Document:

TOKYO 25257 v7 (2K)

                    STOCKHOLDERS AGREEMENT

                             AMONG

             OUTBACK STEAKHOUSE INTERNATIONAL L.P.

               NEWPORT PACIFIC RESTAURANTS, INC.

                         MICHAEL COBLE

                     GREGORY LOUIS WALTHER

                         DONNIE EVERTS

                        WILLIAM DANIEL

                         BETH BOSWELL

                           DON GALE

                        STACY GARDELLA

                        JAYME GOODSELL

                       KEVIN LEE CRIPPEN

                              AND

              OUTBACK STEAKHOUSE JAPAN CO., LTD.

                    ____________ ___, 2003

                       TABLE OF CONTENTS

1. CURRENT ISSUANCE                                      1

2. TRANSFER OF EQUITY SECURITIES                         1
   2.1  TRANSFER OF COMMON STOCK BY INDIVIDUAL
        STOCKHOLDER                                      1
   2.2  TRANSFER OF COMMON STOCK BY EXECUTIVE
        STOCKHOLDER                                      4
   2.3  PURCHASE ON DEATH OF INDIVIDUAL STOCKHOLDER
        OR EXECUTIVE SHAREHOLDER                         6
   2.4  TRANSFER OF EQUITY SECURITIES BY NPRI            6

3. TRANSFER OF PREFERRED STOCK                           8
   3.1  RESTRICTION ON TRANSFER OF PREFERRED STOCK
        BY THE MANAGEMENT STOCKHOLDER                    8

4. GENERAL PROVISIONS RELATED TO TRANSFERS               10
   4.1. TRANSFER                                         10
   4.2. TRANSFER IN VIOLATION OF SECTIONS 2 AND 3        10
   4.3. TERMINATION OF RIGHTS AND OBLIGATIONS            10

5. COVENANTS OF STOCKHOLDERS                             10
   5.1  CORPORATE EXISTENCE                              10
   5.2  PUBLICITY                                        11
   5.3  CONFIDENTIALITY                                  11
   5.4  AGREEMENT NOT TO COMPETE                         11
   5.5  VOTING AGREEMENT                                 11

6. REPRESENTATIONS AND WARRANTIES                        12
   6.1  REPRESENTATIONS AND WARRANTIES OF THE
        MANAGEMENT STOCKHOLDERS                          12
   6.2  REPRESENTATIONS AND WARRANTIES OF INDIVIDUAL
        STOCKHOLDERS AND EXECUTIVE STOCKHOLDER           13
   6.3  REPRESENTATIONS AND WARRANTIES OF THE COMPAN
        Y                                                13

7. EFFECTIVENESS OF AGREEMENT                            14

8. DEFINITIONS                                           14

9. MISCELLANEOUS                                         16
   9.1  ADDITIONAL ACTIONS AND DOCUMENTS                 16
   9.2  EXPENSES                                         16
   9.3  ASSIGNMENT                                       16
   9.4  ENTIRE AGREEMENT; AMENDMENT                      16
   9.5  WAIVER                                           16
   9.6  LIMITATION ON BENEFIT                            17
   9.7  BINDING EFFECT                                   17
   9.8  GOVERNING LAW                                    17
   9.9  NOTICES                                          17
   9.10 HEADINGS                                         18
   9.11 EXECUTION IN COUNTERPARTS                        18

Appendix 1     Management Stockholders
Appendix 2     Individual Stockholders
Appendix 3     Executive Stockholder
Appendix 4     Calculation of Option Price in respect of
Sections 2.1.2, 2.2.2 and 2.4.2

                    STOCKHOLDERS AGREEMENT

              OUTBACK STEAKHOUSE JAPAN CO., LTD.

    THIS  STOCKHOLDERS AGREEMENT (this "Agreement") is entered
into   as  of  __________  ___,  2003  by  and  among  Outback
Steakhouse  Japan  Co.,  Ltd., a Japan Kabushiki  Kaisha  (the
"Company"),  the  stockholders of the  Company  identified  on
Appendix  1  as  "Management Stockholders" (collectively,  the
"Management  Stockholders"), the stockholders of  the  Company
identified  on  Appendix  2  as the "Individual  Stockholders"
(collectively   the   "Individual   Stockholders")   and   the
stockholders of the Company identified on Appendix  3  as  the
"Executive  Stockholder" (the "Executive  Stockholder").   The
Management Stockholders, the Individual Stockholders  and  the
Executive  Stockholder are referred to herein collectively  as
the "Stockholders" and individually as a "Stockholder."

   WHEREAS, the parties hereto intend that 10,000 Common Stock
be  issued  to Executive Stockholder on or shortly  after  the
date  hereof ("Current Issuance") and consequently the  entire
capital stock of the Company will consist of 3,210,000  shares
of Preferred Stock and 100,000 shares of Common Stock;

    WHEREAS  each of the Stockholders holds after the  Current
Issuance, the Equity Securities (as defined in Article  8)  in
the  Company  set  forth opposite that Stockholder's  name  on
Appendix 1, 2 and 3 respectively; and

   WHEREAS the Company and the Stockholders wish to enter into
this  Agreement  to provide, among other things,  for  certain
mutual   restrictions  relating  to  the  transfer  of  Equity
Securities and other rights and responsibilities as set  forth
in this Agreement.

    Capitalized terms used in this Agreement have the  meaning
ascribed to them in Article 8.

   NOW THEREFORE, in consideration of the mutual covenants and
obligations  of the parties set forth herein,  and  for  other
good  and  valuable consideration, the receipt and sufficiency
of   which  is  hereby  acknowledged,  the  Company  and   the
Stockholders agree as follows:

1. CURRENT ISSUANCE

    Each  Stockholder  acknowledges that the  Stockholder  has
received  due  notice  of  the  shareholders'  meeting  and/or
consented   to  hold  such  meeting  without  the   procedures
otherwise required by law and the Articles of Incorporation of
the Company to be held on or before the date hereof, and shall
vote  to  approve the issuance of 10,000 shares  to  Executive
Stockholder in consideration of his contribution of  6,000,000
yen into the Company.

2. TRANSFER OF EQUITY SECURITIES

 2.1  Transfer of Common Stock by Individual Stockholder

     Each  Individual Stockholder shall not make any  Transfer
 of  any  Common  Stock now or hereafter held or  acquired  by
 such  Stockholder except pursuant to the provisions  of  this
 Section 2.1.

   2.1.1 Restrictions on Transfers while the Individual
         Stockholder is Employed by OSI LP

         During  such  time as the Individual  Stockholder  is
   employed  by  OSI  LP and until the lapse of  the  purchase
   options  contained  in  Section 2.1.2  and  2.1.3  of  this
   Agreement,   if  at  any  time  an  Individual  Stockholder
   desires  to  transfer his/her Common Stock, the  Individual
   Stockholder shall, prior to any desired Transfer, give  OSI
   LP  written  notice  of such desire ("Transfer  Notice  A")
   which  notice  shall specify such Individual  Stockholder's
   Common  Stock  to  be  transferred,  the  identity  of  the
   proposed  transferee,  the purchase price  for  the  Common
   Stock  to be transferred and the terms for payment of  said
   purchase price.  OSI LP shall respond to Transfer Notice  A
   within  thirty (30) days of receipt of such notice  whether
   it  consents  to  the Transfer described in  such  Transfer
   Notice  A.   In  the event OSI LP does not consent  to  the
   Transfer  by the Individual Stockholder (which consent  OSI
   LP  may  or  may  not  give in its  sole  discretion),  the
   Individual  Stockholder shall not transfer or  request  the
   Company to redeem such Common Stock. Failure of OSI  LP  to
   respond  to Transfer Notice A shall be deemed a refusal  of
   consent to the Transfer.

   2.1.2 Purchase Option in Favor of OSI LP

         In  the event the Individual Stockholder's employment
   with  OSI  LP is terminated for whatever reason,  including
   death  or Disability, OSI LP shall have the exclusive right
   and  option  (but  not  the obligation)  to  purchase  such
   Individual  Stockholder's Common Stock upon  the  following
   terms and conditions ("Purchase Option A"):

   (a)   Purchase Option A may be exercised by OSI LP to acquire
         such Common Stock at any time during a sixty (60) day period
         commencing  upon  the termination of  the  Individual
         Stockholder's employment with OSI LP.

   (b)   Purchase Option A shall be exercised by giving written
         notice thereof ("Option Notice") to the Individual Stockholder
         in accordance with the notice provisions hereof.  The date of
         mailing of the Option Notice shall be the date of exercise.
         The Option Notice shall specify a date and place for closing
         of the purchase, which notice shall be not more than thirty
         (30) days after the date of exercise.  OSI LP shall pay for
         the Common Stock to be purchased pursuant to Purchase Option A
         in immediately available funds.  OSI LP is entitled to receive
         customary representations and warranties from the Individual
         Stockholder  regarding  sale  of  shares   (including
         representations and warranties regarding good title to such
         shares, free and clear of any liens or encumbrances).

   (c)  The  purchase  price  to be paid by  OSI  LP  to  such
        Individual Stockholder shall be:

        (i)  if, at the time of termination of employment, any shares
             of Preferred Stock of the Company are outstanding, Option
             Price A-1 calculated pursuant to the method set forth in
             Appendix 4; and

        (ii) if, at the time of termination of employment, no shares
             of Preferred Stock of the Company are  outstanding, Option
             Price A-2 calculated pursuant to the method set forth in
             Appendix 4.

   2.1.3     Right of First Refusal held by OSI LP

   (a)   In the event Purchase Option A is not exercised within
         the sixty (60) days period commencing upon the termination of
         the Individual Stockholder's employment with OSI LP, and such
         Individual Stockholder (or his/her permitted successors in the
         case of death) thereafter desires to transfer his/her Common
         Stock, the Individual Stockholder shall, prior to any desired
         Transfer, give OSI LP and the Company written notice of such
         desire ("Transfer Notice A"), which transfer notice shall
         specify such Individual Stockholder's Common Stock to be
         transferred, the identity of the proposed transferee, the
         purchase price (the "Purchase Price A") for the Common Stock
         to be transferred and the terms for payment of said Purchase
         Price A.  Upon receipt of a proper Transfer Notice A, OSI LP
         shall have the right to acquire such Individual Stockholder's
         Common Stock or a portion of his/her Common Stock as is
         specified in the Transfer Notice A.  In the event the terms of
         payment are such that OSI LP cannot reasonably duplicate, OSI
         LP shall have the right to substitute the reasonable cash
         equivalent thereof.

   (b)   (i)OSI  LP  may  exercise the right of  first  refusal
         contained  herein by mailing written  notice  thereof
         ("Election  Notice A") to the Individual  Stockholder
         within  thirty  (30) days of the date of  receipt  of
         the Transfer Notice A.  In the event OSI LP fails  to
         mail  the  Election  Notice  A  to  the  transferring
         Individual  Stockholder within said thirty  (30)  day
         period,  OSI  LP's  rights under this  Section  2.1.3
         shall lapse.

         (ii) The closing for any purchase under this Section 2.1.3
         shall be consummated and closed on a date and at a place
         designated  by  OSI LP in a notice to the  Individual
         Stockholder, provided such consummation and closing date shall
         occur within sixty (60) days from the date of mailing of the
         Election Notice. At such closing, the Individual Stockholder
         shall execute and deliver all documents and instruments as are
         necessary and appropriate, in the opinion of counsel for the
         Company, to effectuate the Transfer of the Individual
         Stockholder's Common Stock to OSI LP in accordance with the
         terms of the Transfer Notice A and OSI LP shall deliver the
         Purchase Price to the Individual Stockholder in immediately
         available funds.  OSI LP is entitled to receive customary
         representations and warranties from the Individual Stockholder
         regarding his sale of shares (including representations and
         warranties regarding good title to such shares, free and clear
         of any liens or encumbrances). In the event the transferring
         Individual Stockholder has any outstanding debts to the
         Company, or unpaid capital contribution obligations to the
         Company, such debts or unpaid capital contributions, including
         any accrued interest, shall be repaid in full prior to such
         closing.

   (c)   The  right of first refusal provided herein  shall
         continue  until all of the Individual Stockholder's  Common
         Stock  are  transferred  by the Individual  Stockholder  in
         compliance with the terms hereof.

 2.2  Transfer of Common Stock by Executive Stockholder

    The Executive Stockholder shall not make any Transfers of
 any Common Stock now or hereafter held or acquired by such
 Stockholder except pursuant to the provisions of this
 Section 2.2.

   2.2.1  Restrictions on Transfers while the Executive
          Stockholder is Employed by OSI LP

         During  such  time  as the Executive  Stockholder  is
   employed  by  OSI  LP and until the lapse of  the  purchase
   options  contained  in Sections 2.2.2  and  2.2.3  of  this
   Agreement,   if  at  any  time  the  Executive  Stockholder
   desires   to  transfer  his  Common  Stock,  the  Executive
   Stockholder shall, prior to any desired Transfer, give  OSI
   LP  written  notice  of such desire ("Transfer  Notice  B")
   which  notice  shall  specify the  Executive  Stockholder's
   Common  Stock  to  be  transferred, the  indemnity  of  the
   proposed transfer, the purchase price for the Common  Stock
   to  be  transferred  and  the  terms  of  payment  of  said
   purchase price.  OSI LP shall respond to Transfer Notice  B
   within  thirty (30) days of receipt of such notice  whether
   it  consents  to  the Transfer described in  such  Transfer
   Notice  B.   In  the event OSI LP does not consent  to  the
   Transfer  by  the Executive Stockholder (which consent  OSI
   LP  may  or  may  not  give in its  sole  discretion),  the
   Executive  Stockholder shall not transfer  or  request  the
   Company to redeem such Common Stock. Failure of OSI  LP  to
   respond  to Transfer Notice B shall be deemed a refusal  of
   consent to the Transfer.

   2.2.2  Purchase Option in favor of OSI LP

         In  the  event the Executive Stockholder's employment
   with  OSI LP is terminated: (A) prior to December 31,  2006
   by  OSI  LP  for  Cause,  or  by resignation  by  Executive
   Stockholder;  (B) prior to December 31,  2006  due  to  any
   reason  other than as set forth in (A), including Executive
   Stockholder's  death or Disability; or (C)  upon  or  after
   December  31,  2006  for  any  reason  whatsoever,  whether
   voluntary  or involuntary; then, in any such event  OSI  LP
   shall  have  the exclusive right and option  (but  not  the
   obligation)  to  purchase  the Common  Stock  held  by  the
   Executive  Stockholder  (the "Executive  Stock")  upon  the
   following terms and conditions ("Purchase Option B"):

   (a)  Purchase  Option B may be exercised by OSI LP  at  any
         time  during a sixty (60) day period commencing  upon
         the    termination    of   Executive    Stockholder's
         employment  with OSI LP as described in (A),  (B)  or
         (C)  of  this  paragraph 2.2.2.   Purchase  Option  B
         arising  under circumstances described in  (A)  above
         shall  be referred to herein as Purchase Option  B-1,
         Purchase    Option   arising   under    circumstances
         described  in  (B) above as Purchase Option  B-2  and
         Purchase    Option   arising   under    circumstances
         described in (C) above as Purchase Option B-3.

   (b)  Purchase  Option  B  shall  be  exercised  by   giving
         written  notice  thereof  ("Option  Notice   B")   to
         Executive  Stockholder in accordance with the  notice
         provisions  hereof.  The date of  mailing  of  Option
         Notice  B shall be the date of exercise.  The  Option
         Notice  B  shall  specify a  date  and  a  place  for
         closing  of  the purchase, which shall  not  be  more
         than  thirty  (30) days after the date  of  exercise.
         OSI  LP  shall  pay  for the Executive  Stock  to  be
         purchased   pursuant   to  Purchase   Option   B   in
         immediately  available funds.  OSI LP is entitled  to
         receive   customary  representations  and  warranties
         regarding  sale  of shares (including representations
         and  warranties regarding good title to such  shares,
         free and clear of any liens or encumbrances).

   (c)   The  purchase  price  to be paid  by  OSI  LP  to  the
         Executive Stockholder shall be:

         (i)   In the case of Purchase Option B-1, Option Price B-1
               calculated pursuant to the method set forth in Appendix 4;

         (ii)  In the case of Purchase Option B-2, Option Price B-2
               calculated pursuant to the method set forth in Appendix 4; and

         (iii) In the case of Purchase Option B-3, Option Price B-3
               calculated pursuant to the method set forth in Appendix 4.

   2.2.3  Right of First Refusal held by OSI LP

   (a)  In  the  event  Purchase Option  B  is  not  exercised
         within  the  sixty (60) days period  commencing  upon
         the   termination  of  the  Executive   Stockholder's
         employment   with   OSI   LP,   and   the   Executive
         Stockholder (or his/her permitted successors  in  the
         event   of  death)  thereafter  desires  to  transfer
         his/her   Common  Stock,  the  Executive  Stockholder
         shall,  prior to any desired Transfer,  give  OSI  LP
         and   the  Company  written  notice  of  such  desire
         ("Transfer  Notice B"), which transfer  notice  shall
         specify such Executive Stockholder's Common Stock  to
         be   transferred,  the  identity  of   the   proposed
         transferee,  the purchase price (the "Purchase  Price
         B")  for  the Common Stock to be transferred and  the
         terms  for  payment of said Purchase Price  B.   Upon
         receipt  of a proper Transfer Notice B, OSI LP  shall
         have    the   right   to   acquire   such   Executive
         Stockholder's  Common Stock as is  specified  in  the
         Transfer  Notice  B.   In  the  event  the  terms  of
         payment  are  such  that  OSI  LP  cannot  reasonably
         duplicate,  OSI LP shall have the right to substitute
         the reasonable cash equivalent thereof.

   (b)      (i)   OSI  LP  may  exercise the  right  of  first
             refusal   contained  herein  by  mailing  written
             notice  thereof  ("Election  Notice  B")  to  the
             Executive Stockholder within thirty (30) days  of
             the  date  of receipt of the Transfer  Notice  B.
             In  the  event OSI LP fails to mail the  Election
             Notice    B   to   the   transferring   Executive
             Stockholder  within said thirty (30) day  period,
             OSI  LP's  rights under this Section 2.2.3  shall
             lapse.

            (ii)  The  closing  for  any purchase  under  this
             Section 2.2.3 shall be consummated and closed  on
             a  date and at a place designated by OSI LP in  a
             notice  to  the  Executive Stockholder,  provided
             such  consummation and closing date  shall  occur
             within  sixty (60) days from the date of  mailing
             of  the  Election  Notice. At such  closing,  the
             Executive  Stockholder shall execute and  deliver
             all  documents  and instruments as are  necessary
             and  appropriate, in the opinion of  counsel  for
             the  Company, to effectuate the Transfer  of  the
             Executive  Stockholder's Common Stock to  OSI  LP
             in  accordance  with the terms  of  the  Transfer
             Notice  B  and OSI LP shall deliver the  Purchase
             Price   B   to   the  Executive  Stockholder   in
             immediately available funds.  OSI LP is  entitled
             to    receive   customary   representations   and
             warranties   from   the   Executive   Stockholder
             regarding   his   sale   of   shares   (including
             representations  and  warranties  regarding  good
             title  to  such  shares, free and  clear  of  any
             liens   or   encumbrances).  In  the  event   the
             transferring   Executive  Stockholder   has   any
             outstanding  debts  to  the  Company,  or  unpaid
             capital  contribution obligations to the Company,
             such   debts  or  unpaid  capital  contributions,
             including  any accrued interest, shall be  repaid
             in full prior to such closing.

   (c)  The  right  of  first  refusal provided  herein  shall
         continue  until  all  of the Executive  Stockholder's
         Common   Stock  are  transferred  by  the   Executive
         Stockholder in compliance with the terms hereof.

 2.3  Purchase on Death of Individual Stockholder or Executive
      Shareholder

     In  the  event  of death of an Individual Stockholder  or
 Executive  Stockholder,  if OSI  LP  does  not  exercise  the
 purchase  option under 2.1.2 or 2.2.2, the Common  Stock  may
 pass  to  his/her estate or heirs, provided  such  estate  or
 heirs  agree  that  such Common Stock  shall  be  and  remain
 subject  to  the  rights of first refusal  of  OSI  LP  under
 Section  2.1.3 or 2.2.3.  In the event such estate  or  heirs
 refuse  to  so agree in writing within twelve (12) days  from
 the  death  of  the  stockholder, the relevant  Common  Stock
 shall   automatically  be  transferred  to  OSI  LP  for   no
 consideration as of the date of the death.

 2.4  TRANSFER OF EQUITY SECURITIES BY NPRI

     NPRI shall not make any Transfer of any Common Stock  now
 or  hereafter held or acquired by NPRI except pursuant to the
 provisions of this Section 2.4.

   2.4.1  Restriction on Transfers while NPRI Employee is
          Employed by OSI LP

         During  such  time as NPRI Executive is  employed  by
   OSI  LP  and  until  the  lapse  of  the  purchase  options
   contained in Section 2.4.2 and 2.4.3 of this Agreement,  if
   at   any   time  NPRI  desires  to  transfer   its   Equity
   Securities,  NPRI  shall, prior to  any  desired  Transfer,
   give  OSI  LP  written  notice of  such  desire  ("Transfer
   Notice   C")  which  notice  shall  specify  NPRI's  Equity
   Securities to be transferred, the identity of the  proposed
   transferee,  the  purchase price for the Equity  Securities
   to  be  transferred  and  the  terms  of  payment  of  said
   purchase price.  OSI LP shall respond to Transfer Notice  C
   within  thirty (30) days of such notice whether it consents
   to  the Transfer described in such Transfer Notice  C.   In
   the  event OSI LP does not consent to the transfer by  NRPI
   (which  consent  OSI LP may or may not  give  in  its  sole
   discretion),  NPRI  shall  not  transfer  or  request   the
   Company  to redeem such Equity Securities. Failure  of  OSI
   LP  to  respond  to  Transfer Notice C shall  be  deemed  a
   refusal of consent to the Transfer.

   2.4.2  Purchase Option in favor of OSI LP

         In  the  event  the NPRI Executive's employment  with
   OSI  LP is terminated for whatever reason, including  death
   or  Disability, OSI LP shall have the exclusive  right  and
   option  (but  not the obligation) to purchase Common  Stock
   held  by  NPRI  upon  the following  terms  and  conditions
   ("Purchase Option C"):

   (a)  Purchase Option C may be exercised by OSI LP to acquire
         such Common Stock at any time during a sixty (60) day period
         commencing upon the termination of NPRI Executive's employment
         with OSI LP.

   (b)  Purchase Option C shall be exercised by giving written
         notice thereof ("Option Notice C") to NPRI in accordance with
         the notice provisions hereof.  The date of mailing of the
         Option Notice C shall be the date of exercise.  The Option
         Notice shall specify a date and place for closing of the
         purchase, which notice shall be not more than thirty (30) days
         after the date of exercise.  OSI LP shall pay for the Common
         Stock to be purchased pursuant to Purchase Option C in
         immediately available funds.  OSI LP is entitled to receive
         customary representations and warranties from NPRI regarding
         sale of shares (including representations and warranties
         regarding good title to such shares, free and clear of any
         liens or encumbrances).

   (c)  The purchase price to be paid by OSI LP to NPRI shall be:

         (i)  if, at the time of termination of employment, any time
             shares of Preferred Stock of the Company are outstanding,
             Option Price C-1 calculated pursuant to the method set forth
             in Appendix 4; and

         (ii) if, at the time of termination of employment,  no shares
             of Preferred Stock of the Company are  outstanding, Option
             Price C-2 calculated pursuant to the method set forth in
             Appendix 4.

   2.4.3  Right of First Refusal held by OSI LP

   (a)  In  the  event  Purchase Option  C  is  not  exercised
         within  the  sixty (60) days period  commencing  upon
         the  termination of NPRI Executive's employment  with
         OSI  LP, and NPRI thereafter desires to transfer  its
         Common  Stock,  NPRI  shall,  prior  to  any  desired
         Transfer, give OSI LP and the Company written  notice
         of  such desire ("Transfer Notice C"), which transfer
         notice  shall specify such Common Stock held by  NPRI
         to  be  transferred,  the identity  of  the  proposed
         transferee,  the purchase price (the "Purchase  Price
         C")  for  the Common Stock to be transferred and  the
         terms  for  payment of said Purchase Price  C.   Upon
         receipt  of a proper Transfer Notice C, OSI LP  shall
         have  the  right to acquire such NPRI's Common  Stock
         as  is  specified in the Transfer Notice C.   In  the
         event  the  terms  of payment is  such  that  OSI  LP
         cannot  reasonably duplicate, OSI LP shall  have  the
         right  to  substitute the reasonable cash  equivalent
         thereof.

   (b)      (i)   OSI  LP  may  exercise the  right  of  first
             refusal   contained  herein  by  mailing  written
             notice  thereof  ("Election Notice  C")  to  NPRI
             within  thirty (30) days of the date  of  receipt
             of  the  Transfer Notice C.  In the event OSI  LP
             fails  to  mail  the Election Notice  C  to  NPRI
             within  said  thirty (30) day  period,  OSI  LP's
             rights under this Section 2.4.3 shall lapse.

         (ii)     The  closing  for  any purchase  under  this
             Section 2.4.3 shall be consummated and closed  on
             a  date and at a place designated by OSI LP in  a
             notice  to  NPRI, provided such consummation  and
             closing  date shall occur within sixty (60)  days
             from  the date of mailing of the Election Notice.
             At  such  closing, NPRI shall execute and deliver
             all  documents  and instruments as are  necessary
             and  appropriate, in the opinion of  counsel  for
             the  Company, to effectuate the Transfer of  such
             NPRI's Common Stock to OSI LP in accordance  with
             the  terms  of the Transfer Notice C and  OSI  LP
             shall  deliver  the  Purchase  Price  C  to   the
             Individual  Stockholder in immediately  available
             funds.   OSI LP is entitled to receive  customary
             representations   and   warranties   from    NPRI
             regarding   his   sale   of   shares   (including
             representations  and  warranties  regarding  good
             title  to  such  shares, free and  clear  of  any
             liens  or  encumbrances). In the event  NPRI  has
             any  outstanding debts to the Company, or  unpaid
             capital  contribution obligations to the Company,
             such   debts  or  unpaid  capital  contributions,
             including  any accrued interest, shall be  repaid
             in full prior to such closing.

   (c)  The  right  of  first  refusal provided  herein  shall
         continue  until  all  of  NPRI's  Common  Stock   are
         transferred  by  NPRI in compliance  with  the  terms
         hereof.

3. TRANSFER OF PREFERRED STOCK

 3.1  Restriction on Transfer of Preferred Stock by the
      Management Stockholder

 Subject to the provisions set forth in Section 2.4.1:

   (a)      (i)     If   at   any   time   either   Management
             Stockholder  desires  to transfer  its  Preferred
             Stock,  the  Management Stockholder shall,  prior
             to   any   desired   transfer  give   the   other
             Management  Stockholder and the  Company  written
             notice  of  such  desire ("Transfer  Notice  D"),
             which   transfer   notice   shall   specify   the
             Management  Stockholder's Preferred Stock  to  be
             transferred,   the  identity  of   the   proposed
             transferee, the Purchase Price and the  terms  of
             payment of said Purchase Price.  Upon receipt  of
             a   Transfer   Notice  D,  the  other  Management
             Stockholder shall have the right to acquire  such
             transferring  Management Stockholder's  Preferred
             Stock  or  such portion of such Equity Securities
             as  is  specified in the Transfer Notice  D.   In
             the  event  the terms of payment in the  Transfer
             Notice  D  is such that the transferee Management
             Stockholder   cannot  reasonably  duplicate,   it
             shall   have   the   right  to   substitute   the
             reasonable equivalent thereof.

         (ii) The other Management Stockholder in receipt of the
             Transfer Notice D shall exercise the right of first refusal
             contained herein by mailing written Election Notice to the
             transferring Management Stockholder within thirty (30) days of
             the date of receipt of the Transfer Notice D.  In the event
             the other Management Stockholder fails to mail the Election
             Notice to the transferring Management Stockholder within said
             thirty (30) days period the other Management Stockholder's
             rights under this Section 3.1 shall lapse.

         (iii)     The closing for any purchase hereunder shall be
             consummated and closed on a date and at a place designated by
             the Company in a notice to both the Management Stockholders,
             provided such consummation and closing shall occur within
             sixty (60) days of mailing of the Election Notice.  At such
             closing, the transferring Management Stockholder shall execute
             and deliver all documents and instruments as are necessary and
             appropriate, in the opinion of counsel for the Company to
             effectuate the transfer of Management Stockholder's Preferred
             Stock to the other Management Stockholder in accordance with
             the terms of Transfer Notice D and the other Management
             Stockholder shall deliver the Purchase Price to the
             transferring management Stockholder in immediately available
             funds. The other Management Stockholder is entitled to receive
             customary representations and warranties from the transferring
             Management Stockholder regarding his sale of shares (including
             representations and warranties regarding good title to such
             shares, free and clear of any liens or encumbrances). In the
             event the transferring Management Stockholder has any
             outstanding debts to the Company, or unpaid capital
             contribution obligations to the Company, such debts or unpaid
             capital contributions, including any accrued interest, shall
             be repaid in full prior to such closing.

   (b)      (i)    In   the   event   the   other   Management
             Stockholder  does  not  exercise  the  right   of
             refusal   contained  in  subparagraph  (a),   the
             Company  may exercise the right of first  refusal
             contained  herein  by  mailing  written  Election
             Notice    to    the    transferring    Management
             Stockholder  within sixty (60) days of  the  date
             of  receipt  of the Transfer Notice  D.   In  the
             event  the  Company  fails to mail  the  Election
             Notice    to    the    transferring    Management
             Stockholder  within said sixty (60)  days  period
             the  Company's  rights  under  this  Section  3.1
             shall lapse.

         (ii)  The closing for any purchase hereunder shall be
             consummated and closed on a date and at a place designated by
             the Company in a notice to the transferring Management
             Stockholder, provided such consummation and closing shall
             occur within sixty (60) days of mailing of the Election
             Notice.  At such closing, the transferring Management
             Stockholder shall execute and deliver all documents and
             instruments as are necessary and appropriate, in the opinion
             of counsel for the Company to effectuate the transfer of
             Management Stockholder's Preferred Stock to the Company in
             accordance with the terms of Transfer Notice D and the Company
             shall deliver the Purchase Price to the transferring
             Management Stockholder in immediately available funds. The
             Company is entitled to receive customary representations and
             warranties from the transferring Management Stockholder
             regarding his sale of shares (including representations and
             warranties regarding good title to such shares, free and clear
             of any liens or encumbrances). In the event the transferring
             Management Stockholder has any outstanding debts to the
             Company, or unpaid capital contribution obligations to the
             Company, such debts or unpaid capital contributions, including
             any accrued interest, shall be repaid in full prior to such
             closing.

4. GENERAL PROVISIONS RELATED TO TRANSFERS

     4.1. Transfer

     (a)   "Transfer"  as  used in this Agreement  includes  a
 sale,  gift, mortgage, pledge, exchange, assignment or  other
 disposition  (whether  with  or  without  consideration   and
 whether  voluntary  or involuntary or by operation  of  law),
 including  without limitation, a disposition  under  judicial
 order,  legal  process, execution, attachment or  enforcement
 of   an  encumbrance  and  including  where  the  context  so
 requires, redemption by the Company.

     (b)   Any  permitted Transfer shall be made in accordance
 with the requirements of Japanese law.

     4.2. Transfer in violation of Sections 2 and 3

         The  parties  agree that no Transfer  shall  be  made
 except  in  compliance with the terms of the Agreement.   Any
 purported  transfer contrary to the terms of this Sections  2
 and 3 shall be null and void and of no force and effect.   In
 the  event transfer contrary to such terms is made,  and  the
 transferee  acquires  a valid claim as a shareholder  against
 the  Company under Japanese law, the transferor shall pay OSI
 LP  as  penalty the amount equal to the product of three  (3)
 and  the  greater  of (i) the market value  of  the  relevant
 Equity  Securities  determined by  OSI  LP  (which  shall  be
 binding  on the parties) and (ii) 100 yen multiplied  by  the
 number of shares of the relevant Equity Securities.

     4.3. Termination of Rights and Obligations

     The  rights and obligations of the parties under Sections
 2  and  3 irrevocably terminate on the occurrence of  any  of
 the  following  events:  (i)  the  voluntary  or  involuntary
 dissolution   of   the  Company;  or  (ii)  an   acquisition,
 consolidation, or merger of the Company into or with  another
 corporation that results in the Stockholders owning  publicly
 traded securities.

5. COVENANTS OF STOCKHOLDERS

 5.1  Corporate Existence

     The  Company shall preserve, maintain, and keep  in  full
 force  and  effect  the Company's corporate existence;  shall
 preserve,  maintain, and keep in full force  and  effect  all
 rights, franchises, and privileges necessary or desirable  in
 the  normal  conduct  of the Company's  business;  and  shall
 qualify  and  remain  qualified as a foreign  corporation  in
 each  jurisdiction in which such qualification  is  necessary
 in  view  of  the Company's business and operations  and  the
 ownership of its properties.

 5.2  Publicity

     Each  Stockholder hereby covenants and agrees  that  such
 Stockholder  shall  not,  directly or  indirectly,  make  any
 press  release  or  public  notice, announcement,  or  filing
 available   to   the  public  concerning  the  Company,   its
 Stockholders, or its intended business without  prior  notice
 to  and  reasonable  consultation with the  Company  and  the
 other  Stockholders, unless such notice and  consultation  is
 impracticable   under   applicable   laws   or   governmental
 regulations.

 5.3  Confidentiality

     Each  Stockholder covenants and agrees that,  unless  the
 Company  and  each  other Stockholder  otherwise  consent  in
 advance in writing, and except as otherwise required  by  any
 applicable  law or governmental regulation, such  Stockholder
 shall  not, directly or indirectly, disclose to anyone  other
 than  the Stockholders or the employees or directors  of  the
 Company  any non-public information regarding this  Agreement
 or   any  of  the  Exhibits  or  Appendices  hereto  or   the
 transactions   contemplated  hereby   or   thereby   or   the
 Stockholders or business of the Company.

 5.4  Agreement Not to Compete

     Each  Stockholder  other than OSI  LP   hereby  severally
 covenant and agree that they shall not, for  so long as  they
 are  stockholders of the Company and for a  period  of  three
 (3)  years  thereafter,  compete  with  the  Company  in  any
 business  in  which the Company is engaged or has  reasonably
 firm  plans  to  engage  during  such  period,  or  hold  any
 investment  (except for an investment in  less  than  a  five
 (5)%  equity  interest  in a publicly-traded  corporation  or
 other  entity)  in  any  entity that  so  competes  with  the
 Company.     The   noncompetition   covenants   under    this
 Section 5.3 shall terminate (a) if the Company ceases  to  be
 engaged in restaurant operating business, (ii) a petition  is
 filed  against  the Company under any bankruptcy,  insolvency
 or  similar  law  of any jurisdiction and  is  not  dismissed
 within  sixty  (60) days after such filing,  or  a  receiver,
 liquidator, trustee or similar agent for the Company  or  any
 of  its property is appointed by court order which remains in
 effect  for  more than sixty (60) days, or (iii) the  Company
 files  a  voluntary petition under any bankruptcy, insolvency
 or   similar  law  of  any  jurisdiction,  consents  to   the
 appointment  of  a receiver, liquidator, trustee  or  similar
 agent  for  it  or  any of its property, or makes  a  general
 assignment for the benefit of creditors.

 5.5  Voting Agreement

     No  Stockholder holding shares of the Common Stock of the
 Company  shall  take  any  action  to  cause  the  Board   of
 Directors of the Company to adopt a resolution approving  and
 authorizing the creation of any share of any class or  series
 of  capital  stock  of the Company other than  the  currently
 authorized shares of Common Stock and Preferred Stock of  the
 Company,  or  of any right or option requiring the  Board  of
 Directors of the Company to adopt a resolution approving  and
 authorizing the creation of any share of any class or  series
 of  capital  stock  of the Company other than  the  currently
 authorized  classes  of  the  shares  of  Common  Stock   and
 Preferred Stock of the Company.

6. REPRESENTATIONS AND WARRANTIES

 6.1  Representations and Warranties of the Management
     Stockholders

     Each  Stockholder that is a corporation, partnership,  or
 limited  liability company hereby represents and warrants  to
 the Company and to each other Stockholder as follows:

   6.1.1  Organization and Standing

         Such Stockholder is duly organized, validly existing,
   and in good standing under the laws of the jurisdiction  in
   which   it   is  organized.   Such  Stockholder   has   the
   corporate, partnership, or limited liability company  power
   and   authority  to  enter  into  this  Agreement  and   to
   consummate the transactions contemplated hereby.

   6.1.2  Authorization

           Such   Stockholder   has   taken   all   corporate,
   partnership, or limited liability company action  necessary
   for  it to enter into this Agreement and to consummate  the
   transactions contemplated hereby.

   6.1.3  Absence of Violation

         Neither the execution and delivery of this Agreement,
   or  of  any  document  or instrument  to  be  executed  and
   delivered  by  such Stockholder pursuant  hereto,  nor  the
   consummation  of the transactions contemplated  hereby  and
   thereby  will constitute a violation of, or default  under,
   or  conflict with, or require any consent under (other than
   a  violation or default that has been waived or  a  consent
   that  has  been  obtained), any term or  provision  of  the
   certificate  or  articles  of  incorporation   or   bylaws,
   partnership  agreement,  or  certificate  or  articles   of
   formation  or limited liability company agreement  of  such
   Stockholder or any contract, commitment, indenture,  lease,
   or  other agreement to which such Stockholder is a party or
   by which such Stockholder or any of its assets is bound.

   6.1.4  Binding Obligation

          This  Agreement  constitutes  a  valid  and  binding
   obligation  of such Stockholder, enforceable in  accordance
   with   its   terms,   except  to  the  extent   that   such
   enforceability  may  be limited by bankruptcy,  insolvency,
   and  similar  laws  affecting the rights  and  remedies  of
   creditors  generally, and by general principles  of  equity
   and  public policy; and each document and instrument to  be
   executed   by   such  Stockholder  pursuant  hereto,   when
   executed  and  delivered in accordance with the  provisions
   of  this Agreement, shall be a valid and binding obligation
   of  such  Stockholder, enforceable in accordance  with  its
   terms (with the aforesaid exceptions).

 6.2  Representations and Warranties of Individual Stockholders
     and Executive Stockholder

     Each  Stockholder who is an individual hereby  represents
 and  warrants  to the Company and each other  Stockholder  as
 follows:

   6.2.1  Power and Authority

         Such Stockholder has the legal capacity and all other
   necessary  power and authority to enter into this Agreement
   and to consummate the transactions contemplated hereby.

   6.2.2  Absence of Violation

         Neither the execution and delivery of this Agreement,
   or  of  any  document  or instrument  to  be  executed  and
   delivered  by  such Stockholder pursuant  hereto,  nor  the
   consummation  of the transactions contemplated  hereby  and
   thereby  will constitute a violation of, or default  under,
   or  conflict with, or require any consent under (other than
   a  violation or default that has been waived or  a  consent
   that  has  been  obtained), any term or  provision  of  any
   contract,  commitment, indenture, lease, or other agreement
   to  which  such  Stockholder is a party or  by  which  such
   Stockholder or any of his assets is bound.

   6.2.3  Binding Obligation

          This  Agreement  constitutes  a  valid  and  binding
   obligation  of such Stockholder, enforceable in  accordance
   with   its   terms,   except  to  the  extent   that   such
   enforceability  may  be limited by bankruptcy,  insolvency,
   and  similar  laws  affecting the rights  and  remedies  of
   creditors  generally, and by general principles  of  equity
   and  public policy; and each document and instrument to  be
   executed   by   such  Stockholder  pursuant  hereto,   when
   executed  and  delivered in accordance with the  provisions
   of  this Agreement, shall be a valid and binding obligation
   of  such  Stockholder, enforceable in accordance  with  its
   terms (with the aforesaid exceptions).

 6.3  Representations and Warranties of the Company

      The  Company  hereby  represents and  warrants  to  each
Stockholder as follows:

   6.3.1  Organization and Standing

         The  Company is a corporation duly organized, validly
   existing,  and  in good standing under the laws  of  Japan.
   The  Company has the corporate power and authority to enter
   into  this  Agreement  and to consummate  the  transactions
   contemplated hereby.

   6.3.2  Authorization

         The  Company has taken all corporate action necessary
   for  it to enter into this Agreement and to consummate  the
   transactions contemplated hereby.

   6.3.3  Absence of Violation

         Neither the execution and delivery of this Agreement,
   or  of  any  document  or instrument  to  be  executed  and
   delivered   by  the  Company  pursuant  hereto,   nor   the
   consummation  of the transactions contemplated  hereby  and
   thereby  will constitute a violation of, or default  under,
   or  conflict with, or require any consent under (other than
   a  violation or default that has been waived or  a  consent
   that  has  been  obtained), any term or  provision  of  the
   Articles  of Incorporation of the Company or any  contract,
   commitment, indenture, lease, or other agreement  to  which
   the  Company is a party or by which the Company or  any  of
   its assets is bound.

   6.3.4  Binding Obligation

          This  Agreement  constitutes  a  valid  and  binding
   obligation  of the Company, enforceable in accordance  with
   its  terms,  except to the extent that such  enforceability
   may  be limited by bankruptcy, insolvency, and similar laws
   affecting  the rights and remedies of creditors  generally,
   and  by general principles of equity and public policy; and
   each  document and instrument to be executed by the Company
   pursuant  hereto, when executed and delivered in accordance
   with  the  provisions of this Agreement, shall be  a  valid
   and  binding  obligation  of the  Company,  enforceable  in
   accordance with its terms (with the aforesaid exceptions).

   6.3.5  No Other Representations or Warranties

         The  Company and each Stockholder hereby  acknowledge
   that  no  party  hereto  has  made  any  representation  or
   warranty  as  to  the  transactions  contemplated  by  this
   Agreement,  the  business or prospects of the  Company,  or
   any  other  matter,  except  for  the  representations  and
   warranties   expressly  set  forth   in   this   Agreement,
   including the Exhibits and Appendices hereto.  The  Company
   and  each Stockholder further acknowledge that, in entering
   into  the transactions contemplated by this Agreement, they
   have  not relied on any representation or warranty  by  any
   party   other  than  the  representations  and   warranties
   expressly  set  forth  in  this  Agreement,  including  the
   Exhibits and Appendices hereto.

7. EFFECTIVENESS OF AGREEMENT

    This  Agreement is effective for all purposes at the  time
each  Stockholder and the Company have executed and  delivered
this Agreement.

8. DEFINITIONS

    Capitalized terms used in this Agreement have the  meaning
ascribed to them as follows:

   "Agreement" means this Stockholders Agreement.

    "Cause" means, (i) failure of the employee to perform  the
duties  required  of the employee in a manner satisfactory  to
OSI  LP,  in its sole discretion; provided, however, that  the
employment   shall   not  be  terminated  pursuant   to   this
subparagraph  (i)  unless OSI LP first gives  the  employee  a
written  notice  ("Notice  of  Deficiency").  The  Notice   of
Deficiency  shall specify the deficiencies in  the  employee's
performance of the employee's duties. The employee shall  have
a  period  of thirty (30) days, commencing on receipt  of  the
Notice  of  Deficiency,  in  which to  cure  the  deficiencies
contained  in  the  Notice of Deficiency.  In  the  event  the
employee does not cure the deficiencies to the satisfaction of
OSI  LP,  in its sole discretion, within such thirty (30)  day
period  (or  if  during such thirty (30)  day  period  OSI  LP
determines  that  the employee is not making reasonable,  good
faith efforts to cure the deficiencies to the satisfaction  of
OSI  LP)  OSI LP shall have the right to immediately terminate
the  term  of  employment. The provisions of this subparagraph
(i)  may be invoked by OSI LP any number of times and cure  of
deficiencies contained in any Notice of Deficiency  shall  not
be  construed as a waiver of this subparagraph (i) nor prevent
OSI  LP from issuing any subsequent Notices of Deficiency;  or
(ii) any dishonesty by the employee in the employee's dealings
with  OSI  LP or the Company, the commission of fraud  by  the
employee, negligence in the performance of the duties  of  the
employee,   insubordination,  willful   misconduct,   or   the
conviction  (or  plea  of guilty or nolo  contendere)  of  the
employee   of  any  felony,  or  any  other  crime   involving
dishonesty or moral turpitude; or (iii) any violation  of  any
covenant  or  restriction contained in Section 2.4.1,  Section
5.2,  Section 5.3 or Section 5.4 hereof; or (iv) any violation
of  any  material published policy of OSI LP, the  Company  or
their affiliates (material published policies include, but are
not  limited  to, the OSI LP's discrimination  and  harassment
policy,   responsible  alcohol  policy  and  insider   trading
policy).

   "Common Stock" means the common stock of the Company.

   "Company" means OSJ K.K. a Japan Kabushiki Kaisha.

    "Disability" means the inability of the employee,  arising
out   of   any  medically  determinable  physical  or   mental
impairment,  to perform the services required of the  employee
hereunder for a period of ninety (90) consecutive days.

    "Equity Securities" means any share of any class or series
of  capital  stock of the Company or any right  or  option  to
acquire any share of capital stock of the Company and includes
the Common Stock and the Preferred Stock.

    "Executive  Stockholder" means the  person  identified  in
Appendix 3.

    "Executive Stock" has the meaning ascribed to that term in
Section 2.5.2.

    "Individual  Stockholder" means any person  identified  as
such in Appendix 2.

    "Management Stockholder" means the entities identified  as
such in Appendix 1.

    "NPRI"  means Newport Pacific Restaurants, Inc., a Georgia
corporation.

   "NPRI Employee" means Joel Silverstein.

    "OSI  LP" means Outback Steakhouse International, L.P.,  a
Georgia limited partnership.

   "Preferred Stock" means the preferred stock of the Company.

    "Stockholder" has the meaning ascribed to that term in the
first paragraph of this Agreement.

9. MISCELLANEOUS

 9.1  Additional Actions and Documents

     Each of the parties hereto hereby agrees to take or cause
 to  be  taken  such further actions, to execute, deliver  and
 file  or  cause  to  be executed, delivered  and  filed  such
 further  documents  and  instruments,  and  to  obtain   such
 consents,  as  may  be  necessary or  as  may  be  reasonably
 requested  in  order to fully effectuate the purposes,  terms
 and conditions of this Agreement.

 9.2  Expenses

     Each party shall pay his or its own expenses incident  to
 the  preparation  and negotiation of this Agreement  and  the
 transactions contemplated hereunder, including all legal  and
 accounting fees and disbursements.

 9.3  Assignment

     Neither  the Company nor any Stockholder may assign  this
 Agreement, in whole or in part, whether by operation  of  law
 or  otherwise, (a) unless such person has obtained the  prior
 written  consent of all the other parties, or (b) unless  and
 to  the  extent that such assignment is in connection with  a
 transfer  of Equity Securities upon death of such Stockholder
 in  accordance with Section 2.3.  Any purported assignment of
 this Agreement contrary to its terms is null and void and  of
 no force and effect.

 9.4  Entire Agreement; Amendment

     This  Agreement,  including the Appendices  and  Exhibits
 hereto  and  other writings referred to herein  or  delivered
 pursuant  hereto, constitutes the entire agreement among  the
 parties  to  this Agreement with respect to the  transactions
 contemplated  herein, and it supersedes  all  prior  oral  or
 written   agreements,  commitments  or  understandings   with
 respect  to  the matters provided for herein.  No  amendment,
 modification  or  discharge of this  Agreement  is  valid  or
 binding unless set forth in writing and duly executed by  all
 the Stockholders.

 9.5  Waiver

     No  delay  or  failure on the part of any party  to  this
 Agreement  in exercising any right, power or privilege  under
 this  Agreement  or  under  any other  instruments  given  in
 connection  with or pursuant to this Agreement  shall  impair
 any  such  right,  power or privilege or be  construed  as  a
 waiver  of  any  default  or  any acquiescence  therein.   No
 single  or  partial  exercise of any  such  right,  power  or
 privilege shall preclude the further exercise of such  right,
 power  or  privilege,  or the exercise of  any  other  right,
 power  or  privilege.  No waiver will be  valid  against  any
 party to this Agreement unless made in writing and signed  by
 the  party against whom enforcement of such waiver is  sought
 and then only to the extent expressly specified therein.

 9.6  Limitation on Benefit

     It  is the explicit intention of the parties hereto  that
 no  person or entity other than the parties to this Agreement
 is  or  shall be entitled to bring any action to enforce  any
 provision  of this Agreement against any of the parties,  and
 the  covenants, undertakings and agreements set forth in this
 Agreement  shall be solely for the benefit of, and  shall  be
 enforceable only by, the parties to this Agreement  or  their
 respective   successors,  heirs,  executors,  administrators,
 legal representatives and permitted assigns.

 9.7  Binding Effect

     This  Agreement binds and inures to the  benefit  of  the
 parties  to  this Agreement and their respective  successors,
 heirs,  executors, administrators, legal representatives  and
 permitted assigns.

 9.8  Governing Law

     This Agreement, the rights and obligations of the parties
 hereto,  and  any claims or disputes relating thereto,  shall
 be  governed by and construed in accordance with the laws  of
 Japan (excluding the choice of law rules thereof).

 9.9  Notices

      Every   notice  or  other  communication   required   or
 contemplated by this Agreement must be in writing  and  hand-
 delivered  or mailed by first-class, registered or  certified
 mail,   return   receipt  requested,  postage   prepaid,   or
 transmitted by telegram, telecopy, facsimile transmission  or
 telex, addressed as follows:

          (i)  If to the Company:

              Outback Steakhouse Japan Co., Ltd.
              Telest Building 2F
              7-1, Nishi-Azabu 1-chome, Minato-ku
              Tokyo 107-0052 Japan

                        with a copy (which does not constitute
               notice) to:

              Outback Steakhouse International L.P.
              Attention: CFO
              3355 Lenox Road, Suite 600
              Atlanta, Georgia, 30326
              U.S.A.

          (ii) If to a Stockholder:

                         To  such  Stockholder's  address   on
               Appendix 1, 2 and 3.

 Each  party may designate by notice in writing a new  address
 to  which  any  notice, demand, request or communication  may
 thereafter  be  so  given,  served  or  sent.   Each  notice,
 demand,  request,  or communication that  is  hand-delivered,
 mailed  transmitted,  telecopied or  telexed  in  the  manner
 described   above,  or  that  is  delivered  to  a  telegraph
 company,  will  be  considered  sufficiently  given,  served,
 sent,  received or delivered for all purposes at the time  it
 is  delivered to the addressee (with the return receipt,  the
 delivery   receipt,  or  the  answerback   being   considered
 conclusive, but not exclusive, evidence of such delivery)  or
 at   the   time   the   addressee   refuses   delivery   upon
 presentation.

 9.10 Headings

     Article  and Section headings contained in this Agreement
 are  inserted for convenience of reference only,  are  not  a
 part  of  this Agreement for any purpose, and do not  in  any
 way  define or affect the meaning, construction or  scope  of
 any of the provisions of this Agreement.

 9.11 Execution in Counterparts

      This Agreement may be executed in counterparts; each  of
which is an original.

          IN  WITNESS  WHEREOF, the undersigned are  executing
this  Agreement  as  of the date stated  in  the  introductory
clause.

                               OUTBACK STEAKHOUSE
                               INTERNATIONAL L.P.
                               By:OUTBACK STEAKHOUSE
                                   INTERNATIONAL, INC.,
                                   its general partner

                               By:
                               Name:
                               Title

                               NEWPORT PACIFIC RESTAURANTS,
                               INC.

                               By:
                               Name:
                               Title

                               MICHAEL COBLE

                               GREGORY LOUIS WALTHER

                               DONNIE EVERTS

                               WILLIAM DANIEL

                               BETH BOSWELL

                               DON GALE

                               STACY GARDELLA

                               JAYME GOODSELL

                               KEVIN LEE CRIPPEN

                               OUTBACK STEAKHOUSE JAPAN CO.,
                               LTD.

