any of the rights of a holder of the Certificates, including, without
limitation, the right to receive the payment of any amount on or in respect of
the Certificates or to enforce any of the covenants of the Trust Agreement.

                                   ARTICLE II

                            Restrictions on Transfer

     Section 2.1 RESTRICTIVE LEGENDS. Except as otherwise permitted by this
Article II, each Call Warrant (including each Call Warrant issued upon the
transfer of any Call Warrant) shall be issued with a legend in substantially the
following form:

     "This Call Warrant has not been registered under the Securities Act of
1933, as amended, and may not be transferred, sold or otherwise disposed of
except while a registration under such Act is in effect or pursuant to an
exemption therefrom under such Act. The Call Warrant represented hereby may be
transferred only in compliance with the conditions specified in the Call
Warrants."

     Section 2.2 NOTICE OF PROPOSED TRANSFER. Prior to any transfer of any Call
Warrant or portion thereof, the Warrant Holder will give 5 Business Days (or
such lesser period acceptable to the Warrant Agent) prior written notice to the
Warrant Agent of such Warrant Holder's intention to effect such transfer.

                                       3

<PAGE>

                                  ARTICLE III

                Registration and Transfer of Call Warrants, etc.

     Section 3.1 WARRANT REGISTER; OWNERSHIP OF CALL WARRANTS. The Warrant Agent
will keep a register in which the Warrant Agent will provide for the
registration of Call Warrants and the registration of transfers of Call Warrants
representing whole numbers of Call Warrants. The Trustee and the Warrant Agent
may treat the Person in whose name any Call Warrant is registered on such
register as the owner thereof for all purposes, and the Trustee and the Warrant
Agent shall not be affected by any notice to the contrary.

     Section 3.2 TRANSFER AND EXCHANGE OF CALL WARRANTS. Upon surrender of any
Call Warrant for registration of transfer or for exchange to the Warrant Agent,
the Warrant Agent shall (subject to compliance with Article II) execute and
deliver, and cause the Trustee, on behalf of the Trust, to execute and deliver,
in exchange therefor, a new Call Warrant of like tenor and evidencing a like
whole number of Call Warrants, in the name of such Warrant Holder or as such
Warrant Holder (upon payment by such Warrant Holder of any applicable transfer
taxes or government charges) may direct; provided that as a condition precedent
for transferring the Call Warrants, the prospective transferee shall be required
to deliver to the Trustee and the Depositor an executed copy of the Investment
Letter (set forth as Exhibit C to the Series Supplement).

     Section 3.3 REPLACEMENT OF CALL WARRANTS. Upon receipt of evidence
reasonably satisfactory to the Warrant Agent of the loss, theft, destruction or
mutilation of any Call Warrant and, in the case of any such loss, theft or
destruction of any Call Warrant, upon delivery of an indemnity bond in such
reasonable amount as the Warrant Agent may determine, or, in the case of any
such mutilation, upon the surrender of such Call Warrant for cancellation to the
Warrant Agent, the Warrant Agent shall execute and deliver, and cause the
Trustee, on behalf of the Trust, to execute and deliver, in lieu thereof, a new
Call Warrant of like tenor bearing a number not contemporaneously outstanding.

     Section 3.4 EXECUTION AND DELIVERY OF CALL WARRANTS BY TRUSTEE. The
Trustee, on behalf of the Trust, hereby agrees (subject to compliance with
Article II) to execute and deliver such new Call Warrants issued in accordance
with Section 1.2 or this Article III as the Warrant Agent shall request in
accordance herewith.

                                   ARTICLE IV

                                   Definitions

     As used herein, unless the context otherwise requires, the following terms
have the following respective meanings:

     "Accreted Principal Amount": For each six month period from and including
each date specified in Schedule II to the Series Supplement to but excluding the
next such date, the amount specified in that Schedule II as the "Ending Balance"
for such beginning date.

     "Business Day": As defined in the Trust Agreement.

                                       4

<PAGE>

     "Call Date": Any Business Day on or after September 21, 2006, or after the
announcement of any redemption or other unscheduled payment or sale of the
Underlying Securities on which the Call Warrants are exercised and the proceeds
of an Optional Call (as defined in the Series Supplement) are distributed to the
holders of the Certificates pursuant to Section 7 of the Series Supplement.

