Document:

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                                                                     Exhibit 4.2

              ORIGEN MANUFACTURED HOUSING CONTRACT TRUST [20__ - _]

                                     Issuer

                                       and

                              [-------------------]

                                Indenture Trustee
                ------------------------------------------------

                                    INDENTURE

                         Dated as of [_______ __, 20__]
       ORIGEN MANUFACTURED HOUSING CONTRACT TRUST NOTES, SERIES [20__ - _]

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

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                                TABLE OF CONTENTS

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Section                                                                                                      Page
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                                                   ARTICLE I

                                                  DEFINITIONS

Section 1.01       Definitions.............................................................................    2
Section 1.02       Incorporation by Reference of Trust Indenture Act.......................................    2
Section 1.03       Rules of Construction...................................................................    2

                                                   ARTICLE II

                                         ORIGINAL ISSUANCE OF THE NOTES

Section 2.01       Form....................................................................................    3
Section 2.02       Execution, Authentication and Delivery..................................................    3
Section 2.03       Acceptance of Assets by Indenture Trustee...............................................    4

                                                  ARTICLE III

                                                   COVENANTS

Section 3.01       Collection of Payments with respect to the Assets.......................................    5
Section 3.02       Maintenance of Office or Agency.........................................................    5
Section 3.03       Money for Payments To Be Held in Trust; Paying Agent....................................    5
Section 3.04       Existence...............................................................................    6
Section 3.05       Payment of Principal and Interest.......................................................    7
Section 3.06       Protection of Trust Estate..............................................................    7
Section 3.07       Opinions as to Trust Estate.............................................................    7
Section 3.08       Performance of Obligations..............................................................    8
Section 3.09       Negative Covenants......................................................................    9
Section 3.10       [Reserved]..............................................................................    9
Section 3.11       [Reserved]..............................................................................    9
Section 3.12       Representations and Warranties Concerning the Assets....................................    9
Section 3.13       Amendments to Servicing Agreement.......................................................    9
Section 3.14       Servicer as Agent and Bailee of the Indenture Trustee...................................    9
Section 3.15       Investment Company Act..................................................................   10
Section 3.16       Issuer May Consolidate, etc.............................................................   10
Section 3.17       Successor or Transferee.................................................................   12
Section 3.18       No Other Business.......................................................................   12
Section 3.19       No Borrowing............................................................................   12
Section 3.20       Guarantees, Loans, Advances and Other Liabilities.......................................   12
Section 3.21       Capital Expenditures....................................................................   12
Section 3.22       Reserved................................................................................   12
Section 3.23       Restricted Payments.....................................................................   12
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Section 3.24       Notice of Events of Default..............................................................  13
Section 3.25       Further Instruments and Acts.............................................................  13
Section 3.26       Statements to Noteholders................................................................  13
Section 3.27       [Reserved]...............................................................................  13
Section 3.28       Certain Representations Regarding the Trust Estate.......................................  13

                                                   ARTICLE IV

                               THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE

Section 4.01       The Notes................................................................................  14
Section 4.02       Registration of and Limitations on Transfer and Exchange of Notes; Appointment of Note
                   Registrar and Certificate Registrar......................................................  15
Section 4.03       Mutilated, Destroyed, Lost or Stolen Notes...............................................  16
Section 4.04       Persons Deemed Owners....................................................................  17
Section 4.05       Cancellation.............................................................................  17
Section 4.06       Book-Entry Notes.........................................................................  17
Section 4.07       Notices to Depository....................................................................  18
Section 4.08       Definitive Notes.........................................................................  18
Section 4.09       Tax Treatment............................................................................  18
Section 4.10       Satisfaction and Discharge of Indenture..................................................  18
Section 4.11       Application of Trust Money...............................................................  19
Section 4.12       Reserved.................................................................................  20
Section 4.13       Repayment of Monies Held by Paying Agent.................................................  20
Section 4.14       Temporary Notes..........................................................................  20
Section 4.15       Representation Regarding ERISA...........................................................  20

                                                   ARTICLE V

                                              DEFAULT AND REMEDIES

Section 5.01       Events of Default........................................................................  21
Section 5.02       Acceleration of Maturity; Rescission and Annulment.......................................  21
Section 5.03       Collection of Indebtedness and Suits for Enforcement by Indenture Trustee................  21
Section 5.04       Remedies; Priorities.....................................................................  23
Section 5.05       Optional Preservation of the Trust Estate................................................  24
Section 5.06       Limitation of Suits......................................................................  25
Section 5.07       Unconditional Rights of Noteholders To Receive Principal and Interest....................  25
Section 5.08       Restoration of Rights and Remedies.......................................................  26
Section 5.09       Rights and Remedies Cumulative...........................................................  26
Section 5.10       Delay or Omission Not a Waiver...........................................................  26
Section 5.11       Control By Noteholders...................................................................  26
Section 5.12       Waiver of Past Defaults..................................................................  27
Section 5.13       Undertaking for Costs....................................................................  27
Section 5.14       Waiver of Stay or Extension Laws.........................................................  27
Section 5.15       Sale of Trust Estate.....................................................................  27
Section 5.16       Action on Notes..........................................................................  29
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Section 5.17       Performance and Enforcement of Certain Obligations.......................................  29

                                                   ARTICLE VI

                                             THE INDENTURE TRUSTEE

Section 6.01       Duties of Indenture Trustee..............................................................  30
Section 6.02       Rights of Indenture Trustee..............................................................  31
Section 6.03       Individual Rights of Indenture Trustee...................................................  32
Section 6.04       Indenture Trustee's Disclaimer...........................................................  32
Section 6.05       Notice of Event of Default...............................................................  32
Section 6.06       Reports by Indenture Trustee to Holders and Tax Administration...........................  32
Section 6.07       Compensation and Indemnity...............................................................  32
Section 6.08       Replacement of Indenture Trustee.........................................................  33
Section 6.09       Successor Indenture Trustee by Merger....................................................  34
Section 6.10       Appointment of Co-Indenture Trustee or Separate Indenture Trustee........................  34
Section 6.11       Eligibility; Disqualification............................................................  35
Section 6.12       Preferential Collection of Claims Against Issuer.........................................  35
Section 6.13       Representations and Warranties...........................................................  35
Section 6.14       Directions to Indenture Trustee..........................................................  36
Section 6.15       The Agents...............................................................................  36

                                                  ARTICLE VII

                                         NOTEHOLDERS' LISTS AND REPORTS

Section 7.01       Issuer To Furnish Indenture Trustee Names and Addresses of Noteholders...................  36
Section 7.02       Preservation of Information; Communications to Noteholders...............................  36
Section 7.03       Reserved.................................................................................  37
Section 7.04       Reports by Indenture Trustee.............................................................  37
Section 7.05       Statements to Noteholders................................................................  37

                                                  ARTICLE VIII

                                      ACCOUNTS, DISBURSEMENTS AND RELEASES

Section 8.01       Collection of Money......................................................................  39
Section 8.02       Payments on the Notes....................................................................  39
Section 8.03       Officer's Certificate....................................................................  42
Section 8.04       Termination Upon Distribution to Noteholders.............................................  42
Section 8.05       Release of Trust Estate..................................................................  42
Section 8.06       Surrender of Notes Upon Final Payment....................................................  43
Section 8.07       Optional Redemption of the Notes; Auction................................................  43
Section 8.08       Allocation of Realized Losses............................................................  44
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                                                   ARTICLE IX

                                            SUPPLEMENTAL INDENTURES

Section 9.01       Supplemental Indentures Without Consent of Noteholders...................................  44
Section 9.02       Supplemental Indentures With Consent of Noteholders......................................  46
Section 9.03       Execution of Supplemental Indentures.....................................................  47
Section 9.04       Effect of Supplemental Indenture.........................................................  48
Section 9.05       Conformity with Trust Indenture Act......................................................  48
Section 9.06       Reference in Notes to Supplemental Indentures............................................  48

                                                   ARTICLE X

                                                 MISCELLANEOUS

Section 10.01      Compliance Certificates and Opinions, etc................................................  48
Section 10.02      Form of Documents Delivered to Indenture Trustee.........................................  50
Section 10.03      Acts of Noteholders......................................................................  50
Section 10.04      Notices etc., to Indenture Trustee Issuer and Rating Agencies............................  51
Section 10.05      Notices to Noteholders; Waiver...........................................................  52
Section 10.06      Conflict with Trust Indenture Act........................................................  52
Section 10.07      Effect of Headings.......................................................................  52
Section 10.08      Successors and Assigns...................................................................  52
Section 10.09      Separability.............................................................................  52
Section 10.10      Third Party Beneficiary..................................................................  53
Section 10.11      Legal Holidays...........................................................................  53
Section 10.12      GOVERNING LAW............................................................................  53
Section 10.13      Counterparts.............................................................................  53
Section 10.14      Recording of Indenture...................................................................  53
Section 10.15      Issuer Obligation........................................................................  53
Section 10.16      No Petition..............................................................................  54
Section 10.17      Inspection...............................................................................  54
Section 10.18      No Recourse to Owner Trustee.............................................................  54
Section 10.19      Proofs of Claim..........................................................................  54

EXHIBITS

Exhibit A-1       Form of Class A-[_] Note
Exhibit A-2       Form of Class M-[_] Note
Exhibit B-1       List of Contracts
Exhibit B-2       Mortgage Loan Schedule
Exhibit C         Form of Custodial Agreement

Appendix A        Definitions
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      This Indenture, dated as of [______ __, 20__] is entered into between
Origen Manufactured Housing Contract Trust [20__ - _], a Delaware statutory
trust, as Issuer (the "Issuer"), and [________________], a New York banking
association, as Indenture Trustee (the "Indenture Trustee").

                                WITNESSETH THAT:

      Each party hereto agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Issuer's Notes, Series
[20__ - _] (the "Notes").

                                 GRANTING CLAUSE

     The Issuer hereby Grants to the Indenture Trustee at the Closing Date,
as trustee for the benefit of the Holders of the Notes, all of the Issuer's
right, title and interest in and to whether now existing or hereafter created by
(a) the Assets, Eligible Substitute Assets and the proceeds thereof and all
rights under the Related Documents; (b) all funds on deposit from time to time
in the Collection Account allocable to the Assets excluding any investment
income from such funds; (c) all funds on deposit from time to time in the Note
Payment Account and in all proceeds thereof; (d) all rights under (i) the Asset
Purchase Agreement as assigned to the Issuer, (ii) the Servicing Agreement, and
(iii) all rights under every Hazard Insurance Policy relating to a Manufactured
Home or Mortgaged Property securing an Asset for the benefit of the creditor of
such Asset, and (iv) all documents contained in the Asset Files, subject to the
exceptions set forth in the Initial Certification and the Final Certification
delivered by the Custodian, in the forms of Exhibit A-1 and Exhibit A-2 to the
Custodial Agreement, respectively; and (e) all present and future claims,
demands, causes and choses in action in respect of any or all of the foregoing
and all payments on or under, and all proceeds of every kind and nature
whatsoever in respect of, any or all of the foregoing and all payments on or
under, and all proceeds of every kind and nature whatsoever in the conversion
thereof, voluntary or involuntary, into cash or other liquid property, all cash
proceeds, accounts, accounts receivable, notes, drafts, acceptances, checks,
deposit accounts, rights to payment of any and every kind, and other forms of
obligations and receivables, instruments and other property which at any time
constitute all or part of or are included in the proceeds of any of the
foregoing (collectively, the "Trust Estate" or the "Collateral").

      The foregoing Grant is made in trust to secure the payment of principal of
and interest on, and any other amounts owing in respect of, the Notes, equally
and ratably without prejudice, priority or distinction, and to secure compliance
with the provisions of this Indenture, all as provided in this Indenture.

      The Indenture Trustee, as trustee on behalf of the Holders of the Notes,
acknowledges such Grant, accepts the trust under this Indenture in accordance
with the provisions hereof and agrees to perform its duties as Indenture Trustee
as required herein.

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                                    ARTICLE I

                                   DEFINITIONS

      Section 1.01 Definitions. For all purposes of this Indenture, except as
otherwise expressly provided herein or unless the context otherwise requires,
capitalized terms not otherwise defined herein shall have the meanings assigned
to such terms in the Definitions attached hereto as Appendix A which is
incorporated by reference herein. All other capitalized terms used herein shall
have the meanings specified herein.

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

            "Commission" means the Securities and Exchange Commission.

            "indenture securities" means the Notes.

            "indenture security holder" means a Noteholder.

            "indenture to be qualified" means this Indenture.

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

            "obligor" on the indenture securities means the Issuer and any other
             obligor on the indenture securities.

      All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rules and
have the meanings assigned to them by such definitions.

            Section 1.03 Rules of Construction. Unless the context otherwise
            requires:

                  (i)   a term has the meaning assigned to it;

                  (ii)  an accounting term not otherwise defined has the meaning
            assigned to it in accordance with generally accepted accounting
            principles as in effect from time to time;

                  (iii) "or" is not exclusive;

                  (iv)  "including" means including without limitation;

                  (v)   words in the singular include the plural and words in
             the plural include the singular; and

                  (vi)  any agreement, instrument or statute defined or referred
            to herein or in any instrument or certificate delivered in
            connection herewith means such agreement, instrument or statute as
            from time to time amended, modified or supplemented and

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      includes (in the case of agreements or instruments) references to all
      attachments thereto and instruments incorporated therein; references to a
      Person are also to its permitted successors and assigns.

                                   ARTICLE II

                         ORIGINAL ISSUANCE OF THE NOTES

      Section 2.01 Form. The Class A Notes and the Mezzanine Notes, together
with the Indenture Trustee's certificate of authentication, shall be in
substantially the form set forth in Exhibits A-1 and A-2 to this Indenture,
respectively, with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture.

      The Notes shall be typewritten, printed, lithographed or engraved or
produced by any combination of these methods (with or without steel engraved
borders).

      The terms of the Notes set forth in Exhibits A-1 and A-2 to this Indenture
are part of the terms of this Indenture.

      Section 2.02 Execution, Authentication and Delivery. The Notes shall be
executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.

      Notes bearing the manual or facsimile signature of individuals who were at
any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.