                               By:
                               Name:
                               Title
 Appendix 1Management Stockholders

 Appendix 2Individual Stockholders

 Appendix 3Executive Stockholder

 Appendix 4Calculation of Purchase Price in respect of
            Sections2.1.2 and 2.2.2 and 2.4.2

                    MANAGEMENT STOCKHOLDERS

     Name/Notice Address    Numbers and Class of Equity
Securities held

   OSI    3355 Lenox Road, Suite    : 2,921,0  Preferred
   LP     600, Atlanta, Georgia,           00  Stock
          30326 U.S.A.
                                       65,000  Common
                                               Stock

   NPRI   4279 Roswell Road, Suite  : 289,000  Preferred
          102-273, Atlanta,                    Stock
          Georgia, 30342-3700
          U.S.A.
                                       15,000  Common
                                               Stock

                    INDIVIDUAL STOCKHOLDERS

  Name        Notice Address Numbers and Class of Equity
Securities held

 Michael       779 Argonne Ave., Atlanta,   : 2,44 Common
 Coble         GA 30308                          0 Stock
 Gregory       2049 Wrights Mill Circle,    : 2,44 Common
 Walther       Atlanta,                          0 Stock
               GA 30324
 Donnie        78 W. Brookhaven Dr.,        : 2,44 Common
 Everts        Atlanta,                          0 Stock
               GA 30319
 William       2635 Coachmans Circle,       :  976 Common
 Daniel        Alpharetta, GA 30022                Stock
 Beth Boswell  1190 Standard Dr, NE,        :  488 Common
               Atlanta,                            Stock
               GA 30319
 Don Gale      145 Shadowbrook Dr.,         :  488 Common
               Roswell,                            Stock
               GA 30075
 Stacy         3995 Berkeley View Drive,    :  488 Common
 Gardella      Berkeley, GA 30096                  Stock
 Jayme         2517 Mt. Vernon Rd.,         :  240 Common
 Goodsell      Dunwoody,                           Stock
               GA 30338

                     EXECUTIVE STOCKHOLDER

     Name     Notice Address Numbers and Class of Equity
Securities held

   Kevin       c/o Outback Steakhouse         :10,00 Common
   Crippen     International L.P.                  0 Stock
               Attention: CFO
               3355 Lenox Road, Suite 600
               Atlanta, Georgia, 30326
               U.S.A.

CALCULATION OF OPTION PRICE IN RESPECT OF SECTIONS 2.1.2,
2.2.2 and 2.4.2

Option Price A-1: Net worth of the Company on its books as
             prepared by the Company divided by the number of
             shares of Common Stock outstanding at the time
             of the relevant date of exercise.

Option Price A-2:  The  purchase price shall be the  Appraised
             Value  of  the Common Stock. The Appraised  Value
             shall   be   such   price   as   the   Individual
             Stockholder and OSI LP shall agree. In the  event
             they  cannot  agree,  the Individual  Stockholder
             and  OSI LP shall each have the right to have the
             value  of  the  Common Stock ("Appraised  Value")
             determined  by appraisal in accordance  with  the
             following  terms. The Individual  Stockholder  or
             OSI  LP  shall  provide the  other  with  written
             notice  of  the Individual Stockholder's  or  OSI
             LP's   election  to  use  the  appraisal  process
             within  ten (10) days following the date  of  the
             Option   Notice.   If  neither   the   Individual
             Stockholder  or  OSI LP provide  the  other  with
             timely  written notice of an election to use  the
             appraisal  process, the Individual  Stockholder's
             and  OSI LP's right to an appraisal shall forever
             lapse  and  be  null and void and  the  Appraised
             Value  of  the  Individual  Stockholder's  Common
             Stock  shall  be finally and conclusively  deemed
             equal  to:  fifty percent (50%) of the Individual
             Stockholder's   total  cash  distributions   with
             respect  to  the Common Stock for the twenty-four
             (24)  months  immediately prior to the  month  of
             the    date   of   termination   of   employment,
             multiplied by five (5).

             If  the  Individual Stockholder or OSI  LP  gives
             timely  notice of election to have an  appraisal,
             two  (2)  appraisers  shall be  appointed  within
             twenty  (20)  days  following  the  date  of  the
             Option    Notice,    one   by   the    Individual
             Stockholder,   and  one  by  OSI   LP.   If   the
             Individual Stockholder, on the one hand,  or  OSI
             LP,  on  the  other  hand, fails  to  appoint  an
             appraiser  within  the  twenty  (20)  day  period
             specified  herein,  the sole appraiser  appointed
             within  such twenty (20) day period shall be  the
             sole  appraiser  for the purposes of  determining
             the  Appraised Value of the Common  Stock  to  be
             purchased. The Individual Stockholder and OSI  LP
             shall promptly provide notice of the name of  the
             appraiser  so  appointed by  such  party  to  the
             other.  A  third  appraiser, if the  initial  two
             appraisers  are appointed, shall be appointed  by
             the  mutual agreement of the first two appraisers
             so   appointed.  Each  of  the  appraisers  shall
             submit to the Individual Stockholder and OSI  LP,
             within   thirty   (30)  days  after   the   final
             appraiser    has   been   appointed   ("Appraisal
             Period"),  a  written appraisal of the  Appraised
             Value of the Common Stock.

             In   connection  with  any  appraisal   conducted
             pursuant  to  the provisions herein, the  parties
             hereto   agree  that  each  appraiser   appointed
             hereunder  shall  be  given  full  access  during
             normal   business   hours  to   all   information
             required  and  relevant to  a  valuation  of  the
             Common Stock.

             It   is  the  intent  of  the  parties  that  the
             Appraised   Value   of  the   Common   Stock   be
             determined  solely by reference to the  Company's
             restaurants  which are open and in  operation  as
             of  the  date  of  the appraisal ("Restaurants").
             Accordingly,  in determining the Appraised  Value
             of  the  Common  Stock, the appraiser  shall  not
             consider,  take  into account  or  attribute  any
             value  to (and shall be so instructed in  writing
             by  the  parties)  any goodwill  or  other  value
             attributable    to   the   Outback    Steakhouser
             restaurant  operating system  ("System")  or  the
             Outback   Steakhouser  trademarks   ("Proprietary
             Marks")  (other  than  the  Company's  right   to
             utilize the System and Proprietary Marks  in  the
             operation  of  the  Restaurants),  and  no  value
             shall  be attributed to any right or prospect  of
             opening additional restaurants in the future.

             If  three appraisers are appointed, the Appraised
             Value  of the Common Stock shall be equal to  the
             numerical  average of three appraised valuations;
             provided,   however,  that  if   the   difference
             between  any two appraisals is not more than  ten
             percent  (10%) of the lower of the two,  and  the
             third  appraisal differs by more than twenty-five
             percent  (25%)  of  the lower of  the  other  two
             appraisals,  the numerical average  of  such  two
             appraisals shall be determinative.

             Any  appraiser,  to be qualified  to  conduct  an
             appraisal  hereunder,  shall  be  an  independent
             appraiser  (i.e., not affiliated with OSI  LP  or
             the   Individual  Stockholder),  and   shall   be
             reasonably  competent as an  expert  to  appraise
             the  value  of the Common Stock. If any appraiser
             initially  appointed under this Agreement  shall,
             for  any  reason, be unable to serve, a successor
             appraiser   shall   be  promptly   appointed   in
             accordance with the procedures pursuant to  which
             the predecessor appraiser was appointed.

             Notwithstanding    the    foregoing,    if    the
             determination  of  the  Appraised  Value  of  the
             Common  Stock  by appraisal is not completed  and
             all   appraisal  reports  delivered  as  provided
             herein  within  the Appraisal  Period,  then  all
             closing,  payment  and similar  dates  subsequent
             thereto  shall be automatically extended one  (1)
             day  for  each  day  delivery  of  the  appraisal
             reports  is  delayed  beyond  the  end   of   the
             Appraisal Period.

             The  cost  of  the  appraiser appointed  by  each
             party  shall  be  borne by each such  party.  The
             cost  of the third appraiser, if any, or the sole
             appraiser,    in   the   event   the   Individual
             Stockholder  and  OSI LP mutually  agree  upon  a
             single  appraiser, shall be borne equally by  the
             Individual Stockholder and OSI LP.

Option Price B-1:  600  yen per Common Stock less, accumulated
             loss  of  the Company on the books of the Company
             as  prepared  and accounted for  by  the  Company
             during  the  period  of employment  of  Executive
             Stockholder  divided  by  the  number  of  Common
             Stock  outstanding at the time  of  the  relevant
             date of exercise.

Option Price B-2: The Appraised Value as calculated using  the
             method  set forth for Option Price A-2  shall  be
             used;  provided, however, that in  the  event  of
             termination   of   the  Executive  Stockholders's
             employment  due  to the his death or  Disability,
             the purchase price shall be a percentage (not  to
             exceed   100%)  of  the  Appraised  Value,   such
             percentage being the same percentage as  (i)  the
             number  of  months elapsed from the  commencement
             of   his   employment  to  the   termination   of
             employment, bears to (ii) sixty (60).

Option Price B-3:   The method for calculating Option Price A-
2 shall be used.

Option Price C-1:   The method for calculating Option Price A-
1 shall be used.

Option Price C-2:   The method for calculating Option Price A-
2 shall be used.EXHIBIT 4.1

                       CITIGROUP MORTGAGE LOAN TRUST INC.

                                    Depositor

                               [NAME OF SERVICER]

                                    Servicer

                                       and

                                [NAME OF TRUSTEE]

                                     Trustee

                         POOLING AND SERVICING AGREEMENT
                            Dated as of ____ 1, 20__

               Citigroup Home Equity Loan Trust, Series 20__-____
                     Asset Backed Pass-Through Certificates

                                Series 20__-____

<PAGE>

                                TABLE OF CONTENTS

                                    ARTICLE I

                                   DEFINITIONS
SECTION 1.01.    Defined Terms...............................................-1-
SECTION 1.02.    Allocation of Certain Interest Shortfalls..................-45-

                                   ARTICLE II

                          CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01.    Conveyance of the Mortgage Loans...........................-47-
SECTION 2.02.    Acceptance of REMIC I by Trustee...........................-49-
SECTION 2.03.    Repurchase or Substitution of Mortgage Loans by the
                 Originator.................................................-50-
SECTION 2.04.    Reserved...................................................-52-
SECTION 2.05.    Representations, Warranties and Covenants of the Servicer..-52-
SECTION 2.06.    Issuance of the REMIC I Regular Interests and the Class
                 R-I Interest...............................................-54-
SECTION 2.07.    Conveyance of the REMIC I Regular Interests; Acceptance
                 of REMIC II by  the Trustee................................-55-
SECTION 2.08.    Issuance of Class R Certificates...........................-55-
SECTION 2.09.    Conveyance of the Class M-4 Interest; Acceptance of
                 REMIC III by the Trustee...................................-55-
SECTION 2.10.    Conveyance of the Class M-5 Interest; Acceptance of
                 REMIC IV by the Trustee....................................-55-
SECTION 2.11.    Conveyance of the Class CE-I Interest and the Class
                 CE-II Interest; Acceptance of REMIC V by the Trustee.......-55-
SECTION 2.12.    Conveyance of the Class P Interest; Acceptance of
                 REMIC VI  by the Trustee...................................-56-
SECTION 2.13.    Issuance of Class R-X Certificates.........................-56-

                                   ARTICLE III

                          ADMINISTRATION AND SERVICING
                              OF THE MORTGAGE LOANS
SECTION 3.01.    Servicer to Act as Servicer................................-57-
SECTION 3.02.    Sub-Servicing Agreements Between Servicer and
                 Sub-Servicers..............................................-59-
SECTION 3.03.    Successor Sub-Servicers....................................-60-
SECTION 3.04.    No Contractual Relationship Between Sub-Servicer, Trustee
                 or the Certificateholders..................................-60-
SECTION 3.05.    Assumption or Termination of Sub-Servicing Agreement by
                 Trustee ...................................................-60-

                                       -i-

<PAGE>

SECTION 3.06.    [Reserved].................................................-60-
SECTION 3.07.    Collection of Certain Mortgage Loan Payments...............-61-
SECTION 3.08.    [Reserved].................................................-61-
SECTION 3.09.    Collection of Taxes, Assessments and Similar Items;
                 Servicing Accounts.........................................-61-
SECTION 3.10.    Collection Account, Distribution Account and Initial
                 Deposit Accounts............................................62-
SECTION 3.11.    Withdrawals from the Collection Account and Distribution
                 Account....................................................-64-
SECTION 3.12.    Investment of Funds in the Investment Accounts.............-66-
SECTION 3.13.    [Reserved].................................................-67-
SECTION 3.14.    Maintenance of Hazard Insurance and Errors and Omissions
                 and Fidelity Coverage......................................-67-
SECTION 3.15.    Enforcement of Due-on-Sale Clauses; Assumption Agreements..-68-
SECTION 3.16.    Realization Upon Defaulted Mortgage Loans..................-69-
SECTION 3.17.    Trustee to Cooperate; Release of Mortgage Files............-71-
SECTION 3.18.    Servicing Compensation.....................................-72-
SECTION 3.19.    Reports to the Trustee; Collection Account Statements......-73-
SECTION 3.20.    Statement as to Compliance.................................-73-
SECTION 3.21.    Independent Public Accountants' Servicing Report...........-73-
SECTION 3.22.    Access to Certain Documentation............................-74-
SECTION 3.23.    Title, Management and Disposition of REO Property..........-74-
SECTION 3.24.    Obligations of the Servicer in Respect of Prepayment
                 Interest Shortfalls........................................-77-
SECTION 3.25.    [Reserved].................................................-77-
SECTION 3.26.    Obligations of the Servicer in Respect of Mortgage Rates
                 and Monthly Payments.......................................-77-
SECTION 3.27.    Reserve Fund...............................................-77-
SECTION 3.28.    Advance Facility...........................................-79-

                                   ARTICLE IV

                         PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01.    Distributions..............................................-80-
SECTION 4.02.    Statements to Certificateholders...........................-88-
SECTION 4.03.    Remittance Reports; Advances...............................-91-
SECTION 4.04.    Allocation of Realized Losses..............................-92-
SECTION 4.05.    Compliance with Withholding Requirements...................-94-
SECTION 4.06     Exchange Commission; Additional Information................-95-
SECTION 4.07     Net WAC Rate Carryover Reserve Account.....................-95-
SECTION 4.08.    Excess Net WAC Rate Reserve Fund...........................-96-

                                    ARTICLE V

                                THE CERTIFICATES
SECTION 5.01.    The Certificate............................................-98-
SECTION 5.02.    Registration of Transfer and Exchange of Certificates.....-100-

                                                      -ii-

<PAGE>

SECTION 5.03.    Mutilated, Destroyed, Lost or Stolen Certificates.........-104-
SECTION 5.04.    Persons Deemed Owners.....................................-105-
SECTION 5.05.    Certain Available Information.............................-105-

                                   ARTICLE VI

                         THE DEPOSITOR AND THE SERVICER
SECTION 6.01.    Liability of the Depositor and the Servicer...............-107-
SECTION 6.02.    Merger or Consolidation of the Depositor or the Servicer..-107-
SECTION 6.03.    Limitation on Liability of the Depositor, the Servicer
                 and Others................................................-107-
SECTION 6.04.    Limitation on Resignation of the Servicer.................-108-
SECTION 6.05.    Rights of the Depositor in Respect of the Servicer........-109-

                                   ARTICLE VII

                                     DEFAULT
SECTION 7.01.    Servicer Events of Default................................-110-
SECTION 7.02.    Trustee to Act; Appointment of Successor..................-112-
SECTION 7.03.    Notification to Certificateholders........................-113-
SECTION 7.04.    Waiver of Servicer Events of Default......................-114-

                                  ARTICLE VIII

                             CONCERNING THE TRUSTEE
SECTION 8.01.    Duties of Trustee.........................................-115-
SECTION 8.02.    Certain Matters Affecting the Trustee.....................-116-
SECTION 8.04.    Trustee and Trust Administrator May Own Certificates. ....-117-
SECTION 8.05.    Trustee's and Trust Administrator's Fees and Expenses. ...-118-
SECTION 8.06.    Eligibility Requirements for Trustee. ....................-118-
SECTION 8.07.    Resignation and Removal of the Trustee ...................-119-
SECTION 8.08.    Successor Trustee.........................................-120-
SECTION 8.09.    Merger or Consolidation of Trustee........................-121-
SECTION 8.10.    Appointment of Co-Trustee or Separate Trustee.............-121-
SECTION 8.11.    Appointment of Office or Agency...........................-122-
SECTION 8.12.    Representations and Warranties............................-122-

                                   ARTICLE IX

                                   TERMINATION
SECTION 9.01     Termination Upon Repurchase or Liquidation of All
                 Mortgage Loans............................................-124-
SECTION 9.02     Additional Termination Requirements.......................-126-

                                    ARTICLE X

                                REMIC PROVISIONS

                                      -iii-

<PAGE>

SECTION 10.01.   REMIC Administration......................................-127-
SECTION 10.02.   Prohibited Transactions and Activities....................-129-
SECTION 10.03.   Servicer and Trustee Indemnification......................-130-

                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS
SECTION 11.01.   Amendment.................................................-131-
SECTION 11.02.   Recordation of Agreement; Counterparts....................-132-
SECTION 11.03.   Limitation on Rights of Certificateholders................-132-
SECTION 11.04.   Governing Law.............................................-133-
SECTION 11.05.   Notices...................................................-133-
SECTION 11.06.   Severability of Provisions................................-134-
SECTION 11.07.   Notice to Rating Agencies.................................-134-
SECTION 11.08.   Article and Section References............................-135-
SECTION 11.09.   Grant of Security Interest................................-135-

                                      -iv-

<PAGE>

EXHIBITS

Exhibit A-1    Form of Class A Certificate
Exhibit A-2    Form of Class M-1 Certificate
Exhibit A-3    Form of Class M-2 Certificate
Exhibit A-4    Form of Class M-3 Certificate
Exhibit A-5    Form of Class M-4 Certificate
Exhibit A-6    Form of Class M-5 Certificate
Exhibit A-7    Form of Class CE Certificate
Exhibit A-8    Form of Class P Certificate
Exhibit A-9    Form of Class R Certificate
Exhibit A-10   Form of Class R-X Certificate
Exhibit B      [Reserved]
Exhibit C-1    Form of Trustee's Initial Certification
Exhibit C-2    Form of Trustee's Final Certification
Exhibit D-1    Form of [____] Mortgage Loan Purchase Agreement
Exhibit D-2    Form of [____] Mortgage Loan Purchase Agreement
Exhibit E      Request for Release
Exhibit F-1    Form of Transferor Representation Letter and Form of Transferee
               Representation Letter in Connection with Transfer of the Private
               Certificates Pursuant to Rule 144A Under the 1933 Act
Exhibit F-2    Form of Transfer Affidavit and Agreement and Form of Transferor
               Affidavit in Connection with Transfer of Residual Certificates
Exhibit G      Form of Certification with respect to ERISA and the Code
Exhibit H      [Reserved]
Exhibit I      [Reserved]
Exhibit J      Form of Officer's Certificate with respect to Prepayments
Exhibit K      Form of Lost Note Affidavit
Exhibit L-1    Form of Certification to Be Provided by the Depositor with
               Form 10-K
Exhibit L-2    Form of Certification to Be Provided to Depositor by the Trustee
Exhibit L-3    Form of Certification to Be Provided to Depositor by the Servicer

Schedule 1     Mortgage Loan Schedule
Schedule 2     Prepayment Charge Schedule

                                       -v-

<PAGE>

                  This Pooling and Servicing Agreement, is dated and effective
as of ____ 1, 20__, among CITIGROUP MORTGAGE LOAN TRUST INC. as Depositor, [NAME
OF SERVICER] as Servicer and [NAME OF TRUSTEE] as Trustee.

                             PRELIMINARY STATEMENT:

                  The Depositor intends to sell pass-through certificates to be
issued hereunder in multiple classes, which in the aggregate will evidence the
entire beneficial ownership interest in each REMIC (as defined herein) created
hereunder. The Trust Fund will consist of a segregated pool of assets comprised
of the Mortgage Loans and certain other related assets subject to this
Agreement.

                                     REMIC I

                  As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the Mortgage Loans and certain other
related assets (other than the Servicer Prepayment Charge Payment Amount and the
Net WAC Rate Carryover Reserve Account) subject to this Agreement as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC I." The Class R-I Interest will be the sole class of
"residual interests" in REMIC I for purposes of the REMIC Provisions (as defined
herein). The following table irrevocably sets forth the designation, the REMIC I
Remittance Rate, the initial Uncertificated Balance and, solely for purposes of
satisfying Treasury regulation section 1.860G-1(a)(4)(iii), the "latest possible
maturity date" for each of the REMIC I Regular Interests (as defined herein).
None of the REMIC I Regular Interests will be certificated.

                      REMIC I                Initial             Latest Possible
Designation       Remittance Rate    Uncertificated Balance     Maturity Date(1)
-----------       ---------------    ----------------------     ----------------

  I-LTAA            Variable(2)
   I-LTA            Variable(2)
  I-LTM1            Variable(2)
  I-LTM2            Variable(2)
  I-LTM3            Variable(2)
  I-LTM4            Variable(2)
  I-LTM5            Variable(2)
  I-LTZZ            Variable(2)
   I-LTP            Variable(2)
_______________
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date immediately following the maturity date
     for the Mortgage Loan with the latest maturity date has been designated as
     the "latest possible maturity date" for each REMIC I Regular Interest.
(2)  Calculated in accordance with the definition of "REMIC I Remittance Rate"
     herein.

                                      -vi-

<PAGE>

                                    REMIC II
                                    --------

                  As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the REMIC I Regular Interests as a REMIC
for federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC II." The Class R-II Interest will evidence the sole class
of "residual interests" in REMIC II for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designation, the Pass-Through Rate, the initial aggregate Certificate Principal
Balance and, solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for the indicated
Classes of Certificates.

                                         Initial Aggregate
                       Pass-Through    Certificate Principal    Latest Possible
    Designation            Rate               Balance           Maturity Date(1)
------------------    -------------    ---------------------    ----------------

      Class A          Variable(2)

     Class M-1         Variable(2)

     Class M-2         Variable(2)

Class M-3 Interest     Variable(2)

Class M-4 Interest     Variable(2)

Class M-5 Interest     Variable(2)

 Class CE Interest     Variable(3)

 Class P Interest        N/A(4)

_______________
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date immediately following the maturity date
     for the Mortgage Loans with the latest maturity date has been designated as
     the "latest possible maturity date" for each Class of Certificates.
(2)  Calculated in accordance with the definition of "Pass-Through Rate" herein.
(3)  The Class CE Interest will accrue interest at its variable Pass-Through
     Rate on the Notional Amount of the Class CE Interest outstanding from time
     to time which shall equal the Uncertificated Balance of the REMIC I Regular
     Interests. The Class CE Interest will not accrue interest on its
     Certificate Principal Balance.
(4)  The Class P Interest will not accrue interest.

                                      -vii-

<PAGE>

                                    REMIC III
                                    ---------

                  As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the Class M-3 Interest as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC III." The Class R-III Interest will evidence the sole class
of "residual interests" in REMIC III for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designation, the Pass-Through Rate, the initial aggregate Certificate Principal
Balance and, solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for the indicated
Classes of Certificates.

                                       Initial Aggregate
                                     Certificate Principal       Latest Possible
Designation      Pass-Through Rate          Balance             Maturity Date(1)
-----------      -----------------   ---------------------      ----------------

 Class M-3          Variable(2)
_______________
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date immediately following the maturity date
     for the Mortgage Loans with the latest maturity date has been designated as
     the "latest possible maturity date" for each Class of Certificates.
(2)  The Class M-3 Certificates will receive 100% of amounts received in respect
     of the Class M-3 Interest.

                                     -viii-

<PAGE>

                                    REMIC IV
                                    --------

                  As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the Class M-4 Interest as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC IV." The Class R-IV Interest will evidence the sole class
of "residual interests" in REMIC IV for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designation, the Pass-Through Rate, the initial aggregate Certificate Principal
Balance and, solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for the indicated
Classes of Certificates.

                                       Initial Aggregate
                                     Certificate Principal       Latest Possible
Designation     Pass-Through Rate           Balance             Maturity Date(1)
-----------     -----------------    ---------------------      ----------------

 Class M-4         Variable(2)
_______________
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date immediately following the maturity date
     for the Mortgage Loans with the latest maturity date has been designated as
     the "latest possible maturity date" for each Class of Certificates.
(2)  The Class M-4 Certificates will receive 100% of amounts received in respect
     of the Class M-5 Interest.

                                      -ix-

<PAGE>

                                     REMIC V
                                     -------

                  As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the Class M-5 Interest as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC V." The Class R-V Interest will evidence the sole class of
"residual interests" in REMIC V for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designation, the Pass-Through Rate, the initial aggregate Certificate Principal
Balance and, solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for the indicated
Classes of Certificates.

                                       Initial Aggregate
                                     Certificate Principal       Latest Possible
Designation     Pass-Through Rate           Balance             Maturity Date(1)
-----------     -----------------    ---------------------      ----------------

 Class M-5         Variable(2)
_______________
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date immediately following the maturity date
     for the Mortgage Loans with the latest maturity date has been designated as
     the "latest possible maturity date" for each Class of Certificates.
(2)  The Class M-5 Certificates will receive 100% of amounts received in respect
     of the Class M-5 Interest.

                                       -x-

<PAGE>

                                    REMIC VI
                                    --------

                  As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the Class CE Interest as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC VI." The Class R-VI Interest will evidence the sole class
of "residual interests" in REMIC VI for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designation, the Pass-Through Rate, the initial aggregate Certificate Principal
Balance and, solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for the indicated
Classes of Certificates.

                                        Initial Aggregate
                                      Certificate Principal      Latest Possible
Designation      Pass-Through Rate           Balance            Maturity Date(1)
-----------      -----------------    ---------------------     ----------------

 Class CE           Variable(2)
_______________
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date immediately following the maturity date
     for the Mortgage Loans with the latest maturity date has been designated as
     the "latest possible maturity date" for each Class of Certificates.
(2)  The Class CE Certificates will receive 100% of amounts received in respect
     of the Class CE Interest.

                                      -xi-

<PAGE>

                                    REMIC VII
                                    ---------

                  As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the Class P Interest as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC VII." The Class R-VII Interest will evidence the sole class
of "residual interests" in REMIC VII for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designation, the Pass-Through Rate, the initial aggregate Certificate Principal
Balance and, solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for the indicated
Classes of Certificates.

                                       Initial Aggregate
                                     Certificate Principal      Latest Possible
Designation     Pass-Through Rate           Balance            Maturity Date(1)
-----------     -----------------    ---------------------     -----------------

Class P(2)             N/A
_______________
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date immediately following the maturity date
     for the Mortgage Loans with the latest maturity date has been designated as
     the "latest possible maturity date" for each Class of Certificates.
(2)  The Class P Certificates will receive 100% of amounts received in respect
     of the Class P Interest.

                  As of the Cut-off Date, the Mortgage Loans had an aggregate
principal balance equal to $[__].

                  In consideration of the mutual agreements herein contained,
the Depositor, the Servicer and the Trustee agree as follows:

                                      -xii-

<PAGE>

                                    ARTICLE I

                                   DEFINITIONS

                  SECTION 1.01. Defined Terms.

                  Whenever used in this Agreement, including, without
limitation, in the Preliminary Statement hereto, the following words and
phrases, unless the context otherwise requires, shall have the meanings
specified in this Article. Unless otherwise specified, all calculations
described herein shall be made on the basis of a 360-day year consisting of
twelve 30-day months.

                  "Accepted Servicing Practices": The servicing standards set
forth in Section 3.01.

                  "[___] Mortgage Loan": Each Mortgage Loan originated by [___].

                  "[____] Mortgage Loan Purchase Agreement": The agreement among
[____], the Seller and the Depositor, regarding the sale of the [____] Mortgage
Loans by the Seller to the Depositor, substantially in the form of Exhibit D-1
annexed hereto.

                  "Accrued Certificate Interest": With respect to any Class A
Certificate, Mezzanine Certificate, the Class CE Interest and each Distribution
Date, interest accrued during the related Interest Accrual Period at the
Pass-Through Rate for such Certificate for such Distribution Date on the
Certificate Principal Balance, in the case of the Class A Certificates and the
Mezzanine Certificates, or on the Notional Amount, in the case of the Class CE
Interest, of such Certificate immediately prior to such Distribution Date. The
Class P Interest is not entitled to distributions in respect of interest and,
accordingly, will not accrue interest. All distributions of interest on the
Class A Certificates and the Mezzanine Certificates will be calculated on the
basis of a 360-day year and the actual number of days in the applicable Interest
Accrual Period. All distributions of interest on the Class CE Interest will be
based on a 360-day year consisting of twelve 30-day months. Accrued Certificate
Interest with respect to each Distribution Date, as to any Class A Certificate,
Mezzanine Certificate or the Class CE Interest, shall be reduced by an amount
equal to the portion allocable to such Certificate pursuant to Section 1.02
hereof of the sum of (a) the aggregate Prepayment Interest Shortfall, if any,
for such Distribution Date to the extent not covered by payments pursuant to
Section 3.24 and (b) the aggregate amount of any Relief Act Interest Shortfall,
if any, for such Distribution Date. In addition, Accrued Certificate Interest
with respect to each Distribution Date, as to the Class CE Interest shall be
reduced by an amount equal to the portion allocable to the Class CE Interest of
Realized Losses, if any, pursuant to Section 4.04 hereof.

                  "Adjustable-Rate Mortgage Loan": Each of the Mortgage Loans
identified on the Mortgage Loan Schedule as having a Mortgage Rate that is
subject to adjustment.

                  "Adjustment Date": With respect to each Adjustable-Rate
Mortgage Loan, the first day of the month in which the Mortgage Rate of such
Mortgage Loan changes pursuant to the related Mortgage Note. The first
Adjustment Date following the Cut-off Date as to each Adjustable-Rate Mortgage
Loan is set forth in the Mortgage Loan Schedule.

<PAGE>

                  "Advance": As to any Mortgage Loan, any advance made by the
Servicer in respect of any Distribution Date pursuant to Section 4.03.

                  "Advance Facility": As defined in Section 3.28(a) hereof.

                  "Advance Facility Notice": As defined in Section 3.28(b)
hereof.

                  "Advance Financing Person": As defined in Section 3.28(a)
hereof.

                  "Advance Reimbursement Amounts": As defined in Section 3.28(b)
hereof.

                  "Affiliate": With respect to any specified Person, any other
Person controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with respect to
any specified Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.

                  "Agreement": This Pooling and Servicing Agreement and all
amendments hereof and supplements hereto.

                  "Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form (excepting therefrom, if applicable,
the mortgage recordation information which has not been required pursuant to
Section 2.01 hereof or returned by the applicable recorder's office), which is
sufficient under the laws of the jurisdiction wherein the related Mortgaged
Property is located to reflect of record the sale of the Mortgage, which
assignment, notice of transfer or equivalent instrument may be in the form of
one or more blanket assignments covering Mortgages secured by Mortgaged
Properties located in the same county, if permitted by law.

                  "Available Distribution Amount": With respect to any
Distribution Date, an amount equal to (1) the sum of (a) the aggregate of the
amounts on deposit in the Collection Account and Distribution Account
attributable to the Mortgage Loans as of the close of business on the related
Determination Date, (b) the aggregate of any amounts received in respect of an
REO Property withdrawn from any REO Account and deposited in the Distribution
Account for such Distribution Date pursuant to Section 3.23, (c) the aggregate
of any amounts deposited in the Distribution Account by the Servicer in respect
of Prepayment Interest Shortfalls attributable to the Mortgage Loans for such
Distribution Date pursuant to Section 3.24, (d) the aggregate of any Advances
attributable to the Mortgage Loans made by the Servicer for such Distribution
Date pursuant to Section 4.03 and (e) the aggregate of any advances made by the
Trustee as successor Servicer or any other successor Servicer for such
Distribution Date pursuant to Section 7.02(b), reduced (to not less than zero)
by (2) the portion of the amount described in clause (1)(a) above that
represents (i) Monthly Payments on the Mortgage Loans received from a Mortgagor
on or prior to the Determination Date but due during any Due Period subsequent
to the related Due Period, (ii) Principal Prepayments on the Mortgage Loans
received after the related Prepayment Period (together with any interest
payments received with such Principal Prepayments to the extent they represent
the payment of interest accrued on the Mortgage Loans during a period subsequent
to the related

                                       -2-

<PAGE>

Prepayment Period) (other than Prepayment Charges), (iii) Liquidation Proceeds
and Insurance Proceeds received in respect of the Mortgage Loans after the
related Prepayment Period, (iv) amounts reimbursable or payable to the
Depositor, the Servicer, the Trustee, the Seller or any Sub- Servicer pursuant
to Section 3.11, Section 3.12, Section 8.05 or otherwise payable in respect of
Extraordinary Trust Fund Expenses attributable to the Mortgage Loans, (v) the
Trustee Fee payable from the Distribution Account pursuant to Section 8.05, (vi)
amounts deposited in the Collection Account or the Distribution Account in error
and (vii) the amount of any Prepayment Charges collected by the Servicer in
connection with the Principal Prepayment of any of the Mortgage Loans or any
Servicer Prepayment Charge Payment Amount with respect to the Mortgage Loans.

                  "Balloon Mortgage Loan": A Mortgage Loan that provides for the
payment of the unamortized principal balance of such Mortgage Loan in a single
payment at the maturity of such Mortgage Loan that is substantially greater than
the preceding monthly payment.

                  "Balloon Payment": A payment of the unamortized principal
balance of a Mortgage Loan in a single payment at the maturity of such Mortgage
Loan that is substantially greater than the preceding Monthly Payment.

                  "Bankruptcy Code": The Bankruptcy Reform Act of 1978 (Title 11
of the United States Code), as amended.

                  "Bankruptcy Loss": With respect to any Mortgage Loan, a
Realized Loss resulting from a Deficient Valuation or Debt Service Reduction.

                  "Book-Entry Certificate": The Class A Certificates and the
Mezzanine Certificates for so long as the Certificates of such Class shall be
registered in the name of the Depository or its nominee.

                  "Book-Entry Custodian": The custodian appointed pursuant to
Section 5.01.

                  "Business Day": Any day other than a Saturday, a Sunday or a
day on which banking or savings and loan institutions in the State of
California, the State of New York or in the city in which the Corporate Trust
Office of the Trustee is located, are authorized or obligated by law or
executive order to be closed.

                  "Cash-Out Refinancing": A Refinanced Mortgage Loan the
proceeds of which are more than a nominal amount in excess of the principal
balance of any existing first mortgage or subordinate mortgage on the related
Mortgaged Property and related closing costs.

                  "Certificate": Any one of the Citigroup Home Equity Loan
Trust, Series 20__-____, Asset Backed Pass-Through Certificates, Class A, Class
M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class CE, Class P, Class R and
Class R-X issued under this Agreement.

                  "Certificate Factor": With respect to any Class of Regular
Certificates as of any Distribution Date, a fraction, expressed as a decimal
carried to six places, the numerator of which is the aggregate Certificate
Principal Balance (or the Notional Amount, in the case of the Class CE

                                       -3-

<PAGE>

Certificates) of such Class of Certificates on such Distribution Date (after
giving effect to any distributions of principal and in the case of the Mezzanine
Certificates and the Class CE Certificates, the allocations of Realized Losses
in reduction of the Certificate Principal Balance (or the Notional Amount, in
the case of the Class CE Certificates) of such Class of Certificates to be made
on such Distribution Date), and the denominator of which is the initial
aggregate Certificate Principal Balance (or the Notional Amount, in the case of
the Class CE Certificates) of such Class of Certificates as of the Closing Date.

                  "Certificate Margin": With respect to the Class A-1
Certificates, [__]% in the case of each Distribution Date through and including
the Distribution Date on which the aggregate Principal Balance of the Mortgage
Loans (and properties acquired in respect thereof) remaining in the Trust Fund
is reduced to less than 10% of the aggregate Principal Balance of the Mortgage
Loans as of the Cut-off Date and [__]% in the case of each Distribution Date
thereafter.

                  With respect to the Class M-1 Certificates, [__]% in the case
of each Distribution Date through and including the Distribution Date on which
the aggregate Principal Balance of the Mortgage Loans (and properties acquired
in respect thereof) remaining in the Trust Fund is reduced to less than 10% of
the aggregate Principal Balance of the Mortgage Loans as of the Cut-off Date and
[__]% in the case of each Distribution Date thereafter.

                  With respect to the Class M-2 Certificates, [__]% in the case
of each Distribution Date through and including the Distribution Date on which
the aggregate Principal Balance of the Mortgage Loans (and properties acquired
in respect thereof) remaining in the Trust Fund is reduced to less than 10% of
the aggregate Principal Balance of the Mortgage Loans as of the Cut-off Date and
[__]% in the case of each Distribution Date thereafter.

                  With respect to the Class M-3 Interest, [__]% in the case of
each Distribution Date through and including the Distribution Date on which the
aggregate Principal Balance of the Mortgage Loans (and properties acquired in
respect thereof) remaining in the Trust Fund is reduced to less than 10% of the
aggregate Principal Balance of the Mortgage Loans as of the Cut-off Date and
[__]% in the case of each Distribution Date thereafter.

                  With respect to the Class M-4 Interest, [__]% in the case of
each Distribution Date through and including the Distribution Date on which the
aggregate Principal Balance of the Mortgage Loans (and properties acquired in
respect thereof) remaining in the Trust Fund is reduced to less than 10% of the
aggregate Principal Balance of the Mortgage Loans as of the Cut-off Date and
[__]% in the case of each Distribution Date thereafter.

                  With respect to the Class M-5 Interest, [__]% in the case of
each Distribution Date through and including the Distribution Date on which the
aggregate Principal Balance of the Mortgage Loans (and properties acquired in
respect thereof) remaining in the Trust Fund is reduced to less than 10% of the
aggregate Principal Balance of the Mortgage Loans as of the Cut-off Date and
[__]% in the case of each Distribution Date thereafter.

                  "Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, except that a
Disqualified Organization or a Non-United States Person

                                       -4-

<PAGE>

shall not be a Holder of a Residual Certificate for any purposes hereof and,
solely for the purposes of giving any consent pursuant to this Agreement, any
Certificate registered in the name of the Depositor or the Servicer or any
Affiliate thereof shall be deemed not to be outstanding and the Voting Rights to
which it is entitled shall not be taken into account in determining whether the
requisite percentage of Voting Rights necessary to effect any such consent has
been obtained, except as otherwise provided in Section 11.01. The Trustee may
conclusively rely upon a certificate of the Depositor or the Servicer in
determining whether a Certificate is held by an Affiliate thereof. All
references herein to "Holders" or "Certificateholders" shall reflect the rights
of Certificate Owners as they may indirectly exercise such rights through the
Depository and participating members thereof, except as otherwise specified
herein; provided, however, that the Trustee shall be required to recognize as a
"Holder" or "Certificateholder" only the Person in whose name a Certificate is
registered in the Certificate Register.

                  "Certificate Owner": With respect to a Book-Entry Certificate,
the Person who is the beneficial owner of such Certificate as reflected on the
books of the Depository or on the books of a Depository Participant or on the
books of an indirect participating brokerage firm for which a Depository
Participant acts as agent.

                  "Certificate Principal Balance": With respect to each Class A
Certificate, Mezzanine Certificate or Class P Interest as of any date of
determination, the Certificate Principal Balance of such Certificate on the
Distribution Date immediately prior to such date of determination, minus all
distributions allocable to principal made thereon and, in the case of the
Mezzanine Certificates, Realized Losses allocated thereto on such immediately
prior Distribution Date (or, in the case of any date of determination up to and
including the first Distribution Date, the initial Certificate Principal Balance
of such Certificate, as stated on the face thereof). With respect to each Class
CE Interest as of any date of determination, an amount equal to the Percentage
Interest evidenced by such Certificate times the excess, if any, of (A) the then
aggregate Uncertificated Balances of the REMIC I Regular Interests over (B) the
then aggregate Certificate Principal Balances of the Class A Certificates, the
Mezzanine Certificates and the Class P Certificates then outstanding. With
respect to each Class of Certificates, the aggregate of the Certificate
Principal Balances of the Certificates of such Class.

                  "Certificate Register": The register maintained pursuant to
Section 5.02.

                  "Class": Collectively, all of the Certificates bearing the
same class designation.

                  "Class A Certificates": Any one of the Class A Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-1 and evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.

                  "Class A Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the Certificate Principal Balance of the
Class A Certificates immediately prior to such Distribution Date over (y) the
lesser of (A) the product of (i) [__]% and (ii) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period and
(B) the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day of the related Due Period minus $[__].

                                       -5-

<PAGE>

                  "Class CE Certificate": Any one of the Class CE Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-7 and evidencing a Regular Interest in REMIC VI for
purposes of the REMIC Provisions.

                  "Class CE Interest": An uncertificated interest in the Trust
Fund held by the Trustee on behalf of the Holders of the Class CE Certificates,
evidencing a Regular Interest in REMIC II for purposes of the REMIC Provisions.

                  "Class M-1 Certificate": Any one of the Class M-1 Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-2 and evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.

                  "Class M-1 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the sum of (i) the Certificate Principal
Balance of the Class A Certificates (after taking into account the payment of
the Class A Principal Distribution Amount on such Distribution Date) and (ii)
the Certificate Principal Balance of the Class M-1 Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
[__]% and (ii) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period and (B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period minus
$[__].

                  "Class M-2 Certificate": Any one of the Class M-2 Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-3 and evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.

                  "Class M-2 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the sum of (i) the Certificate Principal
Balance of the Class A Certificates (after taking into account the payment of
the Class A Principal Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after taking into
account the payment of the Class M-1 Principal Distribution Amount on such
Distribution Date) and (iii) the Certificate Principal Balance of the Class M-2
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) [__]% and (ii) the aggregate Stated Principal Balance of
the Mortgage Loans as of the last day of the related Due Period and (B) the
aggregate Stated Principal Balance of the Mortgage Loans as of the last day of
the related Due Period minus $[__].

                  "Class M-3 Certificate": Any one of the Class M-3 Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-4 and evidencing a Regular Interest in REMIC III for
purposes of the REMIC Provisions.

                  "Class M-3 Interest": An uncertificated interest in the Trust
Fund held by the Trustee on behalf of the Holders of the Class M-3 Certificates,
evidencing a Regular Interest in REMIC II for purposes of the REMIC Provisions.

                  "Class M-3 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the sum of (i) the Certificate Principal
Balance of the Class A Certificates (after

                                       -6-

<PAGE>

taking into account the payment of the Class A Principal Distribution Amount on
such Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the payment of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the payment of
the Class M-2 Principal Distribution Amount on such Distribution Date) and (iv)
the Certificate Principal Balance of the Class M-3 Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
[__]% and (ii) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period and (B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period minus
$[__].

                  "Class M-4 Certificate": Any one of the Class M-4 Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-5 and evidencing a Regular Interest in REMIC IV for
purposes of the REMIC Provisions.

                  "Class M-4 Interest": An uncertificated interest in the Trust
Fund held by the Trustee on behalf of the Holders of the Class M-4 Certificates,
evidencing a Regular Interest in REMIC II for purposes of the REMIC Provisions.

                  "Class M-4 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the sum of (i) the Certificate Principal
Balance of the Class A Certificates (after taking into account the payment of
the Class A Principal Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after taking into
account the payment of the Class M-1 Principal Distribution Amount on such
Distribution Date), (iii) the Certificate Principal Balance of the Class M-2
Certificates (after taking into account the payment of the Class M-2 Principal
Distribution Amount on such Distribution Date), (iv) the Certificate Principal
Balance of the Class M-3 Certificates (after taking into account the payment of
the Class M-3 Principal Distribution Amount on such Distribution Date) and (v)
the Certificate Principal Balance of the Class M-4 Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
[__]% and (ii) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period and (B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period minus
$[__].

                  "Class M-5 Certificate": Any one of the Class M-5 Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-6 and evidencing a Regular Interest in REMIC V for
purposes of the REMIC Provisions.

                  "Class M-5 Interest": An uncertificated interest in the Trust
Fund held by the Trustee on behalf of the Holders of the Class M-5 Certificates,
evidencing a Regular Interest in REMIC II for purposes of the REMIC Provisions.

                  "Class M-5 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the sum of (i) the Certificate Principal
Balance of the Class A Certificates (after taking into account the payment of
the Class A Principal Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after taking into
account the payment of the Class M-1 Principal Distribution Amount on such
Distribution Date), (iii) the Certificate Principal Balance of the Class M-2
Certificates (after taking into account the payment of

                                       -7-

<PAGE>

the Class M-2 Principal Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Certificate Principal Balance of the Class M-4
Certificates immediately prior to such Distribution Date and (vi) the
Certificate Principal Balance of the Class M-5 Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of (i) [__]% and
(ii) the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day of the related Due Period and (B) the aggregate Stated Principal Balance of
the Mortgage Loans as of the last day of the related Due Period minus $[__].

                  "Class P Certificate": Any one of the Class P Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-8 and evidencing a Regular Interest in REMIC VII for
purposes of the REMIC Provisions.

                  "Class P Interest": An uncertificated interest in the Trust
Fund held by the Trustee on behalf of the Holders of the Class P Certificates,
evidencing a Regular Interest in REMIC II for purposes of the REMIC Provisions.

                  "Class R Certificate": Any one of the Class R Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-9 and evidencing the ownership of the Class R-I
Interest and the Class R-II Interest.

                  "Class R-X Certificate": Any one of the Class R-X Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-10 and evidencing the ownership of the Class R-III
Interest, the Class R-IV Interest, the Class R-V Interest, the Class R-VI
Interest and the Class R-VII Interest.

                  "Class R-I Interest": The uncertificated Residual Interest in
REMIC I.

                  "Class R-II Interest": The uncertificated Residual Interest in
REMIC II.

                  "Class R-III Interest": The uncertificated Residual Interest
in REMIC III.

                  "Class R-IV Interest": The uncertificated Residual Interest in
REMIC IV.

                  "Class R-V Interest": The uncertificated Residual Interest in
REMIC V.

                  "Class R-VI Interest": The uncertificated Residual Interest in
REMIC VI.

                  "Class R-VII Interest": The uncertificated Residual Interest
in REMIC VII.

                  "Closing Date": April 25, 2003.

                  "Code": The Internal Revenue Code of 1986.

                  "Collection Account": The account or accounts created and
maintained, or caused to be created and maintained, by the Servicer pursuant to
Section 3.10(a), which shall be entitled

                                       -8-

<PAGE>

"[NAME OF SERVICER], as Servicer for [NAME OF TRUSTEE], as Trustee, in trust for
the registered holders of Citigroup Mortgage Loan Trust Inc., Citigroup Home
Equity Loan Trust, Series 20__-____, Asset Backed Pass-Through Certificates."
The Collection Account must be an Eligible Account.

                  "Commission": The Securities and Exchange Commission.

                  "Corporate Trust Office": The principal corporate trust office
of the Trustee at which at any particular time its corporate trust business in
connection with this Agreement shall be administered, which office at the date
of the execution of this instrument is located at 1761 East St. Andrew Place,
Santa Ana, CA 92705-4934, Attn: SB0301, or at such other address as the Trustee
may designate from time to time by notice to the Certificateholders, the
Depositor and the Servicer.

                  "Corresponding Certificate": With respect to (i) REMIC I
Regular Interest I-LTA, (ii) REMIC I Regular Interest I-LTM1, (iii) REMIC I
Regular Interest I-LTM2, (iv) REMIC I Regular Interest I-LTM3 and the Class M-3
Interest, (v) REMIC I Regular Interest I-LTM4 and the Class M-4 Interest, (vi)
REMIC I Regular Interest I-LTM5 and the Class M-5 Interest, (vii) the Class CE
Interest and (viii) REMIC I Regular Interest I-LTP and the Class P Interest, (i)
the Class A Certificates, (ii) the Class M-1 Certificates, (iii) the Class M-2
Certificates, (iv) the Class M-3 Certificates, (v) the Class M-4 Certificates,
(vi) the Class M-5 Certificates, (vii) the Class CE Certificates and (viii) the
Class P Certificates, respectively.

                  "Credit Enhancement Percentage": For any Distribution Date,
the percentage equivalent of a fraction, the numerator of which is the sum of
the aggregate Certificate Principal Balances of the Mezzanine Certificates and
the Class CE Interest, and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period.

                  "Cumulative Loss Percentage": With respect to any Distribution
Date, the percentage equivalent of a fraction, the numerator of which is the
aggregate amount of Realized Losses incurred from the Cut-off Date to the last
day of the preceding calendar month and the denominator of which is the
aggregate Stated Principal Balance of the Mortgage Loans as of the Cut-off Date.

                  "Cut-off Date": With respect to each Original Mortgage Loan,
____ 1, 20__. With respect to all Qualified Substitute Mortgage Loans, their
respective dates of substitution. References herein to the "Cut-off Date," when
used with respect to more than one Mortgage Loan, shall be to the respective
Cut-off Dates for such Mortgage Loans.

                  "Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction resulting from a Deficient Valuation.

                  "Deficient Valuation": With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property by a court of competent jurisdiction
in an amount less than the then outstanding Principal Balance of the Mortgage
Loan, which valuation results from a proceeding initiated under

                                       -9-

<PAGE>

the Bankruptcy Code.

                  "Definitive Certificates": As defined in Section 5.01(b).

                  "Deleted Mortgage Loan": A Mortgage Loan replaced or to be
replaced by a Qualified Substitute Mortgage Loan.

                  "Delinquency Percentage": As of the last day of any Due
Period, the percentage equivalent of a fraction, the numerator of which is the
aggregate Stated Principal Balance of the Mortgage Loans that, as of the last
day of the previous calendar month, are 60 or more days delinquent, are in
foreclosure, have been converted to REO Properties or have been discharged by
reason of bankruptcy, and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans and REO Properties as of the last day of
such calendar month; provided, however, that any Mortgage Loan purchased by the
Servicer pursuant to Section 3.16(c) shall not be included in either the
numerator or the denominator for purposes of calculating the Delinquency
Percentage.

                  "Depositor": Citigroup Mortgage Loan Trust Inc., a Delaware
corporation, or its successor in interest.

                  "Depository": The Depository Trust Company, or any successor
Depository hereafter named. The nominee of the initial Depository, for purposes
of registering those Certificates that are to be Book-Entry Certificates, is
CEDE & Co. The Depository shall at all times be a "clearing corporation" as
defined in Section 8-102(3) of the Uniform Commercial Code of the State of New
York and a "clearing agency" registered pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934, as amended.

                  "Depository Institution": Any depository institution or trust
company, including the Trustee, that (a) is incorporated under the laws of the
United States of America or any State thereof, (b) is subject to supervision and
examination by federal or state banking authorities and (c) has outstanding
unsecured commercial paper or other short-term unsecured debt obligations (or,
in the case of a depository institution that is the principal subsidiary of a
holding company, such holding company has unsecured commercial paper or other
short-term unsecured debt obligations) that are rated at least P-1 by Moody's,
F-1 by Fitch (if rated by Fitch) and A-1 by S&P.

                  "Depository Participant": A broker, dealer, bank or other
financial institution or other Person for whom from time to time a Depository
effects book-entry transfers and pledges of securities deposited with the
Depository.

                  "Determination Date": With respect to each Distribution Date,
the 15th day of the calendar month in which such Distribution Date occurs or, if
such 15th day is not a Business Day, the Business Day immediately preceding such
15th day.

                  "Directly Operate": With respect to any REO Property, the
furnishing or rendering of services to the tenants thereof, the management or
operation of such REO Property, the holding of such REO Property primarily for
sale to customers, the performance of any construction work thereon or any use
of such REO Property in a trade or business conducted by REMIC I other than

                                      -10-

<PAGE>

through an Independent Contractor; provided, however, that the Trustee (or the
Servicer on behalf of the Trustee) shall not be considered to Directly Operate
an REO Property solely because the Trustee (or the Servicer on behalf of the
Trustee) establishes rental terms, chooses tenants, enters into or renews
leases, deals with taxes and insurance, or makes decisions as to repairs or
capital expenditures with respect to such REO Property.

                  "Disqualified Organization": Any of the following: (i) the
United States, any State or political subdivision thereof, any possession of the
United States, or any agency or instrumentality of any of the foregoing (other
than an instrumentality which is a corporation if all of its activities are
subject to tax and, except for Freddie Mac, a majority of its board of directors
is not selected by such governmental unit), (ii) any foreign government, any
international organization, or any agency or instrumentality of any of the
foregoing, (iii) any organization (other than certain farmers' cooperatives
described in Section 521 of the Code) which is exempt from the tax imposed by
Chapter 1 of the Code (including the tax imposed by Section 511 of the Code on
unrelated business taxable income), (iv) rural electric and telephone
cooperatives described in Section 1381(a)(2)(C) of the Code, (v) an "electing
large partnership" and (vi) any other Person as set forth in an Opinion of
Counsel delivered to the Trustee and the Depositor to the effect that the
holding of an Ownership Interest in a Residual Certificate by such Person may
cause any Trust REMIC or any Person having an Ownership Interest in any Class of
Certificates (other than such Person) to incur a liability for any federal tax
imposed under the Code that would not otherwise be imposed but for the Transfer
of an Ownership Interest in a Residual Certificate to such Person. The terms
"United States," "State" and "international organization" shall have the
meanings set forth in Section 7701 of the Code or successor provisions.