     "Call Price": (i) in the case of the Class A-1 Certificates, the par value
of the Class A-1 Certificates being purchased pursuant to the exercise of the
Call Warrants, plus any accrued and unpaid interest on such amount to but
excluding the Call Date and (ii) in the case of the Class A-2 Certificates being
purchased pursuant to the exercise of the Call Warrants, the Accreted Principal
Amount of the Class A-2 Certificates.

     "Call Warrant": As defined in the recitals.

     "Closing Date": September 21, 2001.

     "Depositor": As defined in the recitals.

     "Depositor Order": As defined in the Trust Agreement.

     "Person": Any individual, corporation, partnership, joint venture,
association, joint stock company, trust (including any beneficiary thereof),
unincorporated organization or government or any agency or political subdivision
thereof.

     "Rating Agencies": Standard & Poor's Ratings Services and Moody's Investors
Service, Inc. and any successor thereto.

     "Responsible Officer": As defined in the Trust Agreement.

     "Securities Act": The Securities Act of 1933, or any similar federal
statute, and the rules and regulations of the Commission thereunder, all as the
same shall be in effect at the time.

     "Trust": As defined in the recitals.

     "Trust Agreement": As defined in the recitals.

     "Trustee": As defined in the introduction to this Warrant, or any successor
thereto under the Trust Agreement.

     "Warrant Agent": U.S. Bank Trust National Association, a national banking
association, in its capacity as warrant agent hereunder, or any successor
thereto.

                                   ARTICLE V

                                  Warrant Agent

     Section 5.1 LIMITATION ON LIABILITY. The Warrant Agent shall be protected
and shall incur no liability for or in respect of any action taken, suffered or
omitted by it in connection

                                       5

<PAGE>

with its administration of the Call Warrants in reliance upon any instrument of
assignment or transfer, power of attorney, endorsement, affidavit, letter,
notice, direction, consent, certificate, statement or other paper or document in
good faith believed by it to be genuine and to be signed, executed and, where
necessary, verified and acknowledged, by the proper Person or Persons.

     Section 5.2 DUTIES OF WARRANT AGENT. The Warrant Agent undertakes only the
specific duties and obligations imposed hereunder upon the following terms and
conditions, by all of which the Depositor, the Trust, the Trustee and each
Warrant Holder shall be bound:

     (a) The Warrant Agent may consult with legal counsel (who may be legal
counsel for the Depositor), and the opinion of such counsel shall be full and
complete authorization and protection to the Warrant Agent as to any action
taken or omitted by it in good faith and in accordance with such opinion,
provided the Warrant Agent shall have exercised reasonable care in the selection
by it of such counsel.

     (b) Whenever in the performance of its duties hereunder, the Warrant Agent
shall deem it necessary or desirable that any fact or matter be proved or
established by the Depositor or the Trustee prior to taking or suffering any
action hereunder, such fact or matter may be deemed to be conclusively proved
and established by a Depositor Order or a certificate signed by a Responsible
Officer of the Trustee and delivered to the Warrant Agent; and such certificate
shall be full authorization to the Warrant Agent for any action taken or
suffered in good faith by it hereunder in reliance upon such certificate.

     (c) The Warrant Agent shall be liable hereunder only for its own
negligence, willful misconduct or bad faith.

     (d) The Warrant Agent shall not be liable for or by reason of any of the
statements of fact or recitals contained herein or be required to verify the
same, but all such statements and recitals are and shall be deemed to have been
made by the Trust and the Depositor only.

     (e) The Warrant Agent shall not have any responsibility in respect of and
makes no representation as to the validity of the Call Warrants or the execution
and delivery thereof (except the due execution hereof by the Warrant Agent); nor
shall it be responsible for any breach by the Trust of any covenant or condition
contained in the Call Warrants; nor shall it by any act thereunder be deemed to
make any representation or warranty as to the Certificates to be purchased
thereunder.