      The Indenture Trustee shall upon Issuer Request authenticate and deliver
the Class A Notes and the Mezzanine Notes for original issue in an aggregate
initial principal amount of $[__________]. The Class A-1 Notes shall be issued
in an aggregate initial Note Balance of $[__________], the Class A-2 Notes shall
be issued in an aggregate initial Note Balance of $[__________], the Class A-3
Notes shall be issued in an aggregate initial Note Balance of $[__________], the
Class A-4 Notes shall be issued in an aggregate initial Note Balance of
$[__________], the Class M-1 Notes shall be issued in an aggregate initial
Note Balance of $[__________], and the Class M-2 Notes shall be issued in an
aggregate initial Note Balance of $[__________].

      Each of the Notes shall be dated the date of its authentication. The Notes
shall be issuable as registered Notes and the Notes shall be issuable in the
minimum initial Note Balances of $25,000 and in integral multiples of $1 in
excess thereof.

      No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose, unless there appears on such Note a certificate
of authentication substantially in the form provided for herein executed by the
Indenture Trustee by the manual signature of one of its authorized signatories,
and such certificate upon any Note shall be conclusive evidence, and the only
evidence, that such Note has been duly authenticated and delivered hereunder.

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      Section 2.03 Acceptance of Assets by Indenture Trustee.

      (a)   The Indenture Trustee or the Custodian acknowledges receipt of,
subject to the exceptions it notes pursuant to the procedures described below,
the documents (or certified copies thereof) referred to in Section 2.2 of the
Asset Purchase Agreement, and declares that it holds and will continue to hold
those documents and any amendments, replacements or supplements thereto and all
other assets of the Trust Estate as Indenture Trustee in trust for the use and
benefit of all present and future Holders of the Notes or, in the case of the
Custodian, on behalf of the Indenture Trustee.

      The Indenture Trustee, or the Custodian on its behalf, shall, for the
benefit of the Noteholders, review each Asset File on or before the Closing Date
and certify in substantially the form attached to the Custodial Agreement as
Exhibit A-1 thereto that, as to each Asset listed in the List of Contracts or
Mortgage Loan Schedule (other than any Asset specifically identified in the
exception report annexed thereto as not being covered by such certification),
(i) all documents constituting part of such Asset File (other than assumption
and modification agreements) required to be delivered to it pursuant to the
Asset Purchase Agreement are in its possession, (ii) such documents have been
reviewed by it and appear regular on their face and relate to such Asset and
(iii) based on its examination and only as to the foregoing, the information set
forth in the List of Contracts or Mortgage Loan Schedule accurately reflects
information set forth in the Asset File. It is herein acknowledged that, in
conducting such review, neither the Indenture Trustee nor the Custodian shall be
under any duty or obligation (i) to inspect, review or examine any such
documents, instruments, certificates or other papers to determine whether they
are genuine, enforceable, or appropriate for the represented purpose or whether
they have actually been recorded or that they are other than what they purport
to be on their face or (ii) to determine whether any Asset File should include
any of the documents concerning assumption and modification agreements.

      Prior to the first anniversary date of this Indenture the Indenture
Trustee or the Custodian shall deliver to the Depositor and the Servicer a final
certification in the form annexed to the Custodial Agreement as Exhibit A-2
evidencing the completeness of the Asset 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 Asset Files and making or preparing, as
the case may be, the certifications referred to above, the Indenture Trustee or
the Custodian finds any document or documents constituting a part of an Asset
File to be missing or defective in any material respect, at the conclusion of
its review the Indenture Trustee or the Custodian shall so notify the Depositor
and the Servicer. In addition, upon the discovery by the Indenture Trustee of a
breach of any of the representations and warranties made by the Originator and
the Seller in the Asset Purchase Agreement in respect of any Asset which
materially adversely affects such Asset or the interests of the related
Noteholders in such Asset, the Indenture Trustee party discovering such breach
shall give prompt written notice to the Depositor, the Servicer, the Originator
and the Seller.

      (b)   Upon receipt by the Trust Estate by deposit in the Note Payment
Account of the Repurchase Price for a repurchased Asset under Section 2.03 of
the Servicing Agreement, or the

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delivery of an Eligible Substitute Asset pursuant to subsection 3.6(b) of the
Asset Purchase Agreement, and upon receipt of a certificate of an Officer of the
Originator in the form attached as Exhibit B to the Servicing Agreement or, with
respect to any Eligible Substitute Asset delivered under subsection 3.6(b) of
the Asset Purchase Agreement, a certificate of an Officer of the Originator in
the form attached as Exhibit A to the Asset Purchase Agreement, the Indenture
Trustee shall release or shall cause the Custodian to release the related Asset
File and shall execute and deliver all instruments of transfer or assignment,
without recourse, furnished to it by the Originator as are necessary to vest in
the Originator title to and rights under the related Asset.

                                  ARTICLE III

                                    COVENANTS

      Section 3.01 Collection of Payments with respect to the Assets. The
Indenture Trustee shall establish and maintain an Eligible Account (the "Note
Payment Account") in which the Indenture Trustee shall deposit, on the same day
as received from the Servicer, amounts received from the Servicer pursuant to
Section 3.06(a) of the Servicing Agreement. The Indenture Trustee shall make all
payments of principal of and interest on the Notes, subject to Section 3.03 as
provided in Section 3.05 herein from monies on deposit in the Note Payment
Account.

      Section 3.02 Maintenance of Office or Agency. The Issuer will maintain an
office or agency where, subject to satisfaction of conditions set forth herein,
Notes may be surrendered for registration of transfer or exchange, and where
notices and demands to or upon the Issuer in respect of the Notes and this
Indenture may be served. The Issuer hereby initially appoints the Indenture
Trustee to serve as its agent for the foregoing purposes. If at any time the
Issuer shall fail to maintain any such office or agency or shall fail to furnish
the Indenture Trustee with the address thereof, such surrenders may be made at
the office of the Indenture Trustee's agent located at c/o DTC Transfer
Services, 55 Water Street, Jeanette Park Entrance, New York, New York 10041, and
notices and demands may be made or served at the Corporate Trust Office.

      Section 3.03 Money for Payments To Be Held in Trust; Paying Agent. As
provided in Section 3.01, all payments of amounts due and payable with respect
to any Notes that are to be made from amounts withdrawn from the Note Payment
Account pursuant to Section 3.01 shall be made on behalf of the Issuer by the
Indenture Trustee or by the Paying Agent, and no amounts so withdrawn from the
Note Payment Account for payments of Notes shall be paid over to the Issuer
except as provided in this Section 3.03. The Issuer hereby appoints the
Indenture Trustee as its Paying Agent.

      The Issuer will cause each Paying Agent other than the Indenture Trustee
to execute and deliver to the Indenture Trustee an instrument in which such
Paying Agent shall agree with the indenture Trustee (and if the Indenture
Trustee acts as Paying Agent it hereby so agrees), subject to the provisions of
this Section 3.03, that such Paying Agent will:

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

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

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

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

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

            (vi)  not commence a bankruptcy proceeding against the Issuer in
      connection with this Indenture.

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

      Any money held by the Indenture Trustee or any Paying Agent in trust for
the payment of any amount due with respect to any Note and remaining unclaimed
for one year after such amount has become due and payable shall be discharged
from such trust and be paid to the Issuer on Issuer Request; and the Holder of
such Note shall thereafter, as an unsecured general creditor, look only to the
Issuer for payment thereof (but only to the extent of the amounts so paid to the
Issuer), and all liability of the Indenture Trustee or such Paying Agent with
respect to such trust money shall thereupon cease; provided, however, that the
Indenture Trustee or such Paying Agent, before being required to make any such
repayment, shall at the expense and direction of the Issuer cause to be
published once, in an Authorized Newspaper published in the English language,
notice that such money remains unclaimed and that, after a date specified
therein which shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid to the Issuer.
The Indenture Trustee may also adopt and employ, at the expense and direction f
the Issuer, any other reasonable means of notification of such repayment
(including, but not limited to, mailing notice of such repayment to Holders
whose Notes have been called but have not been surrendered for redemption or
whose right to or interest in monies due and payable but not claimed is
determinable from the records of the Indenture Trustee or of any Paying Agent,
at the last address of record for each such Holder).

      Section 3.04 Existence. The Issuer will keep in full effect its existence,
rights and franchises as a statutory trust under the laws of the State of
Delaware (unless it becomes, or any

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successor Issuer hereunder is or becomes, organized under the laws of any other
state or of the United States of America, in which case the Issuer will keep in
full effect its existence, rights and franchises under the laws of such other
jurisdiction) and will obtain and preserve its qualification to do business in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Indenture, the Notes, the Assets
and each other instrument or agreement included in the Trust Estate.

      Section 3.05 Payment of Principal and Interest. On each Payment Date from
amounts on deposit in the Note Payment Account in accordance with Section 8.02
hereof, the Indenture Trustee shall pay to the Persons and to the extent
provided therein, the Amount Available for such Payment Date.

      Section 3.06   Protection of Trust Estate.

      (a)   The Issuer will from time to time prepare, execute and deliver all
such supplements and amendments hereto and all such financing statements,
continuation statements, instruments of further assurance and other instruments,
and will take such other action necessary or advisable to:

            (i)   maintain or preserve the lien and security interest (and the
priority thereof) of this Indenture or carry out more effectively the purposes
hereof;

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

            (iii) cause the Issuer or Servicer to enforce any of the rights to
the Assets; or

            (iv)  preserve and defend title to the Trust Estate and the rights
of the Indenture Trustee and the Noteholders in such Trust Estate against the
claims of all persons and parties.

      (b)   Except as otherwise provided in this Indenture, the Indenture
Trustee shall not remove any portion of the Trust Estate that consists of money
or is evidenced by an instrument, certificate or other writing from the
jurisdiction in which it was held at the date of the most recent Opinion of
Counsel delivered pursuant to Section 3.07 hereof (or from the jurisdiction in
which it was held as described in the Opinion of Counsel delivered on the
Closing Date pursuant to Section 3.07(a) hereof, or if no Opinion of Counsel has
yet been delivered pursuant to Section 3.07(b) hereof, unless the Indenture
Trustee shall have first received an Opinion of Counsel to the effect that the
lien and security interest created by this Indenture with respect to such
property will continue to be maintained after giving effect to such action or
actions).

      The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to sign any financing statement, continuation statement or
other instrument required to be signed pursuant to this Section 3.06 upon the
Issuer's preparation thereof and delivery to the Indenture Trustee.

      Section 3.07  Opinions as to Trust Estate.

                                       7
<PAGE>

      (a)   On the Closing Date, the Issuer shall furnish to the Indenture
Trustee and the Owner Trustee an Opinion of Counsel either stating that, in the
opinion of such counsel, such action has been taken with respect to the
recording and filing of this Indenture, any indentures supplemental hereto, and
any other requisite documents, and with respect to the execution and filing of
any financing statements and continuation statements, as are necessary to
perfect and make effective the lien and first priority security interest in the
Collateral and reciting the details of such action, or stating that, in the
opinion of such counsel, no such action is necessary to make such lien and first
priority security interest effective.

      (b)   On or before April 15th in each calendar year, beginning in [20__],
the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel at the
expense of the Issuer either stating that, in the opinion of such counsel, such
action has been taken with respect to the recording, filing, rerecording and
refiling of this Indenture, any indentures supplemental hereto and any other
requisite documents and with respect to the execution and filing of any
financing statements and continuation statements as is necessary to maintain the
lien and first priority security interest in the Collateral and reciting the
details of such action or stating that in the opinion of such counsel no such
action is necessary to maintain such lien and security interest. Such Opinion of
Counsel shall also describe the recording, filing, re-recording and refiling of
this Indenture, any indentures supplemental hereto and any other requisite
documents and the execution and filing of any financing statements and
continuation statements that will, in the opinion of such counsel, be required
to maintain the lien and security interest in the Collateral until December 31st
in the following calendar year.

      Section 3.08 Performance of Obligations.

      (a)   The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the Basic Documents and
in the instruments and agreements included in the Trust Estate.

      (b)   The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Indenture Trustee in an Officer's Certificate of
the Issuer shall be deemed to be action taken by the Issuer.

      (c)   The Issuer will not take any action or permit any action to be taken
by others which would release any Person from any of such Person's covenants or
obligations under any of the documents relating to the Assets or under any
instrument included in the Trust Estate, or which would result in the amendment,
hypothecation, subordination, termination or discharge of, or impair the
validity or effectiveness of, any of the documents relating to the Assets or any
such instrument, except such actions as the Servicer is expressly permitted to
take in the Servicing Agreement. The Indenture Trustee may exercise the rights
of the Issuer to direct the actions of the Servicer pursuant to the Servicing
Agreement.

      (d)   The Issuer may retain an administrator and may enter into contracts
with other Persons for the performance of the Issuer's obligations hereunder,
and performance of such obligations by such Persons shall be deemed to be
performance of such obligations by the Issuer.

                                       8
<PAGE>

      Section 3.09 Negative Covenants. So long as any Notes are Outstanding, the
Issuer shall not:

            (i)   except as expressly permitted by this Indenture, sell,
      transfer, exchange or otherwise dispose of the Trust Estate, unless
      directed to do so by the Indenture Trustee;

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

            (iii) (A) permit the validity or effectiveness of this Indenture to
      be impaired, or permit the lien of this Indenture to be amended,
      hypothecated, subordinated, terminated or discharged, or permit any Person
      to be released from any covenants or obligations with respect to the Notes
      under this Indenture except as may be expressly permitted hereby, (B)
      permit any lien, charge, excise, claim, security interest, mortgage or
      other encumbrance (other than the lien of this Indenture) to be created on
      or extend to or otherwise arise upon or burden the Trust Estate or any
      part thereof or any interest therein or the proceeds thereof or (C) permit
      the lien of this Indenture not to constitute a valid first priority
      security interest in the Trust Estate; or

            (iv)  waive or impair, or fail to assert rights under, the Assets,
      or impair or cause to be impaired the Issuer's interest in the Assets, the
      Asset Purchase Agreement or in any Basic Document, if any such action
      would materially and adversely affect the interests of the Noteholders.