                  "Distribution Account": The trust account or accounts created
and maintained by the Trustee pursuant to Section 3.10(b), which shall be
entitled "[NAME OF TRUSTEE], as Trustee, in trust for the registered holders of
Citigroup Mortgage Loan Trust Inc., Citigroup Home Equity Loan Trust, Series
20__-____, Asset Backed Pass-Through Certificates." The Distribution Account
must be an Eligible Account.

                  "Distribution Date": The 25th day of any month, or if such
25th day is not a Business Day, the Business Day immediately following such 25th
day, commencing in May 2003.

                  "Due Date": With respect to each Mortgage Loan and any
Distribution Date, the first day of the calendar month in which such
Distribution Date occurs on which the Monthly Payment for such Mortgage Loan was
due (or, in the case of any Mortgage Loan under terms of which the Monthly
Payment for such Mortgage Loan was due on a day other than the first day of the
calendar month in which such Distribution Date occurs, the day during the
related Due Period on which such Monthly Payment was due), in each case
exclusive of any days of grace.

                  "Due Period": With respect to any Distribution Date, the
period commencing on the second day of the month immediately preceding the month
in which such Distribution Date occurs and ending on the first day of the month
of such Distribution Date.

                  "Eligible Account": Any of (i) an account or accounts
maintained with a Depository Institution, (ii) an account or accounts the
deposits in which are fully insured by the FDIC or (iii) a

                                      -11-

<PAGE>

segregated non-interest bearing trust account or accounts maintained with the
corporate trust department of a federal depository institution or
state-chartered depository institution subject to regulations regarding
fiduciary funds on deposit similar to Title 12 of the Code of Federal Regulation
Section 9.10(b), which, in either case, has corporate trust powers, acting in
its fiduciary capacity.

                  "[___] Mortgage Loan": Each Mortgage Loan originated by [___].

                  "[___] Mortgage Loan Purchase Agreement": The agreement among
[____], the Seller and the Depositor, regarding the sale of the [____] Mortgage
Loans by the Seller to the Depositor, substantially in the form of Exhibit D-2
annexed hereto.

                  "ERISA": The Employee Retirement Income Security Act of 1974,
as amended.

                  "Estate in Real Property": A fee simple estate in a parcel of
land.

                  "Excess Overcollateralized Amount": With respect to the Class
A Certificates and the Mezzanine Certificates and any Distribution Date, the
excess, if any, of (i) the Overcollateralized Amount for such Distribution Date
over (ii) the Overcollateralization Target Amount for such Distribution Date.

                  "Expense Adjusted Mortgage Rate": With respect to any Mortgage
Loan (or the related REO Property), as of any date of determination, a per annum
rate of interest equal to the applicable Mortgage Rate thereon as of the first
day of the related Due Period minus the sum of (i) the Trustee Fee Rate and (ii)
the Servicing Fee Rate.

                  "Expense Adjusted Maximum Mortgage Rate": With respect to any
Mortgage Loan (or the related REO Property), as of any date of determination, a
per annum rate of interest equal to the applicable Maximum Mortgage Rate (or the
applicable Mortgage Rate in the case of any Fixed- Rate Mortgage Loan) thereon
as of the first day of the related Due Period minus the sum of (i) the Trustee
Fee Rate and (ii) the Servicing Fee Rate.

                  "Extraordinary Trust Fund Expense": Any amounts reimbursable
to the Trustee or any director, officer, employee or agent of the Trustee from
the Trust Fund pursuant to Section 8.05 or Section 10.01(c) and any amounts
payable from the Distribution Account in respect of taxes pursuant to Section
10.01(g)(iii) and any costs of the Trustee for the recording of the Assignments
pursuant to Section 2.01 (to the extent the related Originator is unable to pay
such costs).

                  "Fannie Mae": Fannie Mae, formally known as the Federal
National Mortgage Association, or any successor thereto.

                  "FDIC": Federal Deposit Insurance Corporation or any successor
thereto.

                  "Final Recovery Determination": With respect to any defaulted
Mortgage Loan or any REO Property (other than a Mortgage Loan or REO Property
purchased by an Originator, the Depositor or the Servicer pursuant to or as
contemplated by Section 2.03, Section 3.16(c) or Section 9.01), a determination
made by the Servicer that all Insurance Proceeds, Liquidation Proceeds and

                                      -12-

<PAGE>

other payments or recoveries which the Servicer, in its reasonable good faith
judgment, expects to be finally recoverable in respect thereof have been so
recovered. The Servicer shall maintain records, prepared by a Servicing Officer,
of each Final Recovery Determination made thereby.

                  "Fitch": Fitch Ratings, or its successor in interest.

                  "Fixed-Rate Mortgage Loan": Each of the Mortgage Loans
identified on the Mortgage Loan Schedule as having a fixed Mortgage Rate.

                  "Formula Rate": For any Distribution Date and the Class A
Certificates, the Mezzanine Certificates and, solely for purposes of calculating
the Marker Rate, REMIC I Regular Interest I-LTA, REMIC I Regular Interest
I-LTM1, REMIC I Regular Interest I-LTM2, REMIC I Regular Interest I-LTM3, REMIC
I Regular Interest I-LTM4 and REMIC I Regular Interest I-LTM5, the lesser of (i)
One-Month LIBOR plus the related Certificate Margin and (ii) the Maximum Cap
Rate.

                  "Freddie Mac": Freddie Mac, formally known as the Federal Home
Loan Mortgage Corporation, or any successor thereto.

                  "Gross Margin": With respect to each Adjustable-Rate Mortgage
Loan, the fixed percentage set forth in the related Mortgage Note that is added
to the Index on each Adjustment Date in accordance with the terms of the related
Mortgage Note used to determine the Mortgage Rate for such Adjustable-Rate
Mortgage Loan.

                  "Independent": When used with respect to any specified Person,
any such Person who (a) is in fact independent of the Depositor, the Servicer,
the Seller and their respective Affiliates, (b) does not have any direct
financial interest in or any material indirect financial interest in the
Depositor, the Servicer, the Seller or any Affiliate thereof, and (c) is not
connected with the Depositor, the Servicer, the Seller or any Affiliate thereof
as an officer, employee, promoter, underwriter, trustee, partner, director or
Person performing similar functions; provided, however, that a Person shall not
fail to be Independent of the Depositor, the Servicer, the Seller or any
Affiliate thereof merely because such Person is the beneficial owner of 1% or
less of any class of securities issued by the Depositor, the Servicer, the
Seller or any Affiliate thereof, as the case may be.

                  "Independent Contractor": Either (i) any Person (other than
the Servicer) that would be an "independent contractor" with respect to REMIC I
within the meaning of Section 856(d)(3) of the Code if REMIC I were a real
estate investment trust (except that the ownership tests set forth in that
section shall be considered to be met by any Person that owns, directly or
indirectly, 35% or more of any Class of Certificates), so long as REMIC I does
not receive or derive any income from such Person and provided that the
relationship between such Person and REMIC I is at arm's length, all within the
meaning of Treasury Regulation Section 1.856-4(b)(5), or (ii) any other Person
(including the Servicer) if the Trustee has received an Opinion of Counsel to
the effect that the taking of any action in respect of any REO Property by such
Person, subject to any conditions therein specified, that is otherwise herein
contemplated to be taken by an Independent Contractor will not cause such REO
Property to cease to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code (determined without regard to the exception
applicable for purposes of

                                      -13-

<PAGE>

Section 860D(a) of the Code), or cause any income realized in respect of such
REO Property to fail to qualify as Rents from Real Property.

                  "Index": With respect to each Adjustable-Rate Mortgage Loan
and each related Adjustment Date, the index specified in the related Mortgage
Note.

                  "Insurance Proceeds": Proceeds of any title policy, hazard
policy or other insurance policy covering a Mortgage Loan, to the extent such
proceeds are not to be applied to the restoration of the related Mortgaged
Property or released to the Mortgagor in accordance with the procedures that the
Servicer would follow in servicing mortgage loans held for its own account,
subject to the terms and conditions of the related Mortgage Note and Mortgage.

                  "Interest Accrual Period": With respect to any Distribution
Date and the Class A Certificates and the Mezzanine Certificates, the period
commencing on the Distribution Date of the month immediately preceding the month
in which such Distribution Date occurs (or, in the case of the first
Distribution Date, commencing on the Closing Date) and ending on the day
preceding such Distribution Date. With respect to any Distribution Date and the
Class CE Interest and the REMIC I Regular Interests, the one-month period ending
on the last day of the calendar month preceding the month in which such
Distribution Date occurs.

                  "Interest Carry Forward Amount": With respect to any
Distribution Date and the Class A Certificates or the Mezzanine Certificates,
the sum of (i) the amount, if any, by which (a) the Interest Distribution Amount
for such Class of Certificates as of the immediately preceding Distribution Date
exceeded (b) the actual amount distributed on such Class of Certificates in
respect of interest on such immediately preceding Distribution Date, (ii) the
amount of any Interest Carry Forward Amount for such Class of Certificates
remaining unpaid from the previous Distribution Date and (iii) accrued interest
on the sum of (i) and (ii) above calculated at the related Pass-Through Rate for
the most recently ended Interest Accrual Period.

                  "Interest Determination Date": With respect to the Class A
Certificates, the Mezzanine Certificates, REMIC I Regular Interest I-LTA, REMIC
I Regular Interest I-LTM1, REMIC I Regular Interest I-LTM2, REMIC I Regular
Interest I-LTM3, REMIC I Regular Interest I-LTM4 and REMIC I Regular Interest
I-LTM5 and any Interest Accrual Period therefor, the second London Business Day
preceding the commencement of such Interest Accrual Period.

                  "Interest Distribution Amount": With respect to any
Distribution Date and the Class A Certificates, the Mezzanine Certificates and
the Class CE Certificates, the aggregate Accrued Certificate Interest on the
Certificates of such Class for such Distribution Date.

                  "Interest Remittance Amount": For any Distribution Date, that
portion of the Available Distribution Amount for the related Distribution Date
that represents interest received or advanced on the Mortgage Loans.

                  "Late Collections": With respect to any Mortgage Loan and any
Due Period, all amounts received subsequent to the Determination Date
immediately following such Due Period, whether as late payments of Monthly
Payments or as Insurance Proceeds, Liquidation Proceeds or

                                      -14-

<PAGE>

otherwise, which represent late payments or collections of principal and/or
interest due (without regard to any acceleration of payments under the related
Mortgage and Mortgage Note) but delinquent for such Due Period and not
previously recovered.

                  "Liquidation Event": With respect to any Mortgage Loan, any of
the following events: (i) such Mortgage Loan is paid in full; (ii) a Final
Recovery Determination is made as to such Mortgage Loan; or (iii) such Mortgage
Loan is removed from REMIC I, by reason of its being purchased, sold or replaced
pursuant to or as contemplated by Section 2.03, Section 3.16(c) or Section 9.01.
With respect to any REO Property, either of the following events: (i) a Final
Recovery Determination is made as to such REO Property; or (ii) such REO
Property is removed from REMIC I by reason of its being purchased pursuant to
Section 9.01.

                  "Liquidation Proceeds": The amount (other than Insurance
Proceeds or amounts received in respect of the rental of any REO Property prior
to REO Disposition) received by the Servicer in connection with (i) the taking
of all or a part of a Mortgaged Property by exercise of the power of eminent
domain or condemnation, (ii) the liquidation of a defaulted Mortgage Loan
through a trustee's sale, foreclosure sale or otherwise, or (iii) the
repurchase, substitution or sale of a Mortgage Loan or an REO Property pursuant
to or as contemplated by Section 2.03, Section 3.16(c), Section 3.23 or Section
9.01.

                  "Loan-to-Value Ratio": As of any date of determination, the
fraction, expressed as a percentage, the numerator of which is the principal
balance of the related Mortgage Loan at such date and the denominator of which
is the Value of the related Mortgaged Property.

                  "London Business Day": Any day on which banks in the City of
London are open and conducting transactions in United States dollars.

                  "Marker Rate": With respect to the Class CE Certificates and
any Distribution Date, a per annum rate equal to two (2) times the weighted
average of the REMIC I Remittance Rate for each of the REMIC I Regular Interests
(other than REMIC I Regular Interest I-LTP), with the rate on each such REMIC I
Regular Interest (other than REMIC I Regular Interest I-LTZZ) subject to a cap
equal to the related Formula Rate for the purpose of this calculation for such
Distribution Date and with the rate on REMIC I Regular Interest I-LTZZ subject
to a cap of zero for the purpose of this calculation; provided, however, each
cap shall be multiplied by a fraction, the numerator of which is the actual
number of days in the related Interest Accrual Period and the denominator of
which is 30.

                  "Maximum Cap Rate": For any Distribution Date and the Class A
Certificates and the Mezzanine Certificates, a per annum rate equal to the
product of (x) the weighted average of the Expense Adjusted Maximum Mortgage
Rates of the Mortgage Loans, weighted based on their Principal Balances as of
the first day of the related Due Period and (y) a fraction, the numerator of
which is 30 and the denominator of which is the actual number of days elapsed in
the related Interest Accrual Period.

                  "Maximum I-LTZZ Uncertificated Interest Deferral Amount": With
respect to any Distribution Date, the excess of (i) accrued interest at the
REMIC I Remittance Rate applicable to

                                      -15-

<PAGE>

REMIC I Regular Interest I-LTZZ for such Distribution Date on a balance equal to
the Uncertificated Balance of REMIC I Regular Interest I-LTZZ minus the REMIC I
Overcollateralized Amount, in each case for such Distribution Date, over (ii)
Uncertificated Interest on REMIC I Regular Interest I-LTA, REMIC I Regular
Interest I-LTM1, REMIC I Regular Interest I-LTM2, REMIC I Regular Interest
I-LTM3, REMIC I Regular Interest I-LTM4 and REMIC I Regular Interest I-LTM5 for
such Distribution Date, with the rate on each of REMIC I Regular Interest I-LTA,
REMIC I Regular Interest I-LTM1, REMIC I Regular Interest I-LTM2, REMIC I
Regular Interest I-LTM3, REMIC I Regular Interest I-LTM4 and REMIC I Regular
Interest I-LTM5 subject to a cap equal to the related Formula Rate; provided,
however, each cap shall be multiplied by a fraction, the numerator of which is
the actual number of days in the related Interest Accrual Period and the
denominator of which is 30.

                  "Maximum Mortgage Rate": With respect to each Adjustable-Rate
Mortgage Loan, the percentage set forth in the related Mortgage Note as the
maximum Mortgage Rate thereunder.

                  "MERS": Mortgage Electronic Registration Systems, Inc., a
corporation organized and existing under the laws of the State of Delaware, or
any successor thereto.

                  "MERS(R) System": The system of recording transfers of
Mortgages electronically maintained by MERS.

                  "MIN": The Mortgage Identification Number for Mortgage Loans
registered with MERS on the MERS(R)System.

                  "MOM Loan": With respect to any [____] Mortgage Loan, MERS
acting as the mortgagee of such Mortgage Loan, solely as nominee for the
originator of such Mortgage Loan and its successors and assigns, at the
origination thereof.

                  "Mezzanine Certificates": The Class M-1 Certificates, the
Class M-2 Certificates, the Class M-3 Certificates or the Class M-3 Interest, as
applicable, the Class M-4 Certificates or the Class M-4 Interest, as applicable
and the Class M-5 Certificates or the Class M-5 Interest, as applicable.

                  "Minimum Mortgage Rate": With respect to each Adjustable-Rate
Mortgage Loan, the percentage set forth in the related Mortgage Note as the
minimum Mortgage Rate thereunder.

                  "Monthly Payment": With respect to any Mortgage Loan, the
scheduled monthly payment of principal and interest on such Mortgage Loan which
is payable by the related Mortgagor from time to time under the related Mortgage
Note, determined: (a) after giving effect to (i) any Deficient Valuation and/or
Debt Service Reduction with respect to such Mortgage Loan and (ii) any reduction
in the amount of interest collectible from the related Mortgagor pursuant to the
Relief Act; (b) without giving effect to any extension granted or agreed to by
the Servicer pursuant to Section 3.07 and (c) on the assumption that all other
amounts, if any, due under such Mortgage Loan are paid when due.

                  "Moody's": Moody's Investors Service, Inc., or its successor
in interest.

                                      -16-

<PAGE>

                  "Mortgage": The mortgage, deed of trust or other instrument
creating a first lien on, or first priority security interest in, a Mortgaged
Property securing a Mortgage Note.

                  "Mortgage File": The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement.

                  "Mortgage Loan": Each mortgage loan transferred and assigned
to the Trustee and delivered to the Trustee pursuant to Section 2.01 or Section
2.03(b) of this Agreement, as held from time to time as a part of the Trust
Fund, the Mortgage Loans so held being identified in the Mortgage Loan Schedule.

                  "Mortgage Loan Purchase Agreement": The [____] Mortgage Loan
Purchase Agreement or the [____] Mortgage Loan Purchase Agreement, as the
context requires.

                  "Mortgage Loan Schedule": As of any date, the list of Mortgage
Loans included in REMIC I on such date, attached hereto as Schedule 1. The
Mortgage Loan Schedule shall set forth the following information with respect to
each Mortgage Loan:

                  (i) the Mortgage Loan identifying number;

                  (ii) the Originator of the Mortgage Loan;

                  (iii) the state and zip code;

                  (iv) a code indicating whether the Mortgaged Property is
         owner-occupied;

                  (v) the type of Residential Dwelling constituting the
         Mortgaged Property;

                  (vi) the original months to maturity;

                  (vii) the stated remaining months to maturity from the Cut-off
         Date based on the original amortization schedule;

                  (viii) the Loan-to-Value Ratio at origination;

                  (ix) the Mortgage Rate in effect immediately following the
         Cut-off Date;

                  (x) (A) the date on which the first Monthly Payment was due on
         the Mortgage Loan and (B) if such date is not consistent with the Due
         Date currently in effect, such Due Date;

                  (xi) the stated maturity date;

                  (xii) the amount of the Monthly Payment at origination;

                                      -17-

<PAGE>

                  (xiii) the amount of the Monthly Payment due on the first Due
         Date after the Cut-off Date;

                  (xiv) the last Due Date on which a Monthly Payment was
         actually applied to the unpaid Stated Principal Balance;

                  (xv) the original principal amount of the Mortgage Loan;

                  (xvi) the principal balance of the Mortgage Loan as of the
         close of business on the Cut-off Date;

                  (xvii) a code indicating the purpose of the Mortgage Loan
         (i.e., purchase financing, Rate/Term Refinancing, Cash-Out
         Refinancing);

                  (xviii) with respect to each Adjustable-Rate Mortgage Loan,
         the Adjustment Dates, the Gross Margin, the Maximum Mortgage Rate, the
         Minimum Mortgage Rate, the Periodic Rate Cap, the maximum first
         Adjustment Date Mortgage Rate adjustment and the first Adjustment Date
         immediately following the Cut-off Date;

                  (xix) the Mortgage Rate at origination;

                  (xx) a code indicating the documentation program;

                  (xxi) the risk grade;

                  (xxii) the Value of the Mortgaged Property;

                  (xxiii) the sale price of the Mortgaged Property, if
         applicable;

                  (xxiv) the actual unpaid principal balance of the Mortgage
         Loan as of the Cut-off Date;

                  (xxv) a code indicating the type and term of the related
         Prepayment Charge;

                  (xxvi) with respect to each Adjustable-Rate Mortgage Loan, the
         rounding code (i.e., nearest 0.125%, next highest 0.125%);

                  (xxvii) the program code; and

                  (xxviii) whether such Mortgage Loan is an Adjustable-Rate
         Mortgage Loan or a Fixed-Rate Mortgage Loan.

                  The Mortgage Loan Schedule shall set forth the following
information with respect to the Mortgage Loans in the aggregate as of the
Cut-off Date: (1) the number of Mortgage Loans; (2) the current principal
balance of the Mortgage Loans; (3) the weighted average Mortgage Rate of the
Mortgage Loans and (4) the weighted average maturity of the Mortgage Loans. The
Mortgage

                                      -18-

<PAGE>

Loan Schedule shall be amended from time to time by the Depositor in accordance
with the provisions of this Agreement. With respect to any Qualified Substitute
Mortgage Loan, the Cut-off Date shall refer to the related Cut-off Date for such
Mortgage Loan, determined in accordance with the definition of Cut-off Date
herein.

                  "Mortgage Note": The original executed note or other evidence
of the indebtedness of a Mortgagor under a Mortgage Loan.

                  "Mortgage Pool": The pool of Mortgage Loans, identified on
Schedule 1 and existing from time to time thereafter, and any REO Properties
acquired in respect thereof.

                  "Mortgage Rate": With respect to each Mortgage Loan, the
annual rate at which interest accrues on such Mortgage Loan from time to time in
accordance with the provisions of the related Mortgage Note, which rate (i) with
respect to each Fixed-Rate Mortgage Loan shall remain constant at the rate set
forth in the Mortgage Loan Schedule as the Mortgage Rate in effect immediately
following the Cut-off Date and (ii) with respect to the Adjustable-Rate Mortgage
Loans, (A) as of any date of determination until the first Adjustment Date
following the Cut-off Date shall be the rate set forth in the Mortgage Loan
Schedule as the Mortgage Rate in effect immediately following the Cut-off Date
and (B) as of any date of determination thereafter shall be the rate as adjusted
on the most recent Adjustment Date equal to the sum, rounded as provided in the
Mortgage Note, of the Index, as most recently available as of a date prior to
the Adjustment Date as set forth in the related Mortgage Note, plus the related
Gross Margin; provided that the Mortgage Rate on such Adjustable-Rate Mortgage
Loan on any Adjustment Date shall never be more than the lesser of (i) the sum
of the Mortgage Rate in effect immediately prior to the Adjustment Date plus the
related Periodic Rate Cap, if any, and (ii) the related Maximum Mortgage Rate,
and shall never be less than the greater of (i) the Mortgage Rate in effect
immediately prior to the Adjustment Date less the Periodic Rate Cap, if any, and
(ii) the related Minimum Mortgage Rate. With respect to each Mortgage Loan that
becomes an REO Property, as of any date of determination, the annual rate
determined in accordance with the immediately preceding sentence as of the date
such Mortgage Loan became an REO Property.

                  "Mortgaged Property": The underlying property securing a
Mortgage Loan, including any REO Property, consisting of an Estate in Real
Property improved by a Residential Dwelling.

                  "Mortgagor": The obligor on a Mortgage Note.

                  "Net Monthly Excess Cashflow": With respect to any
Distribution Date, the sum of (i) any Overcollateralization Reduction Amount for
such Distribution Date and (ii) the excess of (x) the Available Distribution
Amount for such Distribution Date over (y) the sum for such Distribution Date of
(A) the Senior Interest Distribution Amount payable to the holders of the Class
A Certificates and the Interest Distribution Amount payable to the holders of
the Mezzanine Certificates and (B) the Principal Remittance Amount.

                  "Net Mortgage Rate": With respect to any Mortgage Loan (or the
related REO Property) as of any date of determination, a per annum rate of
interest equal to the then applicable Mortgage Rate for such Mortgage Loan minus
the Servicing Fee Rate.

                                      -19-

<PAGE>

                  "Net WAC Pass-Through Rate": With respect to the Class A
Certificates and the Mezzanine Certificates and any Distribution Date, a rate
per annum equal to the product of (x) the weighted average of the Expense
Adjusted Mortgage Rates of the Mortgage Loans, weighted based on their Stated
Principal Balances as of the first day of the related Due Period and (y) a
fraction, the numerator of which is 30 and the denominator of which is the
actual number of days elapsed in the related Interest Accrual Period. With
respect to each REMIC I Regular Interest and any Distribution Date, a rate per
annum equal to the weighted average of the Expense Adjusted Mortgage Rates of
the Mortgage Loans, weighted based on their Stated Principal Balances as of the
first day of the related Due Period.

                  "Net WAC Rate Carryover Amount": With respect to any Class of
the Class A Certificates and the Mezzanine Certificates and any Distribution
Date, the sum of (A) the positive excess of (i) the amount of interest accrued
on such Class of Certificates for such Distribution Date calculated at the
related Formula Rate for such Distribution Date over (ii) the amount of interest
accrued on such Class of Certificates at the applicable Net WAC Pass-Through
Rate for such Distribution Date and (B) the related Net WAC Rate Carryover
Amount for the previous Distribution Date not previously paid, together with
interest thereon at a rate equal to the related Formula Rate for such Class of
Certificates for such Distribution Date.

                  "Net WAC Rate Carryover Reserve Account": As defined in
Section 3.27.

                  "New Lease": Any lease of REO Property entered into on behalf
of REMIC I, including any lease renewed or extended on behalf of REMIC I, if
REMIC I has the right to renegotiate the terms of such lease.

                  "Nonrecoverable Advance": Any Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Property that, in the
good faith business judgment of the Servicer, will not or, in the case of a
proposed Advance, would not be ultimately recoverable from related Late
Collections, Insurance Proceeds or Liquidation Proceeds on such Mortgage Loan or
REO Property as provided herein.

                  "Nonrecoverable Servicing Advance": Any Servicing Advance
previously made or proposed to be made in respect of a Mortgage Loan or REO
Property that, in the good faith business judgment of the Servicer, will not or,
in the case of a proposed Servicing Advance, would not be ultimately recoverable
from related Late Collections, Insurance Proceeds or Liquidation Proceeds on
such Mortgage Loan or REO Property as provided herein.

                  "Non-United States Person": Any Person other than a United
States Person.

                  "Notional Amount": With respect to the Class CE Interest and
any Distribution Date, the aggregate Uncertificated Balance of the REMIC I
Regular Interests for such Distribution Date.

                  "Officers' Certificate": A certificate signed by the Chairman
of the Board, the Vice Chairman of the Board, the President or a vice president
(however denominated), and by the Treasurer, the Secretary, or one of the
assistant treasurers or assistant secretaries of the Servicer, the Seller or the
Depositor, as applicable.

                                      -20-

<PAGE>

                  "One-Month LIBOR": With respect to the Class A Certificates,
the Mezzanine Certificates and for purposes of the Formula Rate, REMIC I Regular
Interest I-LTA, REMIC I Regular Interest I-LTM1, REMIC I Regular Interest
I-LTM2, REMIC I Regular Interest I-LTM3, REMIC I Regular Interest I-LTM4 and
REMIC I Regular Interest I-LTM5 and any Interest Accrual Period therefor, the
rate determined by the Trustee on the related Interest Determination Date on the
basis of the offered rate for one-month U.S. dollar deposits, as such rate
appears on Telerate Page 3750 as of 11:00 a.m. (London time) on such Interest
Determination Date; provided that if such rate does not appear on Telerate Page
3750, the rate for such date will be determined on the basis of the offered
rates of the Reference Banks for one-month U.S. dollar deposits, as of 11:00
a.m. (London time) on such Interest Determination Date. In such event, the
Trustee will request the principal London office of each of the Reference Banks
to provide a quotation of its rate. If on such Interest Determination Date, two
or more Reference Banks provide such offered quotations, One-Month LIBOR for the
related Interest Accrual Period shall be the arithmetic mean of such offered
quotations (rounded upwards if necessary to the nearest whole multiple of
1/16%). If on such Interest Determination Date, fewer than two Reference Banks
provide such offered quotations, One-Month LIBOR for the related Interest
Accrual Period shall be the higher of (i) LIBOR as determined on the previous
Interest Determination Date and (ii) the Reserve Interest Rate. Notwithstanding
the foregoing, if, under the priorities described above, LIBOR for an Interest
Determination Date would be based on LIBOR for the previous Interest
Determination Date for the third consecutive Interest Determination Date, the
Trustee, after consultation with the Depositor, shall select an alternative
comparable index (over which the Trustee has no control), used for determining
one-month Eurodollar lending rates that is calculated and published (or
otherwise made available) by an independent party.

                  "Opinion of Counsel": A written opinion of counsel, who may,
without limitation, be salaried counsel for the Depositor or the Servicer,
acceptable to the Trustee, if such opinion is delivered to the Trustee, except
that any opinion of counsel relating to (a) the qualification of any Trust REMIC
as a REMIC or (b) compliance with the REMIC Provisions must be an opinion of
Independent counsel.

                  "Original Mortgage Loan": Any of the Mortgage Loans included
in REMIC I as of the Closing Date.

                  "Originator": Either (i) [____] or its successor in interest,
in its capacity as originator under the [____] Mortgage Loan Purchase Agreement
or (ii) [____] or its successor in interest, in its capacity as originator under
the [____] Mortgage Loan Purchase Agreement, as the context requires.

                  "Overcollateralization Deficiency Amount": With respect to any
Distribution Date, the excess, if any, of (a) the Overcollateralization Target
Amount applicable to such Distribution Date over (b) the Overcollateralized
Amount applicable to such Distribution Date (calculated for this purpose only,
after taking into account the distributions to be made of the Principal
Remittance Amount on such Distribution Date).

                  "Overcollateralization Increase Amount": With respect to any
Distribution Date, the lesser of (a) the Overcollateralization Deficiency Amount
as of such Distribution Date (after taking

                                      -21-

<PAGE>

into account the payment of the Principal Distribution Amount on such
Distribution Date, exclusive of the payment of any Overcollateralization
Increase Amount) and (b) the amount of Accrued Certificate Interest payable on
the Class CE Certificates on such Distribution Date as reduced by Realized
Losses allocated thereto with respect to such Distribution Date pursuant to
Section 4.04.

                  "Overcollateralization Reduction Amount": With respect to any
Distribution Date, an amount equal to the lesser of (a) the Principal Remittance
Amount on such Distribution Date and (b) the excess, if any, of (i) the
Overcollateralized Amount for such Distribution Date (calculated for this
purpose only after assuming that 100% of the Principal Remittance Amount on such
Distribution Date have been distributed) over (ii) the Overcollateralization
Target Amount for such Distribution Date.

                  "Overcollateralization Target Amount": With respect to any
Distribution Date, (i) prior to the Stepdown Date, an amount equal to $[__],
(ii) on or after the Stepdown Date provided a Trigger Event is not in effect,
the greater of (x) [__]% of the then current aggregate outstanding principal
balance of the Mortgage Loans as of the last day of the related Due Period and
(y) $[__], or (iii) on or after the Stepdown Date and if a Trigger Event is in
effect, the Overcollateralization Target Amount for the immediately preceding
Distribution Date.

                  "Overcollateralized Amount": With respect to any Distribution
Date, the excess, if any, of (a) the aggregate Stated Principal Balances of the
Mortgage Loans and REO Properties as of the last day of the related Due Period
over (b) the sum of the aggregate Certificate Principal Balances of the Class A
Certificates, the Mezzanine Certificates and the Class P Certificates after
giving effect to distributions to be made on such Distribution Date.

                  "Ownership Interest": As to any Certificate, any ownership or
security interest in such Certificate, including any interest in such
Certificate as the Holder thereof and any other interest therein, whether direct
or indirect, legal or beneficial, as owner or as pledgee.

                  "Pass-Through Rate": With respect to the Class A Certificates
and the Mezzanine Certificates and any Distribution Date, a rate per annum equal
to the lesser of (i) the related Formula Rate for such Distribution Date and
(ii) the Net WAC Pass-Through Rate for such Distribution Date. With respect to
the Class CE Interest and any Distribution Date, a rate per annum equal to the
percentage equivalent of a fraction, the numerator of which is the sum of the
amounts calculated pursuant to clauses (A) through (I) below, and the
denominator of which is the Uncertificated Balance of the REMIC I Regular
Interests. For purposes of calculating the Pass-Through Rate for the Class CE
Interest, the numerator is equal to the sum of the following components:

                  (A) the REMIC I Remittance Rate for REMIC I Regular Interest
         I-LTAA minus the Marker Rate, applied to an amount equal to the
         Uncertificated Balance of REMIC I Regular Interest I-LTAA;

                  (B) the REMIC I Remittance Rate for REMIC I Regular Interest
         I-LTA minus the Marker Rate, applied to an amount equal to the
         Uncertificated Balance of REMIC I Regular Interest I-LTA;

                                      -22-

<PAGE>

                  (C) the REMIC I Remittance Rate for REMIC I Regular Interest
         I-LTM1 minus the Marker Rate, applied to an amount equal to the
         Uncertificated Balance of REMIC I Regular Interest I-LTM1;

                  (D) the REMIC I Remittance Rate for REMIC I Regular Interest
         I-LTM2 minus the Marker Rate, applied to an amount equal to the
         Uncertificated Balance of REMIC I Regular Interest I-LTM2;

                  (E) the REMIC I Remittance Rate for REMIC I Regular Interest
         I-LTM3 minus the Marker Rate, applied to an amount equal to the
         Uncertificated Balance of REMIC I Regular Interest I-LTM3;

                  (F) the REMIC I Remittance Rate for REMIC I Regular Interest
         I-LTM4 minus the Marker Rate, applied to an amount equal to the
         Uncertificated Balance of REMIC I Regular Interest I-LTM4;

                  (G) the REMIC I Remittance Rate for REMIC I Regular Interest
         I-LTM5 minus the Marker Rate, applied to an amount equal to the
         Uncertificated Balance of REMIC I Regular Interest I-LTM5;

                  (H) the REMIC I Remittance Rate for REMIC I Regular Interest
         I-LTZZ minus the Marker Rate, applied to an amount equal to the
         Uncertificated Balance of REMIC I Regular Interest I-LTZZ; and

                  (I) 100% of the interest on REMIC I Regular Interest I-LTP.

                  With respect to the Class CE Certificates, 100% of the
interest payable to the Class CE Interest.

                  "Percentage Interest": With respect to any Class of
Certificates (other than the Residual Certificates), the undivided percentage
ownership in such Class evidenced by such Certificate, expressed as a
percentage, the numerator of which is the initial Certificate Principal Balance
or Notional Amount represented by such Certificate and the denominator of which
is the aggregate initial Certificate Principal Balance or initial Notional
Amount of all of the Certificates of such Class. The Class A Certificates and
the Mezzanine Certificates are issuable only in minimum Percentage Interests
corresponding to minimum initial Certificate Principal Balances of $100,000 and
integral multiples of $1.00 in thereof. The Class P Certificates are issuable
only in Percentage Interests corresponding to initial Certificate Principal
Balances of $20 and integral multiples thereof. The Class CE Certificates are
issuable only in minimum Percentage Interests corresponding to minimum initial
Certificate Principal Balances of $100,000 and integral multiples of $1.00 in
thereof; provided, however, that a single Certificate of each such Class of
Certificates may be issued having a Percentage Interest corresponding to the
remainder of the aggregate initial Certificate Principal Balance or Notional
Amount of such Class or to an otherwise authorized denomination for such Class
plus such remainder. With respect to any Residual Certificate, the undivided
percentage ownership in such Class evidenced by such Certificate, as set forth
on the face of such Certificate. The Residual Certificates are issuable in
Percentage Interests of 20% and multiples thereof.

                                      -23-

<PAGE>

                  "Periodic Rate Cap": With respect to each Adjustable-Rate
Mortgage Loan and any Adjustment Date therefor, the fixed percentage set forth
in the related Mortgage Note, which is the maximum amount by which the Mortgage
Rate for such Mortgage Loan may increase or decrease (without regard to the
Maximum Mortgage Rate or the Minimum Mortgage Rate) on such Adjustment Date from
the Mortgage Rate in effect immediately prior to such Adjustment Date.

                  "Permitted Investments": Any one or more of the following
obligations or securities acquired at a purchase price of not greater than par,
regardless of whether issued by the Depositor, the Servicer, the Trustee or any
of their respective Affiliates:

                  (i) direct obligations of, or obligations fully guaranteed as
         to timely payment of principal and interest by, the United States or
         any agency or instrumentality thereof, provided such obligations are
         backed by the full faith and credit of the United States;

                  (ii) demand and time deposits in, certificates of deposit of,
         or bankers' acceptances issued by, any Depository Institution;

                  (iii) repurchase obligations with respect to any security
         described in clause (i) above entered into with a Depository
         Institution (acting as principal);

                  (iv) securities bearing interest or sold at a discount that
         are issued by any corporation incorporated under the laws of the United
         States of America or any state thereof and that are rated by each
         Rating Agency that rates such securities in its highest long-term
         unsecured rating categories at the time of such investment or
         contractual commitment providing for such investment;

                  (v) commercial paper (including both non-interest-bearing
         discount obligations and interest-bearing obligations payable on demand
         or on a specified date not more than 30 days after the date of
         acquisition thereof) that is rated by each Rating Agency that rates
         such securities in its highest short-term unsecured debt rating
         available at the time of such investment;

                  (vi) units of money market funds that have been rated "AAA" by
         Fitch (if rated by Fitch) and "AAAm" or "AAAm-G" by S&P or "Aaa" by
         Moody's; and

                  (viii) if previously confirmed in writing to the Trustee, any
         other demand, money market or time deposit, or any other obligation,
         security or investment, as may be acceptable to the Rating Agencies as
         a permitted investment of funds backing securities having ratings
         equivalent to its highest initial rating of the Class A Certificates;

provided, however, that no instrument described hereunder shall evidence either
the right to receive (a) only interest with respect to the obligations
underlying such instrument or (b) both principal and interest payments derived
from obligations underlying such instrument and the interest and principal
payments with respect to such instrument provide a yield to maturity at par
greater than 120% of the yield to maturity at par of the underlying obligations.

                                      -24-

<PAGE>

                  "Permitted Transferee": Any Transferee of a Residual
Certificate other than a Disqualified Organization or Non-United States Person.

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

                  "Plan": Any employee benefit plan or certain other retirement
plans and arrangements, including individual retirement accounts and annuities,
Keogh plans and bank collective investment funds and insurance company general
or separate accounts in which such plans, accounts or arrangements are invested,
that are subject to ERISA or Section 4975 of the Code.

                  "Prepayment Assumption": A prepayment rate for the Mortgage
Loans of [__]% CPR. The Prepayment Assumption is used solely for determining the
accrual of original issue discount on the Certificates for federal income tax
purposes. A CPR (or Constant Prepayment Rate) represents an annualized constant
assumed rate of prepayment each month of a pool of mortgage loans relative to
its outstanding principal balance for the life of such pool.

                  "Prepayment Charge": With respect to any Prepayment Period,
any prepayment premium, penalty or charge payable by a Mortgagor in connection
with any Principal Prepayment on a Mortgage Loan pursuant to the terms of the
related Mortgage Note (other than any Servicer Prepayment Charge Payment
Amount).

                  "Prepayment Charge Schedule": As of any date, the list of
Prepayment Charges included in the Trust Fund on such date, attached hereto as
Schedule 2 (including the prepayment charge summary attached thereto). The
Prepayment Charge Schedule shall set forth the following information with
respect to each Prepayment Charge:

                  (i) the Mortgage Loan identifying number;

                  (ii) a code indicating the type of Prepayment Charge;

                  (iii) the date on which the first Monthly Payment was due on
         the related Mortgage Loan;

                  (iv) the term of the related Prepayment Charge;

                  (v) the original Stated Principal Balance of the related
         Mortgage Loan; and

                  (vi) the Stated Principal Balance of the related Mortgage Loan
         as of the Cut-off Date.

                  "Prepayment Interest Shortfall": With respect to any
Distribution Date, for each Mortgage Loan that was during the related Prepayment
Period the subject of a Principal Prepayment in full that was applied by the
Servicer to reduce the outstanding principal balance of such loan on a date
preceding the Due Date in the succeeding Prepayment Period, an amount equal to
interest at

                                      -25-

<PAGE>

the applicable Net Mortgage Rate on the amount of such Principal Prepayment for
the number of days commencing on the date on which the prepayment is applied and
ending on the last day of the related Prepayment Period. The obligations of the
Servicer in respect of any Prepayment Interest Shortfall are set forth in
Section 3.24.

                  "Prepayment Period": With respect to any Distribution Date,
the calendar month preceding the calendar month in which such Distribution Date
occurs.

                  "Principal Balance": As to any Mortgage Loan other than a
Liquidated Mortgage Loan, and any day, the related Stated Principal Balance as
of the Cut-off Date, MINUS all collections credited against the Principal
Balance of any such Mortgage Loan. For purposes of this definition, a Liquidated
Mortgage Loan shall be deemed to have a Principal Balance equal to the Principal
Balance of the related Mortgage Loan as of the final recovery of related
Liquidation Proceeds and a Principal Balance of zero thereafter. As to any REO
Property and any day, the Principal Balance of the related Mortgage Loan
immediately prior to such Mortgage Loan becoming REO Property minus any REO
Principal Amortization received with respect thereto on or prior to such day.

                  "Principal Distribution Amount": With respect to any
Distribution Date, the sum of:

                  (i) the principal portion of each Monthly Payment on the
         Mortgage Loans due during the related Due Period, whether or not
         received on or prior to the related Determination Date;

                  (ii) the Stated Principal Balance of any Mortgage Loan that
         was purchased during the related Prepayment Period pursuant to or as
         contemplated by Section 2.03, Section 3.16(c) or Section 9.01 and the
         amount of any shortfall deposited in the Collection Account in
         connection with the substitution of a Deleted Mortgage Loan pursuant to
         Section 2.03 during the related Prepayment Period;

                  (iii) the principal portion of all other unscheduled
         collections (including, without limitation, Principal Prepayments,
         Insurance Proceeds, Liquidation Proceeds and REO Principal
         Amortization) received during the related Prepayment Period, net of any
         portion thereof that represents a recovery of principal for which an
         Advance was made by the Servicer pursuant to Section 4.03 in respect of
         a preceding Distribution Date; and

                  (iv) the amount of any Overcollateralization Increase Amount
         for such Distribution Date; MINUS

                  (v) the amount of any Overcollateralization Reduction Amount
         for such Distribution Date.

                  "Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its scheduled Due
Date and which is not accompanied by an amount of interest representing the full
amount of scheduled interest due on any Due Date in any month or months
subsequent to the month of prepayment.

                                      -26-

<PAGE>

                  "Principal Remittance Amount": The sum of the amounts set
forth in (i) through (iii) of the definition of Principal Distribution Amount.

                  "Private Certificates":  As defined in Section 5.02(b).

                  "PTCE": A Prohibited Transaction Class Exemption issued by the
United States Department of Labor which provides that exemptive relief is
available to any party to any transaction which satisfies the conditions of the
exemption.

                  "Purchase Price": With respect to any Mortgage Loan or REO
Property to be purchased pursuant to or as contemplated by Section 2.03, Section
3.16(c) or Section 9.01, and as confirmed by a certification from a Servicing
Officer to the Trustee, an amount equal to the sum of (i) 100% of the Stated
Principal Balance thereof as of the date of purchase (or such other price as
provided in Section 9.01), (ii) in the case of (x) a Mortgage Loan, accrued
interest on such Stated Principal Balance at the applicable Net Mortgage Rate in
effect from time to time from the Due Date as to which interest was last covered
by a payment by the Mortgagor or an Advance by the Servicer, which payment or
Advance had as of the date of purchase been distributed pursuant to Section
4.01, through the end of the calendar month in which the purchase is to be
effected plus and (y) an REO Property, the sum of (1) accrued interest on such
Stated Principal Balance at the applicable Net Mortgage Rate in effect from time
to time from the Due Date as to which interest was last covered by a payment by
the Mortgagor or an Advance by the Servicer through the end of the calendar
month immediately preceding the calendar month in which such REO Property was
acquired, plus (2) REO Imputed Interest for such REO Property for each calendar
month commencing with the calendar month in which such REO Property was acquired
and ending with the calendar month in which such purchase is to be effected, net
of the total of all net rental income, Insurance Proceeds, Liquidation Proceeds
and Advances that as of the date of purchase had been distributed as or to cover
REO Imputed Interest pursuant to Section 4.01, (iii) any unreimbursed Servicing
Advances and Advances (including Nonrecoverable Advances and Nonrecoverable
Servicing Advances) and any unpaid Servicing Fees allocable to such Mortgage
Loan or REO Property, (iv) any amounts previously withdrawn from the Collection
Account in respect of such Mortgage Loan or REO Property pursuant to Section
3.11(a)(ix) and Section 3.16(b), and (v) in the case of a Mortgage Loan required
to be purchased pursuant to Section 2.03, expenses reasonably incurred or to be
incurred by the Servicer or the Trustee in respect of the breach or defect
giving rise to the purchase obligation including, except for any Mortgage Loan
repurchased pursuant to Section 3.16(c), any costs and damages incurred by the
Trust Fund in connection with any violation by such loan of any predatory or
abusive lending law.

                  "Qualified Substitute Mortgage Loan": A mortgage loan
substituted for a Deleted Mortgage Loan pursuant to the terms of this Agreement
which must, on the date of such substitution, (i) have an outstanding principal
balance, after application of all scheduled payments of principal and interest
due during or prior to the month of substitution, not in excess of the Stated
Principal Balance of the Deleted Mortgage Loan as of the Due Date in the
calendar month during which the substitution occurs, (ii) have a Mortgage Rate
not less than (and not more than one percentage point in excess of) the Mortgage
Rate of the Deleted Mortgage Loan, (iii) with respect to any Adjustable- Rate
Mortgage Loan, have a Maximum Mortgage Rate not less than the Maximum Mortgage
Rate on the Deleted Mortgage Loan, (iv) with respect to any Adjustable-Rate
Mortgage Loan, have a

                                      -27-

<PAGE>

Minimum Mortgage Rate not less than the Minimum Mortgage Rate of the Deleted
Mortgage Loan, (v) with respect to any Adjustable-Rate Mortgage Loan, have a
Gross Margin equal to the Gross Margin of the Deleted Mortgage Loan, (vi) with
respect to any Adjustable-Rate Mortgage Loan, have a next Adjustment Date not
more than two months later than the next Adjustment Date on the Deleted Mortgage
Loan, (vii) have a remaining term to maturity not greater than (and not more
than one year less than) that of the Deleted Mortgage Loan, (viii) have the same
Due Date as the Due Date on the Deleted Mortgage Loan, (ix) have a Loan-to-Value
Ratio as of the date of substitution equal to or lower than the Loan-to-Value
Ratio of the Deleted Mortgage Loan as of such date, (x) have a risk grading
determined by the originator of the Mortgage Loan at least equal to the risk
grading assigned on the Deleted Mortgage Loan and (xi) conform to each
representation and warranty set forth in Section 6 of the Mortgage Loan Purchase
Agreement applicable to the Deleted Mortgage Loan. In the event that one or more
mortgage loans are substituted for one or more Deleted Mortgage Loans, the
amounts described in clause (i) hereof shall be determined on the basis of
aggregate principal balances, the Mortgage Rates described in clause (ii) hereof
shall be determined on the basis of weighted average Mortgage Rates, the terms
described in clause (vii) hereof shall be determined on the basis of weighted
average remaining term to maturity, the Loan-to-Value Ratios described in clause
(ix) hereof shall be satisfied as to each such mortgage loan, the risk gradings
described in clause (x) hereof shall be satisfied as to each such mortgage loan
and, except to the extent otherwise provided in this sentence, the
representations and warranties described in clause (xi) hereof must be satisfied
as to each Qualified Substitute Mortgage Loan or in the aggregate, as the case
may be.

                  "Rate/Term Refinancing": A Refinanced Mortgage Loan, the
proceeds of which are not more than a nominal amount in excess of the existing
first mortgage loan and any subordinate mortgage loan on the related Mortgaged
Property and related closing costs, and were used exclusively (except for such
nominal amount) to satisfy the then existing first mortgage loan and any
subordinate mortgage loan of the Mortgagor on the related Mortgaged Property and
to pay related closing costs.

                  "Rating Agency or Rating Agencies": Fitch, Moody's and S&P or
their successors. If such agencies or their successors are no longer in
existence, "Rating Agencies" shall be such nationally recognized statistical
rating agencies, or other comparable Persons, designated by the Depositor,
notice of which designation shall be given to the Trustee and the Servicer.

                  "Realized Loss": With respect to each Mortgage Loan as to
which a Final Recovery Determination has been made, an amount (not less than
zero) equal to (i) the unpaid principal balance of such Mortgage Loan as of the
commencement of the calendar month in which the Final Recovery Determination was
made, plus (ii) accrued interest from the Due Date as to which interest was last
paid by the Mortgagor through the end of the calendar month in which such Final
Recovery Determination was made, calculated in the case of each calendar month
during such period (A) at an annual rate equal to the annual rate at which
interest was then accruing on such Mortgage Loan and (B) on a principal amount
equal to the Stated Principal Balance of such Mortgage Loan as of the close of
business on the Distribution Date during such calendar month, plus (iii) any
amounts previously withdrawn from the Collection Account in respect of such
Mortgage Loan pursuant to Section 3.11(a)(ix) and Section 3.16(b), minus (iv)
the proceeds, if any, received in respect of such Mortgage Loan during the
calendar month in which such Final Recovery Determination was made,

                                      -28-

<PAGE>

net of amounts that are payable therefrom to the Servicer with respect to such
Mortgage Loan pursuant to Section 3.11(a)(iii).

                  With respect to any REO Property as to which a Final Recovery
Determination has been made, an amount (not less than zero) equal to (i) the
unpaid principal balance of the related Mortgage Loan as of the date of
acquisition of such REO Property on behalf of REMIC I, plus (ii) accrued
interest from the Due Date as to which interest was last paid by the Mortgagor
in respect of the related Mortgage Loan through the end of the calendar month
immediately preceding the calendar month in which such REO Property was
acquired, calculated in the case of each calendar month during such period (A)
at an annual rate equal to the annual rate at which interest was then accruing
on the related Mortgage Loan and (B) on a principal amount equal to the Stated
Principal Balance of the related Mortgage Loan as of the close of business on
the Distribution Date during such calendar month, plus (iii) REO Imputed
Interest for such REO Property for each calendar month commencing with the
calendar month in which such REO Property was acquired and ending with the
calendar month in which such Final Recovery Determination was made, plus (iv)
any amounts previously withdrawn from the Collection Account in respect of the
related Mortgage Loan pursuant to Section 3.11(a)(ix) and Section 3.16(b), minus
(v) the aggregate of all Advances and Servicing Advances (in the case of
Servicing Advances, without duplication of amounts netted out of the rental
income, Insurance Proceeds and Liquidation Proceeds described in clause (vi)
below) made by the Servicer in respect of such REO Property or the related
Mortgage Loan for which the Servicer has been or, in connection with such Final
Recovery Determination, will be reimbursed pursuant to Section 3.23 out of
rental income, Insurance Proceeds and Liquidation Proceeds received in respect
of such REO Property, minus (vi) the total of all net rental income, Insurance
Proceeds and Liquidation Proceeds received in respect of such REO Property that
has been, or in connection with such Final Recovery Determination, will be
transferred to the Distribution Account pursuant to Section 3.23.

                  With respect to each Mortgage Loan which has become the
subject of a Deficient Valuation, the difference between the principal balance
of the Mortgage Loan outstanding immediately prior to such Deficient Valuation
and the principal balance of the Mortgage Loan as reduced by the Deficient
Valuation.

                  With respect to each Mortgage Loan which has become the
subject of a Debt Service Reduction, the portion, if any, of the reduction in
each affected Monthly Payment attributable to a reduction in the Mortgage Rate
imposed by a court of competent jurisdiction. Each such Realized Loss shall be
deemed to have been incurred on the Due Date for each affected Monthly Payment.

                  "Record Date": With respect to each Distribution Date and any
Book-Entry Certificate, the Business Day immediately preceding such Distribution
Date. With respect to each Distribution Date and any other Certificates,
including any Definitive Certificates, the last Business Day of the month
immediately preceding the month in which such Distribution Date occurs.

                  "Reference Banks": Deutsche Bank AG, Barclays' Bank PLC, The
Tokyo Mitsubishi Bank and National Westminster Bank PLC and their successors in
interest; provided, however, that if any of the foregoing banks are not suitable
to serve as a Reference Bank, then any leading banks selected by the Trustee,
after consultation with the Depositor, which are engaged in transactions in

                                      -29-

<PAGE>

Eurodollar deposits in the international Eurocurrency market (i) with an
established place of business in London and (ii) not controlling, under the
control of or under common control with the Depositor or any Affiliate thereof.

                  "Refinanced Mortgage Loan": A Mortgage Loan the proceeds of
which were not used to purchase the related Mortgaged Property.

                  "Regular Certificate": Any Class A Certificate, Mezzanine
Certificate, Class CE Certificate or Class P Certificate.

                  "Regular Interest": A "regular interest" in a REMIC within the
meaning of Section 860G(a)(1) of the Code.

                  "Relief Act": The Soldiers' and Sailors' Civil Relief Act of
1940, as amended.

                  "Relief Act Interest Shortfall": With respect to any
Distribution Date and any Mortgage Loan, any reduction in the amount of interest
collectible on such Mortgage Loan for the most recently ended calendar month as
a result of the application of the Relief Act.