     (f) The Warrant Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from the
Chairman of the Board, the Chief Executive Officer, Chief Financial Officer,
Chief Operating Officer, President, a Vice President, a Senior Vice President, a
Managing Director, its Treasurer, an Assistant Treasurer, its Secretary or an
Assistant Secretary of the Depositor, and any Responsible Officer of the
Trustee, and to apply to such officers for advice or instructions in connection
with its duties, and it shall not be liable for any action taken or suffered to
be taken by it in good faith in accordance with instructions of any such
officer.

                                       6

<PAGE>

     (g) The Warrant Agent and any shareholder, director, officer or employee of
the Warrant Agent may buy, sell or deal in any of the Call Warrants or other
securities of the Trust or otherwise act as fully and freely as though it were
not Warrant Agent hereunder, so long as such persons do so in full compliance
with all applicable laws. Nothing herein shall preclude the Warrant Agent from
acting in any other capacity for the Trust, the Depositor or for any other legal
entity.

     (h) The Warrant Agent may execute and exercise any of the rights or powers
hereby vested in it or perform any duty hereunder either itself or by or through
its attorneys or agents.

     (i) The Warrant Agent shall act solely as the agent of the Trust hereunder.
The Warrant Agent shall not be liable except for the failure to perform such
duties as are specifically set forth herein, and no implied covenants or
obligations shall be read into the Call Warrants against the Warrant Agent,
whose duties shall be determined solely by the express provisions thereof. The
Warrant Agent shall not be deemed to be a fiduciary.

     (j) The Warrant Agent shall not be responsible for any failure on the part
of the Trustee to comply with any of its covenants and obligations contained
herein.

     (k) The Warrant Agent shall not be under any obligation or duty to
institute, appear in or defend any action, suit or legal proceeding in respect
hereof, unless first indemnified to its satisfaction, but this provision shall
not affect the power of the Warrant Agent to take such action as the Warrant
Agent may consider proper, whether with or without such indemnity. The Warrant
Agent shall promptly notify the Depositor and the Trustee in writing of any
claim made or action, suit or proceeding instituted against it arising out of or
in connection with the Call Warrants.

     (l) The Trustee will perform, execute, acknowledge and deliver or cause to
be performed, executed, acknowledged and delivered all such further acts,
instruments and assurances as may be required by the Warrant Agent in order to
enable it to carry out or perform its duties hereunder.

     Section 5.3 CHANGE OF WARRANT AGENT. The Warrant Agent may resign and be
discharged from its duties hereunder upon thirty (30) days notice in writing
mailed to the Depositor and the Trustee by registered or certified mail, and to
the Warrant Holders by first-class mail at the expense of the Depositor;
provided that no such resignation or discharge shall become effective until a
successor Warrant Agent shall have been appointed hereunder. The Depositor may
remove the Warrant Agent or any successor Warrant Agent upon thirty (30) days
notice in writing, mailed to the Warrant Agent or successor Warrant Agent, as
the case may be, and to the Warrant Holders by first-class mail; provided
further that no such removal shall become effective until a successor Warrant
Agent shall have been appointed hereunder. If the Warrant Agent shall resign or
be removed or shall otherwise become incapable of acting, the Depositor shall
promptly appoint a successor to the Warrant Agent, which may be designated as an
interim Warrant Agent. If an interim Warrant Agent is designated, the Depositor
shall then appoint a permanent successor to the Warrant Agent, which may be the
interim Warrant Agent. If the Depositor shall fail to make such appointment of a
permanent successor within a period of

                                       7

<PAGE>

thirty (30) days after such removal or within sixty (60) days after notification
in writing of such resignation or incapacity by the resigning or incapacitated
Warrant Agent or by the Warrant Holder, then the Warrant Agent or registered
Warrant Holder may apply to any court of competent jurisdiction for the
appointment of such a successor. Any successor to the Warrant Agent appointed
hereunder must be rated in one of the four highest rating categories by the
Rating Agencies. Any entity which may be merged or consolidated with or which
shall otherwise succeed to substantially all of the trust or agency business of
the Warrant Agent shall be deemed to be the successor Warrant Agent without any
further action.