      Section 3.10 [Reserved].

      Section 3.11 [Reserved].

      Section 3.12 Representations and Warranties Concerning the Assets. The
Indenture Trustee, as pledgee of the Assets, has the benefit of the
representations and warranties made by the Originator and the Seller in the
Asset Purchase Agreement concerning the Originator, the Seller and the Assets to
the same extent as though such representations and warranties were made directly
to the Indenture Trustee. If a Responsible Officer of the Indenture Trustee has
actual knowledge of any breach of any representation or warranty made by the
Originator and the Seller in the Asset Purchase Agreement, the Indenture Trustee
shall promptly notify the Originator of such finding and the Originator's
obligation to cure such defect or repurchase or substitute for the related
Asset.

      Section 3.13 Amendments to Servicing Agreement. The Issuer covenants with
the Indenture Trustee that it will not enter into any amendment or supplement to
the Servicing Agreement without the prior written consent of the Indenture
Trustee.

      Section 3.14 Servicer as Agent and Bailee of the Indenture Trustee. Solely
for purposes of perfection under Section 9-305 of the UCC or other similar
applicable law, rule or regulation of the state in which such property is held
by the Servicer, the Issuer and the Indenture

                                       9
<PAGE>

Trustee hereby acknowledge that the Servicer is acting as bailee of the
Indenture Trustee in holding amounts on deposit in the Collection Account, as
well as its bailee in holding any Related Documents released to the Servicer,
and any other items constituting a part of the Trust Estate which from time to
time come into the possession of the Servicer. It is intended that, by the
Servicer's acceptance of such bailee arrangement, the Indenture Trustee, as a
secured party of the Assets, will be deemed to have possession of such Related
Documents, such monies and such other items for purposes of Section 9-305 of the
UCC of the state in which such property is held by the Servicer. The Indenture
Trustee shall not be liable and has no duty with respect to such documents,
monies or items while in possession of the Servicer.

      Section 3.15 Investment Company Act. The Issuer shall not become an
"investment company" or be under the "control" of an "investment company" as
such terms are defined in the Investment Company Act of 1940, as amended (or any
successor or amendatory statute), and the rules and regulations thereunder
(taking into account not only the general definition of the term "investment
company" but also any available exceptions to such general definition);
provided, however, that the Issuer shall be in compliance with this Section 3.15
if it shall have obtained an order exempting it from regulation as an
"investment company" so long as it is in compliance with the conditions imposed
in such order.

      Section 3.16 Issuer May Consolidate, etc.

      (a)   The Issuer shall not consolidate or merge with or into any other
            Person, unless:

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

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

            (iii) the Rating Agencies shall have notified the Issuer that such
      transaction shall not cause the rating of the Notes to be reduced,
      suspended or withdrawn or to be considered by either Rating Agency to be
      below investment grade;

            (iv)  the Issuer shall have received an Opinion of Counsel (and
      shall have delivered a copy thereof to the Indenture Trustee) to the
      effect that such transaction will not (A) result in a "substantial
      modification" of the Notes under Treasury Regulation section 1.1001-3, or
      adversely affect the status of the Notes as indebtedness for federal
      income tax purposes, or (B) if 100% of the Certificates are not owned by
      Origen REIT or

                                       10
<PAGE>

      a direct or indirect qualified REIT subsidiary of Origen REIT, cause the
      Trust to be subject to an entity level tax for federal income tax
      purposes;

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

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

      (b)   The Issuer shall not convey or transfer any of its properties or
assets, including those included in the Trust Estate, to any Person, unless:

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

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

            (iii) the Rating Agencies shall have notified the Issuer that such
      transaction shall not cause the rating of the Notes to be reduced,
      suspended or withdrawn;

            (iv)  the Issuer shall have received an Opinion of Counsel (and
      shall have delivered a copy thereof to the Indenture Trustee) to the
      effect that such transaction will not (A) result in a "substantial
      modification" of the Notes under Treasury Regulation section 1.1001-3, or
      adversely affect the status of the Notes as indebtedness for federal
      income tax purposes, or (B) if 100% of the Certificates are not owned by
      Origen REIT or a direct or indirect qualified REIT subsidiary of Origen
      REIT, cause the Trust to be subject to an entity level tax for federal
      income tax purposes;

                                       11
<PAGE>

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

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

      Section 3.17 Successor or Transferee.

      (a)   Upon any consolidation or merger of the Issuer in accordance with
Section 3.16(a), the Person formed by or surviving such consolidation or merger
(if other than the Issuer) shall succeed to, and be substituted for, and may
exercise every right and power of, the Issuer under this Indenture with the same
effect as if such Person had been named as the Issuer herein.

      (b)   Upon a conveyance or transfer of all the assets and properties of
the Issuer pursuant to Section 3.16(b), the Issuer will be released from every
covenant and agreement of this Indenture to be observed or performed on the part
of the Issuer with respect to the Notes immediately upon the delivery of written
notice to the Indenture Trustee of such conveyance or transfer.

      Section 3.18 No Other Business. The Issuer shall not engage in any
business other than financing, purchasing, owning and selling and managing the
Assets and the issuance of the Notes and Certificates in the manner contemplated
by this Indenture and the Basic Documents and all activities incidental thereto.

      Section 3.19 No Borrowing. The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Notes under this Indenture.

      Section 3.20 Guarantees, Loans, Advances and Other Liabilities. Except as
contemplated by this Indenture or the Basic Documents, the Issuer shall not make
any loan or advance or credit to, or guarantee (directly or indirectly or by an
instrument having the effect of assuring another's payment or performance on any
obligation or capability of so doing or otherwise), endorse or otherwise become
contingently liable, directly or indirectly, in connection with the obligations,
stocks or dividends of, or own, purchase, repurchase or acquire (or agree
contingently to do so) any stock, obligations, assets or securities of, or any
other interest in, or make any capital contribution to, any other Person.

      Section 3.21 Capital Expenditures. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).

      Section 3.22 Reserved.

      Section 3.23 Restricted Payments. The Issuer shall not, directly or
indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Owner Trustee or any owner of a beneficial

                                       12
<PAGE>

interest in the Issuer or otherwise with respect to any ownership or equity
interest or security in or of the Issuer, (ii) redeem, purchase, retire or
otherwise acquire for value any such ownership or equity interest or security or
(iii) set aside or otherwise segregate any amounts for any such purpose;
provided, however, that the Issuer may make, or cause to be made, (x)
distributions and payments to the Owner Trustee, the Indenture Trustee,
Noteholders and the Certificateholders as contemplated by, and to the extent
funds are available for such purpose under this Indenture and the Trust
Agreement and (y) payments to the Servicer pursuant to the terms of the
Servicing Agreement. The Issuer will not, directly or indirectly, make payments
to or distributions from the Collection Account except in accordance with this
Indenture and the Basic Documents.

      Section 3.24 Notice of Events of Default. The Issuer shall give the
Indenture Trustee and the Rating Agencies prompt written notice of each Event of
Default hereunder and under the Trust Agreement.

      Section 3.25 Further Instruments and Acts. Upon request of the Indenture
Trustee, the Issuer will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.

      Section 3.26 Statements to Noteholders. On each Payment Date, the
Indenture Trustee and the Certificate Registrar shall prepare and make available
on the Indenture Trustee's website, [__________________] (or deliver at the
recipient's option), to each Noteholder and Certificateholder the most recent
statement prepared by the Indenture Trustee pursuant to Section 7.05 hereof.

      Section 3.27 [Reserved].

      Section 3.28 Certain Representations Regarding the Trust Estate.

      (a)   With respect to that portion of the Collateral described in clauses
(a) through (d) of the definition of Trust Estate, the Issuer represents to the
Indenture Trustee that:

            (i)   This Indenture creates a valid and continuing security
      interest (as defined in the applicable UCC) in the Collateral in favor of
      the Indenture Trustee, which security interest is prior to all other
      liens, and is enforceable as such as against creditors of and purchasers
      from the Issuer.

            (ii)  The Collateral constitutes "deposit accounts", "chattel
      paper", "general intangibles" or "instruments," as applicable, within the
      meaning of the applicable UCC.

            (iii) The Issuer owns and has good and marketable title to the
      Collateral, free and clear of any lien, claim or encumbrance of any
      Person.

            (iv)  Other than the security interest granted to the Indenture
      Trustee pursuant to this Indenture, the Issuer has not pledged, assigned,
      sold, granted a security interest in, or otherwise conveyed any of the
      Collateral.

      (b)   With respect to that portion of the Collateral described in clause
(e), the Issuer represents to the Indenture Trustee that:

                                       13
<PAGE>

            (i)   This Indenture creates a valid and continuing security
      interest (as defined in the applicable UCC) in the Collateral in favor of
      the Indenture Trustee, which security interest is prior to all other
      liens, and is enforceable as such as against creditors of and purchasers
      from the Issuer.

            (ii)  The Collateral constitutes "general intangibles" within the
      meaning of the applicable UCC.

            (iii) The Issuer owns and has good and marketable title to the
      Collateral, free and clear of any lien, claim or encumbrance of any
      Person.

            (iv)  Other than the security interest granted to the Indenture
      Trustee pursuant to this Indenture, the Issuer has not pledged, assigned,
      sold, granted a security interest in, or otherwise conveyed any of the
      Collateral.

      (c)   With respect to any Collateral in which a security interest may be
perfected by filing, the Issuer has not authorized the filing of, and is not
aware of any financing statements against, the Issuer, that include a
description of collateral covering such Collateral, other than any financing
statement relating to the security interest granted to the Indenture Trustee
hereunder or that has been terminated. The Issuer is not aware of any judgment
or tax lien filings against the Issuer.

      (d)   The Issuer has caused or will have caused, within ten days, the
filing of all appropriate financing statements in the proper filing office in
the appropriate jurisdictions under applicable law in order to perfect the
security interest in all Collateral granted to the Indenture Trustee hereunder
in which a security interest may be perfected by filing. Any financing statement
that is filed in connection with this Section 3.28 shall contain a statement
that a purchase or security interest in any collateral described therein will
violate the rights of the secured party named in such financing statement.

      (e)   The foregoing representations may not be waived and shall survive
the issuance of the Notes.

                                   ARTICLE IV

               THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE

      Section 4.01 The Notes. Each Class of Notes shall be registered in the
name of a nominee designated by the Depository. Beneficial Owners will hold
interests in the Notes through the book-entry facilities of the Depository in
minimum initial Note Balances of $25,000 and integral multiples of $1 in excess
thereof.

      The Indenture Trustee may for all purposes (including the making of
payments due on the Notes) deal with the Depository (through and to its nominee)
as the authorized representative of the Beneficial Owners with respect to the
Notes for the purposes of exercising the rights of Holders of the Notes
hereunder. Except as provided in the next succeeding paragraph of this Section
4.01, the rights of Beneficial Owners with respect to the Notes shall be limited
to those established by law and agreements between such Beneficial Owners and
the Depository and

                                       14
<PAGE>

Depository Participants. Except as provided in Section 4.08 hereof, Beneficial
Owners shall not be entitled to definitive notes for the Notes as to which they
are the Beneficial Owners. Requests and directions from, and votes of, the
Depository as Holder of the Notes shall not be deemed inconsistent if they are
made with respect to different Beneficial Owners. The Indenture Trustee may
establish a reasonable record date in connection with solicitations of consents
from or voting by Noteholders and give notice to the Depository of such record
date. Without the consent of the Issuer and the Indenture Trustee, no Note may
be transferred by the Depository except to a successor Depository that agrees to
hold such Note for the account of the Beneficial Owners.

      In the event the Depository Trust Company resigns or is removed as
Depository, the Indenture Trustee with the approval of the Issuer may appoint a
successor Depository. If no successor Depository has been appointed within 30
days of the effective date of the Depository's resignation or removal, each
Beneficial Owner shall be entitled to certificates representing the Notes it
beneficially owns in the manner prescribed in Section 4.08.

      The Notes shall, on original issue, be executed on behalf of the Issuer by
the Owner Trustee, not in its individual capacity but solely as Owner Trustee,
authenticated by the Indenture Trustee and delivered by the Indenture Trustee to
or upon the order of the Issuer.

      Section 4.02 Registration of and Limitations on Transfer and Exchange of
Notes; Appointment of Note Registrar and Certificate Registrar. The Issuer shall
cause to be kept at the Corporate Trust Office a Note Register in which, subject
to such reasonable regulations as it may prescribe, the Note Registrar shall
provide for the registration of Notes and of transfers and exchanges of Notes as
herein provided.

      Subject to the restrictions and limitations set forth below, upon
surrender for registration of transfer of any Note at the Corporate Trust
Office, the Issuer shall execute and the Note Registrar shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Notes in authorized initial Note Balances evidencing the same Class and
aggregate Percentage Interests.

      Subject to the foregoing, at the option of the Noteholders, Notes may be
exchanged for other Notes of like tenor and in authorized initial Note Balances
evidencing the same Class and aggregate Percentage Interests upon surrender of
the Notes to be exchanged at the Corporate Trust Office of the Note Registrar.
Whenever any Notes are so surrendered for exchange, the Issuer shall execute and
the Indenture Trustee shall authenticate and deliver the Notes which the
Noteholder making the exchange is entitled to receive. Each Note presented or
surrendered for registration of transfer or exchange shall (if so required by
the Note Registrar) be duly endorsed by, or be accompanied by a written
instrument of transfer in form reasonably satisfactory to the Note Registrar
duly executed by the Holder thereof or his attorney duly authorized in writing
with such signature guaranteed by a commercial bank or trust company located or
having a correspondent located in the city of New York. Notes delivered upon any
such transfer or exchange will evidence the same obligations, and will be
entitled to the same rights and privileges, as the Notes surrendered.

                                       15
<PAGE>

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

      The Issuer hereby appoints the Indenture Trustee as (i) Certificate
Registrar to keep at its Corporate Trust Office a Certificate Register pursuant
to Section 3.09 of the Trust Agreement in which, subject to such reasonable
regulations as it may prescribe, the Certificate Registrar shall provide for the
registration of Certificates and of transfers and exchanges thereof pursuant to
Section 3.05 of the Trust Agreement and (ii) Note Registrar under this
Indenture. The Indenture Trustee hereby accepts such appointments.