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

                  "REMIC I": The segregated pool of assets subject hereto,
constituting one of the primary trusts created hereby and to be administered
hereunder, with respect to which a REMIC election is to be made, consisting of:
(i) such Mortgage Loans and Prepayment Charges related thereto as from time to
time are subject to this Agreement, together with the Mortgage Files relating
thereto, and together with all collections thereon and proceeds thereof; (ii)
any REO Property, together with all collections thereon and proceeds thereof;
(iii) the Trustee's rights with respect to the Mortgage Loans under all
insurance policies required to be maintained pursuant to this Agreement and any
proceeds thereof; (iv) the Depositor's rights under each Mortgage Loan Purchase
Agreement (including any security interest created thereby); (v) the Collection
Account (other than any amounts representing any Servicer Prepayment Charge
Payment Amount), the Distribution Account (other than any amounts representing
any Servicer Prepayment Charge Payment Amount) and any REO Account, and such
assets that are deposited therein from time to time and any investments thereof,
together with any and all income, proceeds and payments with respect thereto.
Notwithstanding the foregoing, however, REMIC I specifically excludes all
payments and other collections of principal and interest due on the Mortgage
Loans on or before the Cut-off Date, all Prepayment Charges payable in
connection with Principal Prepayments on the Mortgage Loans made before the
Cut-off Date and the Net WAC Rate Carryover Reserve Account.

                  "REMIC I Interest Loss Allocation Amount": With respect to any
Distribution Date, an amount (subject to adjustment based on the actual number
of days elapsed in the respective Interest Accrual Periods for the indicated
Regular Interests for such Distribution Date) equal to (a) the product of (i)
the aggregate Stated Principal Balance of the Mortgage Loans and REO Properties
then outstanding and (ii) the REMIC I Remittance Rate for REMIC I Regular
Interest I-LTAA minus the Marker Rate, divided by (b) 12.

                                      -30-

<PAGE>

                  "REMIC I Overcollateralized Amount": With respect to any date
of determination, (i) 1% of the aggregate Uncertificated Balances of the REMIC I
Regular Interests minus (ii) the aggregate of the Uncertificated Balances of
REMIC I Regular Interest I-LTA, REMIC I Regular Interest I-LTM1, REMIC I Regular
Interest I-LTM2, REMIC I Regular Interest I-LTM3, REMIC I Regular Interest
I-LTM4, REMIC I Regular Interest I-LTM5 and REMIC I Regular Interest I-LTP, in
each case as of such date of determination.

                  "REMIC I Principal Loss Allocation Amount": With respect to
any Distribution Date, an amount equal to the product of (i) the aggregate
Stated Principal Balance of the Mortgage Loans and REO Properties then
outstanding and (ii) 1 minus a fraction, the numerator of which is two times the
aggregate of the Uncertificated Balances of REMIC I Regular Interest I-LTA,
REMIC I Regular Interest I-LTM1, REMIC I Regular Interest I-LTM2, REMIC I
Regular Interest I-LTM3, REMIC I Regular Interest I-LTM4 and REMIC I Regular
Interest I-LTM5 and the denominator of which is the aggregate of the
Uncertificated Balances of REMIC I Regular Interest I-LTA, REMIC I Regular
Interest I-LTM1, REMIC I Regular Interest I-LTM2, REMIC I Regular Interest
I-LTM3, REMIC I Regular Interest I-LTM4, REMIC I Regular Interest I-LTM5 and
REMIC I Regular Interest I-LTZZ.

                  "REMIC I Regular Interest": Any of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a "regular interest" in REMIC I. Each REMIC I Regular Interest
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time or shall otherwise be entitled to interest as set forth herein, and
shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto. The designations for
the respective REMIC I Regular Interests are set forth in the Preliminary
Statement hereto.

                  "REMIC I Regular Interest I-LTAA": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LTAA
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.

                  "REMIC I Regular Interest I-LTA": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LTA
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.

                  "REMIC I Regular Interest I-LTM1": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LTM1
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.

                                      -31-

<PAGE>

                  "REMIC I Regular Interest I-LTM2": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LTM2
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.

                  "REMIC I Regular Interest I-LTM3": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LTM3
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.

                  "REMIC I Regular Interest I-LTM4": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LTM4
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.

                  "REMIC I Regular Interest I-LTM5": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LTM5
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.

                  "REMIC I Regular Interest I-LTP": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LTP
shall be entitled to any Prepayment Charges collected by the Servicer and to a
distribution of principal, subject to the terms and conditions hereof, in an
aggregate amount equal to its initial Uncertificated Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC I Regular Interest I-LTZZ": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LTZZ
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.

                  "REMIC I Remittance Rate": With respect to each REMIC I
Regular Interest and any Distribution Date, the Net WAC Pass-Through Rate.

                  "REMIC I Required Overcollateralized Amount": 1% of the
Overcollateralization

                                      -32-

<PAGE>

Target Amount.

                  "REMIC II": The segregated pool of assets consisting of all of
the REMIC I Regular Interests conveyed in trust to the Trustee, for the benefit
of the Class A Certificates, the Class M-1 Certificates, the Class M-2
Certificates, the Class M-3 Interest, the Class M-4 Interest, the Class M-5
Interest, the Class CE Interest, the Class P Interest and the Class R-II
Interest and all amounts deposited therein, with respect to which a separate
REMIC election is to be made.

                  "REMIC III": The segregated pool of assets consisting of the
Class M-3 Interest conveyed in trust to the Trustee, for the benefit of the
Class M-3 Certificates and the Class R-III Interest and all amounts deposited
therein, with respect to which a separate REMIC election is to be made.

                  "REMIC IV": The segregated pool of assets consisting of the
Class M-4 Interest conveyed in trust to the Trustee, for the benefit of the
Class M-4 Certificates and the Class R-IV Interest and all amounts deposited
therein, with respect to which a separate REMIC election is to be made.

                  "REMIC V": The segregated pool of assets consisting of the
Class M-5 Interest conveyed in trust to the Trustee, for the benefit of the
Class M-5 Certificates and the Class R-V Interest and all amounts deposited
therein, with respect to which a separate REMIC election is to be made.

                  "REMIC VI": The segregated pool of assets consisting of the
Class CE Interest conveyed in trust to the Trustee, for the benefit of the Class
CE Certificates and the Class R-VI Interest and all amounts deposited therein,
with respect to which a separate REMIC election is to be made.

                  "REMIC VII": The segregated pool of assets consisting of the
Class P Interest conveyed in trust to the Trustee, for the benefit of the Class
P Certificates and the Class R-VII Interest and all amounts deposited therein,
with respect to which a separate REMIC election is to be made.

                  "REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits, which appear at Section
860A through 860G of the Code, and related provisions, and proposed, temporary
and final regulations and published rulings, notices and announcements
promulgated thereunder, as the foregoing may be in effect from time to time.

                  "Remittance Report": A report in form and substance acceptable
to the Trustee on an electronic data file or tape prepared by the Servicer
pursuant to Section 4.03 with such additions, deletions and modifications as
agreed to by the Trustee and the Servicer.

                  "Rents from Real Property": With respect to any REO Property,
gross income of the character described in Section 856(d) of the Code as being
included in the term "rents from real property."

                                      -33-

<PAGE>

                  "REO Account": The account or accounts maintained, or caused
to be maintained, by the Servicer in respect of an REO Property pursuant to
Section 3.23.

                  "REO Disposition": The sale or other disposition of an REO
Property on behalf of REMIC I.

                  "REO Imputed Interest": As to any REO Property, for any
calendar month during which such REO Property was at any time part of REMIC I,
one month's interest at the applicable Net Mortgage Rate on the Stated Principal
Balance of such REO Property (or, in the case of the first such calendar month,
of the related Mortgage Loan, if appropriate) as of the close of business on the
Distribution Date in such calendar month.

                  "REO Principal Amortization": With respect to any REO
Property, for any calendar month, the excess, if any, of (a) the aggregate of
all amounts received in respect of such REO Property during such calendar month,
whether in the form of rental income, sale proceeds (including, without
limitation, that portion of the Termination Price paid in connection with a
purchase of all of the Mortgage Loans and REO Properties pursuant to Section
9.01 that is allocable to such REO Property) or otherwise, net of any portion of
such amounts (i) payable pursuant to Section 3.23(c) in respect of the proper
operation, management and maintenance of such REO Property or (ii) payable or
reimbursable to the Servicer pursuant to Section 3.23(d) for unpaid Servicing
Fees in respect of the related Mortgage Loan and unreimbursed Servicing Advances
and Advances in respect of such REO Property or the related Mortgage Loan, over
(b) the REO Imputed Interest in respect of such REO Property for such calendar
month.

                  "REO Property": A Mortgaged Property acquired by the Servicer
on behalf of REMIC I through foreclosure or deed-in-lieu of foreclosure, as
described in Section 3.23.

                  "Request for Release": A release signed by a Servicing
Officer, in the form of Exhibit E attached hereto.

                  "Reserve Interest Rate": With respect to any Interest
Determination Date, the rate per annum that the Trustee determines to be either
(i) the arithmetic mean (rounded upwards if necessary to the nearest whole
multiple of 1/16%) of the one-month U. S. dollar lending rates which New York
City banks selected by the Trustee, after consultation with the Depositor, are
quoting on the relevant Interest Determination Date to the principal London
offices of leading banks in the London interbank market or (ii) in the event
that the Trustee can determine no such arithmetic mean, the lowest one- month U.
S. dollar lending rate which New York City banks selected by the Trustee, after
consultation with the Depositor, are quoting on such Interest Determination Date
to leading European banks.

                  "Residential Dwelling": Any one of the following: (i) an
attached, detached or semi- detached one-family dwelling, (ii) an attached,
detached or semi-detached two-to four-family dwelling, (iii) a one-family
dwelling unit in a Fannie Mae eligible condominium project, or (iv) an attached,
detached or semi-detached one-family dwelling in a planned unit development,
none of which is a co-operative, mobile or manufactured home (as defined in 42
United States Code, Section 5402(6)).

                                      -34-

<PAGE>

                  "Residual Certificates": The Class R Certificates and the
Class R-X Certificates.

                  "Residual Interest": The sole class of "residual interests" in
a REMIC within the meaning of Section 860G(a)(2) of the Code.

                  "Responsible Officer": When used with respect to the Trustee,
any vice president, managing director, director, any assistant vice president,
the Secretary, any assistant secretary, the Treasurer, any assistant treasurer,
any associate, any trust officer or assistant trust officer or any other officer
of the Trustee having direct responsibility over this Agreement or otherwise
engaged in performing functions similar to those performed by any of the above
designated officers and, with respect to a particular matter, to whom such
matter is referred because of such officer's knowledge of and familiarity with
the particular subject.

                  "S&P": Standard & Poor's Ratings Services, a division of the
McGraw-Hill Companies, Inc., or its successor in interest.

                  "Seller": Citigroup Global Markets Realty Corp. or its
successor in interest, in its capacity as seller under each Mortgage Loan
Purchase Agreement.

                  "Senior Interest Distribution Amount": With respect to any
Distribution Date, an amount equal to the sum of (i) the Interest Distribution
Amount for such Distribution Date for the Class A Certificates and (ii) the
Interest Carry Forward Amount, if any, for such Distribution Date for the Class
A Certificates.

                  "Servicer": [NAME OF SERVICER] or any successor servicer
appointed as herein provided, in its capacity as Servicer hereunder.

                  "Servicer's Assignee": As defined in Section 3.28 hereof.

                  "Servicer Event of Default": One or more of the events
described in Section 7.01.

                  "Servicer Prepayment Charge Payment Amount": The amounts
payable by the Servicer in respect of any waived Prepayment Charges pursuant to
Section 3.01.

                  "Servicer Remittance Date": With respect to any Distribution
Date, by 3:00 p.m. New York time on the Business Day preceding the related
Distribution Date.

                  "Servicer Termination Trigger": With respect to any
Distribution Date, the Realized Losses incurred since the Cut-off Date through
the last day of the related Due Period exceeds the applicable percentages set
forth below with respect to such Distribution Date:

                  DISTRIBUTION DATE OCCURRING IN               PERCENTAGE
                  ------------------------------               ----------

                                      -35-

<PAGE>

                  "Servicing Account": The account or accounts created and
maintained pursuant to Section 3.09.

                  "Servicing Advances": The reasonable "out-of-pocket" costs and
expenses incurred by the Servicer in connection with a default, delinquency or
other unanticipated event by the Servicer in the performance of its servicing
obligations, including, but not limited to, the cost of (i) the preservation,
restoration and protection of a Mortgaged Property, (ii) any enforcement or
judicial proceedings, including but not limited to foreclosures, in respect of a
particular Mortgage Loan, including any expenses incurred in relation to any
such proceedings that result from the Mortgage Loan being registered on the
MERS(R) System, (iii) the management (including reasonable fees in connection
therewith) and liquidation of any REO Property and (iv) the performance of its
obligations under Section 3.01, Section 3.09, Section 3.14, Section 3.16 and
Section 3.23. The Servicer shall not be required to make any Nonrecoverable
Servicing Advances.

                  "Servicing Fee": With respect to each Mortgage Loan and for
any calendar month, an amount equal to the Servicing Fee Rate accrued for one
month (or in the event of any payment of interest which accompanies a Principal
Prepayment in full or in part made by the Mortgagor during such calendar month,
interest for the number of days covered by such payment of interest) on the same
principal amount on which interest on such Mortgage Loan accrues for such
calendar month, calculated on the basis of a 360-day year consisting of twelve
30-day months. A portion of such Servicing Fee may be retained by any
Sub-Servicer as its servicing compensation.

                  "Servicing Fee Rate": [__]% per annum.

                  "Servicing Officer": Any officer of the Servicer involved in,
or responsible for, the administration and servicing of Mortgage Loans, whose
name and specimen signature appear on a list of Servicing Officers furnished by
the Servicer to the Trustee and the Depositor on the Closing Date, as such list
may from time to time be amended.

                  "Servicing Rights Pledgee": One or more lenders, selected by
the Servicer, to which the Servicer will pledge and assign all of its right,
title and interest in, to and under this Agreement, including Wachovia Bank,
National Association, as the representative of certain lenders.

                  "Servicing Transfer Costs": Shall mean all reasonable costs
and expenses incurred by the Trustee in connection with the transfer of
servicing from a predecessor servicer, including, without limitation, any
reasonable costs or expenses associated with the complete transfer of all
servicing data and the completion, correction or manipulation of such servicing
data as may be required by the Trustee to correct any errors or insufficiencies
in the servicing data or otherwise to enable the Trustee (or any successor
servicer appointed pursuant to Section 7.02) to service the Mortgage Loans
properly and effectively.

                  "Single Certificate": With respect to any Class of
Certificates (other than the Class P Certificates and the Residual
Certificates), a hypothetical Certificate of such Class evidencing a Percentage
Interest for such Class corresponding to an initial Certificate Principal
Balance of $1,000.

                                      -36-

<PAGE>

With respect to the Class P Certificates and the Residual Certificates, a
hypothetical Certificate of such Class evidencing a 100% Percentage Interest in
such Class.

                  "Startup Day": With respect to each Trust REMIC, the day
designated as such pursuant to Section 10.01(b) hereof.

                  "Stated Principal Balance": With respect to any Mortgage Loan:
(a) as of any date of determination up to but not including the Distribution
Date on which the proceeds, if any, of a Liquidation Event with respect to such
Mortgage Loan would be distributed, the Principal Balance of such Mortgage Loan
as of the Cut-off Date, as shown in the Mortgage Loan Schedule, minus the sum of
(i) the principal portion of each Monthly Payment due on a Due Date subsequent
to the Cut- off Date, to the extent received from the Mortgagor and distributed
pursuant to Section 4.01 on or before such date of determination, (ii) all
Principal Prepayments received after the Cut-off Date, to the extent distributed
pursuant to Section 4.01 on or before such date of determination, (iii) all
Liquidation Proceeds and Insurance Proceeds applied by the Servicer as
recoveries of principal in accordance with the provisions of Section 3.16, to
the extent distributed pursuant to Section 4.01 on or before such date of
determination, and (iv) any Realized Loss incurred with respect thereto as a
result of a Deficient Valuation made during or prior to the Prepayment Period
for the most recent Distribution Date coinciding with or preceding such date of
determination; and (b) as of any date of determination coinciding with or
subsequent to the Distribution Date on which the proceeds, if any, of a
Liquidation Event with respect to such Mortgage Loan would be distributed, zero.
With respect to any REO Property: (a) as of any date of determination up to but
not including the Distribution Date on which the proceeds, if any, of a
Liquidation Event with respect to such REO Property would be distributed, an
amount (not less than zero) equal to the Stated Principal Balance of the related
Mortgage Loan as of the date on which such REO Property was acquired on behalf
of REMIC I, minus the sum of (i) if such REO Property was acquired before the
Distribution Date in any calendar month, the principal portion of the Monthly
Payment due on the Due Date in the calendar month of acquisition, to the extent
distributed pursuant to Section 4.01 on or before such date of determination,
and (ii) the aggregate amount of REO Principal Amortization in respect of such
REO Property for all previously ended calendar months, to the extent distributed
pursuant to Section 4.01 on or before such date of determination; and (b) as of
any date of determination coinciding with or subsequent to the Distribution Date
on which the proceeds, if any, of a Liquidation Event with respect to such REO
Property would be distributed, zero.

                  "Stepdown Date": The earlier to occur of (i) the Distribution
Date on which the Certificate Principal Balance of the Class A Certificates has
been reduced to zero and (ii) the later to occur of (a) the Distribution Date
occurring in [__] and (b) the first Distribution Date on which the Credit
Enhancement Percentage (calculated for this purpose only prior to any
distribution of the Principal Distribution Amount to the Certificates then
entitled to distributions of principal on such Distribution Date) is equal to or
greater than [__]%.

                  "Sub-Servicer": Any Person with which the Servicer has entered
into a Sub-Servicing Agreement and which meets the qualifications of a
Sub-Servicer pursuant to Section 3.02.

                  "Sub-Servicing Agreement": The written contract between the
Servicer and a Sub- Servicer relating to servicing and administration of certain
Mortgage Loans as provided in Section

                                      -37-

<PAGE>

3.02.

                  "Substitution Shortfall Amount": As defined in Section
2.03(b).

                  "Tax Returns": The federal income tax return on Internal
Revenue Service Form 1066, U. S. Real Estate Mortgage Investment Conduit Income
Tax Return, including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of REMIC Taxable Income or Net Loss Allocation, or any successor forms,
to be filed on behalf of the Trust Fund due to the classification of portions
thereof as REMICs under the REMIC Provisions, together with any and all other
information reports or returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service or any other
governmental taxing authority under any applicable provisions of federal, state
or local tax laws.

                  "Telerate Page 3750": The display designated as page "3750" on
the Dow Jones Telerate Capital Markets Report (or such other page as may replace
page 3750 on that report for the purpose of displaying London interbank offered
rates of major banks).

                  "Termination Price": As defined in Section 9.01.

                  "Terminator": As defined in Section 9.01.

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

                  "Transferee": Any Person who is acquiring by Transfer any
Ownership Interest in a Certificate.

                  "Transferor": Any Person who is disposing by Transfer of any
Ownership Interest in a Certificate.

                  "Trigger Event": A Trigger Event is in effect on any
Distribution Date following the Stepdown Date if:

                  (a) the Delinquency Percentage exceeds [__]% of the then
current Credit Enhancement Percentage; or

                  (b) the aggregate amount of Realized Losses incurred since the
Cut-off Date through the last day of the related Due Period divided by aggregate
Principal Balance of the Mortgage Loans as of the Cut-off Date exceeds the
applicable percentages set forth below with respect to such Distribution Date:

                  DISTRIBUTION DATE OCCURRING IN              PERCENTAGE
                  ------------------------------              ----------

                                      -38-

<PAGE>

                  "Trust Fund": Collectively, all of the assets of REMIC I,
REMIC II, REMIC III, REMIC IV, REMIC V, REMIC VI, REMIC VII, the Net WAC Rate
Carryover Reserve Account and the other assets conveyed by the Depositor to the
Trustee pursuant to Section 2.01.

                  "Trust REMIC": Any of REMIC I, REMIC II, REMIC III, REMIC IV,
REMIC V, REMIC VI or REMIC VII.

                  "Trustee": [NAME OF TRUSTEE], a national banking association,
or its successor in interest, or any successor trustee appointed as herein
provided.

                  "Trustee Fee": The amount payable to the Trustee on each
Distribution Date pursuant to Section 8.05 as compensation for all services
rendered by it in the execution of the trust hereby created and in the exercise
and performance of any of the powers and duties of the Trustee hereunder, which
amount shall equal the Trustee Fee Rate accrued for one month on the aggregate
Scheduled Principal Balance of the Mortgage Loans and any REO Properties as of
the first day of the related Due Period (or, in the case of the initial
Distribution Date, as of the Cut-off Date), calculated on the basis of a 360-day
year consisting of twelve 30-day months.

                  "Trustee Fee Rate": [__]% per annum.

                  "Uncertificated Balance": The amount of any REMIC I Regular
Interest outstanding as of any date of determination. As of the Closing Date,
the Uncertificated Balance of each REMIC I Regular Interest shall equal the
amount set forth in the Preliminary Statement hereto as its initial
uncertificated balance. On each Distribution Date, the Uncertificated Balance of
each REMIC I Regular Interest shall be reduced by all distributions of principal
made on such REMIC I Regular Interest, as applicable, on such Distribution Date
pursuant to Section 4.01 and, if and to the extent necessary and appropriate,
shall be further reduced on such Distribution Date by Realized Losses as
provided in Section 4.04. The Uncertificated Balances of REMIC I Regular
Interest I-LTZZ shall be increased by interest deferrals as provided in Section
4.01(a)(1)(A)(i). The Uncertificated Balance of each REMIC I Regular Interest
shall never be less than zero.

                  "Uncertificated Interest": With respect to any REMIC I Regular
Interest for any Distribution Date, one month's interest at the REMIC I
Remittance Rate applicable to such REMIC I Regular Interest for such
Distribution Date, accrued on the Uncertificated Balance thereof immediately
prior to such Distribution Date. Uncertificated Interest in respect of any REMIC
I Regular Interest shall accrue on the basis of a 360-day year consisting of
twelve 30-day months. Uncertificated Interest with respect to each Distribution
Date, as to any REMIC I Regular Interest, shall be reduced by an amount equal to
the sum of (a) the aggregate Prepayment Interest Shortfall, if any, for such
Distribution Date to the extent not covered by payments pursuant to Section 3.24
and (b) the aggregate amount of any Relief Act Interest Shortfall, if any
allocated, in each case, to such REMIC I Regular Interest pursuant to Section
1.02. In addition, Uncertificated Interest with respect to each Distribution
Date, as to any REMIC I Regular Interest shall be reduced by Realized Losses, if
any, allocated to such REMIC I Regular Interest pursuant to Section 1.02 and
Section 4.04.

                                      -39-

<PAGE>

                  "Underwriters' Exemption": An individual exemption issued by
the United States Department of Labor, Prohibited Transaction Exemption 91-23
(56 Fed. Reg. 15936, April 19, 1991), as amended, to Citigroup Global Markets
Inc. (formerly known as Salomon Smith Barney Inc.), for specific offerings in
which Citigroup Global Markets Inc. or any person directly or indirectly,
through one or more intermediaries, controlling, controlled by or under common
control with Citigroup Global Markets Inc. is an underwriter, placement agent or
a manager or co-manager of the underwriting syndicate or selling group where the
trust and the offered certificates meet specified conditions. The Underwriters'
Exemption, as amended, provides a partial exemption for transactions involving
certificates representing a beneficial interest in a trust and entitling the
holder to pass-through payments of principal, interest and/or other payments
with respect to the trust's assets.

                  "Uninsured Cause": Any cause of damage to a Mortgaged Property
such that the complete restoration of such property is not fully reimbursable by
the hazard insurance policies required to be maintained pursuant to Section
3.14.

                  "United States Person": A citizen or resident of the United
States, a corporation, partnership (or other entity treated as a corporation or
partnership for United States federal income tax purposes) created or organized
in, or under the laws of, the United States, any state thereof, or the District
of Columbia (except in the case of a partnership, to the extent provided in
Treasury regulations) provided that, for purposes solely of the restrictions on
the transfer of Class R Certificates, no partnership or other entity treated as
a partnership for United States federal income tax purposes shall be treated as
a United States Person unless all persons that own an interest in such
partnership either directly or through any entity that is not a corporation for
United States federal income tax purposes are required by the applicable
operative agreement to be United States Persons, or an estate the income of
which from sources without the United States is includible in gross income for
United States federal income tax purposes regardless of its connection with the
conduct of a trade or business within the United States, or a trust if a court
within the United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons have authority
to control all substantial decisions of the trust. The term "United States"
shall have the meaning set forth in Section 7701 of the Code or successor
provisions.

                  "Value": With respect to any Mortgaged Property, the value
thereof as determined by an independent appraisal made at the time of the
origination of the related Mortgage Loan or the sale price, if the appraisal is
not available; except that, with respect to any Mortgage Loan that is a purchase
money mortgage loan, the lesser of (i) the value thereof as determined by an
independent appraisal made at the time of the origination of such Mortgage Loan,
if any, and (ii) the sales price of the related Mortgaged Property.

                  "Voting Rights": The portion of the voting rights of all of
the Certificates which is allocated to any Certificate. With respect to any date
of determination, 98% of all Voting Rights will be allocated among the holders
of the Class A Certificates, the Mezzanine Certificates and the Class CE
Certificates in proportion to the then outstanding Certificate Principal
Balances of their respective Certificates, 1% of all Voting Rights will be
allocated to the holders of the Class P Certificates and 1% of all Voting Rights
will be allocated among the holders of the Residual Certificates. The Voting
Rights allocated to each Class of Certificate shall be allocated among

                                      -40-

<PAGE>

Holders of each such Class in accordance with their respective Percentage
Interests as of the most recent Record Date.

                  SECTION 1.02. Allocation of Certain Interest Shortfalls.

                  For purposes of calculating the amount of Accrued Certificate
Interest and the amount of the Interest Distribution Amount for the Class A
Certificates, the Mezzanine Certificates and the Class CE Interest for any
Distribution Date, (1) the aggregate amount of any Prepayment Interest
Shortfalls (to the extent not covered by payments by the Servicer pursuant to
Section 3.24) and any Relief Act Interest Shortfall incurred in respect of the
Mortgage Loans for any Distribution Date shall be allocated first, to the Class
CE Interest based on, and to the extent of, one month's interest at the then
applicable Pass-Through Rate on the Notional Amount of the Class CE Interest
and, thereafter, among the Class A Certificates and the Mezzanine Certificates
on a PRO RATA basis based on, and to the extent of, one month's interest at the
then applicable respective Pass-Through Rate on the respective Certificate
Principal Balance of each such Certificate and (2) the aggregate amount of any
Realized Losses incurred for any Distribution Date shall be allocated to the
Class CE Interest based on, and to the extent of, one month's interest at the
then applicable Pass-Through Rate on the Notional Amount of the Class CE
Interest.

                  For purposes of calculating the amount of Uncertificated
Interest for the REMIC I Regular Interests for any Distribution Date, the
aggregate amount of any Prepayment Interest Shortfalls (to the extent not
covered by payments by the Servicer pursuant to Section 3.24) and any Relief Act
Interest Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated first, to Uncertificated Interest payable
to REMIC I Regular Interest I-LTAA and REMIC I Regular Interest I-LTZZ up to an
aggregate amount equal to the REMIC I Interest Loss Allocation Amount, 98% and
2%, respectively, and thereafter among REMIC I Regular Interest I- LTAA, REMIC I
Regular Interest I-LTA, REMIC I Regular Interest I-LTM1, REMIC I Regular
Interest I-LTM2, REMIC I Regular Interest I-LTM3, REMIC I Regular Interest
I-LTM4, REMIC I Regular Interest I-LTM5 and REMIC I Regular Interest I-LTZZ PRO
RATA based on, and to the extent of, one month's interest at the then applicable
respective Pass-Through Rate on the respective Uncertificated Balance of each
such REMIC I Regular Interest.

                                      -41-

<PAGE>

                                   ARTICLE II

                          CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES

                  SECTION 2.01. Conveyance of the Mortgage Loans.

                  The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey to the
Trustee without recourse, for the benefit of the Certificateholders, all the
right, title and interest of the Depositor, including any security interest
therein for the benefit of the Depositor, in and to the Mortgage Loans
identified on the Mortgage Loan Schedule, the rights of the Depositor under each
Mortgage Loan Purchase Agreement, and all other assets included or to be
included in REMIC I. Such assignment includes all interest and principal
received by the Depositor or the Servicer on or with respect to the Mortgage
Loans (other than payments of principal and interest due on such Mortgage Loans
on or before the Cut-off Date). The Depositor herewith delivers to the Trustee
an executed copy of the Mortgage Loan Purchase Agreement.

                  In connection with such transfer and assignment, the Depositor
does hereby deliver to, and deposit with, the Trustee, the following documents
or instruments with respect to each Mortgage Loan so transferred and assigned (a
"Mortgage File"):

                  (i) the original Mortgage Note (including any riders thereto),
         endorsed in blank or in the following form: "Pay to the order of [NAME
         OF TRUSTEE], as Trustee under the applicable agreement, without
         recourse," with all prior and intervening endorsements showing a
         complete chain of endorsement from the originator to the Person so
         endorsing to the Trustee;

                  (ii) the original Mortgage, noting the presence of the MIN of
         the Mortgage Loan and language indicating that the Mortgage Loan is a
         MOM Loan if the Mortgage Loan is a MOM Loan, with evidence of recording
         thereon, and the original recorded power of attorney, if the Mortgage
         was executed pursuant to a power of attorney, with evidence of
         recording thereon;

                  (iii) unless the Mortgage Loan is registered on the
         MERS(R)System, an original Assignment in blank;

                  (iv) the original recorded Assignment or Assignments showing a
         complete chain of assignment from the originator to the Person
         assigning the Mortgage to the Trustee (or to MERS, if the Mortgage Loan
         is registered on the MERS(R) System and noting the presence of the MIN)
         as contemplated by the immediately preceding clause (iii);

                  (v) the original or copies of each assumption, modification,
         written assurance or substitution agreement, if any; and

                  (vi) the original lender's title insurance policy, together
         with all endorsements or

                                      -42-

<PAGE>

         riders that were issued with or subsequent to the issuance of such
         policy, insuring the Mortgage on the Mortgaged Property represented
         therein as a fee interest vested in the Mortgagor, or in the event such
         original title policy is unavailable, a written commitment or uniform
         binder or preliminary report of title issued by the title insurance or
         escrow company.

                  With respect to a maximum of 2.0% of the Original Mortgage
Loans, by outstanding principal balance of the Original Mortgage Loans as of the
Cut-off Date, if any original Mortgage Note referred to in Section 2.01(i) above
cannot be located, the obligations of the Depositor to deliver such documents
shall be deemed to be satisfied upon delivery to the Trustee of a photocopy of
such Mortgage Note, if available, with a lost note affidavit substantially in
the form of Exhibit K attached hereto. If any of the original Mortgage Notes for
which a lost note affidavit was delivered to the Trustee is subsequently
located, such original Mortgage Note shall be delivered to the Trustee within
three Business Days.

                  If any of the documents referred to in Sections 2.01(ii),
(iii) or (iv) above has, as of the Closing Date, been submitted for recording
but either (x) has not been returned from the applicable public recording office
or (y) has been lost or such public recording office has retained the original
of such document, the obligations of the Depositor to deliver such documents
shall be deemed to be satisfied upon (1) delivery to the Trustee of a copy of
each such document certified by the related Originator in the case of (x) above
or the applicable public recording office in the case of (y) above to be a true
and complete copy of the original that was submitted for recording and (2) if
such copy is certified by the related Originator, delivery to the Trustee
promptly upon receipt thereof of either the original or a copy of such document
certified by the applicable public recording office to be a true and complete
copy of the original. Notice shall be provided to the Trustee and the Rating
Agencies by the Seller if delivery pursuant to clause (2) above will be made
more than 180 days after the Closing Date. If the original lender's title
insurance policy was not delivered pursuant to Section 2.01(vi) above, the
Depositor shall deliver or cause to be delivered to the Trustee, promptly after
receipt thereof, the original lender's title insurance policy. The Depositor
shall deliver or cause to be delivered to the Trustee promptly upon receipt
thereof any other original documents constituting a part of a Mortgage File
received with respect to any Mortgage Loan, including, but not limited to, any
original documents evidencing an assumption or modification of any Mortgage
Loan.

                  Except with respect to any Mortgage Loan for which MERS is
identified on the Mortgage or on a properly recorded assignment of the Mortgage
as the mortgagee of record, the Trustee shall enforce the obligation of the
Seller or the related Originator, as applicable, under the related Mortgage Loan
Purchase Agreement to promptly (within sixty days following the later of the
Closing Date and the date of receipt by the Trustee of the recording information
for a Mortgage, but in no event later than ninety days following the Closing
Date) submit or cause to be submitted for recording, at the expense of the
related Originator and at no expense to the Trust Fund, the Trustee, the
Servicer or the Depositor, in the appropriate public office for real property
records, each Assignment referred to in Sections 2.01(iii) and (iv) above and
the Depositor shall execute each original Assignment or cause each original
Assignment to be executed in the following form: "[NAME OF TRUSTEE], as Trustee
under the applicable agreement." In the event that any such Assignment is lost
or returned unrecorded because of a defect therein, the Seller or the related
Originator, as applicable, shall promptly prepare or cause to be prepared a
substitute Assignment or cure or cause to be cured such defect, as the case may
be, and thereafter cause each such Assignment

                                      -43-

<PAGE>

to be duly recorded. If the related Originator is unable to pay the cost of
recording the Assignments, such expense will be paid by the Trustee and shall be
reimbursable to the Trustee as an Extraordinary Trust Fund Expense.
Notwithstanding the foregoing, the Trustee shall not be responsible for
determining whether any Assignment delivered by the Depositor hereunder is in
recordable form.

                  In connection with the assignment of any Mortgage Loan
registered on the MERS(R) System, the Depositor further agrees that it will
cause, within 30 Business Days after the Closing Date, the MERS(R) System to
indicate that such Mortgage Loans have been assigned by the Depositor to the
Trustee in accordance with this Agreement for the benefit of the
Certificateholders by including (or deleting, in the case of Mortgage Loans
which are repurchased in accordance with this Agreement) in such computer files
(a) the code in the field which identifies the specific Trustee and (b) the code
in the field "Pool Field" which identifies the series of the Certificates issued
in connection with such Mortgage Loans. The Depositor further agrees that it
will not, and will not permit the Servicer to, and the Servicer agrees that it
will not, alter the codes referenced in this paragraph with respect to any
Mortgage Loan during the term of this Agreement unless and until such Mortgage
Loan is repurchased in accordance with the terms of this Agreement.

                  All original documents relating to the Mortgage Loans that are
not delivered to the Trustee are and shall be held by the Seller, the Depositor
or the Servicer, as the case may be, in trust for the benefit of the Trustee on
behalf of the Certificateholders. In the event that any such original document
is required pursuant to the terms of this Section to be a part of a Mortgage
File, such document shall be delivered promptly to the Trustee. Any such
original document delivered to or held by the Depositor that is not required
pursuant to the terms of this Section to be a part of a Mortgage File, shall be
delivered promptly to the Servicer.

                  SECTION 2.02. Acceptance of REMIC I by Trustee.

                  The Trustee, acknowledges receipt, subject to the provisions
of Section 2.01 and subject to any exceptions noted on the exception report
described in the next paragraph below, of the documents referred to in Section
2.01 (other than such documents described in Section 2.01(v)) above and all
other assets included in the definition of "REMIC I" under clauses (i), (iii),
(iv) and (v) (to the extent of amounts attributable thereto deposited into the
Distribution Account) and declares that it holds and will hold such documents
and the other documents delivered to it constituting a Mortgage File, and that
it holds or will hold all such assets and such other assets included in the
definition of "REMIC I" in trust for the exclusive use and benefit of all
present and future Certificateholders.

                  The Trustee agrees, for the benefit of the Certificateholders,
to review each Mortgage File on or before the Closing Date and to certify in
substantially the form attached hereto as Exhibit C-1 that, as to each Mortgage
Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in
full or any Mortgage Loan specifically identified in the exception report
annexed thereto as not being covered by such certification), (i) all documents
constituting part of such Mortgage File (other than such documents described in
Section 2.01(v)) required to be delivered to it pursuant to this Agreement are
in its possession, (ii) such documents have been reviewed by it and appear
regular on their face and relate to such Mortgage Loan and (iii) based on its
examination and only as to the foregoing, the information set forth in the
Mortgage Loan Schedule that corresponds

                                      -44-

<PAGE>

to items (i), (iii), (xi), (xii) and (xv) of the definition of "Mortgage Loan
Schedule" accurately reflects information set forth in the Mortgage File. It is
herein acknowledged that, in conducting such review, the Trustee was under no
duty or obligation (i) to inspect, review or examine any such documents,
instruments, certificates or other papers to determine whether they are genuine,
enforceable, valid, legally binding, effective or appropriate for the
represented purpose or whether they have actually been recorded or are in
recordable form or that they are other than what they purport to be on their
face, (ii) to determine whether any Mortgage File should include any of the
documents specified in clause (v) of Section 2.01 or (iii) to determine the
perfection or priority of any security interest in any such documents or
instruments. Notwithstanding the foregoing, in conducting the review described
in this Section 2.02, the Trustee shall not be responsible for determining (i)
if an Assignment is sufficient under the laws of the jurisdiction wherein the
related Mortgaged Property is located to reflect of record the sale of the
Mortgage or (ii) if a Mortgage creates a first lien on, or first priority
security interest in, a Mortgaged Property.

                  Prior to the first anniversary date of this Agreement, the
Trustee shall deliver to the Depositor and the Servicer a final certification in
the form annexed hereto as Exhibit C-2 evidencing the completeness of the
Mortgage Files, with any applicable exceptions noted thereon, and the Servicer
shall forward a copy thereof to any Sub-Servicer.

                  If in the process of reviewing the Mortgage Files and making
or preparing, as the case may be, the certifications referred to above, the
Trustee finds any document or documents constituting a part of a Mortgage File
to be missing or defective in any material respect, at the conclusion of its
review the Trustee shall so notify the Depositor and the Servicer. In addition,
upon the discovery by the Depositor, the Servicer or the Trustee of a breach of
any of the representations and warranties made by either Originator or the
Seller in the related Mortgage Loan Purchase Agreement in respect of any
Mortgage Loan which materially adversely affects such Mortgage Loan or the
interests of the Certificateholders in such Mortgage Loan, the party discovering
such breach shall give prompt written notice to the other parties.

                  The Trustee shall, at the written request and expense of any
Certificateholder, provide a written report to such Certificateholder of all
Mortgage Files released to the Servicer for servicing purposes.

                  SECTION 2.03.  Repurchase or Substitution of Mortgage Loans by
                                 the Originators and the Seller.

                  (a) Upon discovery or receipt of notice of any materially
defective document in, or that a document is missing from, a Mortgage File or of
the breach by either Originator or the Seller of any representation, warranty or
covenant under the Mortgage Loan Purchase Agreement in respect of any Mortgage
Loan that materially adversely affects the value of such Mortgage Loan or the
interest therein of the Certificateholders, the Trustee shall promptly notify
the Seller, the related Originator and the Servicer of such defect, missing
document or breach and request that the related Originator or the Seller, as
applicable, deliver such missing document or cure such defect or breach within
60 days from the date the related Originator or the Seller, as applicable, was
notified of such missing document, defect or breach, and if the related
Originator or the Seller, as applicable, does not deliver such missing document
or cure such defect or breach in all material respects during

                                      -45-

<PAGE>

such period, the Servicer, in accordance with Section 3.02(b), shall enforce the
obligations of the related Originator or the Seller, as applicable, under the
Mortgage Loan Purchase Agreement to repurchase such Mortgage Loan from REMIC I
at the Purchase Price within 90 days after the date on which the related
Originator or the Seller, as applicable, was notified (subject to Section
2.03(c)) of such missing document, defect or breach, if and to the extent that
the related Originator or the Seller is obligated to do so under the Mortgage
Loan Purchase Agreement. The Purchase Price for the repurchased Mortgage Loan
shall be remitted to the Servicer for deposit in the Collection Account and the
Trustee, upon receipt of written certification from the Servicer of such
deposit, shall release to the related Originator or the Seller, as applicable,
the related Mortgage File and the Trustee shall execute and deliver such
instruments of transfer or assignment, in each case without recourse, as the
related Originator or the Seller, as applicable, shall furnish to it and as
shall be necessary to vest in the related Originator or the Seller, as
applicable, any Mortgage Loan released pursuant hereto. In furtherance of the
foregoing, if the related Originator or the Seller, as applicable, is not a
member of MERS and repurchases a Mortgage Loan which is registered on the
MERS(R) System, the related Originator or the Seller, as applicable, at its own
expense and without any right of reimbursement, shall cause MERS to execute and
deliver an assignment of the Mortgage in recordable form to transfer the
Mortgage from MERS to the related Originator or the Seller, as applicable, and
shall cause such Mortgage to be removed from registration on the MERS(R) System
in accordance with MERS' rules and regulations. The Trustee shall not have any
further responsibility with regard to such Mortgage File. In lieu of
repurchasing any such Mortgage Loan as provided above, if so provided in the
Mortgage Loan Purchase Agreement, the related Originator or the Seller, as
applicable, may cause such Mortgage Loan to be removed from REMIC I (in which
case it shall become a Deleted Mortgage Loan) and substitute one or more
Qualified Substitute Mortgage Loans in the manner and subject to the limitations
set forth in Section 2.03(b). It is understood and agreed that the obligation of
the related Originator and the Seller to cure or to repurchase (or to substitute
for) any Mortgage Loan as to which a document is missing, a material defect in a
constituent document exists or as to which such a breach has occurred and is
continuing shall constitute the sole remedy respecting such omission, defect or
breach available to the Trustee and the Certificateholders.

                  (b) Any substitution of Qualified Substitute Mortgage Loans
for Deleted Mortgage Loans made pursuant to Section 2.03(a) must be effected
prior to the date which is two years after the Startup Day for REMIC I.

                  As to any Deleted Mortgage Loan for which the related
Originator or the Seller substitutes a Qualified Substitute Mortgage Loan or
Loans, such substitution shall be effected by the related Originator or the
Seller, as applicable, delivering to the Trustee, for such Qualified Substitute
Mortgage Loan or Loans, the Mortgage Note, the Mortgage, the Assignment to the
Trustee, and such other documents and agreements, with all necessary
endorsements thereon, as are required by Section 2.01, together with an
Officers' Certificate providing that each such Qualified Substitute Mortgage
Loan satisfies the definition thereof and specifying the Substitution Shortfall
Amount (as described below), if any, in connection with such substitution. The
Trustee shall acknowledge receipt for such Qualified Substitute Mortgage Loan or
Loans and, within ten Business Days thereafter, shall review such documents as
specified in Section 2.02 and deliver to the Depositor and the Servicer, with
respect to such Qualified Substitute Mortgage Loan or Loans, a certification
substantially in the form attached hereto as Exhibit C-1, with any applicable
exceptions noted

                                      -46-

<PAGE>

thereon. Within one year of the date of substitution, the Trustee shall deliver
to the Depositor and the Servicer a certification substantially in the form of
Exhibit C-2 hereto with respect to such Qualified Substitute Mortgage Loan or
Loans, with any applicable exceptions noted thereon. Monthly Payments due with
respect to Qualified Substitute Mortgage Loans in the month of substitution are
not part of REMIC I and will be retained by the Originator or the Seller, as
applicable. For the month of substitution, distributions to Certificateholders
will reflect the Monthly Payment due on such Deleted Mortgage Loan on or before
the Due Date in the month of substitution, and the related Originator or the
Seller, as applicable, shall thereafter be entitled to retain all amounts
subsequently received in respect of such Deleted Mortgage Loan. The Depositor
shall give or cause to be given written notice to the Certificateholders that
such substitution has taken place, shall amend the Mortgage Loan Schedule to
reflect the removal of such Deleted Mortgage Loan from the terms of this
Agreement and the substitution of the Qualified Substitute Mortgage Loan or
Loans and shall deliver a copy of such amended Mortgage Loan Schedule to the
Trustee. Upon such substitution, such Qualified Substitute Mortgage Loan or
Loans shall constitute part of the Mortgage Pool and shall be subject in all
respects to the terms of this Agreement and the Mortgage Loan Purchase
Agreement, including, all applicable representations and warranties thereof
included in the Mortgage Loan Purchase Agreement.

                  For any month in which either Originator or the Seller, as
applicable, substitutes one or more Qualified Substitute Mortgage Loans for one
or more Deleted Mortgage Loans, the Servicer will determine the amount (the
"Substitution Shortfall Amount"), if any, by which the aggregate Purchase Price
of all such Deleted Mortgage Loans exceeds the aggregate of, as to each such
Qualified Substitute Mortgage Loan, the Stated Principal Balance thereof as of
the date of substitution, together with one month's interest on such Stated
Principal Balance at the applicable Net Mortgage Rate, plus all outstanding
Advances and Servicing Advances (including Nonrecoverable Advances and
Nonrecoverable Servicing Advances) related thereto. On the date of such
substitution, the related Originator or the Seller, as applicable, will deliver
or cause to be delivered to the Servicer for deposit in the Collection Account
an amount equal to the Substitution Shortfall Amount, if any, and the Trustee,
upon receipt of the related Qualified Substitute Mortgage Loan or Loans and
certification by the Servicer of such deposit, shall release to the related
Originator or the Seller, as applicable, the related Mortgage File or Files and
the Trustee shall execute and deliver such instruments of transfer or
assignment, in each case without recourse, the related Originator or the Seller,
as applicable, shall deliver to it and as shall be necessary to vest therein any
Deleted Mortgage Loan released pursuant hereto.

                  In addition, the related Originator or the Seller, as
applicable, shall obtain at its own expense and deliver to the Trustee an
Opinion of Counsel to the effect that such substitution will not cause (a) any
federal tax to be imposed on any Trust REMIC, including without limitation, any
federal tax imposed on "prohibited transactions" under Section 860F(a)(1) of the
Code or on "contributions after the startup date" under Section 860G(d)(1) of
the Code, or (b) any Trust REMIC to fail to qualify as a REMIC at any time that
any Certificate is outstanding.

                  (c) Upon discovery by the Depositor, the Seller, the Servicer
or the Trustee that any Mortgage Loan does not constitute a "qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code, the party discovering such
fact shall within two Business Days give written notice thereof to the other
parties. In connection therewith, the Seller shall repurchase or, subject

                                      -47-

<PAGE>

to the limitations set forth in Section 2.03(b), substitute one or more
Qualified Substitute Mortgage Loans for the affected Mortgage Loan within 90
days of the earlier of discovery or receipt of such notice with respect to such
affected Mortgage Loan. Any such repurchase or substitution shall be made in the
same manner as set forth in Section 2.03(a). The Trustee shall reconvey to the
Seller the Mortgage Loan to be released pursuant hereto in the same manner, and
on the same terms and conditions, as it would a Mortgage Loan repurchased for
breach of a representation or warranty.

                  SECTION 2.04. Reserved.

                  SECTION 2.05. Representations, Warranties and Covenants of the
                                Servicer.

                  The Servicer hereby represents, warrants and covenants to the
Trustee, for the benefit of the Certificateholders and to the Depositor that as
of the Closing Date or as of such date specifically provided herein:

                  (i) The Servicer is a limited partnership duly formed, validly
         existing and in good standing as a limited partnership under the laws
         of the State of Delaware and is duly authorized and qualified to
         transact any and all business contemplated by this Agreement to be
         conducted by the Servicer in any state in which a Mortgaged Property is
         located or is otherwise not required under applicable law to effect
         such qualification and, in any event, is in compliance with the doing
         business laws of any such State, to the extent necessary to ensure its
         ability to enforce each Mortgage Loan and to service the Mortgage Loans
         in accordance with the terms of this Agreement;

                  (ii) The Servicer has the full power and authority to conduct
         its business as presently conducted by it and to execute, deliver and
         perform, and to enter into and consummate, all transactions
         contemplated by this Agreement. The Servicer has duly authorized the
         execution, delivery and performance of this Agreement, has duly
         executed and delivered this Agreement, and this Agreement, assuming due
         authorization, execution and delivery by the Depositor and the Trustee,
         constitutes a legal, valid and binding obligation of the Servicer,
         enforceable against it in accordance with its terms except as the
         enforceability thereof may be limited by bankruptcy, insolvency,
         reorganization or similar laws affecting the enforcement of creditors'
         rights generally and by general principles of equity;

                  (iii) The execution and delivery of this Agreement by the
         Servicer, the servicing of the Mortgage Loans by the Servicer
         hereunder, the consummation by the Servicer of any other of the
         transactions herein contemplated, and the fulfillment of or compliance
         with the terms hereof are in the ordinary course of business of the
         Servicer and will not (A) result in a breach of any term or provision
         of the limited partnership agreement of the Servicer or (B) conflict
         with, result in a breach, violation or acceleration of, or result in a
         default under, the terms of any other material agreement or instrument
         to which the Servicer is a party or by which it may be bound, or any
         statute, order or regulation applicable to the Servicer of any court,
         regulatory body, administrative agency or governmental body having
         jurisdiction over the Servicer; and the Servicer is not a party to,
         bound by, or in breach or violation of any indenture or other agreement
         or instrument, or subject to or in violation of any statute, order

                                      -48-

<PAGE>

         or regulation of any court, regulatory body, administrative agency or
         governmental body having jurisdiction over it, which materially and
         adversely affects or, to the Servicer's knowledge, would in the future
         materially and adversely affect, (x) the ability of the Servicer to
         perform its obligations under this Agreement, (y) the business,
         operations, financial condition, properties or assets of the Servicer
         taken as a whole or (z) the legality, validity or enforceability of
         this Agreement;

                  (iv) The Servicer is a HUD approved mortgagee pursuant to
         Section 203 and Section 211 of the National Housing Act. No event has
         occurred, including but not limited to a change in insurance coverage,
         that would make the Servicer unable to comply with HUD eligibility
         requirements or that would require notification to HUD;

                  (v) The Servicer does not believe, nor does it have any reason
         or cause to believe, that it cannot perform each and every covenant
         made by it and contained in this Agreement;

                  (vi) No litigation is pending against the Servicer that would
         materially and adversely affect the execution, delivery or
         enforceability of this Agreement or the ability of the Servicer to
         service the Mortgage Loans or to perform any of its other obligations
         hereunder in accordance with the terms hereof;

                  (vii) There are no actions or proceedings against, or
         investigations known to it of, the Servicer before any court,
         administrative or other tribunal (A) that might prohibit its entering
         into this Agreement, (B) seeking to prevent the consummation of the
         transactions contemplated by this Agreement or (C) that might prohibit
         or materially and adversely affect the performance by the Servicer of
         its obligations under, or the validity or enforceability of, this
         Agreement;

                  (viii) No consent, approval, authorization or order of any
         court or governmental agency or body is required for the execution,
         delivery and performance by the Servicer of, or compliance by the
         Servicer with, this Agreement or the consummation by it of the
         transactions contemplated by this Agreement, except for such consents,
         approvals, authorizations or orders, if any, that have been obtained
         prior to the Closing Date;

                  (ix) The Servicer does and will continue to accurately report
         its borrower credit files for each Mortgage Loan to the three major
         credit bureaus in existence as of the Closing Date in a timely manner;
         and

                  (x) The Servicer is a member of MERS in good standing, and
         will comply in all material respects with the rules and procedures of
         MERS in connection with the servicing of the Mortgage Loans that are
         registered with MERS.

                  It is understood and agreed that the representations,
warranties and covenants set forth in this Section 2.05 shall survive delivery
of the Mortgage Files to the Trustee and shall inure to the benefit of the
Trustee, the Depositor and the Certificateholders. Upon discovery by any of the
Depositor, the Servicer or the Trustee of a breach of any of the foregoing
representations, warranties and covenants which materially and adversely affects
the value of any Mortgage Loan, Prepayment

                                      -49-

<PAGE>

Charge or the interests therein of the Certificateholders, the party discovering
such breach shall give prompt written notice (but in no event later than two
Business Days following such discovery) to the Trustee. Subject to Section 7.01,
unless such breach shall not be susceptible of cure within 90 days, the
obligation of the Servicer set forth in Section 2.03(c) to cure breaches shall
constitute the sole remedy against the Servicer available to the
Certificateholders, the Depositor or the Trustee on behalf of the
Certificateholders respecting a breach of the representations, warranties and
covenants contained in this Section 2.05.

                  SECTION 2.06.   Issuance of the REMIC I Regular Interests and
                                  the Class R-I Interest.