                                   ARTICLE VI

                                  Miscellaneous

     Section 6.1 REMEDIES. The remedies at law of the Warrant Holder in the
event of any default or threatened default by the Warrant Agent in the
performance of or compliance with any of the terms of the Call Warrants are not
and will not be adequate and, to the full extent permitted by law, such terms
may be specifically enforced by a decree for the specific performance of any
agreement contained herein or by an injunction against a violation of any of the
terms thereof or otherwise.

     Section 6.2 LIMITATION ON LIABILITIES OF WARRANT HOLDER. Nothing contained
in this Warrant Agent Agreement shall be construed as imposing any obligation on
the Warrant Holder to purchase any of the Certificates except in accordance with
the terms thereof.

     Section 6.3 NOTICES. All notices and other communications under this
Warrant Agent Agreement shall be in writing and shall be delivered, or mailed by
registered or certified mail, return receipt requested, by a nationally
recognized overnight courier, postage prepaid, addressed (a) if to any Warrant
Holder, at the registered address of such Warrant Holder as set forth in the
register kept by the Warrant Agent or (b) if to the Warrant Agent, to 100 Wall
Street, Suite 1600, New York, New York 10005, Attention: Corporate Trust or to
such other address notice of which the Warrant Agent shall have given to the
Warrant Holder and the Trustee or (c) if to the Trust or the Trustee, to the
Corporate Trust Office (as set forth in the Trust Agreement); provided that the
exercise of any Call Warrants shall be effective in the manner provided in
Article I.

     Section 6.4 AMENDMENT. (a) This Warrant Agent Agreement may be amended from
time to time by the Depositor, the Trustee and the Warrant Agent without the
consent of any Warrant Holder, upon receipt of an opinion of counsel
satisfactory to the Warrant Agent that the provisions hereof have been satisfied
and that such amendment would not alter the status of the Trust as a grantor
trust under the Code, for any of the following purposes: (i) to cure any
ambiguity or to correct or supplement any provision herein which may be
defective or inconsistent with any other provision herein or to provide for any
other terms or modify any other provisions with respect to matters or questions
arising under the Call Warrant which shall not adversely affect in any material
respect the interests of the Warrant Holder or any holder of a Certificate or
(ii) to evidence and provide for the acceptance of appointment hereunder of a
Warrant Agent other than U.S. Bank Trust National Association.

                                       8

<PAGE>

     (a) Without limiting the generality of the foregoing, the Call Warrants may
also be modified or amended from time to time by the Depositor, the Trustee and
the Warrant Agent with the consent of Warrant Holders of 66-2/3% of each of the
Call Warrants related to the Class A-1 Certificates and the Call Warrants
related to the Class A-2 Certificates, upon receipt of an opinion of counsel
satisfactory to the Warrant Agent that the provisions hereof (including, without
limitation, the following proviso) have seen satisfied, for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Call Warrants or of modifying in any manner the rights of the
Warrant Holders; provided, however, that no such amendment shall (i) adversely
affect in any material respect the interests of holders of Certificates without
the consent of the holders of Certificates evidencing not less than the Required
Percentage-Amendment of the aggregate Voting Rights of such affected
Certificates (as such terms are defined in the Trust Agreement) and without
written confirmation from the Rating Agencies that such amendment will not
result in a downgrading or withdrawal of its rating of the Certificates; (ii)
alter the terms on which Call Warrants are exercisable or the amounts payable
upon exercise of a Warrant without the consent of the holders of Certificates
evidencing not less than 100% of the aggregate Voting Rights of such affected
Certificates and 100% of the affected Warrant Holders or (iii) reduce the
percentage of aggregate Voting Rights required by (i) or (ii) without the
consent of the holders of all such affected Certificates. Notwithstanding any
other provision of this Warrant, this Section 6.4(b) shall not be amended
without the consent of 100% of the affected Warrant Holders.

     (b) Promptly after the execution of any such amendment or modification, the
Warrant Agent shall furnish a copy of such amendment or modification to each
Warrant Holder, to the Trustee and to the Rating Agencies. It shall not be
necessary for the consent of Warrant Holders or holders of Certificates under
this Section to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof shall be subject to such reasonable regulations as the Warrant
Agent may prescribe.