      Section 4.03 Mutilated, Destroyed, Lost or Stolen Notes. If (i) any
mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Indenture Trustee such security or
indemnity as may be required by it to hold the Issuer and the Indenture Trustee
harmless, then, in the absence of notice to the Issuer, the Note Registrar or
the Indenture Trustee that such Note has been acquired by a bona fide purchaser,
and provided that the requirements of Section 8-405 of the UCC are met, the
Issuer shall execute, and upon its request the Indenture Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Note, a replacement Note; provided, however, that if
any such destroyed, lost or stolen Note, but not a mutilated Note, shall have
become or within seven days shall be due and payable, instead of issuing a
replacement Note, the Issuer may pay such destroyed, lost or stolen Note when so
due or payable without surrender thereof. If, after the delivery of such
replacement Note or payment of a destroyed, lost or stolen Note pursuant to the
proviso to the preceding sentence, a bona fide purchaser of the original Note in
lieu of which such replacement Note was issued presents for payment such
original Note, the Issuer and the Indenture Trustee shall be entitled to recover
such replacement Note (or such payment) from the Person to whom it was delivered
or any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a bona
fide purchaser, and shall be entitled to recover upon the security or indemnity
provided therefor to the extent of any loss, damage, cost or expense incurred by
the Issuer or the Indenture Trustee in connection therewith.

      Upon the issuance of any replacement Note under this Section 4.03, the
Issuer may require the payment by the Holder of such Note of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Indenture Trustee) connected therewith.

      Every replacement Note issued pursuant to this Section 4.03 in replacement
of any mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Issuer, whether or not the mutilated,
destroyed, lost or stolen Note shall be at any time enforceable by anyone, and
shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.

      The provisions of this Section 4.03 are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Notes.

                                       16
<PAGE>

      Section 4.04 Persons Deemed Owners. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee, the
Paying Agent and any agent of the Issuer or the Indenture Trustee may treat the
Person in whose name any Note is registered (as of the day of determination) as
the owner of such Note for the purpose of receiving payments of principal of and
interest, if any, on such Note and for all other purposes whatsoever, whether or
not such Note be overdue, and neither the Issuer, the Indenture Trustee, the
Paying Agent nor any agent of the Issuer or the Indenture Trustee shall be
affected by notice to the contrary.

      Section 4.05 Cancellation. All Notes surrendered for payment, registration
of transfer, exchange or redemption shall, if surrendered to any Person other
than the Indenture Trustee, be delivered to the Indenture Trustee and shall be
promptly cancelled by the Indenture Trustee. The Issuer may at any time deliver
to the Indenture Trustee for cancellation any Notes previously authenticated and
delivered hereunder which the Issuer may have acquired in any manner whatsoever,
and all Notes so delivered shall be promptly cancelled by the Indenture Trustee.
No Notes shall be authenticated in lieu of or in exchange for any Notes
cancelled as provided in this Section 4.05, except as expressly permitted by
this Indenture. All cancelled Notes may be held or disposed of by the Indenture
Trustee in accordance with its standard retention or disposal policy as in
effect at the time unless the Issuer shall direct by an Issuer Request that they
be destroyed or returned to it; provided, however, that such Issuer Request is
timely and the Notes have not been previously disposed of by the Indenture
Trustee.

      Section 4.06 Book-Entry Notes. The Notes, upon original issuance, will be
issued in the form of typewritten Notes representing the Book-Entry Notes, to be
delivered to The Depository Trust Company, the initial Depository, by, or on
behalf of, the Issuer. The Notes shall initially be registered on the Note
Register in the name of Cede & Co., the nominee of the initial Depository, and
no Beneficial Owner will receive a Definitive Note representing such Beneficial
Owner's interest in such Note, except as provided in Section 4.08. With respect
to such Notes, unless and until definitive, fully registered Notes (the
"Definitive Notes") have been issued to Beneficial Owners pursuant to Section
4.08:

            (i)   the provisions of this Section 4.06 shall be in full force and
      effect;

            (ii)  the Note Registrar, the Paying Agent and the Indenture Trustee
      shall be entitled to deal with the Depository for all purposes of this
      Indenture (including the payment of principal of and interest on the Notes
      and the giving of instructions or directions hereunder) as the sole holder
      of the Notes, and shall have no obligation to the Beneficial Owners of the
      Notes;

            (iii) to the extent that the provisions of this Section 4.06
      conflict with any other provisions of this Indenture, the provisions of
      this Section 4.06 shall control;

            (iv)  the rights of Beneficial Owners shall be exercised only
      through the Depository and shall be limited to those established by law
      and agreements between such Owners of Notes and the Depository and/or the
      Depository Participants. Unless and until Definitive Notes are issued
      pursuant to Section 4.08, the initial Depository will make book-entry
      transfers among the Depository Participants and receive and transmit
      payments of principal of and interest on the Notes to such Depository
      Participants; and

                                       17
<PAGE>

            (v)   whenever this Indenture requires or permits actions to be
      taken based upon instructions or directions of Holders of Notes evidencing
      a specified percentage of the Note Balances of the Notes, the Depository
      shall be deemed to represent such percentage with respect to the Notes
      only to the extent that it has received instructions to such effect from
      Beneficial Owners and/or Depository Participants owning or representing,
      respectively, such required percentage of the beneficial interest in the
      Notes and has delivered such instructions to the Indenture Trustee.

      Section 4.07 Notices to Depository. Whenever a notice or other
communication to the Note Holders is required under this Indenture, unless and
until Definitive Notes shall have been issued to Beneficial Owners pursuant to
Section 4.08, the Indenture Trustee shall give all such notices and
communications specified herein to be given to Holders of the Notes to the
Depository, and shall have no obligation to the Beneficial Owners.

      Section 4.08 Definitive Notes. If (i) the Indenture Trustee determines
that the Depository is no longer willing or able to properly discharge its
responsibilities with respect to the Notes and the Indenture Trustee is unable
to locate a qualified successor, (ii) the Indenture Trustee elects to terminate
the book-entry system through the Depository or (iii) after the occurrence of an
Event of Default, Beneficial Owners of Notes representing beneficial interests
aggregating at least a majority of the Note Balances of the Notes advise the
Depository in writing that the continuation of a bookentry system through the
Depository is no longer in the best interests of the Beneficial Owners, then the
Depository shall notify all Beneficial Owners and the Indenture Trustee of the
occurrence of any such event and of the availability of Definitive Notes to
Beneficial Owners requesting the same. Upon surrender to the Indenture Trustee
of the typewritten Notes representing the Book-Entry Notes by the Depository,
accompanied by registration instructions, the Issuer shall execute and the
Indenture Trustee shall authenticate the Definitive Notes in accordance with the
instructions of the Depository. None of the Issuer, the Note Registrar or the
Indenture Trustee shall be liable for any delay in delivery of such instructions
and may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Notes, the Indenture Trustee shall
recognize the Holders of the Definitive Notes as Noteholders.

      Section 4.09 Tax Treatment. The Issuer has entered into this Indenture,
and the Notes will be issued with the intention that, for federal, state and
local income, single business and franchise tax purposes, the Notes will qualify
as indebtedness. The Issuer and the Indenture Trustee (in accordance with
Section 6.06 hereof), by entering into this Indenture, and each Noteholder, by
its acceptance of its Note (and each Beneficial Owner by its acceptance of an
interest in the applicable Book-Entry Note), agree to treat the Notes for
federal, state and local income, single business and franchise tax purposes as
indebtedness.

      Section 4.10 Satisfaction and Discharge of Indenture. This Indenture shall
cease to be of further effect with respect to the Notes except as to (i) rights
of registration of transfer and exchange, (ii) substitution of mutilated,
destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments
of principal thereof and interest thereon, (iv) Sections 3.03, 3.04, 3.06, 3.09,
3.17, 3.19 and 3.20, (v) the rights, obligations and immunities of the Indenture
Trustee hereunder (including the rights of the Indenture Trustee under Section
6.07 and the obligations of the Indenture Trustee under Section 4.11) and (vi)
the rights of Noteholders as beneficiaries hereof

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<PAGE>

with respect to the property so deposited with the Indenture Trustee payable to
all or any of them, and the Indenture Trustee, on demand of and at the expense
of the Issuer, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture with respect to the Notes and shall release and
deliver the Collateral to or upon the order of the Issuer, when

            (A)   either

            (1)   all Notes theretofore authenticated and delivered (other than
      (i) Notes that have been destroyed, lost or stolen and that have been
      replaced or paid as provided in Section 4.03 hereof and (ii) Notes for
      whose payment money has theretofore been deposited in trust or segregated
      and held in trust by the Issuer and thereafter repaid to the Issuer or
      discharged from such trust, as provided in Section 3.03) have been
      delivered to the Indenture Trustee for cancellation; or

            (2)   all Notes not theretofore delivered to the Indenture Trustee
      for cancellation (a) have become due and payable, (b) will become due and
      payable at the Final Stated Maturity Date within one year, or (c) have
      been called for early redemption pursuant to Section 8.07 hereof, and the
      Issuer, in the case of (a) or (b) above, has irrevocably deposited or
      caused to be irrevocably deposited with the Indenture Trustee cash or
      direct obligations of or obligations guaranteed by the United States of
      America (which will mature prior to the date such amounts are payable), in
      trust for such purpose, in an amount sufficient to pay and discharge the
      entire indebtedness on such Notes then outstanding not theretofore
      delivered to the Indenture Trustee for cancellation when due on the Final
      Stated Maturity Date or other final Payment Date, or, in the case of (c)
      above, the Issuer shall have complied with all requirements of Section
      8.07 hereof,

            (B)   the Issuer has paid or caused to be paid all other sums
      payable hereunder; and

            (C)   the Issuer has delivered to the Indenture Trustee an Officer's
      Certificate and an Opinion of Counsel, each meeting the applicable
      requirements of Section 10.01 hereof, each stating that all conditions
      precedent herein provided for relating to the satisfaction and discharge
      of this Indenture have been complied with and, if the Opinion of Counsel
      relates to a deposit made in connection with Section 4.10(A)(2)(b) above,
      such opinion shall further be to the effect that such deposit will
      constitute an "in-substance defeasance" within the meaning of Revenue
      Ruling 85-42, 1985-1 C.B. 36, and in accordance therewith, the Issuer will
      be the owner of the assets deposited in trust for federal income tax
      purposes.

      Section 4.11 Application of Trust Money. All monies deposited with the
Indenture Trustee pursuant to Section 4.10 hereof shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent or the
Issuer, Certificate Paying Agent as designee of the Issuer, as the Indenture
Trustee may determine, to the Holders of Notes or Certificates, of all sums due
and to become due thereon for principal and interest or otherwise; but such
monies need not be segregated from other funds except to the extent required
herein or required by law.

                                       19
<PAGE>

      Section 4.12 Reserved.

      Section 4.13 Repayment of Monies Held by Paying Agent. In connection with
the satisfaction and discharge of this Indenture with respect to the Notes, all
monies then held by any Person other than the Indenture Trustee under the
provisions of this Indenture with respect to such Notes shall, upon demand of
the Issuer, be paid to the Indenture Trustee to be held and applied according to
Section 3.05 and thereupon such Person shall be released from all further
liability with respect to such monies.

      Section 4.14 Temporary Notes. Pending the preparation of any Definitive
Notes, the Issuer may execute and upon its written direction, the Indenture
Trustee may authenticate and make available for delivery, temporary Notes that
are printed, lithographed, typewritten, photocopied or otherwise produced, in
any denomination, substantially of the tenor of the Definitive Notes in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Notes may
determine, as evidenced by their execution of such Notes.

      If temporary Notes are issued, the Issuer will cause Definitive Notes to
be prepared without unreasonable delay. After the preparation of the Definitive
Notes, the temporary Notes shall be exchangeable for Definitive Notes upon
surrender of the temporary Notes at the office of the Indenture Trustee located
at c/o DTC Transfer Services, 55 Water Street, Jeanette Park Entrance, New York,
New York 10041, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Notes, the Issuer shall execute and the Indenture
Trustee shall authenticate and make available for delivery, in exchange
therefor, Definitive Notes of authorized denominations and of like tenor, class
and aggregate principal amount. Until so exchanged, such temporary Notes shall
in all respects be entitled to the same benefits under this Indenture as
Definitive Notes.

      Section 4.15 Representation Regarding ERISA. By acquiring a Note or
interest therein, each Holder of such Note or Beneficial Owner of any such
interest will be deemed to represent that either (1) it is not acquiring the
Note with Plan Assets or (2) (A) the acquisition, holding and transfer of such
Note will not give rise to a non-exempt prohibited transaction under Section 406
of ERISA or Section 4975 of the Code and (B) the Notes are rated investment
grade or better and such person believes that the Notes are properly treated as
indebtedness without substantial equity features for purposes of the Department
of Labor regulation 29 C.F.R. Section 2510.3-101, and agrees to so treat the
Notes. Alternatively, regardless of the rating of the Notes, such person may
provide the Indenture Trustee and the Owner Trustee with an opinion of counsel,
which opinion of counsel will not be at the expense of the Issuer, the Seller,
the Originator, any Underwriter, the Owner Trustee, the Indenture Trustee, the
Servicer or any successor servicer which opines that the acquisition, holding
and transfer of such Note or interest therein is permissible under applicable
law, will not constitute or result in a non-exempt prohibited transaction under
ERISA or Section 4975 of the Code and will not subject the Issuer, the Seller,
the Originator, the Depositor, the Owner Trustee, the Indenture Trustee, the
Servicer or any successor servicer to any obligation in addition to those
undertaken in the Indenture.

                                       20
<PAGE>

                                   ARTICLE V

                              DEFAULT AND REMEDIES

      Section 5.01 Events of Default. The Issuer shall deliver to the Indenture
Trustee, written notice in the form of an Officer's Certificate, within five
days after learning of the occurrence of any event which with the giving of
notice and the lapse of time would become an Event of Default under clause (iv),
(v) or (vi) of the definition of "Event of Default," its status and what action
the Issuer is taking or proposes to take with respect thereto. The Indenture
Trustee shall not be deemed to have knowledge of any Event of Default unless a
Responsible Officer has actual knowledge thereof or unless written notice of
such Event of Default is received by a Responsible Officer and such notice
references the Notes, the Trust Estate or this Indenture.