                  The Trustee acknowledges the assignment to it of the Mortgage
Loans and the delivery to it of the Mortgage Files, subject to the provisions of
Section 2.01 and Section 2.02, together with the assignment to it of all other
assets included in REMIC I, the receipt of which is hereby acknowledged.
Concurrently with such assignment and delivery and in exchange therefor, the
Trustee, pursuant to the written request of the Depositor executed by an officer
of the Depositor, has executed, authenticated and delivered to or upon the order
of the Depositor, the Class R Certificates (in respect of the Class R-I
Interest) in authorized denominations. The interests evidenced by the Class R-I
Interest, together with the REMIC I Regular Interests, constitute the entire
beneficial ownership interest in REMIC I. The rights of the Class R-I Interest
and REMIC II (as holder of the REMIC I Regular Interest) to receive
distributions from the proceeds of REMIC I in respect of the Class R-I Interest
and the REMIC I Regular Interests, and all ownership interests evidenced or
constituted by the Class R-I Interest and the REMIC I Regular Interests, shall
be as set forth in this Agreement.

                  SECTION 2.07. Conveyance of the REMIC I Regular Interests;
                                Acceptance of REMIC II by the Trustee.

                  The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey to the
Trustee, without recourse all the right, title and interest of the Depositor in
and to the REMIC I Regular Interests for the benefit of the Class R-II Interest
and REMIC II (as holder of the REMIC I Regular Interests). The Trustee
acknowledges receipt of the REMIC I Regular Interests and declares that it holds
and will hold the same in trust for the exclusive use and benefit of all present
and future Class R-II Interest and REMIC II (as holder of the REMIC I Regular
Interests). The rights of the Class R-II Interest and REMIC II (as holder of the
REMIC I Regular Interests) to receive distributions from the proceeds of REMIC
II in respect of the Class R-II Interest and REMIC II Regular Interests,
respectively, and all ownership interests evidenced or constituted by the Class
R-II Interest and the REMIC II Regular Interests, shall be as set forth in this
Agreement.

                  SECTION 2.08. Issuance of Class R Certificates.

                  The Trustee acknowledges the assignment to it of the REMIC
Regular Interests and, concurrently therewith and in exchange therefor, pursuant
to the written request of the Depositor executed by an officer of the Depositor,
the Trustee has executed, authenticated and delivered to or upon the order of
the Depositor, the Class R Certificates in authorized denominations.

                                      -50-

<PAGE>

                  SECTION 2.09. Conveyance of the Class M-3 Interest; Acceptance
                                of REMIC III by the Trustee.

                  The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey to the
Trustee, without recourse all the right, title and interest of the Depositor in
and to the Class M-3 Interest for the benefit of the Holders of the Class M-3
Certificates and the Class R-III Interest, and REMIC III (as holder of the Class
M-3 Interest). The Trustee acknowledges receipt of the Class M-3 Interest and
declares that it holds and will hold the same in trust for the exclusive use and
benefit of all present and future Holders of the Class M-3 Certificates and the
Class R-X Certificates, in respect of the Class R-III Interest, and REMIC III
(as holder of the Class M-3 Certificates). The rights of the Class R-X
Certificates, in respect of the Class R-III Interest, and REMIC III (as holder
of the Class M-3 Certificates) to receive distributions from the proceeds of
REMIC III, and all ownership interests evidenced or constituted by the Class R-X
Certificates, in respect of the Class R-III Interest, and the Class M-3
Certificates shall be as set forth in this Agreement.

                  SECTION 2.10. Conveyance of the Class M-4 Interest; Acceptance
                                of REMIC IV by the Trustee.

                  The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey to the
Trustee, without recourse all the right, title and interest of the Depositor in
and to the Class M-4 Interest for the benefit of the Holders of the Class M-4
Certificates and the Class R-IV Interest, and REMIC IV (as holder of the Class
M-4 Interest). The Trustee acknowledges receipt of the Class M-4 Interest and
declares that it holds and will hold the same in trust for the exclusive use and
benefit of all present and future Holders of the Class M-4 Certificates and the
Class R-X Certificates, in respect of the Class R-IV Interest, and REMIC IV (as
holder of the Class M-4 Certificates). The rights of the Class R-X Certificates,
in respect of the Class R-IV Interest, and REMIC IV (as holder of the Class M-4
Certificates) to receive distributions from the proceeds of REMIC IV, and all
ownership interests evidenced or constituted by the Class R-X Certificates, in
respect of the Class R-IV Interest, and the Class M-4 Certificates shall be as
set forth in this Agreement.

                  SECTION 2.11. Conveyance of the Class M-5 Interest; Acceptance
                                of REMIC V by the Trustee.

                  The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey to the
Trustee, without recourse all the right, title and interest of the Depositor in
and to the Class M-5 Interest for the benefit of the Holders of the Class M-5
Certificates and the Class R-V Interest, and REMIC V (as holder of the Class M-5
Interest). The Trustee acknowledges receipt of the Class M-5 Interest and
declares that it holds and will hold the same in trust for the exclusive use and
benefit of all present and future Holders of the Class M-5 Certificates and the
Class R-X Certificates, in respect of the Class R-V Interest, and REMIC V (as
holder of the Class M-5 Certificates). The rights of the Class R-X Certificates,
in respect of the Class R-V Interest, and REMIC V (as holder of the Class M-5
Certificates) to receive distributions from the proceeds of REMIC V, and all
ownership interests evidenced or constituted by the Class R-X Certificates, in
respect of the Class R-V Interest, and the Class M-5 Certificates shall be as
set

                                      -51-

<PAGE>

forth in this Agreement.

                  SECTION 2.12. Conveyance of the Class CE Interest; Acceptance
                                of REMIC VI by the Trustee.

                  The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey to the
Trustee, without recourse all the right, title and interest of the Depositor in
and to the Class CE Interest for the benefit of the Holders of the Class CE
Certificates and the Class R-VI Interest, and REMIC VI (as holder of the Class
CE Interest). The Trustee acknowledges receipt of the Class CE Interest and
declares that it holds and will hold the same in trust for the exclusive use and
benefit of all present and future Holders of the Class CE Certificates and the
Class R-X Certificates, in respect of the Class R-VI Interest, and REMIC VI (as
holder of the Class CE Certificates). The rights of the Class R-X Certificates,
in respect of the Class R-VI Interest, and REMIC VI (as holder of the Class CE
Certificates) to receive distributions from the proceeds of REMIC VI, and all
ownership interests evidenced or constituted by the Class R-X Certificates, in
respect of the Class R-VI Interest, and the Class CE Certificates shall be as
set forth in this Agreement.

                  SECTION 2.13. Conveyance of the Class P Interest; Acceptance
                                of REMIC VII by the Trustee.

                  The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey to the
Trustee, without recourse all the right, title and interest of the Depositor in
and to the Class P Interest for the benefit of the Holders of the Class P
Certificates and the Class R-VII Interest, and REMIC VII (as holder of the Class
P Interest). The Trustee acknowledges receipt of the Class P Interest and
declares that it holds and will hold the same in trust for the exclusive use and
benefit of all present and future Holders of the Class P Certificates and the
Class R-X Certificates, in respect of the Class R-VII Interest, and REMIC VII
(as holder of the Class P Certificates). The rights of the Class R-X
Certificates, in respect of the Class R-VII Interest, and REMIC VII (as holder
of the Class P Certificates) to receive distributions from the proceeds of REMIC
VII, and all ownership interests evidenced or constituted by the Class R-X
Certificates, in respect of the Class R-VII Interest, and the Class P
Certificates shall be as set forth in this Agreement.

                  SECTION 2.14. Issuance of Class R-X Certificates.

                  The Trustee acknowledges the assignment to it of the Class
R-III Interest, the Class R-IV Interest, the Class R-V Interest, the Class R-VI
Interest and the Class R-VII Interest and, concurrently therewith and in
exchange therefor, pursuant to the written request of the Depositor executed by
an officer of the Depositor, the Trustee has executed, authenticated and
delivered to or upon the order of the Depositor, the Class R-X Certificates in
authorized denominations.

                                      -52-

<PAGE>

                                   ARTICLE III

                          ADMINISTRATION AND SERVICING
                              OF THE MORTGAGE LOANS

                  SECTION 3.01. Servicer to Act as Servicer.

                  The Servicer shall service and administer the Mortgage Loans
on behalf of the Trust Fund and in the best interests of and for the benefit of
the Certificateholders (as determined by the Servicer in its reasonable
judgment) in accordance with the terms of this Agreement and the respective
Mortgage Loans and, to the extent consistent with such terms, in the same manner
in which it services and administers similar mortgage loans for its own
portfolio, giving due consideration to customary and usual standards of practice
of prudent mortgage lenders and loan servicers administering similar mortgage
loans but without regard to:

                  (i) any relationship that the Servicer or any Affiliate of the
         Servicer may have with the related Mortgagor;

                  (ii) the ownership of any Certificate by the Servicer or any
         Affiliate of the Servicer;

                  (iii) the Servicer's obligation to make Advances or Servicing
         Advances; or

                  (iv) the Servicer's right to receive compensation for its
         services hereunder or with respect to any particular transaction.

                  To the extent consistent with the foregoing, the Servicer
shall also seek to maximize the timely and complete recovery of principal and
interest on the Mortgage Notes. Subject only to the above-described servicing
standards and the terms of this Agreement and of the respective Mortgage Loans,
the Servicer shall have full power and authority, to do or cause to be done any
and all things in connection with such servicing and administration which it may
deem necessary or desirable. Without limiting the generality of the foregoing,
the Servicer in its own name is hereby authorized and empowered by the Trustee
when the Servicer believes it appropriate in its best judgment, to execute and
deliver, on behalf of the Trust Fund, the Certificateholders and the Trustee or
any of them, and upon written notice to the Trustee, any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge, and
all other comparable instruments, with respect to the Mortgage Loans and the
Mortgaged Properties and to institute foreclosure proceedings or obtain a
deed-in-lieu of foreclosure so as to convert the ownership of such properties,
and to hold or cause to be held title to such properties, on behalf of the
Trustee, for the benefit of the Trust Fund and the Certificateholders. The
Servicer shall service and administer the Mortgage Loans in accordance with
applicable state and federal law and shall provide to the Mortgagors any reports
required to be provided to them thereby. The Servicer shall also comply in the
performance of this Agreement with all reasonable rules and requirements of each
insurer under any standard hazard insurance policy. Subject to Section 3.17, the
Trustee shall execute, at the written request of the Servicer, and furnish to
the Servicer any special or limited powers of attorney and other documents
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties

                                      -53-

<PAGE>

hereunder and the Trustee shall not be liable for the actions of the Servicer
under such powers of attorney.

                  In accordance with the standards of the preceding paragraph,
the Servicer shall make or cause to be made Servicing Advances as necessary for
the purpose of effecting the payment of taxes and assessments on the Mortgaged
Properties, which Servicing Advances shall be reimbursable in the first instance
from related collections from the Mortgagors pursuant to Section 3.09, and
further as provided in Section 3.11; provided, however, the Servicer shall only
make such Servicing Advance if the Mortgagor has made such payment as set forth
in Section 3.09 or if the Mortgagor has not made such payment, if the failure to
make such Servicing Advance would result in the loss of the Mortgaged Property
due to a tax sale or foreclosure as result of a tax lien. Any cost incurred by
the Servicer in effecting the payment of taxes and assessments on a Mortgaged
Property shall not, for the purpose of calculating the Stated Principal Balance
of a Mortgage Loan or distributions to Certificateholders, be added to the
unpaid principal balance of the related Mortgage Loan, notwithstanding that the
terms of such Mortgage Loan so permit.

                  The Servicer further is authorized and empowered by the
Trustee, on behalf of the Certificateholders and the Trustee, in its own name or
in the name of the Sub-Servicer, when the Servicer or the Sub-Servicer, as the
case may be, believes it is appropriate in its best judgment to register any
Mortgage Loan on the MERS(R) System, or cause the removal from the registration
of any Mortgage Loan on the MERS(R) System, to execute and deliver, on behalf of
the Trustee and the Certificateholders or any of them, any and all instruments
of assignment and other comparable instruments with respect to such assignment
or re-recording of a Mortgage in the name of MERS, solely as nominee for the
Trustee and its successors and assigns. Any reasonable expenses incurred in
connection with the actions described in the preceding sentence or as a result
of MERS discontinuing or becoming unable to continue operations in connection
with the MERS(R) System, shall be subject to withdrawal by the Servicer from the
Collection Account.

                  Notwithstanding anything in this Agreement to the contrary,
the Servicer may not make any future advances with respect to a Mortgage Loan
(except as provided in Section 4.03) and the Servicer shall not permit any
modification with respect to any Mortgage Loan that would change the Mortgage
Rate, reduce or increase the principal balance (except for reductions resulting
from actual payments of principal) or change the final maturity date on such
Mortgage Loan (unless, as provided in Section 3.07, the Mortgagor is in default
with respect to the Mortgage Loan or such default is, in the judgment of the
Servicer, reasonably foreseeable) or any modification, waiver or amendment of
any term of any Mortgage Loan that would both (A) effect an exchange or
reissuance of such Mortgage Loan under Section 1001 of the Code (or final,
temporary or proposed Treasury regulations promulgated thereunder) and (B) cause
any Trust REMIC created hereunder to fail to qualify as a REMIC under the Code
or the imposition of any tax on "prohibited transactions" or "contributions
after the startup date" under the REMIC Provisions.

                  Notwithstanding anything in this Agreement to the contrary, in
the event of a Principal Prepayment in full of a Mortgage Loan, the Servicer may
not waive any Prepayment Charge or portion thereof required by the terms of the
related Mortgage Note unless (i) the Servicer determines that such waiver would
maximize recovery of Liquidation Proceeds for such Mortgage Loan, taking into
account the value of such Prepayment Charge, (ii)(A) the enforceability thereof
is

                                      -54-

<PAGE>

limited (1) by bankruptcy, insolvency, moratorium, receivership, or other
similar law relating to creditors' rights generally or (2) due to acceleration
in connection with a foreclosure or other involuntary payment, or (B) the
enforceability is otherwise limited or prohibited by applicable law or (iii) the
Servicer has not been provided with information sufficient to enable it to
collect the Prepayment Charge. If a Prepayment Charge is waived as permitted by
meeting the standard described in clause (iii) above, then the Servicer shall
enforce the obligation of the related Originator to pay the amount of such
waived Prepayment Charge to the Servicer for deposit in the Collection Account
(to the extent paid by the related Originator) for the benefit of the Holders of
the Class P Certificates.

                  In the event of a Principal Prepayment in full with respect to
any Mortgage Loan, the Servicer shall deliver to the Trustee a certification of
a Servicing Officer substantially in the form of Exhibit J no later than the
third Business Day following the immediately succeeding Determination Date with
a copy to the Class CE Certificateholder.

                  Promptly upon the earlier of discovery by the Servicer or
receipt of notice by the Servicer of the breach of the covenant of the Servicer
set forth above which materially and adversely affects the interests of the
Holders of the Class P Certificates in any Prepayment Charge, the Servicer shall
promptly pay the amount of such waived Prepayment Charge (or such portion
thereof as had been waived), for the benefit of the holders of the Class P
Certificates by depositing such amount into the Collection Account for
distribution in accordance with the terms of this Agreement. The foregoing shall
not, however, limit any remedies available to the Certificateholders, the
Depositor or the Trustee on behalf of the Trust Fund and for the benefit of the
Certificateholders, pursuant to the Mortgage Loan Purchase Agreement, respecting
a breach of the representations, warranties and covenants of the Originator or
the Seller contained in the Mortgage Loan Purchase Agreement.

                  With respect to each Mortgage Loan which is the subject of a
Principal Prepayment in full, which prepayment is not accompanied by the payment
of a Prepayment Charge, the Trustee shall verify that such Mortgage Loan was
identified on the Mortgage Loan Schedule as not being subject to a Prepayment
Charge.

                  The Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such delegation shall release the Servicer
from the responsibilities or liabilities arising under this Agreement.

                  As part of its servicing activities hereunder, the Servicer,
for the benefit of the Trustee and the Certificateholders, shall enforce the
obligations of each Originator and the Seller under the Mortgage Loan Purchase
Agreements, including, without limitation, any obligation of either Originator
or the Seller to purchase a Mortgage Loan on account of missing or defective
documentation or on account of a breach of a representation, warranty or
covenant, as described in Section 2.03(a).

                  SECTION 3.02. Sub-Servicing Agreements Between Servicer and
                                Sub-Servicers.

                  The Servicer may arrange for the subservicing of any Mortgage
Loan by a Sub-

                                      -55-

<PAGE>

Servicer pursuant to a Sub-Servicing Agreement; provided that such sub-servicing
arrangement and the terms of the related Sub-Servicing Agreement must provide
for the servicing of such Mortgage Loans in a manner consistent with the
servicing arrangements contemplated hereunder. Notwithstanding the provisions of
any Sub-Servicing Agreement, any of the provisions of this Agreement relating to
agreements or arrangements between the Servicer or a Sub-Servicer or reference
to actions taken through a Servicer or otherwise, the Servicer shall remain
obligated and liable to the Depositor, the Trustee and the Certificateholders
for the servicing and administration of the Mortgage Loans in accordance with
the provisions of this Agreement without diminution of such obligation or
liability by virtue of such Sub-Servicing Agreements or arrangements or by
virtue of indemnification from the Sub-Servicer and to the same extent and under
the same terms and conditions as if the Servicer alone were servicing and
administering the Mortgage Loans. Every Sub- Servicing Agreement entered into by
the Servicer shall contain a provision giving the successor Servicer the option
to terminate such agreement in the event a successor Servicer is appointed. All
actions of each Sub-Servicer performed pursuant to the related Sub-Servicing
Agreement shall be performed as an agent of the Servicer with the same force and
effect as if performed directly by the Servicer.

                  For purposes of this Agreement, the Servicer shall be deemed
to have received any collections, recoveries or payments with respect to the
Mortgage Loans that are received by a Sub- Servicer regardless of whether such
payments are remitted by the Sub-Servicer to the Servicer.

                  SECTION 3.03. Successor Sub-Servicers.

                  The Servicer shall be entitled to terminate any Sub-Servicing
Agreement in accordance with the terms and conditions of such Sub-Servicing
Agreement and to either itself directly service the related Mortgage Loans or
enter into a Sub-Servicing Agreement with a successor Sub-Servicer which
qualifies under Section 3.02. Any Sub-Servicing Agreement shall include the
provision that such agreement may be immediately terminated by the Trustee (if
the Trustee is acting as Servicer) without fee, in accordance with the terms of
this Agreement, in the event that the Servicer (or the Trustee, if it is then
acting as Servicer) shall, for any reason, no longer be the Servicer (including
termination due to a Servicer Event of Default).

                  SECTION 3.04. No Contractual Relationship Between
                                Sub-Servicer, Trustee or the Certificateholders.

                  Any Sub-Servicing Agreement and any other transactions or
services relating to the Mortgage Loans involving a Sub-Servicer shall be deemed
to be between the Sub-Servicer and the Servicer alone and the Trustee and the
Certificateholders shall not be deemed parties thereto and shall have no claims,
rights, obligations, duties or liabilities with respect to any Sub-Servicer
except as set forth in Section 3.05.

                  SECTION 3.05. Assumption or Termination of Sub-Servicing
                                Agreement by Trustee.

                  In connection with the assumption of the responsibilities,
duties and liabilities and of the authority, power and rights of the Servicer
hereunder by the Trustee pursuant to Section 7.02

                                      -56-

<PAGE>

or another successor Servicer, it is understood and agreed that the Servicer's
rights and obligations under any Sub-Servicing Agreement then in force between
the Servicer and a Sub-Servicer shall be assumed simultaneously by the Trustee
or another successor Servicer without act or deed on the part of the Trustee;
provided, however, that the Trustee or any other successor Servicer may
terminate the Sub-Servicer.

                  The Servicer shall, upon the reasonable request of the
Trustee, but at the expense of the Servicer, deliver to the assuming party
documents and records relating to each Sub-Servicing Agreement and an accounting
of amounts collected and held by it and otherwise use its best reasonable
efforts to effect the orderly and efficient transfer of the Sub-Servicing
Agreements to the assuming party.

                  SECTION 3.06. [Reserved].

                  SECTION 3.07. Collection of Certain Mortgage Loan Payments.

                  The Servicer shall make reasonable efforts to collect all
payments called for under the terms and provisions of the Mortgage Loans, and
shall, to the extent such procedures shall be consistent with this Agreement,
follow such collection procedures as it would follow with respect to mortgage
loans comparable to the Mortgage Loans and held for its own account. Consistent
with the foregoing, the Servicer may in its discretion (i) waive any late
payment charge or, if applicable, penalty interest or (ii) extend the due dates
for the Monthly Payments due on a Mortgage Note for a period of not greater than
180 days; provided that any extension pursuant to this clause shall not affect
the amortization schedule of any Mortgage Loan for purposes of any computation
hereunder. Notwithstanding the foregoing, in the event that any Mortgage Loan is
in default or, in the judgment of the Servicer, such default is reasonably
foreseeable, the Servicer, consistent with the standards set forth in Section
3.01 may waive, modify or vary any term of such Mortgage Loan (including
modifications that change the Mortgage Rate, forgive the payment of principal or
interest or extend the final maturity date of such Mortgage Loan), accept
payment from the related Mortgagor of an amount less than the Stated Principal
Balance in final satisfaction of such Mortgage Loan (such payment, a "Short
Pay-off"), or consent to the postponement of strict compliance with any such
term or otherwise grant indulgence to any Mortgagor if in the Servicer's
determination such waiver, modification, postponement or indulgence is not
materially adverse to the interests of the Certificateholders (taking into
account any estimated Realized Loss that might result absent such action).

                  SECTION 3.08. [Reserved].

                  SECTION 3.09. Collection of Taxes, Assessments and Similar
                                Items; Servicing Accounts.

                  To the extent the terms of a Mortgage provide for Escrow
Payments, the Servicer shall establish and maintain one or more accounts (the
"Servicing Accounts"), into which all collections from the Mortgagors (or
related advances from Sub-Servicers) for the payment of taxes, assessments,
fire, flood, and hazard insurance premiums, and comparable items for the account
of the Mortgagors ("Escrow Payments") shall be deposited and retained. Servicing
Accounts shall be

                                      -57-

<PAGE>

Eligible Accounts. The Servicer shall deposit in the Servicing Accounts on a
daily basis and in no event later than the second Business Day after receipt,
and retain therein, all Escrow Payments collected on account of the Mortgage
Loans, for the purpose of effecting the timely payment of any such items as
required under the terms of this Agreement. Withdrawals of amounts from a
Servicing Account may be made only to (i) effect timely payment of taxes,
assessments, fire, flood, and hazard insurance premiums, and comparable items;
(ii) reimburse the Servicer out of related collections for any advances made
pursuant to Section 3.01 (with respect to taxes and assessments) and Section
3.14 (with respect to fire, flood and hazard insurance); (iii) refund to
Mortgagors any sums as may be determined to be overages; (iv) pay interest, if
required and as described below, to Mortgagors on balances in the Servicing
Account; or (v) clear and terminate the Servicing Account at the termination of
the Servicer's obligations and responsibilities in respect of the Mortgage Loans
under this Agreement in accordance with Article IX. As part of its servicing
duties, the Servicer shall pay to the Mortgagors interest on funds in Servicing
Accounts, to the extent required by law and, to the extent that interest earned
on funds in the Servicing Accounts is insufficient, to pay such interest from
its or their own funds, without any reimbursement therefor. Notwithstanding the
foregoing, the Servicer shall not be obligated to collect Escrow Payments if the
related Mortgage Loan does not require such payments but the Servicer shall
nevertheless be obligated to make Servicing Advances as provided in Section
3.01. In the event the Servicer shall deposit in the Servicing Accounts any
amount not required to be deposited therein, it may at any time withdraw such
amount from the Servicing Accounts, any provision to the contrary
notwithstanding.

                  To the extent that a Mortgage does not provide for Escrow
Payments, the Servicer (i) shall determine whether any such payments are made by
the Mortgagor in a manner and at a time that is necessary to avoid the loss of
the Mortgaged Property due to a tax sale or the foreclosure as a result of a tax
lien and (ii) shall ensure that all insurance required to be maintained on the
Mortgaged Property pursuant to this Agreement is maintained. If any such payment
has not been made and the Servicer receives notice of a tax lien with respect to
the Mortgage Loan being imposed, the Servicer will, promptly and to the extent
required to avoid loss of the Mortgaged Property, advance or cause to be
advanced funds necessary to discharge such lien on the Mortgaged Property. The
Servicer assumes full responsibility for the payment of all such bills and shall
effect payments of all such bills irrespective of the Mortgagor's faithful
performance in the payment of same or the making of the Escrow Payments and
shall make Servicing Advances from its own funds to effect such payments.

                  SECTION 3.10. Collection Account, Distribution Account and
                                Initial Deposit Accounts.

                  (a) On behalf of the Trust Fund, the Servicer shall establish
and maintain one or more accounts (such account or accounts, the "Collection
Account"), held in trust for the benefit of the Trustee and the
Certificateholders. On behalf of the Trust Fund, the Servicer shall deposit or
cause to be deposited in the Collection Account on a daily basis and in no event
later than two Business Days after receipt, as and when received or as otherwise
required hereunder, the following payments and collections received or made by
it on or subsequent to the Cut-off Date:

                  (i) all payments on account of principal, including Principal
         Prepayments, on the Mortgage Loans;

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<PAGE>

                  (ii) all payments on account of interest (net of the related
         Servicing Fee) on each Mortgage Loan;

                  (iii) all Insurance Proceeds and Liquidation Proceeds (other
         than proceeds collected in respect of any particular REO Property and
         amounts paid by the Servicer in connection with a purchase of Mortgage
         Loans and REO Properties pursuant to Section 9.01);

                  (iv) any amounts required to be deposited pursuant to Section
         3.12 in connection with any losses realized on Permitted Investments
         with respect to funds held in the Collection Account;

                  (v) any amounts required to be deposited by the Servicer
         pursuant to the second paragraph of Section 3.14(a) in respect of any
         blanket policy deductibles;

                  (vi) any Purchase Price or Substitution Shortfall Amount
         delivered to the Servicer and all proceeds (net of amounts payable or
         reimbursable to the Servicer) of Mortgage Loans purchased in accordance
         with Section 9.01; and

                  (vii) any Prepayment Charges or amounts required to be
         deposited by the Servicer in connection with a breach of its
         obligations under Section 3.01 with respect to the waiver of Prepayment
         Charges.

                  The foregoing requirements for deposit in the Collection
Accounts shall be exclusive, it being understood and agreed that, without
limiting the generality of the foregoing, payments in the nature of late payment
charges, assumption fees or other similar fees need not be deposited by the
Servicer in the Collection Account. In the event the Servicer shall deposit in
the Collection Account any amount not required to be deposited therein, it may
at any time withdraw such amount from the Collection Account, any provision
herein to the contrary notwithstanding.

                  (b) On behalf of the Trust Fund, the Trustee shall establish
and maintain one or more accounts (such account or accounts, the "Distribution
Account"), held in trust for the benefit of the Trustee, the Trust Fund and the
Certificateholders. On behalf of the Trust Fund, the Servicer shall deliver to
the Trustee in immediately available funds for deposit in the Distribution
Account on or before 3:00 p.m. New York time (i) on the Servicer Remittance
Date, that portion of the Available Distribution Amount (calculated without
regard to the references in clause (2) of the definition thereof to amounts that
may be withdrawn from the Distribution Account) for the related Distribution
Date then on deposit in the Collection Account and the amount of all Prepayment
Charges collected by the Servicer in connection with the Principal Prepayment of
any of the Mortgage Loans (including the amount of any payment by the Servicer
in respect of a waived Prepayment Charge, other than as permitted in Section
3.01) then on deposit in the Collection Account and the amount of any funds
reimbursable to an Advance Financing Person pursuant to Section 3.28, and (ii)
on each Business Day as of the commencement of which the balance on deposit in
the Collection Account exceeds $75,000 following any withdrawals pursuant to the
next succeeding sentence, the amount of such excess, but only if the Collection
Account constitutes an Eligible Account solely pursuant to clause (ii) of the
definition of "Eligible Account." If the balance

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on deposit in the Collection Account exceeds $75,000 as of the commencement of
business on any Business Day and the Collection Account constitutes an Eligible
Account solely pursuant to clause (ii) of the definition of "Eligible Account,"
the Servicer shall, on or before 5:00 p.m. New York time on such Business Day,
withdraw from the Collection Account any and all amounts payable or reimbursable
to the Depositor, the Servicer, the Trustee, the Originator or the Seller
pursuant to Section 3.11 and shall pay such amounts to the Persons entitled
thereto.

                  (c) Funds in the Collection Account and the Distribution
Account may be invested in Permitted Investments in accordance with the
provisions set forth in Section 3.12. The Servicer shall give notice to the
Trustee of the location of the Collection Account maintained by it when
established and prior to any change thereof. The Trustee shall give notice to
the Servicer and the Depositor of the location of the Distribution Account when
established and prior to any change thereof.

                  (d) Funds held in the Collection Account at any time may be
delivered by the Servicer in immediately available funds to the Trustee for
deposit in the Distribution Account. In the event the Servicer shall deliver to
the Trustee for deposit in the Distribution Account any amount not required to
be deposited therein, it may at any time request that the Trustee withdraw such
amount from the Distribution Account and remit to it any such amount, any
provision herein to the contrary notwithstanding. In no event shall the Trustee
incur liability as a result of withdrawals from the Distribution Account at the
direction of the Servicer in accordance with the immediately preceding sentence.
In addition, the Servicer shall deliver to the Trustee from time to time for
deposit in the Distribution Account the amounts set forth in clauses (i) through
(iv) below:

                  (i) any Advances, as required pursuant to Section 4.03;

                  (ii) any amounts required to be deposited pursuant to Section
         3.23(d) or 3.23(f) in connection with any REO Property;

                  (iii) any amounts to be paid in connection with a purchase of
         Mortgage Loans and REO Properties pursuant to Section 9.01; and

                  (iv) any amounts required to be deposited pursuant to Section
         3.24 in connection with any Prepayment Interest Shortfalls.

                  SECTION 3.11. Withdrawals from the Collection Account and
                                Distribution Account.

                  (a) The Servicer shall, from time to time, make withdrawals
from the Collection Account for any of the following purposes or as described in
Section 4.03:

                  (i) to remit to the Trustee for deposit in the Distribution
         Account the amounts required to be so remitted pursuant to Section
         3.10(b) or permitted to be so remitted pursuant to the first sentence
         of Section 3.10(d);

                  (ii) subject to Section 3.16(d), to reimburse the Servicer for
         Advances, but only

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         to the extent of amounts received which represent Late Collections (net
         of the related Servicing Fees) of Monthly Payments on Mortgage Loans
         with respect to which such Advances were made in accordance with the
         provisions of Section 4.03;

                  (iii) subject to Section 3.16(d), to pay the Servicer any
         unpaid Servicing Fees and reimburse the Servicer any unreimbursed
         Servicing Advances with respect to each Mortgage Loan, but only to the
         extent of any Liquidation Proceeds and Insurance Proceeds received with
         respect to such Mortgage Loan;

                  (iv) to pay to the Servicer as servicing compensation (in
         addition to the Servicing Fee) on the Servicer Remittance Date any
         interest or investment income earned on funds deposited in the
         Collection Account;

                  (v) to pay to the Servicer, the related Originator or the
         Seller, as the case may be, with respect to each Mortgage Loan that has
         previously been purchased or replaced pursuant to Section 2.03 or
         Section 3.16(c) all amounts received thereon not included in the
         Purchase Price or the Substitution Shortfall Amount;

                  (vi) to reimburse the Servicer for any Advance or Servicing
         Advance previously made which the Servicer has determined to be a
         Nonrecoverable Advance or a Nonrecoverable Servicing Advance in
         accordance with the provisions of Section 4.03;

                  (vii) to reimburse the Servicer or the Depositor for expenses
         incurred by or reimbursable to the Servicer or the Depositor, as the
         case may be, pursuant to Section 3.01 or Section 6.03;

                  (viii) to reimburse the Servicer or the Trustee, as the case
         may be, for expenses reasonably incurred in respect of the breach or
         defect giving rise to the purchase obligation under Section 2.03 of
         this Agreement that were included in the Purchase Price of the Mortgage
         Loan, including any expenses arising out of the enforcement of the
         purchase obligation;

                  (ix) to pay, or to reimburse the Servicer for advances in
         respect of, expenses incurred in connection with any Mortgage Loan
         pursuant to Section 3.16(b); and

                  (x) to clear and terminate the Collection Account pursuant to
         Section 9.01.

                  The Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Collection Account, to the extent held by or on behalf of
it, pursuant to subclauses (ii), (iii), (v), (vi), (viii) and (ix) above. The
Servicer shall provide written notification to the Trustee on or prior to the
next succeeding Servicer Remittance Date, upon making any withdrawals from the
Collection Account pursuant to subclauses (vi) and (vii) above.

                  (b) The Trustee shall, from time to time, make withdrawals
from the Distribution Account, for any of the following purposes, without
priority:

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<PAGE>

                  (i) to make distributions to Certificateholders in accordance
         with Section 4.01;

                  (ii) to pay to itself amounts to which it is entitled pursuant
         to Section 8.05 and any Extraordinary Trust Fund Expenses;

                  (iii) to reimburse itself pursuant to Section 7.02;

                  (v) to pay to an Advance Financing Person reimbursements for
         Advances and/or Servicing Advances pursuant to Section 3.28;

                  (vi) to pay any amounts in respect of taxes pursuant to
         Section 10.01(g)(iii); and

                  (vii) to clear and terminate the Distribution Account pursuant
         to Section 9.01.

                  SECTION 3.12. Investment of Funds in the Investment Accounts.

                  (a) The Servicer may direct, by means of written directions
(which may be standing directions), any depository institution maintaining the
Collection Account to invest the funds in the Collection Account (for purposes
of this Section 3.12, an "Investment Account") in one or more Permitted
Investments bearing interest or sold at a discount, and maturing, unless payable
on demand, (i) no later than the Business Day immediately preceding the date on
which such funds are required to be withdrawn from such account pursuant to this
Agreement, if a Person other than the Trustee is the obligor thereon, and (ii)
no later than the date on which such funds are required to be withdrawn from
such account pursuant to this Agreement, if the Trustee is the obligor thereon.
Amounts in the Distribution Account may be held uninvested. All such Permitted
Investments shall be held to maturity, unless payable on demand. Any investment
of funds shall be made in the name of the Trustee (in its capacity as such) or
in the name of a nominee of the Trustee. The Trustee shall be entitled to sole
possession over each such investment (except with respect to investment
direction of funds held in the Collection Account) and, subject to subsection
(b) below, the income thereon, and any certificate or other instrument
evidencing any such investment shall be delivered directly to the Trustee or its
agent, together with any document of transfer necessary to transfer title to
such investment to the Trustee or its nominee. In the event amounts on deposit
in the Collection Account are at any time invested in a Permitted Investment
payable on demand, the party with investment discretion over such Investment
Account shall:

                  (x) consistent with any notice required to be given
         thereunder, demand that payment thereon be made on the last day such
         Permitted Investment may otherwise mature hereunder in an amount equal
         to the lesser of (1) all amounts then payable thereunder and (2) the
         amount required to be withdrawn on such date; and

                  (y) demand payment of all amounts due thereunder promptly upon
         determination by a Responsible Officer of the Trustee that such
         Permitted Investment would not constitute a Permitted Investment in
         respect of funds thereafter on deposit in the Investment Account.

                  (b) All income and gain realized from the investment of funds
deposited in the Collection Account held by or on behalf of the Servicer or the
Trustee, shall be for the benefit of the

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<PAGE>

Servicer and shall be subject to its withdrawal in accordance with Section 3.11.
The Servicer shall deposit in the Collection Account the amount of any loss
incurred in respect of any such Permitted Investment made with funds in such
account immediately upon realization of such loss. All earnings and gain
realized from the investment of funds deposited in the Distribution Account
shall be for the benefit of the Trustee. The Trustee shall remit from its own
funds for deposit into the Distribution Account the amount of any loss incurred
on Permitted Investments in the Distribution Account, if amounts on deposit in
the Distribution Account are invested in Permitted Investments by the Trustee in
the absence of direction from another party.

                  (c) Except as otherwise expressly provided in this Agreement,
if any default occurs in the making of a payment due under any Permitted
Investment, or if a default occurs in any other performance required under any
Permitted Investment, the Trustee may and, subject to Section 8.01 and Section
8.02(v), shall, at the written direction of the Servicer, take such action as
may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate proceedings.

                  (d) The Trustee or its Affiliates are permitted to receive
additional compensation that could be deemed to be in the Trustee's economic
self-interest for (i) serving as investment adviser, administrator, shareholder
servicing agent, custodian or sub-custodian with respect to certain of the
Permitted Investments, (ii) using Affiliates to effect transactions in certain
Permitted Investments and (iii) effecting transactions in certain Permitted
Investments. Such compensation shall not be considered an amount that is
reimbursable or payable to the Trustee pursuant to Section 3.11 or 3.12 or
otherwise payable in respect of Extraordinary Trust Fund Expenses.

                  SECTION 3.13. [Reserved].

                  SECTION 3.14. Maintenance of Hazard Insurance and Errors and
                                Omissions and Fidelity Coverage.

                  (a) The terms of each Mortgage Note require the related
Mortgagor to maintain fire, flood and hazard insurance policies. To the extent
such policies are not maintained, the Servicer shall cause to be maintained for
each Mortgaged Property fire and hazard insurance with extended coverage as is
customary in the area where the Mortgaged Property is located in an amount which
is at least equal to the lesser of the current principal balance of such
Mortgage Loan and the amount necessary to fully compensate for any damage or
loss to the improvements which are a part of such property on a replacement cost
basis, in each case in an amount not less than such amount as is necessary to
avoid the application of any coinsurance clause contained in the related hazard
insurance policy. The Servicer shall also cause to be maintained fire and hazard
insurance on each REO Property with extended coverage as is customary in the
area where the Mortgaged Property is located in an amount which is at least
equal to the lesser of (i) the maximum insurable value of the improvements which
are a part of such property and (ii) the outstanding principal balance of the
related Mortgage Loan at the time it became an REO Property. The Servicer will
comply in the performance of this Agreement with all reasonable rules and
requirements of each insurer under any such hazard policies. Any amounts to be
collected by the Servicer under any such policies (other than amounts to be
applied to the restoration or repair of the property subject to the related
Mortgage or amounts to be released to the Mortgagor in accordance with the
procedures that the Servicer would

                                      -63-

<PAGE>

follow in servicing loans held for its own account, subject to the terms and
conditions of the related Mortgage and Mortgage Note) shall be deposited in the
Collection Account, subject to withdrawal pursuant to Section 3.11, if received
in respect of a Mortgage Loan, or in the REO Account, subject to withdrawal
pursuant to Section 3.23, if received in respect of an REO Property. Any cost
incurred by the Servicer in maintaining any such insurance shall not, for the
purpose of calculating distributions to Certificateholders, be added to the
unpaid principal balance of the related Mortgage Loan, notwithstanding that the
terms of such Mortgage Loan so permit. It is understood and agreed that no
earthquake or other additional insurance is to be required of any Mortgagor
other than pursuant to such applicable laws and regulations as shall at any time
be in force and as shall require such additional insurance. If the Mortgaged
Property or REO Property is at any time in an area identified in the Federal
Register by the Federal Emergency Management Agency as having special flood
hazards, the Servicer will cause to be maintained a flood insurance policy in
respect thereof. Such flood insurance shall be in an amount equal to the lesser
of (i) the unpaid principal balance of the related Mortgage Loan and (ii) the
maximum amount of such insurance available for the related Mortgaged Property
under the national flood insurance program (assuming that the area in which such
Mortgaged Property is located is participating in such program).

                  In the event that the Servicer shall obtain and maintain a
blanket policy with an insurer having a General Policy Rating of B:VI or better
in Best's Key Rating Guide insuring against hazard losses on all of the Mortgage
Loans, it shall conclusively be deemed to have satisfied its obligations as set
forth in the first two sentences of this Section 3.14, it being understood and
agreed that such policy may contain a deductible clause, in which case the
Servicer shall, in the event that there shall not have been maintained on the
related Mortgaged Property or REO Property a policy complying with the first two
sentences of this Section 3.14, and there shall have been one or more losses
which would have been covered by such policy, deposit to the Collection Account
from its own funds the amount not otherwise payable under the blanket policy
because of such deductible clause. In connection with its activities as
administrator and servicer of the Mortgage Loans, the Servicer agrees to prepare
and present, on behalf of itself, the Trustee, the Trust Fund and the
Certificateholders, claims under any such blanket policy in a timely fashion in
accordance with the terms of such policy.

                  (b) The Servicer shall keep in force during the term of this
Agreement a policy or policies of insurance covering errors and omissions for
failure in the performance of its respective obligations under this Agreement,
which policy or policies shall be in such form and amount that would meet the
requirements of Fannie Mae or Freddie Mac if it were the purchaser of the
Mortgage Loans, unless the Servicer, has obtained a waiver of such requirements
from Fannie Mae or Freddie Mac. The Servicer shall each also maintain a fidelity
bond in the form and amount that would meet the requirements of Fannie Mae or
Freddie Mac, unless the Servicer, has obtained a waiver of such requirements
from Fannie Mae or Freddie Mac. The Servicer shall be deemed to have complied
with this provision if an Affiliate of the Servicer, has such errors and
omissions and fidelity bond coverage and, by the terms of such insurance policy
or fidelity bond, the coverage afforded thereunder extends to the Servicer. Any
such errors and omissions policy and fidelity bond shall by its terms not be
cancelable without thirty days' prior written notice to the Trustee.

                  SECTION 3.15. Enforcement of Due-on-Sale Clauses; Assumption
                                Agreements.

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<PAGE>

                  The Servicer will, to the extent it has knowledge of any
conveyance or prospective conveyance of any Mortgaged Property by any Mortgagor
(whether by absolute conveyance or by contract of sale, and whether or not the
Mortgagor remains or is to remain liable under the Mortgage Note and/or the
Mortgage), exercise its rights to accelerate the maturity of such Mortgage Loan
under the "due-on-sale" clause, if any, applicable thereto; provided, however,
that the Servicer shall not exercise any such rights if prohibited by law from
doing so. If the Servicer reasonably believes it is unable under applicable law
to enforce such "due-on-sale" clause, or if any of the other conditions set
forth in the proviso to the preceding sentence apply, the Servicer will enter
into an assumption and modification agreement from or with the person to whom
such property has been conveyed or is proposed to be conveyed, pursuant to which
such person becomes liable under the Mortgage Note and, to the extent permitted
by applicable state law, the Mortgagor remains liable thereon. The Servicer is
also authorized to enter into a substitution of liability agreement with such
person, pursuant to which the original Mortgagor is released from liability and
such person is substituted as the Mortgagor and becomes liable under the
Mortgage Note, provided that no such substitution shall be effective unless such
person satisfies the then current underwriting criteria of the Servicer for
mortgage loans similar to the Mortgage Loans. In connection with any assumption
or substitution, the Servicer shall apply such underwriting standards and follow
such practices and procedures as shall be normal and usual in its general
mortgage servicing activities and as it applies to other mortgage loans owned
solely by it. The Servicer shall not take or enter into any assumption and
modification agreement, however, unless (to the extent practicable in the
circumstances) it shall have received confirmation, in writing, of the continued
effectiveness of any applicable hazard insurance policy. Any fee collected by
the Servicer in respect of an assumption or substitution of liability agreement
will be retained by the Servicer as additional servicing compensation. In
connection with any such assumption, no material term of the Mortgage Note
(including but not limited to the related Mortgage Rate and the amount of the
Monthly Payment) may be amended or modified, except as otherwise required
pursuant to the terms thereof. The Servicer shall notify the Trustee that any
such substitution or assumption agreement has been completed by forwarding to
the Trustee the executed original of such substitution or assumption agreement,
which document shall be added to the related Mortgage File and shall, for all
purposes, be considered a part of such Mortgage File to the same extent as all
other documents and instruments constituting a part thereof.

                  Notwithstanding the foregoing paragraph or any other provision
of this Agreement, the Servicer shall not be deemed to be in default, breach or
any other violation of its obligations hereunder by reason of any assumption of
a Mortgage Loan by operation of law or by the terms of the Mortgage Note or any
assumption which the Servicer may be restricted by law from preventing, for any
reason whatever. For purposes of this Section 3.15, the term "assumption" is
deemed to also include a sale (of the Mortgaged Property) subject to the
Mortgage that is not accompanied by an assumption or substitution of liability
agreement.

                  SECTION 3.16. Realization Upon Defaulted Mortgage Loans.

                  (a) The Servicer shall use its best efforts, consistent with
Accepted Servicing Practices, to foreclose upon or otherwise comparably convert
the ownership of properties securing such of the Mortgage Loans as come into and
continue in default and as to which no satisfactory arrangements can be made for
collection of delinquent payments pursuant to Section 3.07. The Servicer shall
be responsible for all costs and expenses incurred by it in any such
proceedings;

                                      -65-

<PAGE>

provided, however, that such costs and expenses will be recoverable as Servicing
Advances by the Servicer as contemplated in Sections 3.11 and 3.23. The
foregoing is subject to the provision that, in any case in which a Mortgaged
Property shall have suffered damage from an Uninsured Cause, the Servicer shall
not be required to expend its own funds toward the restoration of such property
unless it shall determine in its discretion that such restoration will increase
the proceeds of liquidation of the related Mortgage Loan after reimbursement to
itself for such expenses.

                  (b) Notwithstanding the foregoing provisions of this Section
3.16 or any other provision of this Agreement, with respect to any Mortgage Loan
as to which the Servicer has received actual notice of, or has actual knowledge
of, the presence of any toxic or hazardous substance on the related Mortgaged
Property, the Servicer shall not, on behalf of the Trust Fund, either (i) obtain
title to such Mortgaged Property as a result of or in lieu of foreclosure or
otherwise, or (ii) otherwise acquire possession of, or take any other action
with respect to, such Mortgaged Property, if, as a result of any such action,
the Trust Fund, the Trustee or the Certificateholders would be considered to
hold title to, to be a "mortgagee-in-possession" of, or to be an "owner" or
"operator" of such Mortgaged Property within the meaning of the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended from
time to time, or any comparable law, unless the Servicer has also previously
determined, based on its reasonable judgment and a prudent report prepared by an
Independent Person who regularly conducts environmental audits using customary
industry standards, that:

                  (1) such Mortgaged Property is in compliance with applicable
         environmental laws or, if not, that it would be in the best economic
         interest of the Trust Fund to take such actions as are necessary to
         bring the Mortgaged Property into compliance therewith; and

                  (2) there are no circumstances present at such Mortgaged
         Property relating to the use, management or disposal of any hazardous
         substances, hazardous materials, hazardous wastes or petroleum-based
         materials for which investigation, testing, monitoring, containment,
         clean-up or remediation could be required under any federal, state or
         local law or regulation, or that if any such materials are present for
         which such action could be required, that it would be in the best
         economic interest of the Trust Fund to take such actions with respect
         to the affected Mortgaged Property.

                  The cost of the environmental audit report contemplated by
this Section 3.16 shall be advanced by the Servicer, subject to the Servicer's
right to be reimbursed therefor from the Collection Account as provided in
Section 3.11(a)(ix), such right of reimbursement being prior to the rights of
Certificateholders to receive any amount in the Collection Account received in
respect of the affected Mortgage Loan or other Mortgage Loans.

                  If the Servicer determines, as described above, that it is in
the best economic interest of the Trust Fund to take such actions as are
necessary to bring any such Mortgaged Property into compliance with applicable
environmental laws, or to take such action with respect to the containment,
clean-up or remediation of hazardous substances, hazardous materials, hazardous
wastes, or petroleum-based materials affecting any such Mortgaged Property, then
the Servicer shall take such action as it deems to be in the best economic
interest of the Trust Fund. The cost of any such compliance, containment,
cleanup or remediation shall be advanced by the Servicer, subject to

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the Servicer's right to be reimbursed therefor from the Collection Account as
provided in Sections 3.11(a)(iii) or 3.11(a)(ix), such right of reimbursement
being prior to the rights of Certificateholders to receive any amount in the
Collection Account received in respect of the affected Mortgage Loan or other
Mortgage Loans.

                  (c) The Servicer shall have the right to purchase from REMIC I
any defaulted Mortgage Loan that is 90 days or more delinquent, which the
Servicer determines in good faith will otherwise become subject to foreclosure
proceedings (evidence of such determination to be delivered in writing to the
Trustee, in form and substance satisfactory to the Servicer and the Trustee
prior to purchase), at a price equal to the Purchase Price. The Purchase Price
for any Mortgage Loan purchased hereunder shall be deposited in the Collection
Account, and the Trustee, upon receipt of written certification from the
Servicer of such deposit, shall release or cause to be released to the Servicer
the related Mortgage File and the Trustee shall execute and deliver such
instruments of transfer or assignment, in each case without recourse, as the
Servicer shall furnish and as shall be necessary to vest in the Servicer title
to any Mortgage Loan released pursuant hereto.

                  (d) Proceeds received in connection with any Final Recovery
Determination, as well as any recovery resulting from a partial collection of
Insurance Proceeds or Liquidation Proceeds, in respect of any Mortgage Loan,
will be applied in the following order of priority: first, to reimburse the
Servicer for any related unreimbursed Servicing Advances and Advances, pursuant
to Section 3.11(a)(ii) or (a)(iii); second, to accrued and unpaid interest on
the Mortgage Loan, to the date of the Final Recovery Determination, or to the
Due Date prior to the Distribution Date on which such amounts are to be
distributed if not in connection with a Final Recovery Determination; and third,
as a recovery of principal of the Mortgage Loan. If the amount of the recovery
so allocated to interest is less than the full amount of accrued and unpaid
interest due on such Mortgage Loan, the amount of such recovery will be
allocated by the Servicer as follows: first, to unpaid Servicing Fees; and
second, to the balance of the interest then due and owing. The portion of the
recovery so allocated to unpaid Servicing Fees shall be reimbursed to the
Servicer pursuant to Section 3.11(a)(iii). The portion of the recovery allocated
to interest (net of unpaid Servicing Fees) and the portion of the recovery
allocated to principal of the Mortgage Loan shall be applied as follows: first,
to reimburse the Servicer for any related unreimbursed Advances in accordance
with Section 3.11(a)(ii) and any other amounts reimbursable to the Servicer
pursuant to Section 3.11, and second, as part of the amounts to be transferred
to the Distribution Account in accordance with Section 3.10(b).

                  SECTION 3.17. Trustee to Cooperate; Release of Mortgage Files.

                  Upon the payment in full of any Mortgage Loan, or the receipt
by the Servicer of a notification that payment in full shall be escrowed in a
manner customary for such purposes, the Servicer will notify the Trustee by a
certification in the form of Exhibit E (which certification shall include a
statement to the effect that all amounts received or to be received in
connection with such payment which are required to be deposited in the
Collection Account pursuant to Section 3.10 have been or will be so deposited)
of a Servicing Officer and shall request delivery to it of the Mortgage File.
Upon receipt of such certification and request, the Trustee shall promptly
release the related Mortgage File to the Servicer and the Servicer is authorized
to cause the removal from the registration on the MERS(R) System of any such
Mortgage, if applicable, and to execute and deliver,

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<PAGE>

on behalf of the Trustee and the Certificateholders or any of them, any and all
instruments of satisfaction or cancellation or of partial or full release. No
expenses incurred in connection with any instrument of satisfaction or deed of
reconveyance shall be chargeable to the Collection Account or the Distribution
Account.

                  From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any insurance policy relating to the Mortgage Loans, the Trustee shall, upon
request of the Servicer and delivery to the Trustee of a Request for Release in
the form of Exhibit E, release the related Mortgage File to the Servicer, and
the Trustee or the Servicer as attorney-in-fact of the Trustee shall, at the
direction of the Servicer, execute such documents as shall be necessary to the
prosecution of any such proceedings. Such Request for Release shall obligate the
Servicer to return each and every document previously requested from the
Mortgage File to the Trustee when the need therefor by the Servicer no longer
exists, unless the Mortgage Loan has been liquidated and the Liquidation
Proceeds relating to the Mortgage Loan have been deposited in the Collection
Account or the Mortgage File or such document has been delivered to an attorney,
or to a public trustee or other public official as required by law, for purposes
of initiating or pursuing legal action or other proceedings for the foreclosure
of the Mortgaged Property either judicially or non-judicially, and the Servicer
has delivered to the Trustee a certificate of a Servicing Officer certifying as
to the name and address of the Person to which such Mortgage File or such
document was delivered and the purpose or purposes of such delivery. Upon
receipt of a certificate of a Servicing Officer stating that such Mortgage Loan
was liquidated and that all amounts received or to be received in connection
with such liquidation that are required to be deposited into the Collection
Account have been so deposited, or that such Mortgage Loan has become an REO
Property, a copy of the Request for Release shall be released by the Trustee to
the Servicer.