     Section 6.5 EXPIRATION. The right to exercise the Call Warrants shall
expire on the earliest to occur of (a) the cancellation thereof, (b) the
termination of the Trust Agreement, (c) the liquidation, disposition, or
maturity of all of the Certificates, or (d) the occurrence of an Event of
Default under the Trust Agreement.

     Section 6.6 DESCRIPTIVE HEADINGS. The headings in this Warrant Agent
Agreement are for purposes of reference only and shall not limit or otherwise
affect the meaning hereof.

     Section 6.7 GOVERNING LAW. THIS CALL WARRANT SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY,
THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF
LAWS.

     Section 6.8 JUDICIAL PROCEEDINGS; WAIVER OF JURY. Any judicial proceeding
brought against the Trust, the Trustee or the Warrant Agent with respect to this
Warrant Agent Agreement may be brought in any court of competent jurisdiction in
the County of New York, State of New York or of the United States of America for
the Southern District of New York

                                       9

<PAGE>

and, by execution and delivery of the Call Warrants, the Trustee on behalf of
the Trust and the Warrant Agent (a) accept, generally and unconditionally, the
nonexclusive jurisdiction of such courts and any related appellate court, and
irrevocably agree that the Trust, the Trustee and the Warrant Agent shall be
bound by any judgment rendered thereby in connection with this Warrant Agent
Agreement or the Call Warrants, subject to any rights of appeal, and (b)
irrevocably waive any objection that the Trust, the Trustee or the Warrant Agent
may now or hereafter have as to the venue of any such suit, action or proceeding
brought in such a court or that such court is an inconvenient forum.

     Section 6.9 NONPETITION COVENANT; NO RECOURSE. Each of (i) the Warrant
Holder by its acceptance thereof, and (ii) the Warrant Agent agrees, that it
shall not (and, in the case of the Warrant Holder, that it shall not direct the
Warrant Agent to), until the date which is one year and one day after the
payment in full of the Certificates and all other securities issued by the
Trust, the Depositor or entities formed, established or settled by the
Depositor, acquiesce, petition or otherwise invoke or cause the Trust, the
Depositor, or any such other entity to invoke the process of the United States
of America, any State or other political subdivision thereof or any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government for the purpose of commencing or
sustaining a case by or against the Trust, the Depositor or any such other
entity under a federal or state bankruptcy, insolvency or similar law or
appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or
other similar official of the Trust, the Depositor or any such other entity or
all or any part of the property or assets of Trust, the Depositor or any such
other entity or ordering the winding up or liquidation of the affairs of the
Trust, the Depositor or any such other entity.

                                       10

<PAGE>

     Each of (i) the Warrant Holder, by its acceptance thereof, and (ii) the
Warrant Agent agrees, that it shall not have any recourse to the Certificates.

                                 U.S. BANK TRUST NATIONAL ASSOCIATION,
                                       not in its individual
                                       capacity but solely as
                                       Trustee and Authenticating Agent

                                 By:
                                     --------------------------------------
                                      Authorized Signatory

                                 U.S. BANK TRUST NATIONAL ASSOCIATION,
                                       as Warrant Agent

                                 By:
                                     --------------------------------------
                                     Authorized Signatory

                                 LEHMAN ABS CORPORATION,
                                       as Depositor

                                 By:
                                     --------------------------------------
                                     Name:
                                     Title:

                                       11

<PAGE>

                                                                       EXHIBIT C

                            FORM OF INVESTMENT LETTER

                          QUALIFIED INSTITUTIONAL BUYER

                                                        Dated: [_______________]

U.S. Bank Trust National Association,
100 Wall Street
New York, New York 10005

Lehman Brothers Inc.
  as initial Warrant Holder
One Broadgate
London EC2M 7HA
United Kingdom

Lehman ABS Corporation
One Broadgate
London EC2M 7HA
United Kingdom

Ladies and Gentlemen:

     In connection with our proposed purchase of ___________ Call Warrants (the
"Call Warrants") representing an interest in the Corporate Backed Trust
Certificates, Corning Debenture-Backed Series 2001-35 Trust (the "Trust"), the
investor on whose behalf the undersigned is executing this letter (the
"Purchaser") confirms that:

     (1) Reference is made to the Prospectus Supplement, dated September 19,
2001 (the "Prospectus Supplement"), with respect to the Certificates to which
the Call Warrants relate. Capitalized terms used herein that are not otherwise
defined shall have the meanings ascribed thereto in the Prospectus Supplement.
The Purchaser has received a copy of the Prospectus Supplement and such other
information as the Purchaser deems necessary in order to make its investment
decision and the Purchaser has been provided the opportunity to ask questions
of, and receive answers from, the Depositor and the Underwriters, concerning the
terms and conditions of the Call Warrants. The Purchaser has received and
understands the above, and understands that substantial risks are involved in an
investment in the Call Warrants. The Purchaser represents that in making its
investment decision to acquire the Call Warrants, the Purchaser has not relied
on representations, warranties, opinions, projections, financial or other
information or analysis, if any, supplied to it by any person, including you,
the Depositor or the Trustee or any of your or their affiliates, except as
expressly contained in the Prospectus Supplement and in the other written
information, if any, discussed above. The Purchaser has such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of an investment in the Call Warrants, and the Purchaser is
able to bear the substantial economic risks of such an investment. The Purchaser
has relied upon its own tax, legal and financial advisors in connection with its
decision to purchase the Call Warrants.

                                       C-1

<PAGE>

         (2) The Purchaser is (A) a "Qualified Institutional Buyer" (as defined
in Rule 144A under the Securities Act of 1933, as amended (the "1933 Act")) and
(B) acquiring the Call Warrants for its own account or for the account of an
investor of the type described in clause (A) above as to each of which the
Purchaser exercises sole investment discretion. The Purchaser is purchasing the
Call Warrants for investment purposes and not with a view to, or for, the offer
or sale in connection with, a public distribution or in any other manner that
would violate the 1933 Act or the securities or blue sky laws of any state.

         (3) The Purchaser understands that the Call Warrants have not been and
will not be registered under the 1933 Act or under the securities or blue sky
laws of any state, and that (i) if it decides to resell, pledge or otherwise
transfer any Call Warrant, such Call Warrant may be resold, pledged or
transferred without registration only to an entity that has delivered to the
Depositor and the Trustee a certification that it is a Qualified Institutional
Buyer that purchases (1) for its own account or (2) for the account of such a
Qualified Institutional Buyer, that is, in either case, aware that the resale,
pledge or transfer is being made in reliance on said Rule 144A and (ii) it will,
and each subsequent holder will be required to, notify any purchaser of any Call
Warrant from it of the resale restrictions referred to in clause (i) above.

         (4) The Purchaser understands that each of the Call Warrants will bear
a legend to the following effect, unless otherwise agreed by the Depositor and
the Trustee:

         "THIS CALL WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF
EXCEPT WHILE A REGISTRATION UNDER SUCH ACT IS IN EFFECT OR PURSUANT TO AN
EXEMPTION THEREFROM UNDER SUCH ACT. THIS CALL WARRANT REPRESENTED HEREBY MAY BE
TRANSFERRED ONLY IN COMPLIANCE WITH THE CONDITIONS SPECIFIED IN THIS CALL
WARRANT."

         (5) The Purchaser understands that no subsequent transfer of the Call
Warrants is permitted unless it causes its proposed transferee to provide to the
Depositor and the initial Warrant Holder a letter substantially in the form of
Exhibit C to the Series Supplement, as applicable, or such other written
statement as the Depositor shall prescribe.

         (6) The Purchaser agrees that if at some time in the future it wishes
to transfer or exchange any of the Call Warrants, it will not transfer or
exchange any of the Call Warrants unless such transfer or exchange is in
accordance with Section 3.2 of the Warrant Agent Agreement. The Purchaser
understands that any purported transfer of the Call Warrants (or any interest
therein) in contravention of any of the restrictions and conditions in the Trust
Agreement, as applicable, shall be void, and the purported transferee in such
transfer shall not be recognized by the Trust or any other Person as a Warrant
Holder.

                                      C-2

<PAGE>

         You and the Trustee are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.

                                           Very truly yours,

                                           By:
                                               ---------------------------------
                                               Name:
                                               Title:

                                           [Medallion Stamp to be affixed here]

                                      C-3

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