      Section 5.02 Acceleration of Maturity; Rescission and Annulment. If an
Event of Default should occur and be continuing, then and in every such case the
Indenture Trustee at the written direction of the Holders of Notes representing
not less than 66-2/3% of the aggregate Note Balance of the Notes, together with
accrued and unpaid interest thereon through the date of acceleration shall
become immediately due and payable.

      At any time after such declaration of acceleration of maturity with
respect to an Event of Default has been made and before a judgment or decree for
payment of the money due has been obtained by the Indenture Trustee as
hereinafter in this Article V provided, Holders of the Notes representing not
less than 66-2/3% of the aggregate Note Balance of the Notes, by written notice
to the Issuer and the Indenture Trustee, may waive the related Event of Default
and rescind and annul such declaration and its consequences if:

            (i)   the Issuer has paid or deposited with the Indenture Trustee a
      sum sufficient to pay (a) all payments of principal of and Interest
      Payment Amounts due on the Notes and all other amounts that would then be
      due hereunder or upon the Notes if the Event of Default giving rise to
      such acceleration had not occurred; and (b) all sums paid or advanced by
      the Indenture Trustee hereunder and the reasonable compensation, expenses,
      disbursements and advances of the Indenture Trustee and its agents and
      counsel; and

            (ii)  all Events of Default, other than the nonpayment of the
      principal of the Notes that has become due solely by such acceleration,
      have been cured or waived as provided in Section 5.12.

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

      Section 5.03 Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee.

      (a)   The Issuer covenants that if an Event of Default has occurred and is
continuing, the Issuer shall, upon demand of the Indenture Trustee, at the
direction of the Holders of not less than 66-2/3% of the aggregate Note Balances
of the Notes, pay to the Indenture Trustee, for the

                                       21
<PAGE>

benefit of the Holders of Notes, the whole amount then due and payable on the
Notes for principal and interest, with interest at the applicable Note Rate upon
the overdue principal, and in addition thereto such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Indenture
Trustee and its agents and counsel.

      (b)   In case the Issuer shall fail forthwith to pay such amounts upon
such demand, the Indenture Trustee, in its own name and as trustee of an express
trust, subject to the provisions of Section 10.16 hereof may institute a
Proceeding for the collection of the sums so due and unpaid, and may prosecute
such Proceeding to judgment or final decree, and may enforce the same against
the Issuer or other obligor upon the Notes and collect in the manner provided by
law out of the property of the Issuer or other obligor the Notes, wherever
situated, the monies adjudged or decreed to be payable.

      (c)   If an Event of Default occurs and is continuing, the Indenture
Trustee, subject to the provisions of Section 10.16 hereof may, as more
particularly provided in Section 5.04 hereof, in its discretion, proceed to
protect and enforce its rights and the rights of the Noteholders, by such
appropriate Proceedings, as directed in writing by Holders of at least 66-2/3%
of the aggregate Note Balances of the Notes, to protect and enforce any such
rights, whether for the specific enforcement of any covenant or agreement in
this Indenture or in aid of the exercise of any power granted herein, or to
enforce any other proper remedy or legal or equitable right vested in the
Indenture Trustee by this Indenture or by law.

      (d)   In case there shall be pending, relative to the Issuer or any other
obligor upon the Notes or any Person having or claiming an ownership interest in
the Trust Estate, Proceedings under Title 11 of the United States Code or any
other applicable federal or state bankruptcy, insolvency or other similar law,
or in case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or its property or such other obligor or Person,
or in case of any other comparable judicial Proceedings relative to the Issuer
or other obligor upon the Notes, or to the creditors or property of the Issuer
or such other obligor, the Indenture Trustee, as directed in writing by Holders
of at least 66-2/3% of the aggregate Note Balances of the Notes, irrespective of
whether the principal of any Notes shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the
Indenture Trustee shall have made any demand pursuant to the provisions of this
Section, shall be entitled and empowered, by intervention in such Proceedings or
otherwise:

            (i)   to file and prove a claim or claims for the whole amount of
      principal and interest owing and unpaid in respect of the Notes and to
      file such other papers or documents as may be necessary or advisable in
      order to have the claims of the Indenture Trustee (including any claim for
      reasonable compensation to the Indenture Trustee and each predecessor
      Indenture Trustee, and their respective agents, attorneys and counsel, and
      for reimbursement of all expenses and liabilities incurred, and all
      advances made, by the Indenture Trustee and each predecessor Indenture
      Trustee, except as a result of negligence or bad faith) and of the
      Noteholders allowed in such Proceedings;

                                       22
<PAGE>

            (ii)  unless prohibited by applicable law and regulations, to vote
      on behalf of the Holders of Notes in any election of a trustee, a standby
      trustee or Person performing similar functions in any such Proceedings;

            (iii) to collect and receive any monies or other property payable or
      deliverable on any such claims and to distribute all amounts received with
      respect to the claims of the Noteholders and of the Indenture Trustee on
      their behalf, and

            (iv)  to file such proofs of claim and other papers or documents as
      may be necessary or advisable in order to have the claims of the Indenture
      Trustee or the Holders of Notes allowed in any judicial proceedings
      relative to the Issuer, its creditors and its property; and any trustee,
      receiver, liquidator, custodian or other similar official in any such
      Proceeding is hereby authorized by each of such Noteholders to make
      payments to the Indenture Trustee and, in the event that the Indenture
      Trustee shall consent to the making of payments directly to such
      Noteholders, to pay to the Indenture Trustee such amounts as shall be
      sufficient to cover reasonable compensation to the Indenture Trustee, each
      predecessor Indenture Trustee and their respective agents, attorneys and
      counsel, and all other expenses and liabilities incurred, and all advances
      made, by the Indenture Trustee and each predecessor Indenture Trustee.

      (e)   Nothing herein contained shall be deemed to authorize the Indenture
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the election
of a trustee in bankruptcy or similar Person.

      (f)   All rights of action and of asserting claims under this Indenture,
or under any of the Notes, may be enforced by the Indenture Trustee without the
possession of any of the Notes or the production thereof in any trial or other
Proceedings relative thereto, and any such action or proceedings instituted by
the Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment, subject to the payment of the expenses,
disbursements and compensation of the Indenture Trustee, each predecessor
Indenture Trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Holders of the Notes, subject to Section 5.05 hereof.

      (g)   In any Proceedings brought by the Indenture Trustee (and also any
Proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Holders of the Notes, and it shall not be necessary to
make any Noteholder a party to any such Proceedings.

      Section 5.04 Remedies; Priorities.

      (a)   If an Event of Default shall have occurred and be continuing and if
an acceleration has been declared and not rescinded pursuant to Section 5.02
hereof, the Indenture Trustee subject to the provisions of Section 10.16 hereof
may, and shall, at the written direction

                                       23
<PAGE>

of the Holders of not less than 66-2/3% of the aggregate Note Balances of the
Notes, do one or more of the following (subject to Section 5.05 hereof):

            (i)   institute Proceedings in its own name and as trustee of an
      express trust for the collection of all amounts then payable on the Notes
      or under this Indenture with respect thereto, whether by declaration or
      otherwise enforce any judgment obtained, and collect from the Issuer and
      any other obligor upon such Notes monies adjudged due;

            (ii)  institute Proceedings from time to time for the complete or
      partial foreclosure of this Indenture with respect to the Trust Estate;

            (iii) exercise any remedies of a secured party under the UCC and
      take any other appropriate action to protect and enforce the rights and
      remedies of the Indenture Trustee and the Holders of the Notes; and

            (iv)  sell the Trust Estate or any portion thereof or rights or
      interest therein, at one or more public or private sales called and
      conducted in any manner permitted by law; provided, however, that the
      Indenture Trustee may not sell or otherwise liquidate the Trust Estate
      following an Event of Default, unless (A) the Indenture Trustee obtains
      the consent of the Holders of 100% of the aggregate Note Balance of the
      Notes, (B) the proceeds of such sale or liquidation distributable to the
      Holders of the Notes are sufficient to discharge in full all amounts then
      due and unpaid upon such Notes for principal and interest or (C) the
      Indenture Trustee determines that the Assets will not continue to provide
      sufficient funds for the payment of principal of and Interest Payment
      Amounts due on the applicable Notes as they would have become due if the
      Notes had not been declared due and payable, and the Indenture Trustee
      obtains the consent of the Holders of at least 66-2/3% of the aggregate
      Note Balance of the Notes. In determining such sufficiency or
      insufficiency with respect to clause (B) and (C), the Indenture Trustee
      may, but need not, obtain and rely upon written advice or an opinion
      (obtained at the expense of the Trust) of an Independent investment
      banking or accounting firm of national reputation as to the feasibility of
      such proposed action and as to the sufficiency of the Trust Estate for
      such purpose. Notwithstanding the foregoing, so long as a Servicer Event
      of Default has not occurred, any sale of the Trust Estate shall be made
      subject to the continued servicing of the Assets by the Servicer as
      provided in the Servicing Agreement.

      (b)   If the Indenture Trustee collects any money or property pursuant to
this Article V, it shall pay out the money or property in the order of priority
set forth in Section 8.01 hereof.

      The Indenture Trustee may fix a record date and Payment Date for any
payment to Noteholders pursuant to this Section 5.04. At least 15 days before
such record date, the Indenture Trustee shall mail to each Noteholder a notice
that states the record date, the Payment Date and the amount to be paid.

      Section 5.05 Optional Preservation of the Trust Estate. If the Notes have
been declared to be due and payable under Section 5.02 following an Event of
Default and such declaration and its consequences have not been rescinded and
annulled, the Indenture Trustee may elect to take

                                       24
<PAGE>

and maintain possession of the Trust Estate. It is the desire of the parties
hereto and the Noteholders that there be at all times sufficient funds for the
payment of principal of and interest on the Notes and other obligations of the
Issuer and the Indenture Trustee shall take such desire into account when
determining whether or not to take and maintain possession of the Trust Estate.
In determining whether and how to take and maintain possession of the Trust
Estate, the Indenture Trustee may, but need not, obtain and rely upon the
written advice or an opinion of an Independent investment banking or accounting
firm of national reputation as to the feasibility of such proposed action and as
to the sufficiency of the Trust Estate for such purpose.

      Section 5.06 Limitation of Suits. No Holder of any Note shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless and subject to the provisions of Section 10.16 hereof

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

            (ii)  the Holders of not less than 25% of the aggregate Note

      Balances of the Notes have made a written request to the Indenture Trustee
      to institute such Proceeding in respect of such Event of Default in its
      own name as Indenture Trustee hereunder;

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

            (iv)  the Indenture Trustee for 60 days after its receipt of such
      notice of request and offer of indemnity has failed to institute such
      Proceedings;

            (v)   no direction inconsistent with such written request has been
      given to the Indenture Trustee during such 60-day period by the Holders of
      at least 66-2/3% of the Note Balances of the Notes; and

            (vi)  such Event of Default has occurred and is continuing.

      It is understood and intended that no one or more Holders of Notes shall
have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of Notes or to obtain or to seek to obtain priority or preference
over any other Holders or to enforce any right under this Indenture, except in
the manner herein provided.

      Section 5.07 Unconditional Rights of Noteholders To Receive Principal and
Interest. Notwithstanding any other provisions in this Indenture, the Holder of
any Note shall have the right, which is absolute and unconditional, to receive
payment of the principal of and interest, if any, on such Note on or after the
respective due dates thereof expressed in such Note or in this Indenture and to
institute suit for the enforcement of any such payment, and such right shall not
be impaired without the consent of such Holder.

                                       25
<PAGE>

      Section 5.08 Restoration of Rights and Remedies. If the Indenture Trustee
or any Noteholder has instituted any Proceeding to enforce any right or remedy
under this Indenture and such Proceeding has been discontinued or abandoned for
any reason or has been determined adversely to the Indenture Trustee or to such
Noteholder, then and in every such case the Issuer, the Indenture Trustee and
the Noteholders shall, subject to any determination in such Proceeding, be
restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Indenture Trustee and the Noteholders
shall continue as though no such Proceeding had been instituted.

      Section 5.09 Rights and Remedies Cumulative. No right or remedy herein
conferred upon or reserved to the Indenture Trustee or to the Noteholders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.

      Section 5.10 Delay or Omission Not a Waiver. No delay or omission of the
Indenture Trustee or any Holder of any Note to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article V or by law to the Indenture
Trustee or to the Noteholders may be exercised from time to time, and as often
as may be deemed expedient, by the Indenture Trustee or by the Noteholders, as
the case may be.

      Section 5.11 Control By Noteholders. The Holders of not less than 66-2/3%
of the aggregate Note Balances of Notes shall have the right to direct the time,
method and place of conducting any Proceeding for any remedy available to the
Indenture Trustee with respect to the Notes or exercising any trust or power
conferred on the Indenture Trustee; provided that:

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

            (ii)  any direction to the Indenture Trustee to sell or liquidate
      the Trust Estate shall be by Holders of Notes representing not less than
      100% of the Note Balances of the Notes;

            (iii) the Indenture Trustee has been provided with indemnity
      satisfactory to it; and

            (iv)  the Indenture Trustee may take any other action deemed proper
      by the Indenture Trustee that is not inconsistent with such direction of
      the Holders of Notes representing 66-2/3% of the Note Balances of the
      Notes.

      Notwithstanding the rights of Noteholders set forth in this Section 5.11
the Indenture Trustee need not take any action that it determines might involve
it in liability or if adequate indemnity is not assured to it.

                                       26
<PAGE>

      Section 5.12 Waiver of Past Defaults. Prior to the declaration of the
acceleration of the maturity of the Notes as provided in Section 5.02 hereof,
the Holders of Notes representing not less than 66-2/3% of the aggregate Note
Balance of the Notes may waive any past Event of Default and its consequences
except an Event of Default (a) with respect to payment of principal of or
interest on any of the Notes or (b) in respect of a covenant or provision hereof
which cannot be modified or amended without the consent of the Holder of each
Note. In the case of any such waiver, the Issuer, the Indenture Trustee and the
Holders of the Notes shall be restored to their former positions and rights
hereunder, respectively, but no such waiver shall extend to any subsequent or
other Event of Default or impair any right consequent thereto.