                  Upon written certification of a Servicing Officer, the Trustee
shall execute and deliver to the Servicer, any court pleadings, requests for
trustee's sale or other documents necessary to the foreclosure or trustee's sale
in respect of a Mortgaged Property or to any legal action brought to obtain
judgment against any Mortgagor on the Mortgage Note or Mortgage or to obtain a
deficiency judgment, or to enforce any other remedies or rights provided by the
Mortgage Note or Mortgage or otherwise available at law or in equity. Each such
certification shall include a request that such pleadings or documents be
executed by the Trustee and a statement as to the reason such documents or
pleadings are required and that the execution and delivery thereof by the
Trustee will not invalidate or otherwise affect the lien of the Mortgage, except
for the termination of such a lien upon completion of the foreclosure or
trustee's sale. So long as no Servicing Termination Event shall have occurred
and be continuing, the Servicer shall have the right to execute any and all such
court pleadings, requests and other documents as attorney-in-fact for, and on
behalf of the Trustee.

                  SECTION 3.18. Servicing Compensation.

                  As compensation for the activities of the Servicer, hereunder,
the Servicer shall be entitled to the Servicing Fee with respect to each
Mortgage Loan payable solely from payments of interest in respect of such
Mortgage Loan, subject to Section 3.24. In addition, the Servicer shall be
entitled to recover unpaid Servicing Fees out of Insurance Proceeds or
Liquidation Proceeds to the extent permitted by Section 3.11(a)(iii) and out of
amounts derived from the operation and sale of an REO Property to the extent
permitted by Section 3.23. Except as set forth in Section 6.04 hereof,

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<PAGE>

the right to receive the Servicing Fee may not be transferred in whole or in
part except in connection with the transfer of all of the Servicer's
responsibilities and obligations under this Agreement to the extent permitted
herein.

                  Additional servicing compensation in the form of assumption
fees, late payment charges and other miscellaneous fees (other than Prepayment
Charges) shall be retained by the Servicer only to the extent such fees or
charges are received by the Servicer. The Servicer shall also be entitled
pursuant to Section 3.11(a)(iv) to withdraw from the Collection Account and
pursuant to Section 3.23(b) to withdraw from any REO Account, as additional
servicing compensation, interest or other income earned on deposits therein,
subject to Section 3.12. The Servicer shall be required to pay all expenses
incurred by it in connection with its servicing activities hereunder and shall
not be entitled to reimbursement therefor except as specifically provided
herein.

                  SECTION 3.19. Reports to the Trustee; Collection Account
                                Statements.

                  Not later than fifteen days after each Distribution Date, the
Servicer shall forward to the Trustee and the Depositor a statement prepared by
the institution at which the Collection Account is maintained setting forth the
status of the Collection Account as of the close of business on such
Distribution Date and showing, for the period covered by such statement, the
aggregate amount of deposits into and withdrawals from the Collection Account of
each category of deposit specified in Section 3.10(a) and each category of
withdrawal specified in Section 3.11. Copies of such statement shall be provided
by the Trustee to any Certificateholder and to any Person identified to the
Trustee as a prospective transferee of a Certificate, upon request at the
expense of the requesting party, provided such statement is delivered by the
Servicer to the Trustee.

                  SECTION 3.20. Statement as to Compliance.

                  Not later than March 15th of each calendar year commencing in
2004, the Servicer will deliver to the Trustee and the Depositor an Officers'
Certificate (upon which the Trustee can conclusively rely in connection with its
obligations under Section 4.06) stating, as to each signatory thereof, that (i)
a review of the activities of the Servicer during the preceding year and of
performance under this Agreement has been made under such officers' supervision
and (ii) to the best of such officer's knowledge, based on such review, the
Servicer has fulfilled all of its obligations under this Agreement throughout
such year, or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officer and the nature
and status thereof. Copies of any such statement shall be provided by the
Trustee to any Certificateholder and to any Person identified to the Trustee as
a prospective transferee of a Certificate, upon request at the expense of the
requesting party, provided such statement is delivered by the Servicer to the
Trustee.

                  SECTION 3.21. Independent Public Accountants' Servicing
                                Report.

                  Not later than March 15th of each calendar year commencing in
2004, the Servicer, at its expense, shall cause a nationally recognized firm of
independent certified public accountants to furnish to the Servicer a report
stating that (i) it has obtained a letter of representation regarding certain
matters from the management of the Servicer which includes an assertion that the
Servicer

                                      -69-

<PAGE>

has complied with certain minimum residential mortgage loan servicing standards,
identified in the Uniform Single Attestation Program for Mortgage Bankers
established by the Mortgage Bankers Association of America, with respect to the
servicing of residential mortgage loans during the most recently completed
fiscal year and (ii) on the basis of an examination conducted by such firm in
accordance with standards established by the American Institute of Certified
Public Accountants, such representation is fairly stated in all material
respects, subject to such exceptions and other qualifications that may be
appropriate. Immediately upon receipt of such report, the Servicer shall furnish
a copy of such report to the Trustee and each Rating Agency. Copies of such
statement shall be provided by the Trustee to any Certificateholder upon request
at the Servicer's expense, provided that such statement is delivered by the
Servicer to the Trustee.

                  SECTION 3.22. Access to Certain Documentation.

                  The Servicer shall provide to the Office of Thrift
Supervision, the FDIC, and any other federal or state banking or insurance
regulatory authority that may exercise authority over any Certificate Owner,
access to the documentation regarding the Mortgage Loans required by applicable
laws and regulations. Such access shall be afforded without charge, but only
upon reasonable request and during normal business hours at the offices of the
Servicer designated by it. In addition, access to the documentation regarding
the Mortgage Loans will be provided to any Certificate Owner, the Trustee and to
any Person identified to the Servicer, as a prospective transferee of a
Certificate, upon reasonable request during normal business hours at the offices
of the Servicer designated by it at the expense of the Person requesting such
access.

                  SECTION 3.23. Title, Management and Disposition of REO
                                Property.

                  (a) The deed or certificate of sale of any REO Property shall
be taken in the name of the Trustee, or its nominee, on behalf of the Trust Fund
and for the benefit of the Certificateholders. The Servicer, on behalf of REMIC
I, shall either sell any REO Property by the close of the third calendar year
following the calendar year in which REMIC I acquires ownership of such REO
Property for purposes of Section 860(a)(8) of the Code or request from the
Internal Revenue Service, no later than 60 days before the day on which the
three-year grace period would otherwise expire an extension of the three-year
grace period, unless the Servicer had delivered to the Trustee an Opinion of
Counsel, addressed to the Trustee and the Depositor, to the effect that the
holding by REMIC I of such REO Property subsequent to three years after its
acquisition will not result in the imposition on any Trust REMIC created
hereunder of taxes on "prohibited transactions" thereof, as defined in Section
860F of the Code, or cause any Trust REMIC hereunder to fail to qualify as a
REMIC under Federal law at any time that any Certificates are outstanding. The
Servicer shall manage, conserve, protect and operate each REO Property for the
Certificateholders solely for the purpose of its prompt disposition and sale in
a manner which does not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code or
result in the receipt by any Trust REMIC created hereunder of any "income from
non-permitted assets" within the meaning of Section 860F(a)(2)(B) of the Code,
or any "net income from foreclosure property" which is subject to taxation under
the REMIC Provisions.

                  (b) The Servicer shall segregate and hold all funds collected
and received in connection with the operation of any REO Property separate and
apart from its own funds and

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<PAGE>

general assets and shall establish and maintain with respect to REO Properties
an account held in trust for the Trustee, on behalf of the Trust Fund and for
the benefit of the Certificateholders (the "REO Account"), which shall be an
Eligible Account. The Servicer shall be permitted to allow the Collection
Account to serve as the REO Account, subject to separate ledgers for each REO
Property. The Servicer shall be entitled to retain or withdraw any interest
income paid on funds deposited in the REO Account.

                  (c) The Servicer shall have full power and authority, subject
only to the specific requirements and prohibitions of this Agreement, to do any
and all things in connection with any REO Property as are consistent with the
manner in which the Servicer manages and operates similar property owned by the
Servicer or any of its Affiliates, all on such terms and for such period as the
Servicer deems to be in the best interests of Certificateholders. In connection
therewith, the Servicer shall deposit, or cause to be deposited, on a daily
basis in the REO Account all revenues received by it with respect to an REO
Property and shall withdraw therefrom funds necessary for the proper operation,
management and maintenance of such REO Property including, without limitation:

                  (i) all insurance premiums due and payable in respect of such
         REO Property;

                  (ii) all real estate taxes and assessments in respect of such
         REO Property that may result in the imposition of a lien thereon; and

                  (iii) all costs and expenses necessary to maintain such REO
         Property.

                  To the extent that amounts on deposit in the REO Account with
respect to an REO Property are insufficient for the purposes set forth in
clauses (i) through (iii) above with respect to such REO Property, the Servicer
shall advance from its own funds such amount as is necessary for such purposes
if, but only if, the Servicer would make such advances if the Servicer owned the
REO Property and if in the Servicer's judgment, the payment of such amounts will
be recoverable from the rental or sale of the REO Property.

                  Subject to compliance with applicable laws and regulations as
shall at any time be in force, and notwithstanding the foregoing, the Servicer
shall not:

                  (i) permit the Trust Fund to enter into, renew or extend any
         New Lease with respect to any REO Property, if the New Lease by its
         terms will give rise to any income that does not constitute Rents from
         Real Property;

                  (ii) permit any amount to be received or accrued under any New
         Lease other than amounts that will constitute Rents from Real Property;

                  (iii) authorize or permit any construction on any REO
         Property, other than the completion of a building or other improvement
         thereon, and then only if more than ten percent of the construction of
         such building or other improvement was completed before default on the
         related Mortgage Loan became imminent, all within the meaning of
         Section 856(e)(4)(B) of the Code; or

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<PAGE>

                  (iv) allow any Person to Directly Operate any REO Property on
         any date more than 90 days after its date of acquisition by the Trust
         Fund;

unless, in any such case, the Servicer has obtained an Opinion of Counsel,
provided to the Servicer and the Trustee, to the effect that such action will
not cause such REO Property to fail to qualify as "foreclosure property" within
the meaning of Section 860G(a)(8) of the Code at any time that it is held by
REMIC I, in which case the Servicer may take such actions as are specified in
such Opinion of Counsel.

                  The Servicer may contract with any Independent Contractor for
the operation and management of any REO Property, provided that:

                  (i) the terms and conditions of any such contract shall not be
         inconsistent herewith;

                  (ii) any such contract shall require, or shall be administered
         to require, that the Independent Contractor pay all costs and expenses
         incurred in connection with the operation and management of such REO
         Property, including those listed above and remit all related revenues
         (net of such costs and expenses) to the Servicer as soon as
         practicable, but in no event later than thirty days following the
         receipt thereof by such Independent Contractor;

                  (iii) none of the provisions of this Section 3.23(c) relating
         to any such contract or to actions taken through any such Independent
         Contractor shall be deemed to relieve the Servicer of any of its duties
         and obligations to the Trustee on behalf of the Trust Fund and for the
         benefit of the Certificateholders with respect to the operation and
         management of any such REO Property; and

                  (iv) the Servicer shall be obligated with respect thereto to
         the same extent as if it alone were performing all duties and
         obligations in connection with the operation and management of such REO
         Property.

                  The Servicer shall be entitled to enter into any agreement
with any Independent Contractor performing services for it related to its duties
and obligations hereunder for indemnification of the Servicer by such
Independent Contractor, and nothing in this Agreement shall be deemed to limit
or modify such indemnification. The Servicer shall be solely liable for all fees
owed by it to any such Independent Contractor, irrespective of whether the
Servicer's compensation pursuant to Section 3.18 is sufficient to pay such fees.

                  (d) In addition to the withdrawals permitted under Section
3.23(c), the Servicer may from time to time make withdrawals from the REO
Account for any REO Property: (i) to pay itself unpaid Servicing Fees in respect
of the related Mortgage Loan; and (ii) to reimburse itself or any Sub-Servicer
for unreimbursed Servicing Advances and Advances made in respect of such REO
Property or the related Mortgage Loan. On the Servicer Remittance Date, the
Servicer shall withdraw from each REO Account maintained by it and deposit into
the Distribution Account in accordance with Section 3.10(d)(ii), for
distribution on the related Distribution Date in accordance with Section 4.01,
the income from the related REO Property received during the prior calendar
month, net of any

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<PAGE>

withdrawals made pursuant to Section 3.23(c) or this Section 3.23(d).

                  (e) Subject to the time constraints set forth in Section
3.23(a), each REO Disposition shall be carried out by the Servicer at such price
and upon such terms and conditions as the Servicer shall deem necessary or
advisable, as shall be normal and usual in its Accepted Servicing Practices.

                  (f) The proceeds from the REO Disposition, net of any amount
required by law to be remitted to the Mortgagor under the related Mortgage Loan
and net of any payment or reimbursement to the Servicer as provided above, shall
be deposited in the Distribution Account in accordance with Section 3.10(d)(ii)
on the Servicer Remittance Date in the month following the receipt thereof for
distribution on the related Distribution Date in accordance with Section 4.01.
Any REO Disposition shall be for cash only (unless changes in the REMIC
Provisions made subsequent to the Startup Day allow a sale for other
consideration).

                  (g) The Servicer shall file information returns (and shall
provide a certification of a Servicing Officer to the Trustee that such filings
have been made) with respect to the receipt of mortgage interest received in a
trade or business, reports of foreclosures and abandonments of any Mortgaged
Property and cancellation of indebtedness income with respect to any Mortgaged
Property as required by Sections 6050H, 6050J and 6050P of the Code,
respectively. Such reports shall be in form and substance sufficient to meet the
reporting requirements imposed by such Sections 6050H, 6050J and 6050P of the
Code.

                  SECTION 3.24. Obligations of the Servicer in Respect of
                                Prepayment Interest Shortfalls.

                  The Servicer shall deliver to the Trustee for deposit into the
Distribution Account on or before 5:00 p.m. New York time on the Servicer
Remittance Date from its own funds an amount equal to the lesser of (i) the
aggregate of the Prepayment Interest Shortfalls attributable to prepayments in
full for the related Distribution Date resulting solely from Principal
Prepayments received by the Servicer during the related Prepayment Period and
(ii) 50% of its aggregate Servicing Fee for the most recently ended Prepayment
Period. The Servicer shall not have the right to reimbursement for any amounts
remitted to the Trustee in respect of this Section 3.24. The Servicer shall not
be obligated to pay the amounts set forth in this Section 3.24 with respect to
Relief Act Interest Shortfalls.

                  SECTION 3.25. [Reserved].

                  SECTION 3.26. Obligations of the Servicer in Respect of
                                Mortgage Rates and Monthly Payments.

                  In the event that a shortfall in any collection on or
liability with respect to any Mortgage Loan results from or is attributable to
adjustments to Mortgage Rates, Monthly Payments or Stated Principal Balances
that were made by the Servicer in a manner not consistent with the terms of the
related Mortgage Note and this Agreement, the Servicer, upon discovery or
receipt of notice thereof, immediately shall deliver to the Trustee for deposit
in the Distribution Account from

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<PAGE>

its own funds the amount of any such shortfall and shall indemnify and hold
harmless the Trust Fund, the Trustee, the Depositor and any successor Servicer
in respect of any such liability. Such indemnities shall survive the termination
or discharge of this Agreement.

                  SECTION 3.27. Net WAC Rate Carryover Reserve Account.

                  (a) No later than the Closing Date, the Trustee shall
establish and maintain with itself, as agent for the Trustee, a separate,
segregated trust account titled, "Net WAC Rate Carryover Reserve Account, [NAME
OF TRUSTEE], as Trustee, in trust for the registered holders of Citigroup
Mortgage Loan Trust Inc., Citigroup Home Equity Loan Trust, Series 20__-____,
Asset Backed Pass-Through Certificates." On the Closing Date, the Depositor will
deposit, or cause to be deposited, into the Net WAC Rate Carryover Reserve
Account, $1,000.

                  (b) On each Distribution Date as to which there is a Net WAC
Rate Carryover Amount payable to the Class A Certificates or the Mezzanine
Certificates, the Trustee has been directed by the Class CE Certificateholders
to, and therefore will, deposit into the Net WAC Rate Carryover Reserve Account
the amounts described in Section 4.01(a)(4)(xiii), rather than distributing such
amounts to the Class CE Certificateholders. On each such Distribution Date, the
Trustee shall hold all such amounts for the benefit of the Holders of the Class
A Certificates and the Mezzanine Certificates, and will distribute such amounts
to the Holders of the Class A Certificates and the Mezzanine Certificates in the
amounts and priorities set forth in Section 4.01(a). If no Net WAC Rate
Carryover Amounts are payable on a Distribution Date, the Trustee shall deposit
into the Net WAC Rate Carryover Reserve Account on behalf of the Class CE
Certificateholders, from amounts otherwise distributable to the Class CE
Certificateholders, an amount such that when added to other amounts already on
deposit in the Net WAC Rate Carryover Reserve Account, the aggregate amount on
deposit therein is equal to $1,000.

                  (c) For federal and state income tax purposes, the Class CE
Certificateholders will be deemed to be the owners of the Net WAC Rate Carryover
Reserve Account and all amounts deposited into the Net WAC Rate Carryover
Reserve Account (other than the initial deposit therein of $1,000) shall be
treated as amounts distributed by REMIC II to the Holders of the Class CE
Certificates. Upon the termination of the Trust Fund, or the payment in full of
the Class A Certificates and the Mezzanine Certificates, all amounts remaining
on deposit in the Net WAC Rate Carryover Reserve Account will be released by the
Trust Fund and distributed to the Class CE Certificateholders or their
designees. The Net WAC Rate Carryover Reserve Account will be part of the Trust
Fund but not part of any Trust REMIC and any payments to the Holders of the
Class A Certificates or the Mezzanine Certificates of Net WAC Rate Carryover
Amounts will not be payments with respect to a "regular interest" in a REMIC
within the meaning of Code Section 860(G)(a)(1).

                  (d) By accepting a Class CE Certificate, each Class CE
Certificateholder hereby agrees to direct the Trustee, and the Trustee hereby is
directed to deposit into the Net WAC Rate Carryover Reserve Account the amounts
described above on each Distribution Date as to which there is any Net WAC Rate
Carryover Amount rather than distributing such amounts to the Class CE
Certificateholders. By accepting a Class CE Certificate, each Class CE
Certificateholder further agrees that such direction is given for good and
valuable consideration, the receipt and sufficiency

                                      -74-

<PAGE>

of which is acknowledged by such acceptance.

                  (e) At the written direction of the Holders of a majority in
Percentage Interest in the Class CE Certificates, the Trustee shall direct any
depository institution maintaining the Net WAC Rate Carryover Reserve Account to
invest the funds in such account in one or more Permitted Investments bearing
interest or sold at a discount, and maturing, unless payable on demand, (i) no
later than the Business Day immediately preceding the date on which such funds
are required to be withdrawn from such account pursuant to this Agreement, if a
Person other than the Trustee or an Affiliate manages or advises such
investment, and (ii) no later than the date on which such funds are required to
be withdrawn from such account pursuant to this Agreement, if the Trustee or an
Affiliate manages or advises such investment. If no investment direction of the
Holders of a majority in Percentage Interest in the Class CE Certificates with
respect to the Net WAC Rate Carryover Reserve Account is received by the
Trustee, the Trustee shall invest the funds in Deutsche Cash Management Fund 541
so long as it is a Permitted Investment or as otherwise directed in writing by
the Depositor on behalf of the Holders of a majority Percentage Interest in the
Class CE Certificates. All income and gain earned upon such investment shall be
deposited into the Net WAC Rate Carryover Reserve Account.

                  (f) For federal tax return and information reporting, the
right of the Class A Certificateholders and the Mezzanine Certificateholders to
receive payments from the Net WAC Rate Carryover Reserve Account in respect of
any Net WAC Rate Carryover Amount shall be assigned a value of zero.

                  SECTION 3.28. Advance Facility.

                  (a) The Servicer is hereby authorized to enter into a
financing or other facility (any such arrangement, an "Advance Facility"), the
documentation for which complies with Section 3.28(e) below, under which (1) the
Servicer assigns or pledges its rights under this Agreement to be reimbursed for
any or all Advances and/or Servicing Advances to (i) a Person, which may be a
special-purpose bankruptcy-remote entity (an "SPV"), (ii) a Person, which may
simultaneously assign or pledge such rights to an SPV or (iii) a lender (a
"Lender"), which, in the case of any Person or SPV of the type described in
either of the preceding clauses (i) or (ii), may directly or through other
assignees and/or pledgees, assign or pledge such rights to a Person, which may
include a trustee acting on behalf of holders of debt instruments (any such
Person or any such Lender, an "Advance Financing Person"), and/or (2) an Advance
Financing Person agrees to fund all the Advances and/or Servicing Advances
required to be made by the Servicer pursuant to this Agreement. No consent of
the Trustee, Certificateholders or any other party shall be required before the
Servicer may enter into an Advance Facility nor shall the Trustee or the
Certificateholders be a third party beneficiary of any obligation of an Advance
Financing Person to the Servicer. Notwithstanding the existence of any Advance
Facility under which an Advance Financing Person agrees to fund Advances and/or
Servicing Advances, (A) the Servicer (i) shall remain obligated pursuant to this
Agreement to make Advances and/or Servicing Advances pursuant to and as required
by this Agreement and (ii) shall not be relieved of such obligations by virtue
of such Advance Facility and (B) neither the Advance Financing Person nor any
Servicer's Assignee (as hereinafter defined) shall have any right to proceed
against or otherwise contact any Mortgagor for the purpose of collecting any
payment that may be due with respect to any related Mortgage Loan or enforcing
any covenant of such Mortgagor under

                                      -75-

<PAGE>

the related Mortgage Loan documents.

                  (b) If the Servicer enters into an Advance Facility, the
Servicer and the related Advance Financing Person shall deliver to the Trustee
at the address set forth in Section 11.05 hereof a written notice (an "Advance
Facility Notice"), stating (a) the identity of the Advance Financing Person and
(b) the identity of the Person (the "Servicer's Assignee") that will, subject to
Section 3.28(c) hereof, have the right to receive amounts available from the
Collection Account pursuant to Section 3.11(a) hereof to reimburse previously
unreimbursed Advances and/or Servicing Advances ("Advance Reimbursement
Amounts"). Advance Reimbursement Amounts (i) shall consist solely of amounts in
respect of Advances and/or Servicing Advances for which the Servicer would be
permitted to reimburse itself in accordance with Section 3.11(a) hereof,
assuming the Servicer had made the related Advance(s) and/or Servicing
Advance(s) and (ii) shall not consist of amounts payable to a successor Servicer
in accordance with Section 3.11(a) hereof to the extent permitted under Section
3.28(e) below.

                  (c) Notwithstanding the existence of an Advance Facility, the
Servicer, on behalf of the Advance Financing Person, shall be entitled to
receive reimbursements of Advances and/or Servicing Advances in accordance with
Section 3.11(a) hereof, which entitlement may be terminated by the Advance
Financing Person pursuant to a written notice to the Trustee in the manner set
forth in Section 11.05 hereof. Upon receipt of such written notice, the Servicer
shall no longer be entitled to receive reimbursement for any Advance
Reimbursement Amounts and the Servicer's Assignee shall immediately have the
right to receive from the Collection Account all Advance Reimbursement Amounts.
Notwithstanding the foregoing, an Advance Financing Person shall only be
entitled to reimbursement of Advance Reimbursement Amounts hereunder pursuant to
Section 3.11(a) of this Agreement and shall not otherwise be entitled to receive
amounts designated for distribution to Certificateholders. None of the Trustee
or the Certificateholders shall have any right to, or otherwise be entitled to,
receive any amounts which constitute Advance Reimbursement Amounts. An Advance
Facility may be terminated by the joint written direction of the Servicer and
the related Advance Financing Person. Written notice of such termination shall
be delivered to the Trustee in the manner set forth in Section 11.05 hereof.
None of the Depositor or the Trustee shall, as a result of the existence of any
Advance Facility, have any additional duty or liability with respect to the
calculation or payment of any Advance Reimbursement Amount, nor, as a result of
the existence of any Advance Facility, shall the Depositor or the Trustee have
any additional responsibility to track or monitor the administration of the
Advance Facility or the payment of Advance Reimbursement Amounts to the
Servicer's Assignee. The Servicer shall indemnify the Depositor, the Trustee,
any successor Servicer and the Trust Fund resulting from any claim by the
related Advance Financing Person. The Servicer shall maintain and provide to any
successor Servicer and, upon request, the Trustee a detailed accounting on a
loan-by-loan basis as to amounts advanced by, pledged or assigned to, and
reimbursed to any Advance Financing Person. The successor Servicer shall be
entitled to rely on any such information provided by the predecessor Servicer,
and the successor Servicer shall not be liable for any errors in such
information.

                  (d)      [Reserved].

                  (e) As between a predecessor Servicer and its Advance
Financing Person, on the one hand, and a successor Servicer and its Advance
Financing Person, if any, on the other hand,

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<PAGE>

Advance Reimbursement Amounts on a loan-by-loan basis with respect to each
Mortgage Loan as to which an Advance and/or Servicing Advance shall have been
made and be outstanding shall be allocated on a "first-in, first out" basis. In
the event the Servicer's Assignee shall have received some or all of an Advance
Reimbursement Amount related to Advances and/or Servicing Advances that were
made by a Person other than such predecessor Servicer or its related Advance
Financing Person in error, then such Servicer's Assignee shall be required to
remit any portion of such Advance Reimbursement Amount to each Person entitled
to such portion of such Advance Reimbursement Amount. Without limiting the
generality of the foregoing, the Servicer shall remain entitled to be reimbursed
by the Advance Financing Person for all Advances and/or Servicing Advances
funded by the Servicer to the extent the related Advance Reimbursement Amounts
have not been assigned or pledged to such Advance Financing Person or Servicer's
Assignee.

                  (f) For purposes of any Officer's Certificate of the Servicer
made pursuant to Section 4.03(d), any Nonrecoverable Advance or Nonrecoverable
Servicing Advance referred to therein may have been made by such Servicer or any
predecessor Servicer. In making its determination that any Advance or Servicing
Advance theretofore made has become a Nonrecoverable Advance or Nonrecoverable
Servicing Advance, as applicable, the Servicer shall apply the same criteria in
making such determination regardless of whether such Advance or Servicing
Advance shall have been made by the Servicer or any predecessor Servicer.

                  (g) Any amendment to this Section 3.28 or to any other
provision of this Agreement that may be necessary or appropriate to effect the
terms of an Advance Facility as described generally in this Section 3.28, may be
entered into by the Trustee, the Depositor and the Servicer without the consent
of any Certificateholder, provided such amendment complies with Section 11.01
hereof. All reasonable costs and expenses (including attorneys' fees) of each
party hereto of any such amendment shall be borne solely by the Servicer without
reimbursement from the Trust Fund. The parties hereto hereby acknowledge and
agree that: (a) the Advances and/or Servicing Advances financed by and/or
pledged to an Advance Financing Person under any Advance Facility are
obligations owed to the Servicer payable only from the cash flows and proceeds
received under this Agreement for reimbursement of Advances and/or Servicing
Advances only to the extent provided herein, and the Trustee and the Trust are
not, as a result of the existence of any Advance Facility, obligated or liable
to repay any Advances and/or Servicing Advances financed by the Advance
Financing Person; (b) the Servicer will be responsible for remitting to the
Advance Financing Person the applicable amounts collected by it as reimbursement
for Advances and/or Servicing Advances funded by the Advance Financing Person,
subject to the provisions of this Agreement; and (c) the Trustee shall not have
any responsibility to track or monitor the administration of the financing
arrangement between the Servicer and any Advance Financing Person.

                                      -77-

<PAGE>

                                   ARTICLE IV

                         PAYMENTS TO CERTIFICATEHOLDERS

                  SECTION 4.01. Distributions.

                  (a)(1) On each Distribution Date, the following amounts, in
the following order of priority, shall be distributed by REMIC I to REMIC II on
account of the REMIC I Regular Interests or withdrawn from the Distribution
Account and distributed to the holders of the Class R-I Interest, as the case
may be:

                  (i) first, to Holders of REMIC I Regular Interest I-LTAA,
         REMIC I Regular Interest I-LTA, REMIC I Regular Interest I-LTM1, REMIC
         I Regular Interest I-LTM2, REMIC I Regular Interest I-LTM3, REMIC I
         Regular Interest I-LTM4, REMIC I Regular Interest I-LTM5 and REMIC I
         Regular Interest I-LTZZ, in an amount equal to (A) the Uncertificated
         Interest for such Distribution Date, plus (B) any amounts in respect
         thereof remaining unpaid from previous Distribution Dates. Amounts
         payable as Uncertificated Interest in respect of REMIC I Regular
         Interest I-LTZZ shall be reduced when the sum of the REMIC I
         Overcollateralized Amount is less than the REMIC I Required
         Overcollateralized Amount, by the lesser of (x) the amount of such
         difference and (y) the Maximum I-LTZZ Uncertificated Interest Deferral
         Amount and such amounts will be payable to the Holders of REMIC I
         Regular Interest I-LTA, REMIC I Regular Interest I-LTM1, REMIC I
         Regular Interest I-LTM2, REMIC I Regular Interest I-LTM3, REMIC I
         Regular Interest I-LTM4 and REMIC I Regular Interest I-LTM5 in the same
         proportion as the Overcollateralization Increase Amount is allocated to
         the Corresponding Certificates;

                  (ii) second, to the Holders of REMIC I Regular Interests, in
         an amount equal to the remainder of the Available Distribution Amount
         for such Distribution Date after the distributions made pursuant to
         clause (i) above, allocated as follows:

                           (a) to the Holders of REMIC I Regular Interest
                  I-LTAA, 98.00% of such remainder (less the amount payable in
                  clause (d) below), until the Uncertificated Balance of such
                  REMIC I Regular Interest is reduced to zero;

                           (b) to the Holders of REMIC I Regular Interest I-LTA,
                  REMIC I Regular Interest I-LTM1, REMIC I Regular Interest
                  I-LTM2, REMIC I Regular Interest I- LTM3, REMIC I Regular
                  Interest I-LTM4 and REMIC I Regular Interest I-LTM5, 1.00% of
                  such remainder (less the amount payable in clause (d) below),
                  in the same proportion as principal payments are allocated to
                  the Corresponding Certificates, until the Uncertificated
                  Balances of such REMIC I Regular Interests are reduced to
                  zero;

                           (c) to the Holders of REMIC I Regular Interest
                  I-LTZZ, 1.00% of such remainder (less the amount payable in
                  clause (d) below), until the Uncertificated Balance of such
                  REMIC I Regular Interest is reduced to zero; then

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                           (d) to the Holders of REMIC I Regular Interest I-LTP,
                  on the Distribution Date immediately following the expiration
                  of the latest Prepayment Charge as identified on the
                  Prepayment Charge Schedule or any Distribution Date thereafter
                  until $100 has been distributed pursuant to this clause; and

                           (e)      any remaining amount to the Holders of the
                  Class R Certificates (as Holder of the Class R-I Interest);

provided, however, that 98.00% and 2.00% of any principal payments that are
attributable to an Overcollateralization Reduction Amount shall be allocated to
Holders of REMIC I Regular Interest I-LTAA and REMIC I Regular Interest I-LTZZ,
respectively.

                  (2) On each Distribution Date, the Trustee shall withdraw from
the Distribution Account an amount equal to the Interest Remittance Amount and
distribute to the Certificateholders the following amounts, in the following
order of priority:

                  (i) to the Holders of the Class A Certificates, an amount
         equal to the Senior Interest Distribution Amount allocable to the Class
         A Certificates;

                  (ii) to the Holders of the Class M-1 Certificates, an amount
         equal to the Interest Distribution Amount allocable to the Class M-1
         Certificates;

                  (iii) to the Holders of the Class M-2 Certificates, an amount
         equal to the Interest Distribution Amount allocable to the Class M-2
         Certificates;

                  (iv) to the Holders of the Class M-3 Certificates, an amount
         equal to the Interest Distribution Amount allocable to the Class M-3
         Certificates;

                  (v) to the Holders of the Class M-4 Certificates, an amount
         equal to the Interest Distribution Amount allocable to the Class M-4
         Certificates; and

                  (vi) to the Holders of the Class M-5 Certificates, an amount
         equal to the Interest Distribution Amount allocable to the Class M-5
         Certificates.

                  (3) On each Distribution Date, the Trustee shall withdraw from
the Distribution Account an amount equal to the Principal Distribution Amount
and distribute to the Certificateholders the following amounts, in the following
order of priority:

                  (A) On each Distribution Date (a) prior to the Stepdown Date
         or (b) on which a Trigger Event is in effect, the Principal
         Distribution Amount shall be distributed in the following order of
         priority;

                  (i) to the Holders of the Class A Certificates, until the
         Certificate Principal Balance of such Class has been reduced to zero;

                  (ii) to the Holders of the Class M-1 Certificates, until the
         Certificate Principal

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<PAGE>

         Balance of such Class has been reduced to zero;

                  (iii) to the Holders of the Class M-2 Certificates, until the
         Certificate Principal Balance of such Class has been reduced to zero;

                  (iv) to the Holders of the Class M-3 Certificates, until the
         Certificate Principal Balance of such Class has been reduced to zero;

                  (v) to the Holders of the Class M-4 Certificates, until the
         Certificate Principal Balance of such Class has been reduced to zero;
         and

                  (vi) to the Holders of the Class M-5 Certificates, until the
         Certificate Principal Balance of such Class has been reduced to zero.

                  (B) On each Distribution Date (a) on or after the Stepdown
         Date and (b) on which a Trigger Event is not in effect, the Principal
         Distribution Amount shall be distributed in the following order of
         priority;

                  (i) the Class A Principal Distribution Amount shall be
         distributed to the Holders of the Class A Certificates, until the
         Certificate Principal Balance of such Class has been reduced to zero;

                  (ii) the Class M-1 Principal Distribution Amount shall be
         distributed to the Holders of the Class M-1 Certificates, until the
         Certificate Principal Balance of such Class has been reduced to zero;

                  (iii) the Class M-2 Principal Distribution Amount shall be
         distributed to the Holders of the Class M-2 Certificates, until the
         Certificate Principal Balance of such Class has been reduced to zero;

                  (iv) the Class M-3 Principal Distribution Amount shall be
         distributed to the Holders of the Class M-3 Certificates, until the
         Certificate Principal Balance of such Class has been reduced to zero;

                  (v) the Class M-4 Principal Distribution Amount shall be
         distributed to the Holders of the Class M-4 Certificates, until the
         Certificate Principal Balance of such Class has been reduced to zero;
         and

                  (vi) the Class M-5 Principal Distribution Amount shall be
         distributed to the Holders of the Class M-5 Certificates, until the
         Certificate Principal Balance of such Class has been reduced to zero.

                  (4) On each Distribution Date, the Net Monthly Excess Cashflow
shall be distributed by the Trustee as follows:

                  (i) to the Holders of the Class or Classes of Certificates
         then entitled to receive

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<PAGE>

         distributions in respect of principal, as part of the Principal
         Distribution Amount in an amount equal to the Overcollateralization
         Increase Amount for the Certificates, applied to reduce the Certificate
         Principal Balance of such Certificates until the aggregate Certificate
         Principal Balance of such Certificates is reduced to zero;

                  (ii) to the Holders of the Class M-1 Certificates, in an
         amount equal to the Interest Carry Forward Amount allocable to such
         Class of Certificates;

                  (iii) to the Holders of the Class M-2 Certificates, in an
         amount equal to the Interest Carry Forward Amount allocable to such
         Class of Certificates;

                  (iv) to the Holders of the Class M-3 Certificates, in an
         amount equal to the Interest Carry Forward Amount allocable to such
         Class of Certificates;

                  (v) to the Holders of the Class M-4 Certificates, in an amount
         equal to the Interest Carry Forward Amount allocable to such Class of
         Certificates;

                  (vi) to the Holders of the Class M-5 Certificates, in an
         amount equal to the Interest Carry Forward Amount allocable to such
         Class of Certificates;

                  (vii) to the Holders of the Class A Certificates, in an amount
         equal to the aggregate of any Prepayment Interest Shortfalls and any
         Relief Act Interest Shortfall on the Mortgage Loans allocated to such
         Certificates;

                  (viii) to the Holders of the Class M-1 Certificates, in an
         amount equal to the aggregate of any Prepayment Interest Shortfalls and
         any Relief Act Interest Shortfall on the Mortgage Loans allocated to
         such Certificates;

                  (ix) to the Holders of the Class M-2 Certificates, in an
         amount equal to the aggregate of any Prepayment Interest Shortfalls and
         any Relief Act Interest Shortfall on the Mortgage Loans allocated to
         such Certificates;

                  (x) to the Holders of the Class M-3 Certificates, in an amount
         equal to the aggregate of any Prepayment Interest Shortfalls and any
         Relief Act Interest Shortfall on the Mortgage Loans allocated to such
         Certificates;

                  (xi) to the Holders of the Class M-4 Certificates, in an
         amount equal to the aggregate of any Prepayment Interest Shortfalls and
         any Relief Act Interest Shortfall on the Mortgage Loans allocated to
         such Certificates;

                  (xii) to the Holders of the Class M-5 Certificates, in an
         amount equal to the aggregate of any Prepayment Interest Shortfalls and
         any Relief Act Interest Shortfall on the Mortgage Loans allocated to
         such Certificates;

                  (xiii) to the Net WAC Rate Carryover Reserve Account, the
         amount required by Section 3.27(b);

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<PAGE>

                  (xiv) to the Holders of the Class CE Certificates the Interest
         Distribution Amount and any remaining Overcollateralization Reduction
         Amount for such Distribution Date; and

                  (xv) to the Holders of the Class R Certificates, any remaining
         amounts; provided that if such Distribution Date is the Distribution
         Date immediately following the expiration of the latest Prepayment
         Charge term on a Mortgage Loan as identified on the Mortgage Loan
         Schedule or any Distribution Date thereafter, then any such remaining
         amounts will be distributed first, to the Holders of the Class P
         Certificates, until the Certificate Principal Balance thereof has been
         reduced to zero; and second, to the Holders of the Class R
         Certificates.

                  On each Distribution Date, after making the distributions of
the Available Distribution Amount as set forth above, the Trustee will FIRST,
withdraw from the Net WAC Rate Carryover Reserve Account all income from the
investment of funds in the Net WAC Rate Carryover Reserve Account and distribute
such amount to the Class CE Certificates, and SECOND, withdraw from the Net WAC
Rate Carryover Reserve Account, to the extent of amounts remaining on deposit
therein, the amount of any Net WAC Rate Carryover Amount with respect to the
Class A Certificates and the Mezzanine Certificates for such Distribution Date
and distribute such amount FIRST, to the Class A Certificates; SECOND, to the
Class M-1 Certificates, THIRD, to the Class M-2 Certificates, FOURTH, to the
Class M-3 Certificates, FIFTH, to the Class M-4 Certificates and SIXTH, to the
Class M-5 Certificates, in each case to the extent such Net WAC Carryover Amount
is allocable to each such Class.

                  With respect to any distributions to be made on the Class M-3
Certificates, the Class M-4 Certificates, the Class M-5 Certificates, the Class
CE Certificates or the Class P Certificates pursuant to Section 4.01(a)(2), (3)
or (4) such distributions will be made first, on the Class M-3 Interest, the
Class M-4 Interest, the Class M-5 Interest, the Class CE Interest or the Class P
Interest, as applicable, and then, on the related Class of Certificates.

                  (b) On each Distribution Date, the Trustee shall withdraw any
amounts then on deposit in the Distribution Account that represent Prepayment
Charges collected by the Servicer in connection with the Principal Prepayment of
any of the Mortgage Loans or any Servicer Prepayment Charge Payment Amount and
shall distribute such amounts to the Holders of the Class P Interest. Such
distributions shall not be applied to reduce the Certificate Principal Balance
of the Class P Interest.

                  (c) All distributions made with respect to each Class of
Certificates on each Distribution Date shall be allocated PRO RATA among the
outstanding Certificates in such Class based on their respective Percentage
Interests. Payments in respect of each Class of Certificates on each
Distribution Date shall be made to the Holders of the respective Class of record
on the related Record Date (except as otherwise provided in Section 4.01(e) or
Section 9.01 respecting the final distribution on such Class), based on the
aggregate Percentage Interest represented by their respective Certificates, and
shall be made by wire transfer of immediately available funds to the account of
any such Holder at a bank or other entity having appropriate facilities
therefor, if such Holder shall have so notified the Trustee in writing at least
five Business Days prior to the Record Date immediately prior to such
Distribution Date, or otherwise by check mailed by first class mail

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<PAGE>

to the address of such Holder appearing in the Certificate Register. The final
distribution on each Certificate shall be made in like manner, but only upon
presentment and surrender of such Certificate at the office of the Trustee
maintained for such purpose pursuant to Section 8.12 or such other location
specified in the notice to Certificateholders of such final distribution.

                  Each distribution with respect to a Book-Entry Certificate
shall be paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the Certificate Owners that it represents and to each indirect participating
brokerage firm (a "brokerage firm" or "indirect participating firm") for which
it acts as agent. Each brokerage firm shall be responsible for disbursing funds
to the Certificate Owners that it represents. None of the Trustee, the Depositor
or the Servicer shall have any responsibility therefor except as otherwise
provided by this Agreement or applicable law.

                  (d) The rights of the Certificateholders to receive
distributions in respect of the Certificates, and all interests of the
Certificateholders in such distributions, shall be as set forth in this
Agreement. None of the Holders of any Class of Certificates, the Trustee or the
Servicer shall in any way be responsible or liable to the Holders of any other
Class of Certificates in respect of amounts properly previously distributed on
the Certificates.

                  (e) Except as otherwise provided in Section 9.01, whenever the
Trustee expects that the final distribution with respect to any Class of
Certificates will be made on the next Distribution Date, the Trustee shall, no
later than three (3) days before the related Distribution Date (to the extent
that an accurate Remittance Report is received in a timely manner by the
Trustee), mail to each Holder on such date of such Class of Certificates a
notice to the effect that:

                  (i) the Trustee expects that the final distribution with
         respect to such Class of Certificates will be made on such Distribution
         Date but only upon presentation and surrender of such Certificates at
         the office of the Trustee therein specified, and

                  (ii) no interest shall accrue on such Certificates from and
         after the end of the related Interest Accrual Period.

                  Any funds not distributed to any Holder or Holders of
Certificates of such Class on such Distribution Date because of the failure of
such Holder or Holders to tender their Certificates shall, on such date, be set
aside and held in trust by the Trustee and credited to the account of the
appropriate non-tendering Holder or Holders. If any Certificates as to which
notice has been given pursuant to this Section 4.01(e) shall not have been
surrendered for cancellation within six months after the time specified in such
notice, the Trustee shall mail a second notice to the remaining non- tendering
Certificateholders to surrender their Certificates for cancellation in order to
receive the final distribution with respect thereto. If within one year after
the second notice all such Certificates shall not have been surrendered for
cancellation, the Trustee shall, directly or through an agent, mail a final
notice to the remaining non-tendering Certificateholders concerning surrender of
their Certificates but shall continue to hold any remaining funds for the
benefit of non-tendering Certificateholders. The costs and expenses of
maintaining the funds in trust and of contacting such

                                      -83-

<PAGE>

Certificateholders shall be paid out of the assets held in trust for such
Certificateholders. If within one year after the final notice any such
Certificates shall not have been surrendered for cancellation, the Trustee shall
pay to Citigroup Global Markets Inc., in accordance with its wiring
instructions, all such amounts, and all rights of non-tendering
Certificateholders in or to such amounts shall thereupon cease. No interest
shall accrue or be payable to any Certificateholder on any amount held in trust
by the Trustee as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with this Section
4.01(e). Any such amounts held in trust by the Trustee shall be held in an
Eligible Account and shall be held uninvested.

                  (f) Notwithstanding anything to the contrary herein, (i) in no
event shall the Certificate Principal Balance of a Class A Certificate or a
Mezzanine Certificate be reduced more than once in respect of any particular
amount allocated to such Certificate in respect of Realized Losses pursuant to
Section 4.04 and (ii) in no event shall the Uncertificated Balance of a REMIC I
Regular Interest be reduced more than once in respect of any particular amount
both (a) allocated to such REMIC I Regular Interest in respect of Realized
Losses pursuant to Section 4.04 and (b) distributed on such REMIC I Regular
Interest in reduction of the Uncertificated Balance thereof pursuant to this
Section 4.01.

                  SECTION 4.02. Statements to Certificateholders.

                  On each Distribution Date, the Trustee shall prepare and make
available via its website to each Holder of the Regular Certificates, a
statement as to the distributions made on such Distribution Date setting forth:

                  (i) the amount of the distribution made on such Distribution
         Date to the Holders of the Certificates of each Class allocable to
         principal, and the amount of the distribution made on such Distribution
         Date to the Holders of the Class P Interest and the Class P
         Certificates allocable to Prepayment Charges;

                  (ii) the amount of the distribution made on such Distribution
         Date to the Holders of the Certificates of each Class allocable to
         interest;

                  (iii) the aggregate Servicing Fee received by the Servicer
         during the related Due Period and such other customary information as
         the Trustee deems necessary or desirable, or which a Certificateholder
         reasonably requests, to enable Certificateholders to prepare their tax
         returns;

                  (iv) the aggregate amount of Advances for such Distribution
         Date;

                  (v) the aggregate Stated Principal Balance of the Mortgage
         Loans and any REO Properties as of the close of business on such
         Distribution Date;

                  (vi) the number, aggregate principal balance, weighted average
         remaining term to maturity and weighted average Mortgage Rate of the
         Mortgage Loans as of the related Due Date;

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<PAGE>

                  (vii) the number and aggregate unpaid principal balance of
         Mortgage Loans (a) delinquent 30 to 59 days, (b) delinquent 60 to 89
         days, (c) delinquent 90 or more days, in each case, as of the last day
         of the preceding calendar month, (d) as to which foreclosure
         proceedings have been commenced and (e) with respect to which the
         related Mortgagor has filed for protection under applicable bankruptcy
         laws, with respect to whom bankruptcy proceedings are pending or with
         respect to whom bankruptcy protection is in force;

                  (viii) with respect to any Mortgage Loan that became an REO
         Property during the preceding calendar month, the loan number of such
         Mortgage Loan, the unpaid principal balance and the Stated Principal
         Balance of such Mortgage Loan as of the date it became an REO Property;

                  (ix) the book value of any REO Property as of the close of
         business on the last Business Day of the calendar month preceding the
         Distribution Date;

                  (x) the aggregate amount of Principal Prepayments made during
         the related Prepayment Period;

                  (xi) the aggregate amount of Realized Losses incurred during
         the related Prepayment Period (or, in the case of Bankruptcy Losses
         allocable to interest, during the related Due Period), separately
         identifying whether such Realized Losses constituted Bankruptcy Losses
         and the aggregate amount of Realized Losses incurred since the Closing
         Date;

                  (xii) the aggregate amount of Extraordinary Trust Fund
         Expenses withdrawn from the Collection Account or the Distribution
         Account for such Distribution Date;

                  (xiii) the aggregate Certificate Principal Balance and
         Notional Amount, as applicable, of each Class of Certificates, after
         giving effect to the distributions, and allocations of Realized Losses,
         made on such Distribution Date, separately identifying any reduction
         thereof due to allocations of Realized Losses;

                  (xiv) the Certificate Factor for each such Class of
         Certificates applicable to such Distribution Date;

                  (xv) the Interest Distribution Amount in respect of the Class
         A Certificates, the Mezzanine Certificates and the Class CE Interest
         for such Distribution Date and the Interest Carry Forward Amount, if
         any, with respect to the Class A Certificates and the Mezzanine
         Certificates on such Distribution Date, and in the case of the Class A
         Certificates, the Mezzanine Certificates and the Class CE Interest,
         separately identifying any reduction thereof due to allocations of
         Realized Losses, Prepayment Interest Shortfalls and Relief Act Interest
         Shortfalls;

                  (xvi) the aggregate amount of any Prepayment Interest
         Shortfall for such Distribution Date, to the extent not covered by
         payments by the Servicer pursuant to Section 3.24;

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<PAGE>

                  (xvii) the aggregate amount of Relief Act Interest Shortfalls
         for such Distribution Date;

                  (xviii) the Overcollateralization Target Amount and the Credit
         Enhancement Percentage for such Distribution Date;

                  (xix) the Overcollateralization Increase Amount, if any, for
         such Distribution Date;

                  (xx) the Overcollateralization Reduction Amount, if any, for
         such Distribution Date;

                  (xxi) the respective Pass-Through Rates applicable to the
         Class A Certificates, the Mezzanine Certificates, the Class CE Interest
         and the Class CE Certificates for such Distribution Date and the
         Pass-Through Rate applicable to the Class A Certificates and the
         Mezzanine Certificates for the immediately succeeding Distribution
         Date;

                  (xxii) the Net WAC Rate Carryover Amount for the Class A
         Certificates and the Mezzanine Certificates, if any, for such
         Distribution Date and the amount remaining unpaid after reimbursements
         therefor on such Distribution Date; and

                  (xxiii) whether a Trigger Event is in effect.

                  The Trustee shall make such statement (and, at its option, any
additional files containing the same information in an alternative format)
available each month to Certificateholders, the Servicer and the Rating Agencies
via the Trustee's internet website. The Trustee's internet website shall
initially be located at https://www.corporatetrust.db.com/invr and assistance in
using the website can be obtained by calling the Trustee's customer service desk
at 1-800-735-7777. Parties that are unable to use the above distribution options
are entitled to have a paper copy mailed to them via first class mail by calling
the customer service desk and indicating such. The Trustee shall have the right
to change the way such statements are distributed in order to make such
distribution more convenient and/or more accessible to the above parties and the
Trustee shall provide timely and adequate notification to all above parties
regarding any such changes.

                  In the case of information furnished pursuant to subclauses
(i) through (iii) above, the amounts shall be expressed as a dollar amount per
Single Certificate of the relevant Class.

                  Within a reasonable period of time after the end of each
calendar year, the Trustee shall furnish to each Person who at any time during
the calendar year was a Holder of a Regular Certificate a statement containing
the information set forth in subclauses (i) through (iii) above, aggregated for
such calendar year or applicable portion thereof during which such person was a
Certificateholder. Such obligation of the Trustee shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Trustee pursuant to any requirements of the Code as from time to
time are in force.

                  Within a reasonable period of time after the end of each
calendar year, the Trustee shall furnish to each Person who at any time during
the calendar year was a Holder of a Residual

                                      -86-

<PAGE>

Certificate a statement setting forth the amount, if any, actually distributed
with respect to the Residual Certificates, as appropriate, aggregated for such
calendar year or applicable portion thereof during which such Person was a
Certificateholder.

                  The Trustee shall, upon request, furnish to each
Certificateholder, during the term of this Agreement, such periodic, special, or
other reports or information, whether or not provided for herein, as shall be
reasonable with respect to the Certificateholder, or otherwise with respect to
the purposes of this Agreement, all such reports or information to be provided
at the expense of the Certificateholder in accordance with such reasonable and
explicit instructions and directions as the Certificateholder may provide. For
purposes of this Section 4.02, the Trustee's duties are limited to the extent
that the Trustee receives timely reports as required from the Servicer.

                  On each Distribution Date the Trustee shall provide Bloomberg
Financial Markets, L. P. (" Bloomberg") CUSIP level factors for each class of
Certificates as of such Distribution Date, using a format and media mutually
acceptable to the Trustee and Bloomberg.

                  SECTION 4.03. Remittance Reports; Advances.

                  (a) On the Business Day following each Determination Date, the
Servicer shall deliver to the Trustee by telecopy (or by such other means as the
Servicer and the Trustee may agree from time to time) a Remittance Report with
respect to the related Distribution Date. On the same date, the Servicer shall
forward to the Trustee by overnight mail a computer readable magnetic tape or
electronically transmit (in a format acceptable to the Trustee) on the day
thereafter, a data file containing the information set forth in such Remittance
Report with respect to the related Distribution Date. Such Remittance Report
will include (i) the amount of Advances to be made by the Servicer in respect of
the related Distribution Date, the aggregate amount of Advances outstanding
after giving effect to such Advances, and the aggregate amount of Nonrecoverable
Advances in respect of such Distribution Date and (ii) such other information
with respect to the Mortgage Loans as the Trustee may reasonably require to
perform the calculations necessary to make the distributions contemplated by
Section 4.01 and to prepare the statements to Certificateholders contemplated by
Section 4.02. The Trustee shall not be responsible to recompute, recalculate or
verify any information provided to it by the Servicer.