      Upon any such waiver, any Event of Default arising therefrom shall be
deemed to have been cured and not to have occurred, for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Event of
Default or impair any right consequent thereto.

      Section 5.13 Undertaking for Costs. All parties to this Indenture agree,
and each Holder of any Note and each Beneficial Owner of any interest therein by
such Holder's or Beneficial Owner's acceptance thereof shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 5.13 shall not apply to (a) any suit instituted by
the Indenture Trustee, (b) any suit instituted by any Noteholder, or group of
Noteholders, in each case holding in the aggregate more than 10% of the Note
Balances of the Notes or (c) any suit instituted by any Noteholder for the
enforcement of the payment of principal of or interest on any Note on or after
the respective due dates expressed in such Note and in this Indenture.

      Section 5.14 Waiver of Stay or Extension Laws. The Issuer covenants (to
the extent that it may lawfully do so) that it will not at any time insist upon,
or plead or in any manner whatsoever, claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance of this Indenture; and
the Issuer (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and covenants that it shall not
hinder, delay or impede the execution of any power herein granted to the
Indenture Trustee, but will suffer and permit the execution of every such power
as though no such law had been enacted.

      Section 5.15 Sale of Trust Estate.

      (a)   The power to effect any sale or other disposition (a "Sale") of any
portion of the Trust Estate pursuant to Section 5.04 hereof is expressly subject
to the provisions of Section 5.05 hereof and this Section 5.15. The power to
effect any such Sale shall not be exhausted by any one or more Sales as to any
portion of the Trust Estate remaining unsold, but shall continue unimpaired
until the entire Trust Estate shall have been sold or all amounts payable on the
Notes and under this Indenture shall have been paid. The Indenture Trustee may
from time to time postpone any public Sale by public announcement made at the
time and place of such Sale. The

                                       27
<PAGE>
Indenture Trustee hereby expressly waives its right to any amount fixed by law
as compensation for any Sale.

      (b)   The Indenture Trustee shall not in any private Sale sell the Trust
Estate, or any portion thereof, unless

            (i)   the Holders of all Notes consent to or direct the Indenture
      Trustee to make such Sale, or

            (ii)  the proceeds of such Sale would be not less than the entire
      amount which would be payable to the Noteholders under the Notes, in full
      payment thereof in accordance with Section 5.02 hereof, on the Payment
      Date next succeeding the date of such Sale, or

            (iii) the Indenture Trustee determines that the conditions for
      retention of the Trust Estate set forth in Section 5.05 hereof cannot be
      satisfied (in making any determination under this Section 5.15, the
      Indenture Trustee may rely upon written advice or an opinion of an
      Independent investment banking firm obtained and delivered as provided in
      Section 5.05 hereof), and the Holders of Notes representing at least 100%
      of the Note Balances of the Notes consent to such Sale.

      The purchase by the Indenture Trustee of all or any portion of the Trust
Estate at a private Sale shall not be deemed a Sale or other disposition thereof
for purposes of this Section 5.15(b).

      (c)   [Reserved].

      (d)   In connection with a Sale of all or any portion of the Trust Estate,

            (i)   any Holder or Holders of Notes may bid for and purchase the
      property offered for sale, and upon compliance with the terms of sale may
      hold, retain and possess and dispose of such property, without further
      accountability, and may, in paying the purchase money therefor, deliver
      any Notes or claims for interest thereon in lieu of cash up to the amount
      which shall, upon distribution of the net proceeds of such sale, be
      payable thereon, and such Notes, in case the amounts so payable thereon
      shall be less than the amount due thereon, shall be returned to the
      Holders thereof after being appropriately stamped to show such partial
      payment;

            (ii)  the Indenture Trustee may bid for and acquire the property
      offered for Sale in connection with any Sale thereof, and, subject to any
      requirements of, and to the extent permitted by, applicable law in
      connection therewith, may purchase all or any portion of the Trust Estate
      in a private sale, and, in lieu of paying cash therefor, may make
      settlement for the purchase price by crediting the gross Sale price
      against the sum of (A) the amount which would be payable to the Holders of
      the Notes and Holders of Certificates on the Payment Date next succeeding
      the date of such Sale and (B) the expenses of the Sale and of any
      Proceedings in connection therewith which are reimbursable to it, without
      being required to produce the Notes in order to complete any such Sale or
      in order for the net Sale price to be credited against such Notes, and any

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<PAGE>

      property so acquired by the Indenture Trustee shall be held and dealt with
      by it in accordance with the provisions of this Indenture;

            (iii) the Indenture Trustee shall execute and deliver an appropriate
      instrument of conveyance, prepared by the Issuer and satisfactory to the
      Indenture Trustee, transferring its interest in any portion of the Trust
      Estate in connection with a Sale thereof;

            (iv)  the Indenture Trustee is hereby irrevocably appointed the
      agent and attorney-in-fact of the Issuer to transfer and convey its
      interest in any portion of the Trust Estate in connection with a Sale
      thereof, and to take all action necessary to effect such Sale; and

            (v)   no purchaser or transferee at such a Sale shall be bound to
      ascertain the Indenture Trustee's authority, inquire into the satisfaction
      of any conditions precedent or see to the application of any monies.

      Section 5.16 Action on Notes. The Indenture Trustee's right to seek and
recover judgment on the Notes or under this Indenture shall not be affected by
the seeking, obtaining or application of any other relief under or with respect
to this Indenture. Neither the lien of this Indenture nor any rights or remedies
of the Indenture Trustee or the Noteholders shall be impaired by the recovery of
any judgment by the Indenture Trustee against the Issuer or by the levy of any
execution under such judgment upon any portion of the Trust Estate or upon any
of the assets of the Issuer. Any money or property collected by the Indenture
Trustee shall be applied in accordance with Section 5.04(b) hereof.

      Section 5.17 Performance and Enforcement of Certain Obligations.

      (a)   Promptly following a request from the Indenture Trustee to do so,
the Issuer in its capacity as holder of the Assets, shall take all such lawful
action as the Indenture Trustee may request to cause the Issuer to compel or
secure the performance and observance by the Seller, the Originator and the
Servicer, as applicable, of each of their obligations to the Issuer under or in
connection with the Asset Purchase Agreement and the Servicing Agreement, and to
exercise any and all rights, remedies, powers and privileges lawfully available
to the Issuer under or in connection with the Asset Purchase Agreement and the
Servicing Agreement to the extent and in the manner directed by the Indenture
Trustee, as pledgee of the Assets, including the transmission of notices of
default on the part of the Seller, the Originator or the Servicer thereunder and
the institution of legal or administrative actions or proceedings to compel or
secure performance by the Seller, the Originator or the Servicer of each of
their obligations under the Asset Purchase Agreement and the Servicing
Agreement.

      (b)   The Indenture Trustee, as pledgee of the Assets, may, and at the
direction (which direction shall be in writing or by telephone (confirmed in
writing promptly thereafter)) of the Holders of 66-2/3% of the Note Balances of
the Notes, shall exercise all rights, remedies, powers, privileges and claims of
the Issuer against the Seller, the Originator or the Servicer under or in
connection with the Asset Purchase Agreement and the Servicing Agreement,
including the right or power to take any action to compel or secure performance
or observance

                                       29
<PAGE>

by the Seller, the Originator or the Servicer, as the case may be, of each of
their obligations to the Issuer thereunder and to give any consent, request,
notice, direction, approval, extension or waiver under the Asset Purchase
Agreement and the Servicing Agreement, as the case may be, and any right of the
Issuer to take such action shall not be suspended.

                                   ARTICLE VI

                              THE INDENTURE TRUSTEE

      Section 6.01 Duties of Indenture Trustee.

      (a)   If an Event of Default has occurred and is continuing, the Indenture
Trustee shall exercise the rights and powers vested in it by this Indenture and
use the same degree of care and skill in their exercise as a prudent person
would exercise or use under the circumstances in the conduct of such person's
own affairs.

      (b)   Except during the continuance of an Event of Default:

            (i)   the Indenture Trustee undertakes to perform such duties and
      only such duties as are specifically set forth in this Indenture and no
      implied covenants or obligations shall be read into this Indenture against
      the Indenture Trustee; and

            (ii)  in the absence of bad faith on its part, the Indenture Trustee
      may conclusively rely, as to the truth of the statements and the
      correctness of the opinions expressed therein, upon certificates or
      opinions furnished to the Indenture Trustee and conforming to the
      requirements of this Indenture; however, the Indenture Trustee shall
      examine the certificates and opinions to determine whether or not they
      conform to the requirements of this Indenture.

      (c)   The Indenture Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:

            (i)   this paragraph does not limit the effect of paragraph (b) of
      this Section 6.01;

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

            (iii) the Indenture Trustee shall not be liable with respect to any
      action it takes or omits to take in good faith in accordance with a
      direction received by it from Noteholders or from the Issuer, which they
      are entitled to give under the Basic Documents.

      (d)   The Indenture Trustee shall not be liable for interest on any money
received by it.

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<PAGE>

      (e)   Money held in trust by the Indenture Trustee need not be segregated
from other trust funds except to the extent required by law or the terms of this
Indenture or the Trust Agreement.

      (f)   No provision of this Indenture shall require the Indenture Trustee
to expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayment
of such funds or indemnity satisfactory to it against such risk or liability is
not reasonably assured to it.

      (g)   Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section and to the provisions of the
TIA.

      (h)   The Indenture Trustee shall act in accordance with Section 6.03 of
the Servicing Agreement and shall appoint a successor Servicer in accordance
with Section 6.02 of the Servicing Agreement.

      Section 6.02 Rights of Indenture Trustee.

      (a)   The Indenture Trustee may conclusively rely on, and shall be fully
protected from acting or refraining from acting upon, any document believed by
it to be genuine and to have been signed or presented by the proper person. The
Indenture Trustee need not investigate any fact or matter stated in the
document.

      (b)   Before the Indenture Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel. The Indenture Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on an Officer's Certificate or Opinion of Counsel.

      (c)   The Indenture Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers; provided, however, that the Indenture Trustee's conduct does
not constitute willful misconduct, negligence or bad faith.

      (d)   The Indenture Trustee may consult with counsel, and the advice or
Opinion of Counsel with respect to legal matters relating to the Basic Documents
and the Notes shall be full and complete authorization and protection from
liability in respect to any action taken, omitted or suffered by it hereunder or
in connection herewith in good faith and in accordance with the advice or
opinion of such counsel.

      (e)   The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder, either directly or by or through
agents, attorneys, custodians or nominees appointed with due care, and shall not
be responsible for any willful misconduct or negligence on the part of any
agent, attorney, custodian or nominee so appointed.

      (f)   The Indenture Trustee or its Affiliates are permitted to receive
additional compensation that could be deemed to be in the Indenture Trustee's
economic self-interest for (i)

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<PAGE>

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 Indenture Trustee (i) as part of the Indenture Trustee Fee, (ii) pursuant
to Sections 3.05(d), 3.05(h), 5.04(b), 6.07 or 8.02(c) hereunder or (iii) out of
the Amount Available.

      Section 6.03 Individual Rights of Indenture Trustee. The Indenture Trustee
in its individual or any other capacity may become the owner or pledgee of Notes
and may otherwise deal with the Issuer or its Affiliates with the same rights it
would have if it were not Indenture Trustee, subject to the requirements of the
Trust Indenture Act. Any Note Registrar, co-registrar or co-paying agent may do
the same with like rights. However, the Indenture Trustee must comply with
Sections 6.11 and 6.12 hereof.

      Section 6.04 Indenture Trustee's Disclaimer. The Indenture Trustee shall
not be responsible for and makes no representation as to the validity or
adequacy of this Indenture, the Collateral or the Notes, it shall not be
accountable for the Issuer's use of the proceeds from the Notes, and it shall
not be responsible for any statement of the Issuer in the Indenture or in any
document issued in connection with the sale of the Notes or in the Notes other
than the Indenture Trustee's certificate of authentication.

      Section 6.05 Notice of Event of Default. Subject to Section 5.01, the
Indenture Trustee shall promptly mail to each Noteholder notice of the Event of
Default after it is actually known to a Responsible Officer of the Indenture
Trustee, unless such Event of Default shall have been waived or cured. Except in
the case of an Event of Default in payment of principal of or interest on any
Note, the Indenture Trustee may withhold the notice if and so long as it in good
faith determines that withholding the notice is in the interests of Noteholders.

      Section 6.06 Reports by Indenture Trustee to Holders and Tax
Administration. The Indenture Trustee shall deliver to each Noteholder such
information as may be required to enable such holder to prepare its federal and
state income tax returns. The Indenture Trustee shall prepare and file (or cause
to be prepared and filed), on behalf of the Owner Trustee or the Issuer, any
Form 1099 tax returns. All tax returns and information reports shall be signed
by the Owner Trustee as provided in Section 5.03 of the Trust Agreement.

      Section 6.07 Compensation and Indemnity. The Indenture Trustee shall
withdraw from the Note Payment Account on each Payment Date and pay to itself
the Indenture Trustee Fee. The Indenture Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust.

      The Issuer shall reimburse the Indenture Trustee for all reasonable
out-of-pocket expenses incurred or made by it, including costs of collection, in
addition to compensation for its services. Such expenses which shall be paid
solely from the Trust Estate in accordance with Section 8.02 shall include
reasonable compensation and expenses, disbursements and advances of the
Indenture Trustee's agents, counsel, accountants and experts. The Issuer shall
indemnify the Indenture Trustee solely with payments from the Trust Estate in
accordance with Section 8.02 and hold it harmless against any and all claims,
taxes, penalties, losses, liabilities or

                                       32
<PAGE>

expenses (including attorneys' fees and expenses) of any kind whatsoever
incurred by it in connection with the administration of this Trust and the
performance of its duties under any of the Basic Documents. The Indenture
Trustee shall notify the Issuer promptly of any claim for which it may seek
indemnity. Failure by the Indenture Trustee to so notify the Issuer shall not
relieve the Issuer of its obligations hereunder. The Issuer shall defend any
such claim, and the Indenture Trustee may have separate counsel and the Issuer
shall pay the fees and expenses of such counsel. The Issuer is not obligated to
reimburse any expense or indemnify against any loss, liability or expense
incurred by the Indenture Trustee through the Indenture Trustee's own willful
misconduct, negligence or bad faith.

      The Issuer's payment obligations to the Indenture Trustee pursuant to this
Section 6.07 shall survive the discharge of this Indenture and the termination
or resignation of the Indenture Trustee. When the Indenture Trustee incurs
expenses after the occurrence of an Event of Default with respect to the Issuer,
the expenses are intended to constitute expenses of administration under Title
11 of the United States Code or any other applicable federal or state
bankruptcy, insolvency or similar law.

      Section 6.08 Replacement of Indenture Trustee. No resignation or removal
of the Indenture Trustee and no appointment of a successor Indenture Trustee
shall become effective until the acceptance of appointment by the successor
Indenture Trustee pursuant to this Section 6.08. The Indenture Trustee may
resign at any time by so notifying the Issuer. Holders of a majority of Note
Balances of the Notes may remove the Indenture Trustee by so notifying the
Indenture Trustee and may appoint a successor Indenture Trustee. The Issuer
shall remove the Indenture Trustee if:

            (i)   the Indenture Trustee fails to comply with Section 6.11
      hereof;

            (ii)  the Indenture Trustee is adjudged a bankrupt or insolvent;

            (iii) a receiver or other public officer takes charge of the
      Indenture Trustee or its property; or

            (iv)  the Indenture Trustee otherwise becomes incapable of acting.

      If the Indenture Trustee resigns or is removed or if a vacancy exists in
the office of the Indenture Trustee for any reason (the Indenture Trustee in
such event being referred to herein as the retiring Indenture Trustee), the
Issuer shall promptly appoint a successor Indenture Trustee.

      A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee and to the Issuer. Thereupon, the
resignation or removal of the retiring Indenture Trustee shall become effective,
and the successor Indenture Trustee shall have all the rights, powers and duties
of the Indenture Trustee under this Indenture. The successor Indenture Trustee
shall mail a notice of its succession to Noteholders. The retiring Indenture
Trustee shall promptly transfer all property held by it as Indenture Trustee to
the successor Indenture Trustee.

      If a successor Indenture Trustee does not take office within 30 days after
the retiring Indenture Trustee resigns or is removed, the retiring Indenture
Trustee, the Issuer or the Holders

                                       33
<PAGE>

of a majority of Note Balances of the Notes may petition any court of competent
jurisdiction for the appointment of a successor Indenture Trustee.

      Notwithstanding the replacement of the Indenture Trustee pursuant to this
Section, the Issuer's obligations under Section 6.07 shall continue for the
benefit of the retiring Indenture Trustee.

      Section 6.09 Successor Indenture Trustee by Merger. If the Indenture
Trustee consolidates with, merges or converts into, or transfers all or
substantially all of its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation, without any further act, shall be the successor Indenture Trustee;
provided, that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11 hereof. The Indenture Trustee shall
provide the Rating Agencies with prior written notice of any such transaction.

      If at the time such successor or successors by merger, conversion or
consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture and any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the certificate
of authentication of any predecessor trustee and deliver such Notes so
authenticated; and if at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is in the Notes or in this Indenture provided
that the certificate of the Indenture Trustee shall have.

      Section 6.10 Appointment of Co-Indenture Trustee or Separate Indenture
      Trustee.

      (a)   Notwithstanding any other provisions of this Indenture, at any time,
for the purpose of meeting any legal requirement of any jurisdiction in which
any part of the Trust Estate may at the time be located, the Indenture Trustee
shall have the power and may execute and deliver all instruments to appoint one
or more Persons to act as a co-trustee or co-trustees, or separate trustee or
separate trustees, of all or any part of the Trust Estate, and to vest in such
Person or Persons, in such capacity and for the benefit of the Noteholders, such
title to the Trust Estate, or any part hereof, and, subject to the other
provisions of this Section, such powers, duties, obligations, rights and trusts
as the Indenture Trustee may consider necessary or desirable. No co-trustee or
separate trustee hereunder shall be required to meet the terms of eligibility as
a successor trustee under Section 6.11 hereof.

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

            (i)   all rights, powers, duties and obligations conferred or
      imposed upon the Indenture Trustee shall be conferred or imposed upon and
      exercised or performed by the Indenture Trustee and such separate trustee
      or co-trustee jointly (it being understood that such separate trustee or
      co-trustee is not authorized to act separately without the Indenture
      Trustee joining in such act), except to the extent that under any law of
      any jurisdiction in which any particular act or acts are to be performed
      the Indenture Trustee

                                       34
<PAGE>

      shall be incompetent or unqualified to perform such act or acts, in which
      event such rights, powers, duties and obligations (including the holding
      of title to the Trust Estate or any portion thereof in any such
      jurisdiction) shall be exercised and performed singly by such separate
      trustee or co-trustee, but solely at the direction of the Indenture
      Trustee;

            (ii)  no trustee hereunder shall be personally liable by reason of
      any act or omission of any other trustee hereunder; and

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

      (c)   Any notice, request or other writing given to the Indenture
Trustee shall be deemed to have been given to each of the then separate 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 Indenture and
the conditions of this Article VI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Indenture Trustee or separately, as may be provided therein, subject to all the
provisions of this Indenture, specifically including every provision of this
Indenture relating to the conduct of, affecting the liability of, or affording
protection to, the Indenture Trustee. Every such instrument shall be filed with
the Indenture Trustee.

      (d)   Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee, its agent or attorney-in-fact with full power and authority,
to the extent not prohibited by law, to do any lawful act under or in respect of
this Indenture on its behalf and in its name. If any separate 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 Indenture Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.

      Section 6.11 Eligibility; Disqualification. The Indenture Trustee shall at
all times satisfy the requirements of TIA Section 310(a). The Indenture Trustee
shall have a combined capital and surplus of at least $50,000,000 as set forth
in its most recent published annual report of condition and it or its parent
shall have a long-term debt rating of "Baa3" or better by Moody's and "BBB" or
better by S&P. The Indenture Trustee shall comply with TIA Section 310(b),
including the optional provision permitted by the second sentence of TIA Section
310(b)(9); provided, however, that there shall be excluded from the operation of
TIA Section 310(b)(1) any indenture or indentures under which other securities
of the Issuer are outstanding if the requirements for such exclusion set forth
in TIA Section 310(b)(1) are met.

      Section 6.12 Preferential Collection of Claims Against Issuer. The
Indenture Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). An Indenture Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated.

      Section 6.13 Representations and Warranties. The Indenture Trustee hereby
represents that:

                                       35
<PAGE>

            (i)   It is a New York banking association duly organized, validly
      existing and in good standing under the laws of the United States.

            (ii)  The execution and delivery of this Indenture by it, and the
      performance and compliance with the terms of this Indenture 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 Indenture has duly
      authorized the execution, delivery and performance of this Indenture, and
      has duly executed and delivered this Indenture.

            (iv)  This Indenture, assuming due authorization, execution and
      delivery by the Issuer, 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.

      Section 6.14   Directions to Indenture Trustee. The Indenture Trustee is
                     hereby directed:

            (i)   to accept the pledge of the Assets and hold the assets of the
      Trust Estate in trust for the Noteholders;

            (ii)  to authenticate and deliver the Notes substantially in the
      form prescribed by Exhibits A-1 and A-2 to this Indenture in accordance
      with the terms of this Indenture; and

            (iii) to take all other actions as shall be required to be taken by
      the terms of this Indenture.

      Section 6.15 The Agents. The provisions of this Indenture relating to the
limitations of the Indenture Trustee's liability and to its indemnity, rights
and protections shall inure also to the Paying Agent and Note Registrar.

                                  ARTICLE VII

                         NOTEHOLDERS' LISTS AND REPORTS

      Section 7.01 Issuer To Furnish Indenture Trustee Names and Addresses of
Noteholders. The Issuer will furnish or cause to be furnished to the Indenture
Trustee (a) not more than five days after each Record Date, a list, in such form
as the Indenture Trustee may reasonably require, of the names and addresses of
the Holders of Notes as of such Record Date, (b) at such other times as the
Indenture Trustee may request in writing, within 30 days after receipt by the
Issuer of any such request, a list of similar form and content as of a date not
more than 10 days prior to the time such list is furnished; provided, however,
that so long as the Indenture Trustee is the Note Registrar, no such list shall
be required to be furnished to the Indenture Trustee.

      Section 7.02 Preservation of Information; Communications to Noteholders.

                                       36
<PAGE>

      (a)   The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders of Notes
contained in the most recent list furnished to the Indenture Trustee as provided
in Section 7.01 hereof and the names and addresses of Holders of Notes received
by the Indenture Trustee in its capacity as Note Registrar. The Indenture
Trustee may destroy any list furnished to it as provided in such Section 7.01
upon receipt of a new list so furnished.

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

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

      Section 7.03 Reserved.

      Section 7.04 Reports by Indenture Trustee. If required by TIA Section
313(a), within 60 days after each January 30th beginning with [__________,
20__], the Indenture Trustee shall mail to each Noteholder as required by TIA
Section 313(c) a brief report dated as of such date that complies with TIA
Section 313(a). The Indenture Trustee also shall comply with TIA Section 313(b).

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

      Section 7.05 Statements to Noteholders.

      (a)   With respect to each Payment Date, the Indenture Trustee shall make
available via the Indenture Trustee's website [_______________] or deliver at
the recipient's option to each Noteholder and each Certificateholder, the
Depositor, the Owner Trustee, the Certificate Paying Agent and each Rating
Agency, a statement setting forth the following information, calculated by the
Indenture Trustee based on the aggregate loan-level information provided to it
by the Servicer, as to the Notes (it being understood that the Servicer shall
provide the information described in clauses (iv), (v), (vi), (vii) and (viii)
below in its Electronic File delivered to the Indenture Trustee), to the extent
applicable:

            (i)   the amount of the payment made on such Payment Date to the
      Holders of the Notes of each Class allocable to principal;

            (ii)  the amount of the payment made on such Payment Date to the
      Holders of the Notes 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
      Indenture Trustee deems necessary or desirable, or which a Noteholder or
      Certificateholder reasonably requests, to enable Noteholders and
      Certificateholders to prepare their tax returns;

                                       37
<PAGE>

            (iv)  the aggregate Principal Balance of the Assets as of the end of
      the related Due Period;

            (v)   the number, aggregate principal balance, weighted average
      remaining term to maturity and weighted average Asset Rate of the Assets
      as of the end of the related Due Period;

            (vi)  the number and aggregate unpaid principal balance of Assets
      (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 repossession or foreclosure proceedings
      have been commenced and (e) with respect to which the related Obligor 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;

            (vii) the aggregate amount of Principal Prepayments received during
      the related Prepayment Period;

            (viii) the aggregate amount of Realized Losses incurred during the
      related Prepayment Period and the aggregate amount of Realized Losses
      incurred since the Closing Date;

            (ix)  the aggregate Note Balance of each Class of Notes, after
      giving effect to the payments made on such Payment Date and the Adjusted
      Note Balance of each Class of Mezzanine Notes on such Payment Date;

            (x)   the Interest Payment Amount in respect of the Class A Notes
      and the Mezzanine Notes for such Payment Date and the Class M-1
      Liquidation Loss Interest Amount, Class M-2 Liquidation Loss Interest
      Amount, and any Available Funds Cap Carry-Forward Amount, if any, with
      respect to the Class A Notes and the Mezzanine Notes on such Payment Date,
      and in the case of the Class A-4 Notes and the Mezzanine Notes, separately
      identifying any reduction thereof due to Realized Losses (in the case of
      the Mezzanine Notes only), prepayments and the Relief Act;

            (xi)  the Overcollateralization Target Amount for such Payment Date;

            (xii) the Overcollateralization Amount, if any, for such Payment
      Date;

            (xiii) the respective Note Rates applicable to the Mezzanine Notes
      for such Payment Date and the Available Funds Cap Carry-Forward Amount for
      each Class of Mezzanine Notes, if any, for such Payment Date; and

            (xiv) the amount of such distribution to the Trust Certificates.

      Items (i) through (iii) above shall be presented on the basis of a Note
having a $1,000 denomination. In addition, by January 31st of each calendar year
following any year during which the Notes are outstanding, the Indenture Trustee
shall furnish a report to each Noteholder

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<PAGE>

of record if so requested in writing at any time during each calendar year as to
the aggregate of amounts reported pursuant to (i) through (iii) with respect to
the Notes for such calendar year.

      (b)   The Indenture Trustee may conclusively rely upon the Electronic File
provided by the Servicer pursuant to Section 4.01 of the Servicing Agreement in
its preparation of its Statement to Noteholders.

                                  ARTICLE VIII

                      ACCOUNTS, DISBURSEMENTS AND RELEASES

      Section 8.01 Collection of Money. Except as otherwise expressly provided
herein, the Indenture Trustee may demand payment or delivery of, and shall
receive and collect, directly and without intervention or assistance of any
fiscal agent or other intermediary, all money and other property payable to or
receivable by the Indenture Trustee pursuant to this Indenture. The Indenture
Trustee shall apply all such money received by it as provided in this Indenture.
Except as otherwise expressly provided in this Indenture, if any default occurs
in the making of any payment or performance under any agreement or instrument
that is part of the Trust Estate, the Indenture Trustee may take such action as
may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate Proceedings. Any such action shall be
without prejudice to any right to claim a Default or Event of Default under this
Indenture and any right to proceed thereafter as provided in Article V.