                  (b) The amount of Advances to be made by the Servicer for any
Distribution Date shall equal, subject to Section 4.03(d), (i) the aggregate
amount of Monthly Payments (net of the related Servicing Fee), due during the
related Collection Period in respect of the Mortgage Loans, which Monthly
Payments were delinquent on a contractual basis as of the close of business on
the related Determination Date and (ii) with respect to each REO Property, which
REO Property was acquired during or prior to the related Prepayment Period and
as to which such REO Property an REO Disposition did not occur during the
related Prepayment Period, an amount equal to the excess, if any, of only the
interest portion of the Monthly Payments (net of the related Servicing Fee) that
would have been due on the related Due Date in respect of the related Mortgage
Loans, over the net income from such REO Property deposited in the Collection
Account pursuant to Section 3.23 for distribution on such Distribution Date. For
purposes of the preceding sentence, the Monthly Payment on each Balloon Mortgage
Loan with a delinquent Balloon Payment is equal to the assumed monthly payment
that would have been due on the related Due Date based on the original principal

                                      -87-

<PAGE>

amortization schedule for such Balloon Mortgage Loan.

                  By 3:00 p.m. New York time on the Servicer Remittance Date,
the Servicer shall remit in immediately available funds to the Trustee for
deposit in the Distribution Account an amount equal to the aggregate amount of
Advances, if any, to be made in respect of the Mortgage Loans for the related
Distribution Date either (i) from its own funds or (ii) from the Collection
Account, to the extent of funds held therein for future distribution (in which
case it will cause to be made an appropriate entry in the records of the
Collection Account that amounts held for future distribution have been, as
permitted by this Section 4.03, used by the Servicer in discharge of any such
Advance) or (iii) in the form of any combination of (i) and (ii) aggregating the
total amount of Advances to be made by the Servicer with respect to the Mortgage
Loans. Any amounts held for future distribution and so used shall be
appropriately reflected in the Servicer's records and replaced by the Servicer
by deposit in the Collection Account on or before any future Servicer Remittance
Date to the extent that the Available Distribution Amount for the related
Distribution Date (determined without regard to Advances to be made on the
Servicer Remittance Date) shall be less than the total amount that would be
distributed to the Classes of Certificateholders pursuant to Section 4.01 on
such Distribution Date if such amounts held for future distributions had not
been so used to make Advances. The Trustee will provide notice to the Servicer
by telecopy by the close of business on the Business Day prior to the
Distribution Date in the event that the amount remitted by the Servicer to the
Trustee on such date is less than the Advances required to be made by the
Servicer for the related Distribution Date.

                  (c) The obligation of the Servicer to make such Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to
(d) below, and, with respect to any Mortgage Loan or REO Property, shall
continue until a Final Recovery Determination in connection therewith or the
removal thereof from the Trust Fund pursuant to any applicable provision of this
Agreement, except as otherwise provided in this Section.

                  (d) Notwithstanding anything herein to the contrary, no
Advance or Servicing Advance shall be required to be made hereunder by the
Servicer if such Advance or Servicing Advance would, if made, constitute a
Nonrecoverable Advance or Nonrecoverable Servicing Advance, respectively. The
determination by the Servicer that it has made a Nonrecoverable Advance or a
Nonrecoverable Servicing Advance or that any proposed Advance or Servicing
Advance, if made, would constitute a Nonrecoverable Advance or Nonrecoverable
Servicing Advance, respectively, shall be evidenced by a certification of a
Servicing Officer delivered to the Depositor and the Trustee.

                  SECTION 4.04. Allocation of Realized Losses.

                  (a) Prior to each Determination Date, the Servicer shall
determine as to each Mortgage Loan and REO Property: (i) the total amount of
Realized Losses, if any, incurred in connection with any Final Recovery
Determinations made during the related Prepayment Period; (ii) whether and the
extent to which such Realized Losses constituted Bankruptcy Losses; and (iii)
the respective portions of such Realized Losses allocable to interest and
allocable to principal. Prior to each Determination Date, the Servicer shall
also determine as to each Mortgage Loan: (i) the total amount of Realized
Losses, if any, incurred in connection with any Deficient Valuations made during

                                      -88-

<PAGE>

the related Prepayment Period; and (ii) the total amount of Realized Losses, if
any, incurred in connection with Debt Service Reductions in respect of Monthly
Payments due during the related Due Period. The information described in the two
preceding sentences that is to be supplied by the Servicer shall be evidenced by
an Officers' Certificate delivered to the Trustee by the Servicer prior to the
Determination Date immediately following the end of (i) in the case of
Bankruptcy Losses allocable to interest, the Due Period during which any such
Realized Loss was incurred, and (ii) in the case of all other Realized Losses,
the Prepayment Period during which any such Realized Loss was incurred.

                  (b) All Realized Losses on the Mortgage Loans shall be
allocated by the Trustee on each Distribution Date as follows: first, to the
Accrued Certificate Interest for the Class CE Certificates for the related
Interest Accrual Period; second, to the Class CE Interest, until the Certificate
Principal Balance thereof has been reduced to zero; third, to the Class M-5
Interest until the Certificate Principal Balance thereof has been reduced to
zero; fourth, to the Class M-4 Interest, until the Certificate Principal Balance
thereof has been reduced to zero; fifth, to the Class M-3 Interest, until the
Certificate Principal Balance thereof has been reduced to zero; sixth, to the
Class M-2 Certificates, until the Certificate Principal Balance thereof has been
reduced to zero and seventh, to the Class M-1 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero.

                  All Realized Losses to be allocated to the Certificate
Principal Balances of all Classes on any Distribution Date shall be so allocated
after the actual distributions to be made on such date as provided above. All
references above to the Certificate Principal Balance of any Class of
Certificates shall be to the Certificate Principal Balance of such Class
immediately prior to the relevant Distribution Date, before reduction thereof by
any Realized Losses, in each case to be allocated to such Class of Certificates,
on such Distribution Date.

                  Any allocation of Realized Losses to a Mezzanine Certificate
on any Distribution Date shall be made by reducing the Certificate Principal
Balance thereof by the amount so allocated and any allocation of Realized Losses
to a Class CE Interest shall be made by reducing the amount otherwise payable in
respect thereof pursuant to Section 4.01(a)(4)(xiv). No allocations of any
Realized Losses shall be made to the Certificate Principal Balances of the Class
A Certificates or the Class P Interest.

                  As used herein, an allocation of a Realized Loss on a "PRO
RATA basis" among two or more specified Classes of Certificates means an
allocation on a pro rata basis, among the various Classes so specified, to each
such Class of Certificates on the basis of their then outstanding Certificate
Principal Balances prior to giving effect to distributions to be made on such
Distribution Date. All Realized Losses and all other losses allocated to a Class
of Certificates hereunder will be allocated among the Certificates of such Class
in proportion to the Percentage Interests evidenced thereby.

                  (c) All Realized Losses on the Mortgage Loans shall be
allocated by the Trustee on each Distribution Date to the following REMIC I
Regular Interests in the specified percentages, as follows: first, to
Uncertificated Interest payable to the REMIC I Regular Interest I-LTAA and REMIC
I Regular Interest I-LTZZ up to an aggregate amount equal to the REMIC I
Interest Loss

                                      -89-

<PAGE>

Allocation Amount, 98% and 2%, respectively; second, to the Uncertificated
Balances of the REMIC I Regular Interest I-LTAA and REMIC I Regular Interest
I-LTZZ up to an aggregate amount equal to the REMIC I Principal Loss Allocation
Amount, 98% and 2%, respectively; third, to the Uncertificated Balances of REMIC
I Regular Interest I-LTAA, REMIC I Regular Interest I-LTM5 and REMIC I Regular
Interest I-LTZZ, 98%, 1% and 1%, respectively, until the Uncertificated Balance
of REMIC I Regular Interest I-LTM5 has been reduced to zero; fourth, to the
Uncertificated Balances of REMIC I Regular Interest I-LTAA, REMIC I Regular
Interest I-LTM4 and REMIC I Regular Interest I-LTZZ, 98%, 1% and 1%,
respectively, until the Uncertificated Balance of REMIC I Regular Interest
I-LTM4 has been reduced to zero; fifth to the Uncertificated Balances of REMIC I
Regular Interest I-LTAA, REMIC I Regular Interest I-LTM3 and REMIC I Regular
Interest I- LTZZ, 98%, 1% and 1%, respectively, until the Uncertificated Balance
of REMIC I Regular Interest I-LTM3 has been reduced to zero; sixth to the
Uncertificated Balances of REMIC I Regular Interest I-LTAA, REMIC I Regular
Interest I-LTM2 and REMIC I Regular Interest I-LTZZ, 98%, 1% and 1%,
respectively, until the Uncertificated Balance of REMIC I Regular Interest
I-LTM2 has been reduced to zero; and seventh to the Uncertificated Balances of
REMIC I Regular Interest I-LTAA, REMIC I Regular Interest I-LTM1 and REMIC I
Regular Interest I-LTZZ, 98%, 1% and 1%, respectively, until the Uncertificated
Balance of REMIC I Regular Interest I-LTM1 has been reduced to zero.

                  SECTION 4.05. Compliance with Withholding Requirements

                  Notwithstanding any other provision of this Agreement, the
Trustee shall comply with all federal withholding requirements respecting
payments to Certificateholders of interest or original issue discount that the
Trustee reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. In the event the
Trustee does withhold any amount from interest or original issue discount
payments or advances thereof to any Certificateholder pursuant to federal
withholding requirements, the Trustee shall indicate the amount withheld to such
Certificateholders.

                  SECTION 4.06. Exchange Commission; Additional Information.

                  (a) The Trustee and the Servicer shall reasonably cooperate
with the Depositor in connection with satisfying the reporting requirements
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The
Trustee shall prepare on behalf of the Trust Fund any Forms 8-K and 10-K
customary for similar securities as required by the Exchange Act and the Rules
and Regulations of the Securities and Exchange Commission thereunder, and the
Depositor shall sign (or shall cause another entity acceptable to the Securities
and Exchange Commission to sign) and the Trustee shall file (via the Securities
and Exchange Commission's Electronic Data Gathering and Retrieval System) such
forms on behalf of the Depositor (or such other entity). The Depositor hereby
grants to the Trustee a limited power of attorney to execute each Form 8-K and
file such Forms 8-K and 10-K on behalf of the Depositor. Such power of attorney
shall continue until the earlier of (i) receipt by the Trustee from the
Depositor of written termination of such power of attorney and (ii) the
termination of the Trust Fund. Notwithstanding anything herein to the contrary,
the Depositor, and not the Trustee, shall be responsible for executing each Form
10-K filed on behalf of the Trust.

                                      -90-

<PAGE>

                  (b) Each Form 8-K shall be filed by the Trustee within 15 days
after each Distribution Date, with a copy of the statement to the
Certificateholders for such Distribution Date as an exhibit thereto. Prior to
March 30th of each year (or such earlier date as may be required by the Exchange
Act and the Rules and Regulations of the Securities and Exchange Commission),
the Trustee shall file a Form 10-K, in substance as required by applicable law
or applicable Security and Exchange Commission staff's interpretations. Such
Form 10-K shall include as exhibits the Servicer's annual statement of
compliance described under Section 3.20 and the accountant's report described
under Section 3.21, in each case to the extent they have been timely delivered
to the Trustee. If they are not so timely delivered, the Trustee shall file an
amended Form 10-K including such documents as exhibits reasonably promptly after
they are delivered to the Trustee. The Trustee shall have no liability with
respect to any failure to properly prepare or file such periodic reports
resulting from or relating to the Trustee's inability or failure to obtain any
information not resulting from its own negligence or willful misconduct. The
Form 10-K shall also include a certification in the form attached hereto as
Exhibit L-1 (the "Certification"), which shall be signed by the senior officer
of the Depositor in charge of securitization.

                  (c) In addition, the Trustee shall sign a certification (in
the form attached hereto as Exhibit L-2) for the benefit of the Depositor and
its officers, directors and Affiliates regarding certain aspects of the
Certification (the "Trustee Certification") (provided, however, that the Trustee
shall not undertake an analysis of the accountant's report attached as an
exhibit to the Form 10-K), and the Servicer shall sign a certification in the
form attached hereto as Exhibit L-3) for the benefit of the Depositor, the
Trustee and their officers, directors and Affiliates regarding certain aspects
of items of the Certification (the "Servicer Certification"). The Servicer's
certification shall be delivered to the Depositor by no later than March 18th of
each year (or if such day is not a Business Day, the immediately preceding
Business Day), the Trustee's certification shall be delivered to the Depositor
by no later than March 19th of each year and the Depositor shall deliver the
Certification to the Trustee for filing no later than March 20th of each year
(or if such day is not a Business Day, the immediately preceding Business Day).

                  In addition, (i) the Trustee shall indemnify and hold harmless
the Depositor and its officers, directors and Affiliates from and against any
actual losses, damages, penalties, fines, forfeitures, reasonable and necessary
legal fees and related costs, judgments and other costs and expenses arising out
of or based upon (a) the failure of the Trustee to timely deliver the Trustee
Certification or (b) any material misstatement in the Trustee Certification and
(ii) the Servicer shall indemnify and hold harmless the Depositor, the Trustee
and their respective officers, directors and Affiliates from and against any
actual losses, damages, penalties, fines, forfeitures, reasonable and necessary
legal fees and related costs, judgments and other costs and expenses arising out
of or based upon (a) the failure of the Servicer to timely deliver the Servicer
Certification or (b) any material misstatement in the Servicer Certification and
(iii) the Depositor shall indemnify and hold harmless the Trustee and the
Servicer and its officers, directors and Affiliates from and against any losses,
damages, penalties, fines, forfeitures, reasonable and necessary legal fees and
related costs, judgments and other costs and expenses arising out of or based
upon a breach of the Depositor's obligations under this Section 4.06 or the
Depositor's negligence, bad faith or willful misconduct in connection therewith.
If the indemnification provided for herein is unavailable or insufficient to
hold harmless the Depositor, the Trustee or the Servicer, as applicable, then
the Depositor (in connection with a breach of its obligations under this Section
4.06 or its negligence, bad faith or

                                      -91-

<PAGE>

willful misconduct in connection therewith) or the Trustee or the Servicer (in
connection with a breach of its respective obligations under this Section
4.06(c)), agrees that it shall contribute to the amount paid or payable by the
other party as a result of the losses, claims, damages or liabilities of the
other party in such proportion as is appropriate to reflect the relative fault
and the relative benefit of the Depositor, the Trustee and the Servicer.

                  (d) Upon any filing with the Securities and Exchange
Commission, the Trustee shall promptly deliver to the Depositor a copy of any
executed report, statement or information.

                  (e) Prior to January 30 of the first year in which the Trustee
is able to do so under applicable law, the Trustee shall file a Form 15
Suspension Notification with respect to the Trust Fund.

                  (f) To the extent that, following the Closing Date, the
Depositor certifies that reports and certifications differing from those
required under this Section 4.06 comply with the reporting requirements under
the Exchange Act, the Trustee and the Servicer hereby agree that they will
reasonably cooperate to amend the provisions of this Section 4.06 in order to
comply with such amended reporting requirements and such amendment of this
Section 4.06. Any such amendment may result in the reduction of the reports
filed by the Depositor under the Exchange Act. Notwithstanding the foregoing,
the Trustee shall not be obligated to enter into any amendment pursuant to this
Section that adversely affects its obligations and immunities under this
Agreement.

                                      -92-

<PAGE>

                                    ARTICLE V

                                THE CERTIFICATES

                  SECTION 5.01. The Certificates.

                  (a) The Certificates in the aggregate will represent the
entire beneficial ownership interest in the Mortgage Loans and all other assets
included in REMIC I.

                  The Certificates will be substantially in the forms annexed
hereto as Exhibits A-1 through A-10. The Certificates of each Class will be
issuable in registered form only, in denominations of authorized Percentage
Interests as described in the definition thereof. Each Certificate will share
ratably in all rights of the related Class.

                  Upon original issue, the Certificates shall be executed,
authenticated and delivered by the Trustee to or upon the written order of the
Depositor. The Certificates shall be executed by manual or facsimile signature
on behalf of the Trustee by an authorized signatory. Certificates bearing the
manual or facsimile signatures of individuals who were at any time the proper
officers of the Trustee shall bind the Trustee notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Certificates or did not hold such offices at
the date of such Certificates. No Certificate shall be entitled to any benefit
under this Agreement or be valid for any purpose, unless there appears on such
Certificate a certificate of authentication substantially in the form provided
herein executed by the Trustee by manual signature, and such certificate of
authentication shall be conclusive evidence, and the only evidence, that such
Certificate has been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication.

                  (b) The Class A Certificates and the Mezzanine Certificates
shall initially be issued as one or more Certificates held by the Book-Entry
Custodian or, if appointed to hold such Certificates as provided below, the
Depository and registered in the name of the Depository or its nominee and,
except as provided below, registration of such Certificates may not be
transferred by the Trustee except to another Depository that agrees to hold such
Certificates for the respective Certificate Owners with Ownership Interests
therein. The Certificate Owners shall hold their respective Ownership Interests
in and to such Certificates through the book-entry facilities of the Depository
and, except as provided below, shall not be entitled to definitive, fully
registered Certificates ("Definitive Certificates") in respect of such Ownership
Interests. All transfers by Certificate Owners of their respective Ownership
Interests in the Book-Entry Certificates shall be made in accordance with the
procedures established by the Depository Participant or brokerage firm
representing such Certificate Owner. Each Depository Participant shall only
transfer the Ownership Interests in the Book-Entry Certificates of Certificate
Owners it represents or of brokerage firms for which it acts as agent in
accordance with the Depository's normal procedures. The Trustee is hereby
initially appointed as the Book-Entry Custodian and hereby agrees to act as such
in accordance herewith and in accordance with the agreement that it has with the
Depository authorizing it to act as such. The Book-Entry Custodian may, and, if
it is no longer qualified to act as such, the Book- Entry Custodian shall,
appoint, by a written instrument delivered to the Depositor, the Servicer, the
Trustee and, if the Trustee is not the Book-Entry Custodian, the Trustee, any
other transfer agent

                                      -93-

<PAGE>

(including the Depository or any successor Depository) to act as Book-Entry
Custodian under such conditions as the predecessor Book-Entry Custodian and the
Depository or any successor Depository may prescribe, provided that the
predecessor Book-Entry Custodian shall not be relieved of any of its duties or
responsibilities by reason of any such appointment of other than the Depository.
If the Trustee resigns or is removed in accordance with the terms hereof, the
successor Trustee or, if it so elects, the Depository shall immediately succeed
to its predecessor's duties as Book-Entry Custodian. The Depositor shall have
the right to inspect, and to obtain copies of, any Certificates held as Book-
Entry Certificates by the Book-Entry Custodian.

                  The Trustee, the Servicer and the Depositor may for all
purposes (including the making of payments due on the Book-Entry Certificates)
deal with the Depository as the authorized representative of the Certificate
Owners with respect to the Book-Entry Certificates for the purposes of
exercising the rights of Certificateholders hereunder. The rights of Certificate
Owners with respect to the Book-Entry Certificates shall be limited to those
established by law and agreements between such Certificate Owners and the
Depository Participants and brokerage firms representing such Certificate
Owners. Multiple requests and directions from, and votes of, the Depository as
Holder of the Book-Entry Certificates with respect to any particular matter
shall not be deemed inconsistent if they are made with respect to different
Certificate Owners. The Trustee may establish a reasonable record date in
connection with solicitations of consents from or voting by Certificateholders
and shall give notice to the Depository of such record date.

                  If (i)(A) the Depositor advises the Trustee in writing that
the Depository is no longer willing or able to properly discharge its
responsibilities as Depository, and (B) the Depositor is unable to locate a
qualified successor, (ii) the Depositor at its option, and with the consent of
the Trustee (such consent not to be unreasonably withheld), advises the Trustee
in writing that it elects to terminate the book-entry system through the
Depository or (iii) after the occurrence of a Servicer Event of Default,
Certificate Owners representing in the aggregate not less than 51% of the
Ownership Interests of the Book-Entry Certificates advise the Trustee through
the Depository, in writing, that the continuation of a book-entry system through
the Depository is no longer in the best interests of the Certificate Owners, the
Trustee shall notify all Certificate Owners, through the Depository, of the
occurrence of any such event and of the availability of Definitive Certificates
to Certificate Owners requesting the same. Upon surrender to the Trustee of the
Book-Entry Certificates by the Book-Entry Custodian or the Depository, as
applicable, accompanied by registration instructions from the Depository for
registration of transfer, the Trustee shall cause the Definitive Certificates to
be issued. Such Definitive Certificates will be issued in minimum denominations
of $100,000, except that any beneficial ownership that was represented by a
Book- Entry Certificate in an amount less than $100,000 immediately prior to the
issuance of a Definitive Certificate shall be issued in a minimum denomination
equal to the amount represented by such Book-Entry Certificate. None of the
Depositor, the Servicer or the Trustee shall be liable for any delay in the
delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of Definitive
Certificates all references herein to obligations imposed upon or to be
performed by the Depository shall be deemed to be imposed upon and performed by
the Trustee, to the extent applicable with respect to such Definitive
Certificates, and the Trustee shall recognize the Holders of the Definitive
Certificates as Certificateholders hereunder.

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<PAGE>

                  SECTION 5.02. Registration of Transfer and Exchange of
                                Certificates.

                  (a) The Trustee shall cause to be kept at one of the offices
or agencies to be appointed by the Trustee in accordance with the provisions of
Section 8.11, a Certificate Register for the Certificates in which, subject to
such reasonable regulations as it may prescribe, the Trustee shall provide for
the registration of Certificates and of transfers and exchanges of Certificates
as herein provided.

                  (b) No transfer of any Class CE Certificate, Class P
Certificate or Residual Certificate (the "Private Certificates") shall be made
unless that transfer is made pursuant to an effective registration statement
under the Securities Act of 1933, as amended (the "1933 Act"), and effective
registration or qualification under applicable state securities laws, or is made
in a transaction that does not require such registration or qualification. In
the event that such a transfer of a Private Certificate is to be made without
registration or qualification (other than in connection with the initial
transfer of any such Certificate by the Depositor to an Affiliate of the
Depositor), the Trustee shall require receipt of: (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Certificateholder desiring to effect the transfer and
from such Certificateholder's prospective transferee, substantially in the forms
attached hereto as Exhibit F-1; and (ii) in all other cases, an Opinion of
Counsel satisfactory to it that such transfer may be made without such
registration (which Opinion of Counsel shall not be an expense of the Trust Fund
or of the Depositor, the Trustee, the Servicer in its capacity as such or any
Sub- Servicer), together with copies of the written certification(s) of the
Certificateholder desiring to effect the transfer and/or such
Certificateholder's prospective transferee upon which such Opinion of Counsel is
based, if any. None of the Depositor or the Trustee is obligated to register or
qualify any such Certificates under the 1933 Act or any other securities laws or
to take any action not otherwise required under this Agreement to permit the
transfer of such Certificates without registration or qualification. Any
Certificateholder desiring to effect the transfer of any such Certificate shall,
and does hereby agree to, indemnify the Trustee, the Depositor and the Servicer
against any liability that may result if the transfer is not so exempt or is not
made in accordance with such federal and state laws.

                  Notwithstanding the foregoing, no certification or Opinion of
Counsel described in this Section 5.02(b) will be required in connection with
the transfer, on the Closing Date, of any Class R Certificate or Class R-X
Certificate by the Depositor to an "[____] investor" within the meaning of Rule
501(d) of the 1933 Act.

                  (c) No transfer of a Private Certificate or any interest
therein shall be made to any Plan subject to ERISA or Section 4975 of the Code,
any Person acting, directly or indirectly, on behalf of any such Plan or any
Person acquiring such Certificates with "Plan Assets" of a Plan within the
meaning of the Department of Labor regulation promulgated at 29 C. F. R. ss.
2510.3-101 ("Plan Assets") unless the Trustee is provided with an Opinion of
Counsel on which the Depositor, the Trustee and the Servicer may rely, to the
effect that the purchase of such Certificates is permissible under applicable
law, will not constitute or result in any non-exempt prohibited transaction
under ERISA or Section 4975 of the Code and will not subject the Depositor, the
Servicer, the Trustee or the Trust Fund to any obligation or liability
(including obligations or liabilities under ERISA or Section 4975 of the Code)
in addition to those undertaken in this Agreement, which Opinion of

                                      -95-

<PAGE>

Counsel shall not be an expense of the Depositor, the Servicer, the Trustee or
the Trust Fund. Any prospective Transferee of such Certificates not providing
the above Opinion of Counsel must provide a certification in the form of Exhibit
G to this Agreement (or other form acceptable to the Depositor, the Trustee and
the Servicer), which the Trustee may rely upon without further inquiry or
investigation. Neither an Opinion of Counsel nor any certification will be
required in connection with the initial transfer of any such Certificate by the
Depositor to an Affiliate of the Depositor (in which case, the Depositor or any
Affiliate thereof shall have deemed to have represented that such Affiliate is
not a Plan or a Person investing Plan Assets) and the Trustee shall be entitled
to conclusively rely upon a representation (which, upon the request of the
Trustee, shall be a written representation) from the Depositor of the status of
such transferee as an affiliate of the Depositor.

                  Each beneficial owner of a Mezzanine Certificates or any
interest therein shall be deemed to have represented, by virtue of its
acquisition or holding of that certificate or interest therein, that either (i)
it is not a Plan investor, (ii) it has acquired and is holding such Mezzanine
Certificates in reliance on the Underwriters' Exemption, and that it understands
that there are certain conditions to the availability of the Underwriters'
Exemption, including that the Mezzanine Certificates must be rated, at the time
of purchase, not lower than "BBB-" (or its equivalent) by Fitch Ratings, S&P or
Moody's or (iii) (1) it is an insurance company, (2) the source of funds used to
acquire or hold the certificate or interest therein is an "insurance company
general account," as such term is defined in PTCE 95-60, and (3) the conditions
in Sections I and III of PTCE 95-60 have been satisfied.

                  If any Private Certificate or Mezzanine Certificate or any
interest therein is acquired or held in violation of the provisions of the two
preceding paragraphs, the next preceding permitted beneficial owner will be
treated as the beneficial owner of that Certificate retroactive to the date of
transfer to the purported beneficial owner. Any purported beneficial owner whose
acquisition or holding of any such Certificate or interest therein was effected
in violation of the provisions of the two preceding paragraphs shall indemnify
and hold harmless the Depositor, the Servicer, the Trustee and the Trust Fund
from and against any and all liabilities, claims, costs or expenses incurred by
those parties as a result of that acquisition or holding.

                  (d) (i) Each Person who has or who acquires any Ownership
Interest in a Residual Certificate shall be deemed by the acceptance or
acquisition of such Ownership Interest to have agreed to be bound by the
following provisions and to have irrevocably authorized the Trustee or its
designee under clause (iii)(A) below to deliver payments to a Person other than
such Person and to negotiate the terms of any mandatory sale under clause
(iii)(B) below and to execute all instruments of Transfer and to do all other
things necessary in connection with any such sale. The rights of each Person
acquiring any Ownership Interest in a Residual Certificate are expressly subject
to the following provisions:

                           (A) Each Person holding or acquiring any Ownership
                  Interest in a Residual Certificate shall be a Permitted
                  Transferee and shall promptly notify the Trustee of any change
                  or impending change in its status as a Permitted Transferee.

                           (B) In connection with any proposed Transfer of any
                  Ownership Interest in a Residual Certificate, the Trustee
                  shall require delivery to it, and shall not register

                                      -96-

<PAGE>

                  the Transfer of any Residual Certificate until its receipt of,
                  an affidavit and agreement (a "Transfer Affidavit and
                  Agreement," in the form attached hereto as Exhibit F-2) from
                  the proposed Transferee, in form and substance satisfactory to
                  the Trustee, representing and warranting, among other things,
                  that such Transferee is a Permitted Transferee, that it is not
                  acquiring its Ownership Interest in the Residual Certificate
                  that is the subject of the proposed Transfer as a nominee,
                  trustee or agent for any Person that is not a Permitted
                  Transferee, that for so long as it retains its Ownership
                  Interest in a Residual Certificate, it will endeavor to remain
                  a Permitted Transferee, and that it has reviewed the
                  provisions of this Section 5.02(d) and agrees to be bound by
                  them.

                           (C) Notwithstanding the delivery of a Transfer
                  Affidavit and Agreement by a proposed Transferee under clause
                  (B) above, if a Responsible Officer of the Trustee who is
                  assigned to this transaction has actual knowledge that the
                  proposed Transferee is not a Permitted Transferee, no Transfer
                  of an Ownership Interest in a Residual Certificate to such
                  proposed Transferee shall be effected.

                           (D) Each Person holding or acquiring any Ownership
                  Interest in a Residual Certificate shall agree (x) to require
                  a Transfer Affidavit and Agreement in the form attached hereto
                  as Exhibit F-2 from any other Person to whom such Person
                  attempts to transfer its Ownership Interest in a Residual
                  Certificate and (y) not to transfer its Ownership Interest
                  unless it provides a Transferor Affidavit (in the form
                  attached hereto as Exhibit F-2) to the Trustee stating that,
                  among other things, it has no actual knowledge that such other
                  Person is not a Permitted Transferee.

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

                  (ii) The Trustee will register the Transfer of any Residual
         Certificate only if it shall have received the Transfer Affidavit and
         Agreement and all of such other documents as shall have been reasonably
         required by the Trustee as a condition to such registration. In
         addition, no Transfer of a Residual Certificate shall be made unless
         the Trustee shall have received a representation letter from the
         Transferee of such Certificate to the effect that such Transferee is a
         Permitted Transferee.

                  (iii) (A) If any purported Transferee shall become a Holder of
         a Residual Certificate in violation of the provisions of this Section
         5.02(d), then the last preceding Permitted Transferee shall be
         restored, to the extent permitted by law, to all rights as holder
         thereof retroactive to the date of registration of such Transfer of
         such Residual Certificate. The Trustee shall be under no liability to
         any Person for any registration of Transfer of a Residual Certificate
         that is in fact not permitted by this Section 5.02(d) or for making any

                                      -97-

<PAGE>

         payments due on such Certificate to the holder thereof or for taking
         any other action with respect to such holder under the provisions of
         this Agreement.

                           (B) If any purported Transferee shall become a holder
                  of a Residual Certificate in violation of the restrictions in
                  this Section 5.02(d) and to the extent that the retroactive
                  restoration of the rights of the holder of such Residual
                  Certificate as described in clause (iii)(A) above shall be
                  invalid, illegal or unenforceable, then the Trustee shall have
                  the right, but not the obligation, without notice to the
                  holder or any prior holder of such Residual Certificate, to
                  sell such Residual Certificate to a purchaser selected by the
                  Trustee on such terms as the Trustee may choose. Such
                  purported Transferee shall promptly endorse and deliver each
                  Residual Certificate in accordance with the instructions of
                  the Trustee. Such purchaser may be the Trustee itself or any
                  Affiliate of the Trustee. The proceeds of such sale, net of
                  the commissions (which may include commissions payable to the
                  Trustee or its Affiliates), expenses and taxes due, if any,
                  will be remitted by the Trustee to such purported Transferee.
                  The terms and conditions of any sale under this clause
                  (iii)(B) shall be determined in the sole discretion of the
                  Trustee, and the Trustee shall not be liable to any Person
                  having an Ownership Interest in a Residual Certificate as a
                  result of its exercise of such discretion.

                  (iv) The Trustee shall make available to the Internal Revenue
         Service and those Persons specified by the REMIC Provisions all
         information necessary to compute any tax imposed (A) as a result of the
         Transfer of an Ownership Interest in a Residual Certificate to any
         Person who is a Disqualified Organization, including the information
         described in Treasury regulations sections 1.860D-1(b)(5) and
         1.860E-2(a)(5) with respect to the "excess inclusions" of such Residual
         Certificate and (B) as a result of any regulated investment company,
         real estate investment trust, common trust fund, partnership, trust,
         estate or organization described in Section 1381 of the Code that holds
         an Ownership Interest in a Residual Certificate having as among its
         record holders at any time any Person which is a Disqualified
         Organization. Reasonable compensation for providing such information
         may be accepted by the Trustee.

                  (v) The provisions of this Section 5.02(d) set forth prior to
         this subsection (v) may be modified, added to or eliminated, provided
         that there shall have been delivered to the Trustee at the expense of
         the party seeking to modify, add to or eliminate any such provision the
         following:

                           (A) written notification from each Rating Agency to
                  the effect that the modification, addition to or elimination
                  of such provisions will not cause such Rating Agency to
                  downgrade its then-current ratings of any Class of
                  Certificates; and

                           (B) an Opinion of Counsel, in form and substance
                  satisfactory to the Trustee, to the effect that such
                  modification of, addition to or elimination of such provisions
                  will not cause any Trust REMIC to cease to qualify as a REMIC
                  and will not cause any Trust REMIC to be subject to an
                  entity-level tax caused by the Transfer of any Residual
                  Certificate to a Person that is not a Permitted Transferee or
                  a Person

                                      -98-

<PAGE>

                  other than the prospective transferee to be subject to a
                  REMIC-tax caused by the Transfer of a Residual Certificate to
                  a Person that is not a Permitted Transferee.

                  (e) Subject to the preceding subsections, upon surrender for
registration of transfer of any Certificate at any office or agency of the
Trustee maintained for such purpose pursuant to Section 8.12, the Trustee shall
execute, authenticate and deliver, in the name of the designated Transferee or
Transferees, one or more new Certificates of the same Class of a like aggregate
Percentage Interest.

                  (f) At the option of the Holder thereof, any Certificate may
be exchanged for other Certificates of the same Class with authorized
denominations and a like aggregate Percentage Interest, upon surrender of such
Certificate to be exchanged at any office or agency of the Trustee maintained
for such purpose pursuant to Section 8.12. Whenever any Certificates are so
surrendered for exchange, the Trustee shall execute, authenticate and deliver,
the Certificates which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for transfer or exchange
shall (if so required by the Trustee) be duly endorsed by, or be accompanied by
a written instrument of transfer in the form satisfactory to the Trustee duly
executed by, the Holder thereof or his attorney duly authorized in writing.

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

                  (h) All Certificates surrendered for transfer and exchange
shall be canceled and destroyed by the Trustee in accordance with its customary
procedures.

                  SECTION 5.03. Mutilated, Destroyed, Lost or Stolen
                                Certificates.

                  If (i) any mutilated Certificate is surrendered to the
Trustee, or the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Certificate, and (ii) there is delivered to
the Trustee such security or indemnity as may be required by it to save it
harmless, then, in the absence of actual knowledge by the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute, authenticate and deliver in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of the same
Class and of like denomination and Percentage Interest. Upon the issuance of any
new Certificate under this Section, the Trustee may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Trustee) connected therewith. Any replacement Certificate issued pursuant to
this Section shall constitute complete and indefeasible evidence of ownership in
the applicable REMIC created hereunder, as if originally issued, whether or not
the lost, stolen or destroyed Certificate shall be found at any time.

                  SECTION 5.04. Persons Deemed Owners.

                  The Depositor, the Servicer, the Trustee and any agent of any
of them may treat the

                                      -99-

<PAGE>

Person in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions pursuant to Section 4.01
and for all other purposes whatsoever, and none of the Depositor, the Servicer,
the Trustee or any agent of any of them shall be affected by notice to the
contrary.

                  SECTION 5.05. Certain Available Information.

                  On or prior to the date of the first sale of any Private
Certificate to an Independent third party, the Depositor shall provide to the
Trustee ten copies of any private placement memorandum or other disclosure
document used by the Depositor in connection with the offer and sale of such
Certificates. In addition, if any such private placement memorandum or
disclosure document is revised, amended or supplemented at any time following
the delivery thereof to the Trustee, the Depositor promptly shall inform the
Trustee of such event and shall deliver to the Trustee ten copies of the private
placement memorandum or disclosure document, as revised, amended or
supplemented. The Trustee shall maintain at its Corporate Trust Office and shall
make available free of charge during normal business hours for review by any
Holder of a Certificate or any Person identified to the Trustee as a prospective
transferee of a Certificate, originals or copies of the following items: (i) in
the case of a Holder or prospective transferee of a Private Certificate, the
related private placement memorandum or other disclosure document relating to
such Class of Certificates, in the form most recently provided to the Trustee;
and (ii) in all cases, (A) this Agreement and any amendments hereof entered into
pursuant to Section 11.01, (B) all monthly statements required to be delivered
to Certificateholders of the relevant Class pursuant to Section 4.02 since the
Closing Date, and all other notices, reports, statements and written
communications delivered to the Certificateholders of the relevant Class
pursuant to this Agreement since the Closing Date, (C) all certifications
delivered by a Responsible Officer of the Trustee since the Closing Date
pursuant to Section 10.01(h), (D) any and all Officers' Certificates delivered
to the Trustee by the Servicer since the Closing Date to evidence the Servicer's
determination that any Advance or Servicing Advance was, or if made, would be a
Nonrecoverable Advance or Nonrecoverable Servicing Advance, respectively, and
(E) any and all Officers' Certificates delivered to the Trustee by the Servicer
since the Closing Date pursuant to Section 4.04(a). Copies and mailing of any
and all of the foregoing items will be available from the Trustee upon request
at the expense of the Person requesting the same.

                                      -100-

<PAGE>

                                   ARTICLE VI

                         THE DEPOSITOR AND THE SERVICER

                  SECTION 6.01. Liability of the Depositor and the Servicer.

                  The Depositor and the Servicer each shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
by this Agreement upon them in their respective capacities as Depositor and
Servicer and undertaken hereunder by the Depositor and the Servicer herein.

                  SECTION 6.02. Merger or Consolidation of the Depositor or the
                                Servicer.

                  Subject to the following paragraph, the Depositor will keep in
full effect its existence, rights and franchises as a corporation under the laws
of the jurisdiction of its incorporation. Subject to the following paragraph,
the Servicer will keep in full effect its existence, rights and franchises as a
limited partnership under the laws of the jurisdiction of its formation. The
Depositor and the Servicer each will obtain and preserve its qualification to do
business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.

                  The Depositor or the Servicer may be merged or consolidated
with or into any Person, or transfer all or substantially all of its assets to
any Person, in which case any Person resulting from any merger or consolidation
to which the Depositor or the Servicer shall be a party, or any Person
succeeding to the business of the Depositor or the Servicer, shall be the
successor of the Depositor or the Servicer, as the case may be, hereunder,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto, anything herein to the contrary notwithstanding;
provided, however, that the successor or surviving Person to the Servicer shall
be qualified to service mortgage loans on behalf of Fannie Mae or Freddie Mac;
and provided further that the Rating Agencies' ratings of the Class A
Certificates and the Mezzanine Certificates in effect immediately prior to such
merger or consolidation will not be qualified, reduced or withdrawn as a result
thereof (as evidenced by a letter to such effect from the Rating Agencies).

                  SECTION 6.03. Limitation on Liability of the Depositor, the
                                Servicer and Others.

                  None of the Depositor, the Servicer or any of the directors,
officers, employees or agents of the Depositor or the Servicer shall be under
any liability to the Trust Fund or the Certificateholders for any action taken
or for refraining from the taking of any action in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Depositor, the Servicer or any such person against any
breach of warranties, representations or covenants made herein, or against any
specific liability imposed on the Servicer pursuant hereto, or against any
liability which would otherwise be imposed by reason of willful misfeasance, bad
faith or gross negligence in the performance of duties or by reason of reckless
disregard of obligations and duties hereunder. The Depositor, the Servicer and
any director, officer,

                                      -101-

<PAGE>

employee or agent of the Depositor or the Servicer may rely in good faith on any
document of any kind which, prima facie, is properly executed and submitted by
any Person respecting any matters arising hereunder. The Depositor, the Servicer
and any director, officer, employee or agent of the Depositor or the Servicer
shall be indemnified and held harmless by the Trust Fund against any loss,
liability or expense incurred in connection with any legal action relating to
this Agreement or the Certificates, other than any loss, liability or expense
relating to any specific Mortgage Loan or Mortgage Loans (except as any such
loss, liability or expense shall be otherwise reimbursable pursuant to this
Agreement) or any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder. Neither the Depositor nor the Servicer shall be under any obligation
to appear in, prosecute or defend any legal action unless such action is related
to its respective duties under this Agreement and, in its good faith reasonable
opinion, does not involve it in any expense or liability; provided, however,
that each of the Depositor and the Servicer may in its discretion undertake any
such action which it may deem necessary or desirable with respect to this
Agreement and the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder. In such event, unless the Depositor or the
Servicer acts without the consent of Holders of Certificates entitled to at
least 51% of the Voting Rights, the legal expenses and costs of such action and
any liability resulting therefrom (except any loss, liability or expense
incurred by reason of willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder) shall be expenses, costs and liabilities of
the Trust Fund, and the Depositor and the Servicer shall be entitled to be
reimbursed therefor from the Collection Account as and to the extent provided in
Section 3.11, any such right of reimbursement being prior to the rights of the
Certificateholders to receive any amount in the Collection Account.

                  SECTION 6.04. Limitation on Resignation of the Servicer.

                  (a) The Servicer shall not resign from the obligations and
duties hereby imposed on it except upon determination that its duties hereunder
are no longer permissible under applicable law or as provided in Section
6.04(c). Any such determination pursuant to the preceding sentence permitting
the resignation of the Servicer shall be evidenced by an Opinion of Counsel to
such effect obtained at the expense of the Servicer and delivered to the
Trustee. No resignation of the Servicer shall become effective until the Trustee
or a successor servicer shall have assumed the Servicer's responsibilities,
duties, liabilities (other than those liabilities arising prior to the
appointment of such successor) and obligations under this Agreement.

                  (b) Except as expressly provided herein, the Servicer shall
not assign or transfer any of its rights, benefits or privileges hereunder to
any other Person, or delegate to or subcontract with, or authorize or appoint
any other Person to perform any of the duties, covenants or obligations to be
performed by the Servicer hereunder. The foregoing prohibition on assignment
shall not prohibit the Servicer from designating a Sub-Servicer as payee of any
indemnification amount payable to the Servicer hereunder; provided, however,
that as provided in Section 3.02 hereof, no Sub-Servicer shall be a third-party
beneficiary hereunder and the parties hereto shall not be required to recognize
any Subservicer as an indemnitee under this Agreement.

                  (c) The Trustee and the Depositor hereby specifically (i)
consent to the pledge

                                      -102-

<PAGE>

and assignment by the Servicer of all of the Servicer's right, title and
interest in, to and under this Agreement to the Servicing Rights Pledgee, for
the benefit of certain lenders and (ii) provided that no Servicer Event of
Default exists, agree that upon delivery to the Trustee by the Servicing Rights
Pledgee of a letter signed by the Servicer whereunder the Servicer shall resign
as Servicer under this Agreement, the Trustee shall appoint the Servicing Rights
Pledgee or its designee as successor Servicer, provided that at the time of such
appointment, the Servicing Rights Pledgee or such designee meets the
requirements of a successor Servicer pursuant to Section 7.02(a) hereof and
agrees to be subject to the terms of this Agreement. If, pursuant to any
provision hereof, the duties of the Servicer are transferred to a successor
servicer, the entire amount of the Servicing Fee and other compensation payable
to the Servicer pursuant hereto shall thereafter be payable to such successor
servicer.

                  SECTION 6.05. Rights of the Depositor in Respect of the
                                Servicer.

                  The Servicer shall afford (and any Sub-Servicing Agreement
shall provide that each Sub-Servicer shall afford) the Depositor and the
Trustee, upon reasonable notice, during normal business hours, access to all
records maintained by the Servicer (and any such Sub-Servicer) in respect of the
Servicer's rights and obligations hereunder and access to officers of the
Servicer (and those of any such Sub-Servicer) responsible for such obligations.
Upon request, the Servicer shall furnish to the Depositor and the Trustee its
(and any such Sub-Servicer's) most recent financial statements and such other
information relating to the Servicer's capacity to perform its obligations under
this Agreement as it possesses (and that any such Sub-Servicer possesses). To
the extent such information is not otherwise available to the public, the
Depositor and the Trustee shall not disseminate any information obtained
pursuant to the preceding two sentences without the Servicer's written consent,
except as required pursuant to this Agreement or to the extent that it is
appropriate to do so (i) in working with legal counsel, auditors, taxing
authorities or other governmental agencies, (ii) pursuant to any law, rule,
regulation, order, judgment, writ, injunction or decree of any court or
governmental authority having jurisdiction over the Depositor and the Trustee or
the Trust Fund, and in any case, the Depositor or the Trustee, (iii) disclosure
of any and all information that is or becomes publicly known, or information
obtained by the Trustee from sources other than the Depositor or the Servicer,
(iv) disclosure as required pursuant to this Agreement or (v) disclosure of any
and all information(A) in any preliminary or final offering circular,
registration statement or contract or other document pertaining to the
transactions contemplated by the Agreement approved in advance by the Depositor
or the Servicer or (B) to any affiliate, independent or internal auditor, agent,
employee or attorney of the Trustee having a need to know the same, provided
that the Trustee advises such recipient of the confidential nature of the
information being disclosed, shall use its best efforts to assure the
confidentiality of any such disseminated non-public information. The Depositor
may, but is not obligated to, enforce the obligations of the Servicer under this
Agreement and may, but is not obligated to, perform, or cause a designee to
perform, any defaulted obligation of the Servicer under this Agreement or
exercise the rights of the Servicer under this Agreement; provided that the
Servicer shall not be relieved of any of its obligations under this Agreement by
virtue of such performance by the Depositor or its designee. The Depositor shall
not have any responsibility or liability for any action or failure to act by the
Servicer and is not obligated to supervise the performance of the Servicer under
this Agreement or otherwise.

                                      -103-

<PAGE>

                                   ARTICLE VII

                                     DEFAULT

                  SECTION 7.01. Servicer Events of Default.

                  (a) "Servicer Event of Default," wherever used herein, means
any one of the following events:

                  (i) any failure by the Servicer to remit to the Trustee for
         distribution to the Certificateholders any payment (other than an
         Advance required to be made from its own funds on any Servicer
         Remittance Date pursuant to Section 4.03) required to be made under the
         terms of the Certificates and this Agreement which continues unremedied
         for a period of one Business Day after the date upon which written
         notice of such failure, requiring the same to be remedied, shall have
         been given to the Servicer by the Depositor, the Trustee (in which case
         notice shall be provided by telecopy), or to the Servicer, the
         Depositor and the Trustee by the Holders of Certificates entitled to at
         least 25% of the Voting Rights; or

                  (ii) any failure on the part of the Servicer duly to observe
         or perform in any material respect any other of the covenants or
         agreements on the part of the Servicer contained in this Agreement, or
         the breach by the Servicer of any representation and warranty contained
         in Section 2.05, which continues unremedied for a period of 30 days (or
         if such failure or breach cannot be remedied within 30 days, then such
         remedy shall have been commenced within 30 days and diligently pursued
         thereafter; provided, however, that in no event shall such failure or
         breach be allowed to exist for a period of greater than 90 days) after
         the earlier of (i) the date on which written notice of such failure,
         requiring the same to be remedied, shall have been given to the
         Servicer by the Depositor or the Trustee, or to the Servicer, the
         Depositor and the Trustee by the Holders of Certificates entitled to at
         least 25% of the Voting Rights and (ii) actual knowledge of such
         failure by a Servicing Officer; or

                  (iii) a decree or order of a court or agency or supervisory
         authority having jurisdiction in the premises in an involuntary case
         under any present or future federal or state bankruptcy, insolvency or
         similar law or the appointment of a conservator or receiver or
         liquidator in any insolvency, readjustment of debt, marshalling of
         assets and liabilities or similar proceeding, or for the winding-up or
         liquidation of its affairs, shall have been entered against the
         Servicer and such decree or order shall have remained in force
         undischarged or unstayed for a period of 90 days; or

                  (iv) the Servicer shall consent to the appointment of a
         conservator or receiver or liquidator in any insolvency, readjustment
         of debt, marshalling of assets and liabilities or similar proceedings
         of or relating to it or of or relating to all or substantially all of
         its property; or

                  (v) the Servicer shall admit in writing its inability to pay
         its debts generally as they become due, file a petition to take
         advantage of any applicable insolvency or reorganization statute, make
         an assignment for the benefit of its creditors, or voluntarily

                                      -104-

<PAGE>

         suspend payment of its obligations; or

                  (vi) any failure by the Servicer of the Servicer Termination
         Trigger; or

                  (vii) any failure of the Servicer to make any Advance on any
         Servicer Remittance Date required to be made from its own funds
         pursuant to Section 4.03 which continues unremedied until 3:00 p.m. New
         York time on the Business Day immediately following the Servicer
         Remittance Date.

                  If a Servicer Event of Default described in clauses (i)
through (vi) of this Section shall occur, then, and in each and every such case,
so long as such Servicer Event of Default shall not have been remedied, the
Depositor or the Trustee may, and at the written direction of the Holders of
Certificates entitled to at least 51% of Voting Rights, the Trustee shall, by
notice in writing to the Servicer and to the Depositor, terminate all of the
rights and obligations of the Servicer in its capacity as Servicer under this
Agreement, to the extent permitted by law, and in and to the Mortgage Loans and
the proceeds thereof. If a Servicer Event of Default described in clause (vii)
hereof shall occur, the Trustee shall, by notice in writing to the Servicer, the
Trustee and the Depositor, terminate all of the rights and obligations of the
Servicer in its capacity as Servicer under this Agreement and in and to the
Mortgage Loans and the proceeds thereof. On or after the receipt by the Servicer
of such written notice, all authority and power of the Servicer under this
Agreement, whether with respect to the Certificates (other than as a Holder of
any Certificate) or the Mortgage Loans or otherwise, shall pass to and be vested
in the Trustee pursuant to and under this Section, and, without limitation, the
Trustee is hereby authorized and empowered, as attorney-in-fact or otherwise, to
execute and deliver, on behalf of and at the expense of the Servicer, any and
all documents and other instruments and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the Mortgage Loans and related documents, or otherwise. The Servicer agrees
promptly (and in any event no later than ten Business Days subsequent to such
notice) to provide the Trustee with all documents and records requested by it to
enable it to assume the Servicer's functions under this Agreement, and to
cooperate with the Trustee in effecting the termination of the Servicer's
responsibilities and rights under this Agreement, including, without limitation,
the transfer within one Business Day to the Trustee for administration by it of
all cash amounts which at the time shall be or should have been credited by the
Servicer to the Collection Account held by or on behalf of the Servicer, the
Distribution Account or any REO Account or Servicing Account held by or on
behalf of the Servicer or thereafter be received with respect to the Mortgage
Loans or any REO Property serviced by the Servicer (provided, however, that the
Servicer shall continue to be entitled to receive all amounts accrued or owing
to it under this Agreement on or prior to the date of such termination, whether
in respect of Advances or otherwise, and shall continue to be entitled to the
benefits of Section 6.03, notwithstanding any such termination, with respect to
events occurring prior to such termination). For purposes of this Section 7.01,
the Trustee shall not be deemed to have knowledge of a Servicer Event of Default
unless a Responsible Officer of the Trustee assigned to and working in the
Trustee's Corporate Trust Office has actual knowledge thereof or unless written
notice of any event which is in fact such a Servicer Event of Default is
received by the Trustee and such notice references the Certificates, the Trust
Fund or this Agreement.

                  SECTION 7.02. Trustee to Act; Appointment of Successor.

                                      -105-

<PAGE>

                  (a)(1) On and after the time the Servicer receives a notice of
termination, the Trustee shall separately assume and become the successor in all
respects to the Servicer in its capacity as Servicer under this Agreement and
the transactions set forth or provided for herein, and all the responsibilities,
duties and liabilities relating thereto and arising thereafter shall be assumed
by the Trustee (except for any representations or warranties of the Servicer
under this Agreement, the responsibilities, duties and liabilities contained in
Section 2.05 and the obligation to deposit amounts in respect of losses pursuant
to Section 3.12) by the terms and provisions hereof including, without
limitation, the Servicer's obligations to make Advances pursuant to Section
4.03; provided, however, that if the Trustee is prohibited by law or regulation
from obligating itself to make advances regarding delinquent mortgage loans,
then the Trustee shall not be obligated to make Advances pursuant to Section
4.03; and provided further, that any failure to perform such duties or
responsibilities caused by the Servicer's failure to provide information
required by Section 7.01 shall not be considered a default by the Trustee as
successor to the Servicer hereunder. As compensation therefor, the Trustee shall
be entitled to the Servicing Fee and all funds relating to the Mortgage Loans to
which the Servicer would have been entitled if it had continued to act
hereunder. Notwithstanding the above and subject to Section 7.02(a)(2) below,
the Trustee may, if it shall be unwilling to so act, or shall, if it is unable
to so act or if it is prohibited by law from making advances regarding
delinquent mortgage loans or if the Holders of Certificates entitled to at least
51% of the Voting Rights so request in writing to the Trustee promptly appoint
or petition a court of competent jurisdiction to appoint, an established
mortgage loan servicing institution acceptable to each Rating Agency without
qualification, withdrawal or downgrading of the ratings then assigned to any of
the Certificates and having a net worth of not less than $15,000,000, as the
successor to the Servicer under this Agreement in the assumption of all or any
part of the responsibilities, duties or liabilities of the Servicer under this
Agreement.

                  All Servicing Transfer Costs shall be paid by the predecessor
Servicer upon presentation of reasonable documentation of such costs (provided,
that if the Trustee is the predecessor Servicer by reason of this Section 7.02,
such costs shall be paid by the Servicer preceding the Trustee as successor
servicer), and if such predecessor or initial Servicer, as applicable, defaults
in its obligation to pay such costs, such costs shall be paid by the successor
Servicer or the Trustee (in which case the successor Servicer or the Trustee, as
applicable, shall be entitled to reimbursement therefor from the assets of the
Trust Fund).

                  (2) No appointment of a successor to the Servicer under this
Agreement shall be effective until the assumption by the successor of all of the
Servicer's responsibilities, duties and liabilities hereunder. In connection
with such appointment and assumption described herein, the Trustee may make such
arrangements for the compensation of such successor out of payments on Mortgage
Loans as it and such successor shall agree; provided, however, that no such
compensation shall be in excess of that permitted the Servicer as such
hereunder. The Depositor, the Trustee and such successor shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession. Pending appointment of a successor to the Servicer under this
Agreement, the Trustee shall act in such capacity as hereinabove provided.

                  (b) In the event of a Servicer Event of Default,
notwithstanding anything to the contrary above, the Trustee and the Depositor
hereby agree that upon delivery to the Trustee by the Servicing Rights Pledgee
of a letter signed by the Servicer within ten Business Days of when

                                      -106-

<PAGE>

notification of such event shall have been provided to the Trustee, whereunder
the Servicer shall resign as Servicer under this Agreement, the Trustee shall
appoint the Servicing Rights Pledgee or its designee as successor Servicer,
provided that at the time of such appointment, the Servicing Rights Pledgee or
such designee meets the requirements of a successor Servicer set forth above and
the Servicing Rights Pledgee or such designee agrees to be subject to the terms
of this Agreement.

                  (c) In connection with the termination or resignation of the
Servicer hereunder, either (i) the successor servicer, including the Trustee if
the Trustee is acting as successor Servicer, shall represent and warrant that it
is a member of MERS in good standing and shall agree to comply in all material
respects with the rules and procedures of MERS in connection with the servicing
of the Mortgage Loans that are registered with MERS, in which case the
predecessor Servicer shall cooperate with the successor Servicer in causing MERS
to revise its records to reflect the transfer of servicing to the successor
Servicer as necessary under MERS' rules and regulations, or (ii) the predecessor
Servicer shall cooperate with the successor Servicer in causing MERS to execute
and deliver an assignment of Mortgage in recordable form to transfer the
Mortgage from MERS to the Trustee and to execute and deliver such other notices,
documents and other instruments as may be necessary or desirable to effect a
transfer of such Mortgage Loan or servicing of such Mortgage Loan on the MERS(R)
System to the successor Servicer. The predecessor Servicer shall file or cause
to be filed any such assignment in the appropriate recording office. The
predecessor Servicer shall bear any and all fees of MERS, costs of preparing any
assignments of Mortgage, and fees and costs of filing any assignments of
Mortgage that may be required under this Section 7.02(c).

                  SECTION 7.03. Notification to Certificateholders.

                  (a) Upon any termination of the Servicer pursuant to Section
7.01 above or any appointment of a successor to the Servicer pursuant to Section
7.02 above, the Trustee shall give prompt written notice thereof to
Certificateholders at their respective addresses appearing in the Certificate
Register.

                  (b) Not later than the later of 60 days after the occurrence
of any event, which constitutes or which, with notice or lapse of time or both,
would constitute a Servicer Event of Default or five days after a Responsible
Officer of the Trustee becomes aware of the occurrence of such an event, the
Trustee shall transmit by mail to all Holders of Certificates notice of each
such occurrence, unless such default or Servicer Event of Default shall have
been cured or waived.

                  SECTION 7.04. Waiver of Servicer Events of Default.

                  The Holders representing at least 66% of the Voting Rights
evidenced by all Classes of Certificates affected by any default or Servicer
Event of Default hereunder may waive such default or Servicer Event of Default;
provided, however, that a default or Servicer Event of Default under clause (i)
or (vii) of Section 7.01 may be waived only by all of the Holders of the Regular
Certificates. Upon any such waiver of a default or Servicer Event of Default,
such default or Servicer Event of Default shall cease to exist and shall be
deemed to have been remedied for every purpose hereunder. No such waiver shall
extend to any subsequent or other default or Servicer Event of Default or impair
any right consequent thereon except to the extent expressly so waived.

                                      -107-

<PAGE>

                                  ARTICLE VIII

                             CONCERNING THE TRUSTEE

                  SECTION 8.01. Duties of Trustee.

                  The Trustee, prior to the occurrence of a Servicer Event of
Default and after the curing of all Servicer Events of Default which may have
occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement. During a Servicer Event of Default,
the Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs. Any permissive right of the Trustee enumerated in
this Agreement shall not be construed as a duty.

                  The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform on their face to the requirements of this Agreement. If any such
instrument is found not to conform on its face to the requirements of this
Agreement in a material manner, the Trustee shall take such action as it deems
appropriate to have the instrument corrected, and if the instrument is not
corrected to its satisfaction, will provide notice thereof to the
Certificateholders.

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

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

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

                  (iii) The Trustee shall not be personally liable with respect
         to any action taken, suffered or omitted to be taken by it in good
         faith in accordance with the direction of the Holders of Certificates
         entitled to at least 25% of the Voting Rights relating to the time,
         method and place of conducting any proceeding for any remedy available
         to the Trustee or exercising any trust or power conferred upon it,
         under this Agreement.

                                      -108-

<PAGE>

                  SECTION 8.02. Certain Matters Affecting the Trustee.

                  (a)      Except as otherwise provided in Section 8.01:

                  (i) The Trustee may request and conclusively rely upon and
         shall be fully protected in acting or refraining from acting upon any
         resolution, Officers' Certificate, certificate of auditors or any other
         certificate, statement, instrument, opinion, report, notice, request,
         consent, order, appraisal, bond or other paper or document reasonably
         believed by it to be genuine and to have been signed or presented by
         the proper party or parties;

                  (ii) The Trustee may consult with counsel and any Opinion of
         Counsel shall be full and complete authorization and protection in
         respect of any action taken or suffered or omitted by it hereunder in
         good faith and in accordance with such Opinion of Counsel;

                  (iii) The Trustee shall not be under any obligation to
         exercise any of the trusts or powers vested in it by this Agreement or
         to institute, conduct or defend any litigation hereunder or in relation
         hereto at the request, order or direction of any of the
         Certificateholders, pursuant to the provisions of this Agreement,
         unless such Certificateholders shall have offered to the Trustee
         security or indemnity reasonably satisfactory to it against the costs,
         expenses and liabilities which may be incurred therein or thereby;
         nothing contained herein shall, however, relieve the Trustee of the
         obligation, upon the occurrence of a Servicer Event of Default (which
         has not been cured or waived), to exercise such of the rights and
         powers vested in it by this Agreement, and to use the same degree of
         care and skill in their exercise as a prudent person would exercise or
         use under the circumstances in the conduct of such person's own
         affairs;

                  (iv) The Trustee shall not be personally liable for any action
         taken, suffered or omitted by it in good faith and believed by it to be
         authorized or within the discretion or rights or powers conferred upon
         it by this Agreement;

                  (v) Prior to the occurrence of a Servicer Event of Default
         hereunder and after the curing of all Servicer Events of Default which
         may have occurred, the Trustee shall not be bound to make any
         investigation into the facts or matters stated in any resolution,
         certificate, statement, instrument, opinion, report, notice, request,
         consent, order, approval, bond or other paper or document, unless
         requested in writing to do so by the Holders of Certificates entitled
         to at least 25% of the Voting Rights; provided, however, that if the
         payment within a reasonable time to the Trustee of the costs, expenses
         or liabilities likely to be incurred by it in the making of such
         investigation is, in the opinion of the Trustee not reasonably assured
         to the Trustee by such Certificateholders, the Trustee may require
         indemnity reasonably satisfactory to it against such expense or
         liability from such Certificateholders as a condition to taking any
         such action;

                  (vi) The Trustee may execute any of the trusts or powers
         hereunder or perform any duties hereunder either directly or by or
         through agents, accountants or attorneys, and the Trustee shall not be
         responsible for any misconduct or negligence on the part of any agents,
         accountants or attorneys appointed with due care by it hereunder; and

                                      -109-

<PAGE>

                  (vii) The Trustee shall have no obligation to invest and
         reinvest any cash held in the absence of timely and specific written
         investment direction from the Servicer or the Depositor. In no event
         shall the Trustee be liable for the selection of investments or for
         investment losses incurred thereon. The Trustee shall have no liability
         in respect of losses incurred as a result of the liquidation of any
         investment incurred as a result of the liquidation of any investment
         prior to its stated maturity or the failure of the Servicer or the
         Depositor to provide timely written investment direction.

                  (b) All rights of action under this Agreement or under any of
the Certificates, enforceable by the Trustee, may be enforced by it without the
possession of any of the Certificates, or the production thereof at the trial or
other proceeding relating thereto, and any such suit, action or proceeding
instituted by the Trustee shall be brought in the name of the Trustee for the
benefit of all the Holders of such Certificates, subject to the provisions of
this Agreement.

                  SECTION 8.03. Trustee Not Liable for Certificates or Mortgage
                                Loans.

                  The recitals contained herein and in the Certificates (other
than the signature of the Trustee, the authentication of the Certificate
Registrar on the Certificates, the acknowledgments of the Trustee contained in
Article II and the representations and warranties of the Trustee in Section
8.13) shall be taken as the statements of the Depositor and the Trustee assumes
no responsibility for their correctness. The Trustee makes no representations or
warranties as to the validity or sufficiency of this Agreement (other than as
specifically set forth with respect to such party in Section 8.13) or of the
Certificates (other than the signature of the Trustee and authentication of the
Certificate Registrar on the Certificates) or of any Mortgage Loan or related
document or of MERS or the MERS(R) System. The Trustee shall not be accountable
for the use or application by the Depositor of any of the Certificates or of the
proceeds of such Certificates, or for the use or application of any funds paid
to the Depositor or the Servicer in respect of the Mortgage Loans or deposited
in or withdrawn from the Collection Account by the Servicer, other than any
funds held by or on behalf of the Trustee in accordance with Section 3.10,
subject to Section 8.01.

                  SECTION 8.04. Trustee May Own Certificates.

                  The Trustee in its individual capacity or any other capacity
may become the owner or pledgee of Certificates with the same rights it would
have if it were not Trustee.

                  SECTION 8.05. Trustee's Fees and Expenses.

                  (a) The Trustee shall withdraw from the Distribution Account
on each Distribution Date and pay to itself the Trustee Fee. The Trustee, or any
director, officer, employee or agent of the Trustee shall be indemnified by the
Trust Fund and held harmless against any loss, liability or expense (not
including expenses, disbursements and advances incurred or made by the Trustee
including the compensation and the expenses and disbursements of its agents and
counsel, in the ordinary course of the Trustee's performance in accordance with
the provisions of this Agreement) incurred by the Trustee in connection with any
Servicer Event of Default (not including expenses, disbursements and advances
incurred or made by the Trustee in its capacity as successor Servicer), default,
claim or legal action or any pending or threatened claim or legal action arising
out

                                      -110-

<PAGE>

of or in connection with the acceptance or administration of its obligations and
duties under this Agreement, other than any loss, liability or expense (i)
resulting from a breach of the Servicer's obligations and duties under this
Agreement and the Mortgage Loans (for which the Servicer shall indemnify
pursuant to Section 8.05(b)), (ii) for the expenses of preparing and filing Tax
Returns pursuant to Section 10.01(d) or (iii) any loss, liability or expense
incurred by reason of its willful misfeasance, bad faith or negligence in the
performance of its duties hereunder or by reason of reckless disregard of its
respective obligations and duties hereunder. Any amounts payable to the Trustee,
or any director, officer, employee or agent of the Trustee in respect of the
indemnification provided by this paragraph (a), or pursuant to any other right
of reimbursement from the Trust Fund that the Trustee, or any director, officer,
employee or agent of the Trustee, may have hereunder in its capacity as such,
may be withdrawn by the Trustee from the Distribution Account at any time.

                  (b) The Servicer agrees to indemnify the Trustee from, and
hold it harmless against, any loss, liability or expense resulting from a breach
of the Servicer's obligations and duties under this Agreement. Such indemnity
shall survive the termination or discharge of this Agreement and the resignation
or removal of the Trustee. Any payment hereunder made by the Servicer to the
Trustee shall be from the Servicer's own funds, without reimbursement from the
Trust Fund therefor.

                  The provisions of this Section 8.05 shall survive the
termination of this Agreement or the earlier resignation or removal of the
Trustee.

                  SECTION 8.06. Eligibility Requirements for Trustee.

                  The Trustee hereunder shall at all times be a corporation or
an association (other than the Depositor, the Seller, the Servicer or any
Affiliate of the foregoing) organized and doing business under the laws of any
state or the United States of America, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by federal or state
authority. If such corporation or association publishes reports of conditions at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section the
combined capital and surplus of such corporation or association shall be deemed
to be its combined capital and surplus as set forth in its most recent report of
condition so published. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, the Trustee shall
resign immediately in the manner and with the effect specified in Section 8.07.

                  SECTION 8.07. Resignation and Removal of the Trustee.

                  The Trustee may at any time resign and be discharged from the
trust hereby created by giving written notice thereof to the Depositor, the
Servicer and the Certificateholders. Upon receiving such notice of resignation
of the Trustee, the Depositor shall promptly appoint a successor trustee by
written instrument, in duplicate, which instrument shall be delivered to the
resigning Trustee and to the successor trustee. A copy of such instrument shall
be delivered to the Certificateholders, the Trustee and the Servicer by the
Depositor. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the giving of such notice of
resignation or removal, the Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.

                                      -111-

<PAGE>

                  If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.06 and shall fail to resign after
written request therefor by the Depositor, or if at any time the Trustee shall
become incapable of acting, or shall be adjudged bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Depositor may remove the Trustee and appoint a successor trustee by written
instrument, in duplicate, which instrument shall be delivered to the Trustee so
removed and to the successor trustee. A copy of such instrument shall be
delivered to the Certificateholders and the Servicer by the Depositor.

                  The Holders of Certificates entitled to at least 51% of the
Voting Rights may at any time remove the Trustee and appoint a successor trustee
by written instrument or instruments, in triplicate, signed by such Holders or
their attorneys-in-fact duly authorized, one complete set of which instruments
shall be delivered to the Depositor, one complete set to the Trustee so removed
and one complete set to the successor so appointed. A copy of such instrument
shall be delivered to the Certificateholders and the Servicer by the Depositor.

                  Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor trustee as
provided in Section 8.08.

                  SECTION 8.08. Successor Trustee.

                  Any successor trustee appointed as provided in Section 8.07
shall execute, acknowledge and deliver to the Depositor and to its predecessor
Trustee an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor trustee shall become effective and
such successor trustee without any further act, deed or conveyance, shall become
fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with the like effect as if originally named as Trustee
herein. The predecessor trustee shall deliver to the successor trustee all
Mortgage Files and related documents and statements, as well as all moneys, held
by it hereunder (other than any Mortgage Files at the time held by a custodian,
which custodian shall become the agent of any successor trustee hereunder), and
the Depositor and the predecessor trustee shall execute and deliver such
instruments and do such other things as may reasonably be required for more
fully and certainly vesting and confirming in the successor trustee all such
rights, powers, duties and obligations.

                  No successor trustee shall accept appointment as provided in
this Section unless at the time of such acceptance such successor trustee shall
be eligible under the provisions of Section 8.06 and the appointment of such
successor trustee shall not result in a downgrading of any Class of Certificates
by either Rating Agency, as evidenced by a letter from each Rating Agency.

                  Upon acceptance of appointment by a successor trustee as
provided in this Section, the Depositor shall mail notice of the succession of
such trustee hereunder to all Holders of Certificates at their addresses as
shown in the Certificate Register. If the Depositor fails to mail such notice
within 10 days after acceptance of appointment by the successor trustee, the
successor trustee shall cause such notice to be mailed at the expense of the
Depositor.

                                      -112-

<PAGE>

                  SECTION 8.09. Merger or Consolidation of Trustee.

                  Any corporation or association into which the Trustee may be
merged or converted or with which it may be consolidated or any corporation or
association resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation or association succeeding to the
business of the Trustee shall be the successor of the Trustee hereunder,
provided such corporation or association shall be eligible under the provisions
of Section 8.06, without the execution or filing of any paper or any further act
on the part of any of the parties hereto, anything herein to the contrary
notwithstanding.

                  SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.

                  Notwithstanding any other provisions hereof, at any time, for
the purpose of meeting any legal requirements of any jurisdiction in which any
part of REMIC I or property securing the same may at the time be located, the
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of REMIC I, and to
vest in such Person or Persons, in such capacity, such title to REMIC I, or any
part thereof, and, subject to the other provisions of this Section 8.10, such
powers, duties, obligations, rights and trusts as the Servicer and the Trustee
may consider necessary or desirable. Any such co-trustee or separate trustee
shall be subject to the written approval of the Servicer. If the Servicer shall
not have joined in such appointment within 15 days after the receipt by it of a
request so to do, or in case a Servicer Event of Default shall have occurred and
be continuing, the Trustee alone shall have the power to make such appointment.
No co-trustee or separate trustee hereunder shall be required to meet the terms
of eligibility as a successor trustee under Section 8.06 hereunder and no notice
to Holders of Certificates of the appointment of co- trustee(s) or separate
trustee(s) shall be required under Section 8.08 hereof. The Servicer shall be
responsible for the fees of any co-trustee or separate trustee appointed under
this Section 8.10.

                  In the case of any appointment of a co-trustee or separate
trustee pursuant to this Section 8.10, all rights, powers, duties and
obligations conferred or imposed upon the Trustee shall be conferred or imposed
upon and exercised or performed by the Trustee and such separate trustee or
co-trustee jointly, except to the extent that under any law of any jurisdiction
in which any particular act or acts are to be performed by the Trustee (whether
as Trustee hereunder or as successor to the Servicer hereunder), the Trustee
shall be incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of title to
REMIC I or any portion thereof in any such jurisdiction) shall be exercised and
performed by such separate trustee or co-trustee at the direction of the
Trustee.

                  Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article VIII. Each separate trustee and co-trustee, upon
its acceptance of the trust conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct

                                      -113-

<PAGE>

of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee and a copy thereof given to the
Depositor and the Servicer.

                  Any separate trustee or co-trustee may, at any time,
constitute the Trustee, its agent or attorney-in-fact, with full power and
authority, to the extent not prohibited by law, to do any lawful act under or in
respect of this Agreement on its behalf and in its name. If any separate trustee
or co-trustee shall die, become incapable of acting, resign or be removed, all
of its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.

                  SECTION 8.11. Reserved.

                  SECTION 8.12. Appointment of Office or Agency.

                  The Trustee will designate an office or agency in the City of
New York where the Certificates may be surrendered for registration of transfer
or exchange, and presented for final distribution, and where notices and demands
to or upon the Trustee in respect of the Certificates and this Agreement may be
delivered. As of the Closing Date, the Trustee designates the office of its
agent located c/o DTC Transfer Agent Services, 55 Water Street, Jeanette Park
Entrance, New York, NY 10041 for such purposes.

                  SECTION 8.13. Representations and Warranties of the Trustee.

                  The Trustee hereby represents and warrants, solely as to
itself, to the Servicer and the Depositor, as of the Closing Date, that:

                  (i) It is a national banking association duly organized,
         validly existing and in good standing under the laws of the United
         States.

                  (ii) The execution and delivery of this Agreement by it, and
         the performance and compliance with the terms of this Agreement by it,
         will not violate its charter or bylaws.

                  (iii) It has the full power and authority to enter into and
         consummate all transactions contemplated by this Agreement, has duly
         authorized the execution, delivery and performance of this Agreement,
         and has duly executed and delivered this Agreement.

                  (iv) This Agreement, assuming due authorization, execution and
         delivery by the other parties hereto, constitutes a valid, legal and
         binding obligation of it, enforceable against it in accordance with the
         terms hereof, subject to (A) applicable bankruptcy, insolvency,
         receivership, reorganization, moratorium and other laws affecting the
         enforcement of creditors' rights generally, and (B) general principles
         of equity, regardless of whether such enforcement is considered in a
         proceeding in equity or at law.

                                      -114-

<PAGE>

                                   ARTICLE IX

                                   TERMINATION

                  SECTION 9.01 Termination Upon Repurchase or Liquidation of All
                               Mortgage Loans.

                  (a) Subject to Section 9.02, the respective obligations and
responsibilities under this Agreement of the Depositor, the Servicer and the
Trustee (other than the obligations of the Servicer to the Trustee pursuant to
Section 8.05 and of the Servicer to provide for and the Trustee to make payments
in respect of the REMIC I Regular Interests and the Classes of Certificates as
hereinafter set forth) shall terminate upon payment to the Certificateholders
and the deposit of all amounts held by or on behalf of the Trustee and required
hereunder to be so paid or deposited on the Distribution Date coinciding with or
following the earlier to occur of (i) the purchase by the Terminator (as defined
below) of all Mortgage Loans and each REO Property remaining in REMIC I and (ii)
the final payment or other liquidation (or any advance with respect thereto) of
the last Mortgage Loan or REO Property remaining in REMIC I; provided, however,
that in no event shall the trust created hereby continue beyond the expiration
of 21 years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the Court of St. James,
living on the date hereof. Subject to Section 3.10 hereof, the purchase by the
Terminator of all Mortgage Loans and each REO Property remaining in REMIC I
shall be at a price (the "Termination Price") equal to the greater of:

                  (A) the aggregate Purchase Price of all the Mortgage Loans
included in REMIC I, plus the appraised value of each REO Property, if any,
included in REMIC I, such appraisal to be conducted by an Independent appraiser
selected by (i) the Terminator and (ii) if the Class A Certificates or a Class
of Mezzanine Certificates will not receive all amounts owed to it as a result of
the termination, an Independent appraiser mutually agreed upon by the Terminator
and the Trustee on behalf of the Certificateholders and

                  (B) the aggregate fair market value of all of the assets of
REMIC I (as determined as of the close of business on the third Business Day
next preceding the date upon which notice of any such termination is furnished
to the Certificateholders pursuant to Section 9.01(c) by (i) the Terminator and
(ii) if the Class A Certificates or a Class of Mezzanine Certificates will not
receive all amounts owed to it as a result of the termination, an Independent
appraiser mutually agreed upon by the Terminator and the Trustee on behalf of
the Certificateholders).

                  However, this option may only be exercised if the Termination
Price is sufficient to pay all interest accrued on, as well as amounts necessary
to retire the principal balance of, any net interest margin securities backed by
the Class CE Certificates and Class P Certificates. If the determination of the
appraised value of each REO Property pursuant to (A) above or the fair market
value of the Mortgage Loans and REO Properties pursuant to (B) above shall be
required to be made by the Terminator and an Independent appraiser as provided
above, (i) such appraisal shall be obtained at no expense to the Trustee and
(ii) the Trustee may conclusively rely on, and shall be protected in relying on,
such appraisal.

                                      -115-

<PAGE>

                  (b) The Servicer (or an Affiliate of the Servicer) shall have
the right (the party exercising such right, the "Terminator"), to purchase all
of the Mortgage Loans and each REO Property remaining in REMIC I pursuant to
clause (i) of the preceding paragraph no later than the Determination Date in
the month immediately preceding the Distribution Date on which the Certificates
will be retired; provided, however, that the Terminator may elect to purchase
all of the Mortgage Loans and each REO Property remaining in REMIC I pursuant to
clause (i) above only if the aggregate Stated Principal Balance of the Mortgage
Loans and each REO Property remaining in the Trust Fund at the time of such
election is reduced to less than 10% of the aggregate Stated Principal Balance
of the Mortgage Loans as of the Cut-off Date. By acceptance of a Residual
Certificate, the Holders of the Residual Certificates agree, in connection with
any termination hereunder, to assign and transfer any amounts in excess of par,
and to the extent received in respect of such termination, to pay any such
amounts to the Holders of the Class CE Certificates.

                  (c) Notice of the liquidation of the Certificates shall be
given promptly by the Trustee by letter to Certificateholders mailed (a) in the
event such notice is given in connection with the purchase of the Mortgage Loans
and each REO Property by the Terminator, not earlier than the 10th day and not
later than the 20th day of the month next preceding the month of the final
distribution on the related Certificates or (b) otherwise during the month of
such final distribution on or before the Determination Date in such month, in
each case specifying (i) the Distribution Date upon which the Trust Fund will
terminate and the final payment in respect of the REMIC I Regular Interests, as
applicable and the related Certificates will be made upon presentation and
surrender of the related Certificates at the office of the Trustee therein
designated, (ii) the amount of any such final payment, (iii) that no interest
shall accrue in respect of the REMIC I Regular Interests or the related
Certificates from and after the Interest Accrual Period relating to the final
Distribution Date therefor and (iv) that the Record Date otherwise applicable to
such Distribution Date is not applicable, payments being made only upon
presentation and surrender of the related Certificates at the office of the
Trustee. In the event such notice is given in connection with the purchase of
all of the Mortgage Loans and each REO Property remaining in REMIC I by the
Terminator, the Terminator shall deliver to the Trustee for deposit in the
Distribution Account not later than the last Business Day of the month next
preceding the month of the final distribution on the related Certificates an
amount in immediately available funds equal to the above-described purchase
price. The Trustee shall remit to the Servicer from such funds deposited in the
Distribution Account (i) any amounts which the Servicer would be permitted to
withdraw and retain from the Collection Account pursuant to Section 3.11 and
(ii) any other amounts otherwise payable by the Trustee to the Servicer from
amounts on deposit in the Distribution Account pursuant to the terms of this
Agreement, in each case prior to making any final distributions pursuant to
Section 10.01(d) below. Upon certification to the Trustee by a Servicing Officer
of the making of such final deposit, the Trustee shall promptly release to the
Terminator the Mortgage Files for the remaining Mortgage Loans, and the Trustee
shall execute all assignments, endorsements and other instruments necessary to
effectuate such transfer.

                  Immediately following the deposit of funds in trust hereunder
in respect of the Certificates, the Trust Fund shall terminate.

                  SECTION 9.02 Additional Termination Requirements.

                  (a) In the event that the Terminator purchases all the
Mortgage Loans and each

                                      -116-

<PAGE>

REO Property or the final payment on or other liquidation of the last Mortgage
Loan or REO Property remaining in REMIC I pursuant to Section 9.01, the Trust
Fund (or the applicable Trust REMIC) shall be terminated in accordance with the
following additional requirements:

                  (i) The Trustee shall specify the first day in the 90-day
         liquidation period in a statement attached to each Trust REMIC's final
         Tax Return pursuant to Treasury regulation Section 1.860F-1 and shall
         satisfy all requirements of a qualified liquidation under Section 860F
         of the Code and any regulations thereunder, as evidenced by an Opinion
         of Counsel obtained at the expense of the Terminator;

                  (ii) During such 90-day liquidation period and, at or prior to
         the time of making of the final payment on the Certificates, the
         Trustee shall sell all of the assets of REMIC I to the Terminator for
         cash; and

                  (iii) At the time of the making of the final payment on the
         Certificates, the Trustee shall distribute or credit, or cause to be
         distributed or credited, to the Holders of the Residual Certificates in
         respect of the Class R-I Interest all cash on hand in the Trust Fund
         (other than cash retained to meet claims), and the Trust Fund shall
         terminate at that time.

                  (b) At the expense of the requesting Terminator (or, if the
Trust Fund is being terminated as a result of the occurrence of the event
described in clause (ii) of the first paragraph of Section 9.01, at the expense
of the Depositor without the right of reimbursement from the Trust Fund), the
Terminator shall prepare or cause to be prepared the documentation required in
connection with the adoption of a plan of liquidation of each Trust REMIC
pursuant to this Section 9.02.

                  (c) By their acceptance of Certificates, the Holders thereof
hereby agree to authorize the Trustee to specify the 90-day liquidation period
for each Trust REMIC, which authorization shall be binding upon all successor
Certificateholders.

                                      -117-

<PAGE>

                                    ARTICLE X

                                REMIC PROVISIONS

                  SECTION 10.01. REMIC Administration.

                  (a) The Trustee shall elect to treat each Trust REMIC as a
REMIC under the Code and, if necessary, under applicable state law. Each such
election will be made by the Trustee on Form 1066 or other appropriate federal
tax or information return or any appropriate state return for the taxable year
ending on the last day of the calendar year in which the Certificates are
issued. For the purposes of the REMIC election in respect of REMIC I, the REMIC
I Regular Interests shall be designated as the Regular Interests in REMIC I and
the Class R-I Interest shall be designated as the Residual Interest in REMIC I.
The Class A Certificates, the Class M-1 Certificates and the Class M-2
Certificates shall be designated as the Regular Interests in REMIC II and the
Class R-II Interest shall be designated as the Residual Interest in REMIC II.
The Class M-3 Certificates shall be designated as Regular Interests in REMIC III
and the Class R-III Interest shall be designated as the Residual Interest in
REMIC III. The Class M-4 Certificates shall be designated as Regular Interests
in REMIC IV and the Class R-IV Interest shall be designated as the Residual
Interest in REMIC IV. The Class M-5 Certificates shall be designated as Regular
Interests in REMIC V and the Class R-V Interest shall be designated as the
Residual Interest in REMIC V. The Class CE Certificates shall be designated as
Regular Interests in REMIC VI and the Class R-VI Interest shall be designated as
the Residual Interest in REMIC VI. The Class P Certificates shall be designated
as Regular Interests in REMIC VII and the Class R-VII Interest shall be
designated as the Residual Interest in REMIC VII. The Trustee shall not permit
the creation of any "interests" in any Trust REMIC (within the meaning of
Section 860G of the Code) other than the REMIC I Regular Interests and the
interests represented by the Certificates.

                  (b) The Closing Date is hereby designated as the "Startup Day"
of each Trust REMIC within the meaning of Section 860G(a)(9) of the Code.

                  (c) The Trustee shall be reimbursed for any and all expenses
relating to any tax audit of the Trust Fund (including, but not limited to, any
professional fees or any administrative or judicial proceedings with respect to
each Trust REMIC that involve the Internal Revenue Service or state tax
authorities), including the expense of obtaining any tax related Opinion of
Counsel required to be obtained hereunder. The Trustee, as agent for each Trust
REMIC's tax matters person shall (i) act on behalf of the Trust Fund in relation
to any tax matter or controversy involving any Trust REMIC and (ii) represent
the Trust Fund in any administrative or judicial proceeding relating to an
examination or audit by any governmental taxing authority with respect thereto.
The holder of the largest Percentage Interest of Residual Certificates shall be
designated, in the manner provided under Treasury regulations section
1.860F-4(d) and Treasury regulations section 301.6231(a)(7)-1, as the tax
matters person of each Trust REMIC created hereunder. By their acceptance
thereof, the holder of the largest Percentage Interest of the Residual
Certificates hereby agrees to irrevocably appoint the Trustee or an Affiliate as
its agent to perform all of the duties of the tax matters person for the Trust
Fund.

                  (d) The Trustee shall prepare, sign and file all of the Tax
Returns (including Form

                                      -118-

<PAGE>

8811, which must be filed within 30 days following the Closing Date) in respect
of each Trust REMIC created hereunder. The expenses of preparing and filing such
returns shall be borne by the Trustee without any right of reimbursement
therefor.

                  (e) The Trustee shall perform on behalf of each Trust REMIC
all reporting and other tax compliance duties that are the responsibility of
such REMIC under the Code, the REMIC Provisions or other compliance guidance
issued by the Internal Revenue Service or any state or local taxing authority.
Among its other duties, as required by the Code, the REMIC Provisions or other
such compliance guidance, the Trustee shall provide (i) to any Transferor of a
Residual Certificate such information as is necessary for the application of any
tax relating to the transfer of a Residual Certificate to any Person who is not
a Permitted Transferee, (ii) to the Certificateholders such information or
reports as are required by the Code or the REMIC Provisions including reports
relating to interest, original issue discount and market discount or premium
(using the Prepayment Assumption as required) and (iii) to the Internal Revenue
Service the name, title, address and telephone number of the person who will
serve as the representative of each Trust REMIC. The Depositor shall provide or
cause to be provided to the Trustee, within ten (10) days after the Closing
Date, all information or data that the Trustee reasonably determines to be
relevant for tax purposes as to the valuations and issue prices of the
Certificates, including, without limitation, the price, yield, prepayment
assumption and projected cash flow of the Certificates.

                  (f) The Trustee shall take such action and shall cause each
Trust REMIC created hereunder to take such action as shall be necessary to
create or maintain the status thereof as a REMIC under the REMIC Provisions. The
Trustee shall not take any action or cause the Trust Fund to take any action or
fail to take (or fail to cause to be taken) any action that, under the REMIC
Provisions, if taken or not taken, as the case may be, could (i) endanger the
status of each Trust REMIC as a REMIC or (ii) result in the imposition of a tax
upon the Trust Fund (including but not limited to the tax on prohibited
transactions as defined in Section 860F(a)(2) of the Code and the tax on
contributions to a REMIC set forth in Section 860G(d) of the Code) (either such
event, an "Adverse REMIC Event") unless the Trustee has received an Opinion of
Counsel, addressed to the Trustee (at the expense of the party seeking to take
such action but in no event at the expense of the Trustee) to the effect that
the contemplated action will not, with respect to any Trust REMIC, endanger such
status or result in the imposition of such a tax, nor shall the Servicer take or
fail to take any action (whether or not authorized hereunder) as to which the
Trustee has advised it in writing that it has received an Opinion of Counsel to
the effect that an Adverse REMIC Event could occur with respect to such action;
provided that the Servicer may conclusively rely on such Opinion of Counsel and
shall incur no liability for its action or failure to act in accordance with
such Opinion of Counsel. In addition, prior to taking any action with respect to
any Trust REMIC or the respective assets of each, or causing any Trust REMIC to
take any action, which is not contemplated under the terms of this Agreement,
the Servicer will consult with the Trustee or its designee, in writing, with
respect to whether such action could cause an Adverse REMIC Event to occur with
respect to any Trust REMIC and the Servicer shall not take any such action or
cause any Trust REMIC to take any such action as to which the Trustee has
advised it in writing that an Adverse REMIC Event could occur; provided that the
Servicer may conclusively rely on such writing and shall incur no liability for
its action or failure to act in accordance with such writing. The Trustee may
consult with counsel to make such written advice, and the cost of same shall be
borne by the party seeking to take the action not permitted by this Agreement,
but in no event shall such cost be an expense of the Trustee.

                                      -119-

<PAGE>

At all times as may be required by the Code, the Trustee will ensure that
substantially all of the assets of REMIC I will consist of "qualified mortgages"
as defined in Section 860G(a)(3) of the Code and "permitted investments" as
defined in Section 860G(a)(5) of the Code, to the extent such obligations are
within the Trustee's control and not otherwise inconsistent with the terms of
this Agreement.

                  (g) In the event that any tax is imposed on "prohibited
transactions" of any Trust REMIC created hereunder as defined in Section
860F(a)(2) of the Code, on the "net income from foreclosure property" of such
REMIC as defined in Section 860G(c) of the Code, on any contributions to any
such REMIC after the Startup Day therefor pursuant to Section 860G(d) of the
Code, or any other tax is imposed by the Code or any applicable provisions of
state or local tax laws, such tax shall be charged (i) to the Trustee pursuant
to Section 10.03 hereof, if such tax arises out of or results from a breach by
the Trustee of any of its obligations under this Article X, (ii) to the Servicer
pursuant to Section 10.03 hereof, if such tax arises out of or results from a
breach by the Servicer of any of its obligations under Article III or this
Article X, or (iii) in all other cases, against amounts on deposit in the
Distribution Account and shall be paid by withdrawal therefrom.

                  (h) On or before April 15 of each calendar year, commencing
April 15, 2004, the Trustee shall deliver to each Rating Agency an Officer's
Certificate of the Trustee stating the Trustee's compliance with this Article X.

                  (i) The Trustee shall, for federal income tax purposes,
maintain books and records with respect to each Trust REMIC on a calendar year
and on an accrual basis.

                  (j) Following the Startup Day, neither the Servicer nor the
Trustee shall accept any contributions of assets to any Trust REMIC other than
in connection with any Qualified Substitute Mortgage Loan delivered in
accordance with Section 2.03 unless it shall have received an Opinion of Counsel
to the effect that the inclusion of such assets in the Trust Fund will not cause
any Trust REMIC to fail to qualify as a REMIC at any time that any Certificates
are outstanding or subject any Trust REMIC to any tax under the REMIC Provisions
or other applicable provisions of federal, state and local law or ordinances.

                  (k) Neither the Trustee nor the Servicer shall enter into any
arrangement by which any Trust REMIC will receive a fee or other compensation
for services nor knowingly permit any Trust REMIC to receive any income from
assets other than "qualified mortgages" as defined in Section 860G(a)(3) of the
Code or "permitted investments" as defined in Section 860G(a)(5) of the Code.

                  SECTION 10.02. Prohibited Transactions and Activities.

                  None of the Depositor, the Servicer or the Trustee shall sell,
dispose of or substitute for any of the Mortgage Loans (except in connection
with (i) the foreclosure of a Mortgage Loan, including but not limited to, the
acquisition or sale of a Mortgaged Property acquired by deed in lieu of
foreclosure, (ii) the bankruptcy of REMIC I, (iii) the termination of REMIC I
pursuant to Article IX of this Agreement, (iv) a substitution pursuant to
Article II of this Agreement or (v) a purchase of Mortgage Loans pursuant to
Article II or III of this Agreement), nor acquire any assets for any

                                      -120-

<PAGE>

Trust REMIC (other than REO Property acquired in respect of a defaulted Mortgage
Loan), nor sell or dispose of any investments in the Collection Account or the
Distribution Account for gain, nor accept any contributions to any Trust REMIC
after the Closing Date (other than a Qualified Substitute Mortgage Loan
delivered in accordance with Section 2.03), unless it has received an Opinion of
Counsel, addressed to the Trustee (at the expense of the party seeking to cause
such sale, disposition, substitution, acquisition or contribution but in no
event at the expense of the Trustee) that such sale, disposition, substitution,
acquisition or contribution will not (a) affect adversely the status of any
Trust REMIC as a REMIC or (b) cause any Trust REMIC to be subject to a tax on
"prohibited transactions" or "contributions" pursuant to the REMIC Provisions.

                  SECTION 10.03. Servicer and Trustee Indemnification.

                  (a) The Trustee agrees to indemnify the Trust Fund, the
Depositor and the Servicer for any taxes and costs including, without
limitation, any reasonable attorneys' fees imposed on or incurred by the Trust
Fund, the Depositor or the Servicer as a result of a breach of the Trustee's
covenants set forth in this Article X.

                  (b) The Servicer agrees to indemnify the Trust Fund, the
Depositor and the Trustee for any taxes and costs including, without limitation,
any reasonable attorneys' fees imposed on or incurred by the Trust Fund, the
Depositor or the Trustee, as a result of a breach of the Servicer's covenants
set forth in Article III or this Article X.

                                      -121-

<PAGE>

                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

                  SECTION 11.01. Amendment.

                  This Agreement may be amended from time to time by the
Depositor, the Servicer and the Trustee without the consent of any of the
Certificateholders, (i) to cure any ambiguity or defect, (ii) to correct, modify
or supplement any provisions herein (including to give effect to the
expectations of Certificateholders), (iii) to amend the provisions of Section
4.06 or (iii) to make any other provisions with respect to matters or questions
arising under this Agreement which shall not be inconsistent with the provisions
of this Agreement, provided that such action shall not, as evidenced by either
(a) an Opinion of Counsel delivered to the Trustee adversely affect in any
material respect the interests of any Certificateholder or (b) written notice to
the Depositor, the Servicer and the Trustee from the Rating Agencies that such
action will not result in the reduction or withdrawal of the rating of any
outstanding Class of Certificates with respect to which it is a Rating Agency).
No amendment shall be deemed to adversely affect in any material respect the
interests of any Certificateholder who shall have consented thereto, and no
Opinion of Counsel or Rating Agency confirmation shall be required to address
the effect of any such amendment on any such consenting Certificateholder.
Notwithstanding the foregoing, neither an Opinion of Counsel nor written notice
to the Depositor, the Servicer and the Trustee from the Rating Agencies will be
required in connection with an amendment to the provisions of Section 4.06.

                  This Agreement may also be amended from time to time by the
Depositor, the Servicer and the Trustee with the consent of the Holders of
Certificates entitled to at least 66% of the Voting Rights for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of the
Holders of Certificates; provided, however, that no such amendment shall (i)
reduce in any manner the amount of, or delay the timing of, payments received on
Mortgage Loans which are required to be distributed on any Certificate without
the consent of the Holder of such Certificate, (ii) adversely affect in any
material respect the interests of the Holders of any Class of Certificates (as
evidenced by either (i) an Opinion of Counsel delivered to the Trustee or (ii)
written notice to the Depositor, the Servicer and the Trustee from the Rating
Agencies that such action will not result in the reduction or withdrawal of the
rating of any outstanding Class of Certificates with respect to which it is a
Rating Agency) in a manner, other than as described in (i) or (iii) modify the
consents required by the immediately preceding clauses (i) and (ii) without the
consent of the Holders of all Certificates then outstanding. Notwithstanding any
other provision of this Agreement, for purposes of the giving or withholding of
consents pursuant to this Section 11.01, Certificates registered in the name of
the Depositor or the Servicer or any Affiliate thereof shall be entitled to
Voting Rights with respect to matters affecting such Certificates.

                  Notwithstanding any contrary provision of this Agreement, the
Trustee shall not consent to any amendment to this Agreement unless it shall
have first received an Opinion of Counsel to the effect that such amendment (i)
will not result in the imposition of any tax on any Trust REMIC pursuant to the
REMIC Provisions or cause any Trust REMIC to fail to qualify as a REMIC at any
time that any Certificates are outstanding and (ii) is authorized or permitted

                                      -122-

<PAGE>

hereunder.

                  Promptly after the execution of any such amendment the Trustee
shall furnish a copy of such amendment to each Certificateholder.

                  It shall not be necessary for the consent of
Certificateholders under this Section 11.01 to approve the particular form of
any proposed amendment, but it shall be sufficient if such consent shall approve
the substance thereof. The manner of obtaining such consents and of evidencing
the authorization of the execution thereof by Certificateholders shall be
subject to such reasonable regulations as the Trustee may prescribe.

                  The cost of any Opinion of Counsel to be delivered pursuant to
this Section 11.01 shall be borne by the Person seeking the related amendment,
but in no event shall such Opinion of Counsel be an expense of the Trustee.

                  The Trustee may, but shall not be obligated to enter into any
amendment pursuant to this Section that affects its rights, duties and
immunities under this Agreement or otherwise.

                  SECTION 11.02. Recordation of Agreement; Counterparts.

                  To the extent permitted by applicable law, this Agreement is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any or
all of the properties subject to the Mortgages are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Servicer at the expense of the Certificateholders, but only upon
direction of the Certificateholders accompanied by an Opinion of Counsel to the
effect that such recordation materially and beneficially affects the interests
of the Certificateholders.

                  For the purpose of facilitating the recordation of this
Agreement as herein provided and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and such counterparts shall
constitute but one and the same instrument.

                  SECTION 11.03. Limitation on Rights of Certificateholders.

                  The death or incapacity of any Certificateholder shall not
operate to terminate this Agreement or the Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.

                  No Certificateholder shall have any right to vote (except as
expressly provided for herein) or in any manner otherwise control the operation
and management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of any of the
Certificates, be construed so as to constitute the Certificateholders from time
to time as partners or members of an association; nor shall any
Certificateholder be under any liability to any

                                      -123-

<PAGE>

third person by reason of any action taken by the parties to this Agreement
pursuant to any provision hereof.

                  No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of default
and of the continuance thereof, as hereinbefore provided, and unless also the
Holders of Certificates entitled to at least 25% of the Voting Rights shall have
made written request upon the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs, expenses
and liabilities to be incurred therein or thereby, and the Trustee, for 15 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding. It is
understood and intended, and expressly covenanted by each Certificateholder with
every other Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatsoever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner herein provided and for the equal,
ratable and common benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section, each and every Certificateholder,
the Trustee shall be entitled to such relief as can be given either at law or in
equity.

                  SECTION 11.04. Governing Law.

                  This Agreement shall be construed in accordance with the laws
of the State of New York, without regard to the conflicts of laws provisions
thereof, and the obligations, rights and remedies of the parties hereunder shall
be determined in accordance with such laws, without regard to the conflicts of
laws provisions thereof.

                  SECTION 11.05. Notices.

                  All directions, demands and notices hereunder shall be in
writing and shall be deemed to have been duly given when received if personally
delivered at or mailed by first class mail, postage prepaid, or by express
delivery service or delivered in any other manner specified herein, to (a) in
the case of the Depositor, 390 Greenwich Street, 4th Floor, New York, New York
10013, Attention: Mortgage Finance (telecopy number (212) 723-8604), or such
other address or telecopy number as may hereafter be furnished to the Servicer
and the Trustee in writing by the Depositor, (b) in the case of the Servicer,
4828 Loop Central Drive, Houston, Texas 77081, Attention: Janice McClure
(telecopy number: (713) 960-0539), or such other address or telecopy number as
may hereafter be furnished to the Trustee and the Depositor in writing by the
Servicer and (c) in the case of the Trustee, [NAME OF TRUSTEE], 1761 East St.
Andrew Place, Santa Ana, California 92705- 4934, Attention: Trust
Administration-SB0301 (telecopy number: (714) 247-6329), or such other address
or telecopy number as may hereafter be furnished to the Servicer, the and the
Depositor in writing by the Trustee. Any notice required or permitted to be
given to a Certificateholder shall be given by first class mail, postage
prepaid, at the address of such Holder as shown in the Certificate Register. Any
notice so mailed within the time prescribed in this Agreement shall be
conclusively

                                      -124-

<PAGE>

presumed to have been duly given when mailed, whether or not the
Certificateholder receives such notice. A copy of any notice required to be
telecopied hereunder also shall be mailed to the appropriate party in the manner
set forth above.

                  SECTION 11.06. Severability of Provisions.

                  If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall be for any reason whatsoever held invalid, then
such covenants, agreements, provisions or terms shall be deemed severable from
the remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions of
this Agreement or of the Certificates or the rights of the Holders thereof.

                  SECTION 11.07. Notice to Rating Agencies.

                  The Trustee shall use its best efforts promptly to provide
notice to the Rating Agencies with respect to each of the following of which it
has actual knowledge:

                  1. Any material change or amendment to this Agreement;

                  2. The occurrence of any Servicer Event of Default that has
         not been cured or waived;

                  3. The resignation or termination of the Servicer or the
         Trustee;

                  4. The repurchase or substitution of Mortgage Loans pursuant
         to or as contemplated by Section 2.03;

                  5. The final payment to the Holders of any Class of
         Certificates;

                  6. Any change in the location of the Collection Account or the
         Distribution Account; and

                  7. Any event that would result in the inability of the
         Trustee, as successor servicer, to make advances regarding delinquent
         Mortgage Loans.

                  In addition, the Trustee shall make available to each Rating
Agency copies of each report to Certificateholders described in Section 4.02 and
the Servicer shall promptly furnish to each Rating Agency copies of the
following:

                  1. Each annual statement as to compliance described in Section
         3.20; and

                  2. Each annual independent public accountants' servicing
         report described in Section 3.21.

                  Any such notice pursuant to this Section 11.07 shall be in
writing and shall be deemed to have been duly given if personally delivered at
or mailed by first class mail, postage prepaid, or

                                      -125-

<PAGE>

by express delivery service to Fitch Ratings, One State Street Plaza, New, York,
New York 10004, facsimile number: (212) 344-1986 and to Standard & Poor's
Ratings Services, a division of the McGraw-Hill Companies, Inc., 55 Water
Street, New York, New York 10007 or such other addresses as the Rating Agencies
may designate in writing to the parties hereto.

                  SECTION 11.08. Article and Section References.

                  All article and section references used in this Agreement,
unless otherwise provided, are to articles and sections in this Agreement.

                  SECTION 11.09. Grant of Security Interest.

                  It is the express intent of the parties hereto that the
conveyance of the Mortgage Loans by the Depositor to the Trustee, be, and be
construed as, a sale of the Mortgage Loans by the Depositor and not a pledge of
the Mortgage Loans to secure a debt or other obligation of the Depositor.
However, in the event that, notwithstanding the aforementioned intent of the
parties, the Mortgage Loans are held to be property of the Depositor, then, (a)
it is the express intent of the parties that such conveyance be deemed a pledge
of the Mortgage Loans by the Depositor to the Trustee to secure a debt or other
obligation of the Depositor and (b)(1) this Agreement shall also be deemed to be
a security agreement within the meaning of Articles 8 and 9 of the Uniform
Commercial Code as in effect from time to time in the State of New York; (2) the
conveyance provided for in Section 2.01 hereof shall be deemed to be a grant by
the Depositor to the Trustee of a security interest in all of the Depositor's
right, title and interest in and to the Mortgage Loans and all amounts payable
to the holders of the Mortgage Loans in accordance with the terms thereof and
all proceeds of the conversion, voluntary or involuntary, of the foregoing into
cash, instruments, securities or other property, including without limitation
all amounts, other than investment earnings, from time to time held or invested
in the Collection Account and the Distribution Account, whether in the form of
cash, instruments, securities or other property; (3) the obligations secured by
such security agreement shall be deemed to be all of the Depositor's obligations
under this Agreement, including the obligation to provide to the
Certificateholders the benefits of this Agreement relating to the Mortgage Loans
and the Trust Fund; and (4) notifications to persons holding such property, and
acknowledgments, receipts or confirmations from persons holding such property,
shall be deemed notifications to, or acknowledgments, receipts or confirmations
from, financial intermediaries, bailees or agents (as applicable) of the Trustee
for the purpose of perfecting such security interest under applicable law.
Accordingly, the Depositor hereby grants to the Trustee a security interest in
the Mortgage Loans and all other property described in clause (2) of the
preceding sentence, for the purpose of securing to the Trustee the performance
by the Depositor of the obligations described in clause (3) of the preceding
sentence. Notwithstanding the foregoing, the parties hereto intend the
conveyance pursuant to Section 2.01 to be a true, absolute and unconditional
sale of the Mortgage Loans and assets constituting the Trust Fund by the
Depositor to the Trustee.

                                      -126-

<PAGE>

                  IN WITNESS WHEREOF, the Depositor, the Servicer and the
Trustee have caused their names to be signed hereto by their respective officers
thereunto duly authorized, in each case as of the day and year first above
written.

                                Citigroup Mortgage Loan Trust Inc., as Depositor

                                By:______________________________________
                                Name:
                                Title:

                                [NAME OF SERVICER], as Servicer

                                By:______________________________________
                                Name:
                                Title:

                                [NAME OF TRUSTEE], as Trustee

                                By:______________________________________
                                Name:
                                Title:

                                By:______________________________________
                                Name:
                                Title:

<PAGE>

STATE OF _____________  )
                        ) ss.:
COUNTY OF ___________   )

                  On the day of ______ 20__, before me, a notary public in and
for said State, personally appeared ________________, known to me to be an
Assistant Vice President of Citigroup Mortgage Loan Trust Inc., one of the
corporations that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                                   _____________________________
                                                          Notary Public

[Notarial Seal]

<PAGE>

STATE OF _____________ )
                       ) ss.:
COUNTY OF ____________ )

                  On the ____ day of ______ 20__, before me, a notary public in
and for said State, personally appeared _____________________, known to me to be
__________________ of [NAME OF SERVICER], one of the corporations that executed
the within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                            ____________________________________
                                                       Notary Public

[Notarial Seal]

<PAGE>

STATE OF ______________)
                       )ss.:
COUNTY OF _____________)

                  On the ____ day of ______ 20__, before me, a notary public in
and for said State, personally appeared _______________, known to me to be a
______________ of [NAME OF TRUSTEE], one of the corporations that executed the
within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                            ____________________________________
                                                       Notary Public

[Notarial Seal]

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