      Section 8.02 Payments on the Notes. (a) (I) On each Payment Date, the
Indenture Trustee shall withdraw from the Note Payment Account an amount equal
to the Amount Available for such Payment Date and pay the following amounts, in
the following order of priority:

            (i)   (A) to the Indenture Trustee, the Indenture Trustee Fee for
      such Payment Date and any indemnities and reimbursements ( collectively,
      "amounts") (such amounts subject to a cap of $100,000 per annum) due to
      the Indenture Trustee and (B) commencing on the 13th Payment Date, to the
      Owner Trustee, the Owner Trustee Fee for such Payment Date;

            (ii)  the Monthly Backup Servicing Fee for such Payment Date to the
      Backup Servicer;

            (iii) concurrently, to each Class of Class A Notes, the related
      Interest Payment Amount for such Payment Date, pro rata based on the
      Interest Payment Amount each Class is entitled to receive, with any
      shortfall in the Amount Available being allocated pro rata on that basis;

            (iv)  to the Holders of the Class M-1 Notes, an amount equal to the
      Interest Payment Amount due to the Class M-1 Notes on such Payment Date;

            (v)   to the Holders of the Class M-2 Notes, an amount equal to the
      Interest Payment Amount due to the Class M-2 Notes on such Payment Date;

                                       39
<PAGE>

            (vi)  to the Class A Notes, the Class A Principal Payment Amount for
      such Payment Date sequentially in the following order of priority:

                  (A)   to the Class A-1 Notes, until the Note Principal Balance
            of the Class A-1 Notes has been reduced to zero;

                  (B)   to the Class A-2 Notes, until the Note Principal Balance
            of the Class A-2 Notes has been reduced to zero;

                  (C)   to the Class A-3 Notes, until the Note Principal Balance
            of the Class A-3 Notes has been reduced to zero; and

                  (D)   to the Class A-4 Notes, until the Note Principal Balance
            of the Class A-4 Notes has been reduced to zero;

            (vii)  to the Class M-1 Notes, as follows:

                  (A)   the Class M-1 Liquidation Loss Interest Amount for such
            Payment Date;

                  (B)   the Class M-1 Principal Payment Amount for such Payment
            Date;

            (viii) to the Class M-2 Notes, as follows:

                  (A)   the Class M-2 Liquidation Loss Interest Amount for such
            Payment Date;

                  (B)   the Class M-2 Principal Payment Amount for such Payment
            Date;

            (ix)  to the Class A-4 Notes, the Class M-1 Notes and the Class M-2
      Notes, in that order, the related Available Funds Cap Carry-Forward Amount
      for such Payment Date;

            (x)   to the Indenture Trustee, any amounts incurred in excess of
      the amount set forth in clause (i) above, without regard to the annual cap
      on such amounts;

            (xi)  to the Servicer and the Backup Servicer, any reimbursements
      for expenses incurred in connection with Section 5.03 of the Servicing
      Agreement;

            (xii) to the Owner Trustee for expenses incurred in connection with
      the Trust Agreement; and

            (xiii) any remaining amounts to the Certificate Paying Agent for
      payment to Holders of the Trust Certificates.

      Notwithstanding the prioritization of the payment of the Class A Principal
Payment Amount pursuant to clause (vi) above, if the aggregate Note Balance of
the Class A Notes exceeds the Pool Principal Balance for that Payment Date, the
payment pursuant to clause (vi) above will be made pro rata based on the Note
Balances of the Class A Notes.

                                       40
<PAGE>

      (II)  On each Payment Date, the Indenture Trustee shall withdraw from the
Note Payment Account an amount equal to the Interest Deficiency Remedy Amount
payable on each Class of the Notes for such Payment Date and pay the following
amounts, in the following order of priority:

            (i)   concurrently, to each Class of Class A Notes, any related
      Interest Payment Amount for such Payment Date not paid pursuant to clause
      (a)(I) (iii) above, pro rata based on the unpaid Interest Payment Amount
      each Class is entitled to receive, but in no event shall amounts paid to
      the Class A Notes on a cumulative basis, pursuant to this clause
      (a)(II)(i) exceed the following amounts with respect to each such Class:
      Class A-1 $____________, Class A-2 $____________, Class A-3 $____________,
      and Class A-4 $____________;

            (xiv) to the Holders of the Class M-1 Notes, an amount equal to any
      Interest Payment Amount for such Payment Date not paid pursuant to clause
      (a) (I) (iv) above and any Class M-1 Liquidation Loss Interest Amount for
      such Payment Date not paid pursuant to clause (a) (I) (vii)(A) above, but
      in no event shall amounts paid to the Class M-1 Notes on a cumulative
      basis, pursuant to this clause (a)(II)(ii) exceed $____________; and

            (xv)  to the Holders of the Class M-2 Notes, an amount equal to any
      Interest Payment Amount for such Payment Date not paid pursuant to clause
      (a) (I) (v) above and any Class M-2 Liquidation Loss Interest Amount for
      such Payment Date not paid pursuant to clause (a) (I) (viii)(A) above, but
      in no event shall amounts paid to the Class M-2 Notes on a cumulative
      basis, pursuant to this clause (a)(II)(iii) exceed $____________.

      (b) Pursuant to Section 3.15 of the Servicing Agreement, funds in the Note
Payment Account shall remain uninvested unless the Indenture Trustee is
otherwise directed by the Servicer in Section 3.15 of the Servicing Agreement.

      (c) Each payment with respect to a Book-Entry Note shall be paid to the
Depository, as Holder thereof, and the Depository shall be responsible for
crediting the amount of such payment to the accounts of its Depository
Participants in accordance with its normal procedures. Each Depository
Participant shall be responsible for disbursing such payment to the Note 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 Note Owners
that it represents. None of the Indenture Trustee, the Note Registrar, the
Paying Agent, the Depositor or the Servicer shall have any responsibility
therefor except as otherwise provided by this Indenture or applicable law.

      (d) On each Payment Date, the Certificate Paying Agent shall deposit in
the Certificate Distribution Account all amounts it received pursuant to this
Section 8.02 for the purpose of distributing such funds pursuant to the Trust
Agreement.

      (e) Any installment of interest or principal, if any, payable on any Note
that is punctually paid or duly provided for by the Issuer on the applicable
Payment Date shall, if such

                                       41
<PAGE>

Holder shall have so requested at least five Business Days prior to the related
Record Date, be paid to each Holder of record on the preceding Record Date, by
wire transfer to an account specified in writing by such Holder reasonably
satisfactory to the Indenture Trustee as of the preceding Record Date or in all
other cases or if no such instructions have been delivered to the Indenture
Trustee, by check to such Noteholder mailed to such Holder's address as it
appears in the Note Register in the amount required to be paid to such Holder on
such Payment Date pursuant to such Holder's Notes; provided, however, that the
Indenture Trustee shall not pay to such Holders any amount required to be
withheld from a payment to such Holder by the Code.

      (f) The Note Balance of each Note shall be due and payable in full on the
Final Stated Maturity Date for such Note as provided in the forms of Notes set
forth in Exhibits A-1 and A-2 to this Indenture. All principal payments on the
Notes shall be made to the Noteholders entitled thereto in accordance with the
Percentage Interests represented by such Notes. The Indenture Trustee shall
notify the Person in whose name a Note is registered at the close of business on
the Record Date preceding the Final Stated Maturity Date or other final Payment
Date (including any final Payment Date resulting from any redemption pursuant to
Section 8.07 hereof). Such notice shall to the extent practicable be mailed no
later than five Business Days prior to such Final Stated Maturity Date or other
final Payment Date and shall specify that payment of the principal amount and
any interest due with respect to such Note at the Final Stated Maturity Date or
other final Payment Date will be payable only upon presentation and surrender of
such Note and shall specify the place where such Note may be presented and
surrendered for such final payment. No interest shall accrue on the Notes on or
after the Final Stated Maturity Date or any such other final Payment Date.

      Section 8.03 Officer's Certificate. Except in the case of releases of
documents to the Servicer pursuant to Section 3.11 of the Servicing Agreement,
the Indenture Trustee shall receive at least seven Business Days' notice when
requested by the Issuer to take any action pursuant to Section 8.05(a) hereof,
accompanied by copies of any instruments to be executed, and the Indenture
Trustee shall also require, as a condition to such action, an Officer's
Certificate, in form and substance satisfactory to the Indenture Trustee,
stating the legal effect of any such action, outlining the steps required to
complete the same, and concluding that all conditions precedent to the taking of
such action have been complied with.

   Section 8.04 Termination Upon Distribution to Noteholders. This Indenture and
the respective obligations and responsibilities of the Issuer and the Indenture
Trustee created hereby shall terminate upon the payment to Noteholders, the
Certificate Paying Agent on behalf of the Owner Trustee, the Certificateholders
and the Indenture Trustee of all amounts required to be paid pursuant to Article
III; provided, however, that in no event shall the trust created hereby continue
beyond the expiration of 21 years from the death of the survivor of the
descendants of Joseph P. Kennedy, the late ambassador of the United States to
the Court of St. James, living on the date hereof.

      Section 8.05 Release of Trust Estate.

      (a)   Subject to the payment of its fees, expenses and indemnities, the
Indenture Trustee may, and when required by the provisions of this Indenture
shall, execute instruments to

                                       42
<PAGE>

release property from the lien of this Indenture, or convey the Indenture
Trustee's interest in the same, in a manner and under circumstances that are not
inconsistent with the provisions of this Indenture, including for the purposes
of any repossession by the Servicer of an Asset pursuant to Section 3.11 of the
Servicing Agreement. No party relying upon an instrument executed by the
Indenture Trustee as provided in Article VIII hereunder shall be bound to
ascertain the Indenture Trustee's authority, inquire into the satisfaction of
any conditions precedent, or see to the application of any monies.

      (b)   The Indenture Trustee shall, at such time as (i) there are no Notes
Outstanding and (ii) all sums due to the Indenture Trustee pursuant to this
Indenture have been paid, release any remaining portion of the Trust Estate that
secured the Notes from the lien of this Indenture.

      (c)   The Indenture Trustee shall release property from the lien of this
Indenture pursuant to this Section 8.05 only upon receipt of a request from the
Issuer accompanied by an Officers' Certificate and an Opinion of Counsel stating
that all applicable requirements have been satisfied, except releases to the
Servicer pursuant to Section 3.11 of the Servicing Agreement.

      Section 8.06 Surrender of Notes Upon Final Payment. By acceptance of any
Note, the Holder thereof agrees to surrender such Note to the Indenture Trustee
promptly, prior to such Noteholder's receipt of the final payment thereon.

      Section 8.07 Optional Redemption of the Notes; Auction.

      (a)   The Servicer, pursuant to Section 3.17 of the Servicing Agreement,
shall have the option to purchase all outstanding Assets, effecting a redemption
of the Notes, in whole, but not in part, on any Payment Date on or after the
Payment Date on which the Pool Principal Balance is less than or equal to 20% of
the Cut-off Date Pool Balance. The aggregate redemption price for the Notes will
be equal to the Redemption Price as defined under Section 3.17 of the Servicing
Agreement.

      (b)   Following receipt of notice pursuant to Section 3.17(b) of the
Servicing Agreement, the Indenture Trustee shall provide notice to the
Noteholders of the final payment on the Notes. After receipt of the Redemption
Price from the Servicer pursuant to Section 3.17 of the Servicing Agreement, the
Indenture Trustee shall deposit the Redemption Price into the Note Payment
Account and shall, on the Payment Date after receipt of the funds, apply such
funds to make final payments of principal and interest on the Notes in
accordance with Section 8.02(a) hereof and payment in full to the Indenture
Trustee, and this Indenture shall be discharged subject to the provisions of
Section 4.10 hereof. If for any reason the amount deposited by the Servicer is
not sufficient to make such redemption or such redemption cannot be completed
for any reason, the amount so deposited by the Servicer with the Indenture
Trustee shall be immediately returned to the Servicer in full and shall not be
used for any other purpose or be deemed to be part of the Trust Estate.

      (c)   If the Servicer does not exercise its option to redeem the Notes as
described in clause (a) above, then on the next Payment Date the Indenture
Trustee, or an agent on its behalf, shall begin an auction process to sell the
Assets of the Trust Estate at the highest possible price,

                                       43
<PAGE>

provided, however, that the Indenture Trustee shall not sell the Assets of the
Trust Estate and liquidate the Trust Estate unless the proceeds of that sale are
expected to be sufficient to pay the aggregate unpaid principal balance of the
Notes plus all accrued and unpaid interest. In conducting such auction, the
Indenture Trustee shall solicit good faith bids for the Assets of the Trust
Estate from no more than three (3) parties or, if three (3) bidders cannot be
located, then from as many bidders as the Indenture Trustee can locate; provided
that, at the Indenture Trustee's request, the Issuer shall supply the Indenture
Trustee with the names of parties from whom to solicit such bids; and provided,
further, that the Indenture Trustee shall not be responsible if less than three
(3) or no bidders submit bids for the Assets. The Seller or an affiliate may
participate in the auction. The Indenture Trustee may hire an agent, at the
expense of the Trust, to perform the auction. If the auction of the Trust Estate
is not successful because the highest bid received is too low, then on each
subsequent Payment Date, the Indenture Trustee shall pay, as an additional
payment of principal, the Amount Available remaining after all payments pursuant
to Sections 8.02 (a) (i) through (x) have been made for such Payment Dates
first, to each Class of Class A Notes outstanding, pro rata based on the Note
Balance of such Notes after giving effect to payments of the Class A Principal
Payment Amount on that Payment Date, until the Note Balances thereof have been
reduced to zero; second, to the Class M-1 Notes, until the Note Balance thereof
has been reduced to zero; third, to the Class M-2 Notes, until the Note Balance
thereof has been reduced to zero; and fourth, to the Certificate Paying Agent
for payment to the Holders of the Trust Certificates. In addition, the Indenture
Trustee shall continue to conduct an auction of the Assets every third month
after that, until an acceptable bid is received for the Trust Estate. The
Servicer's purchase option shall expire upon the Indenture Trustee's acceptance
of a qualifying bid.

      Section 8.08 Allocation of Realized Losses.

      If as a result of Realized Losses, the Amount Available on any Payment
Date is insufficient to pay the full Required Principal Payment Amount for such
Payment Date to the Noteholders, the Overcollateralization Amount will be
reduced by the amount of that deficiency. If on any Payment Date the
Overcollateralization Amount is zero, further losses and delinquencies,
including reductions in the principal balances of defaulted Assets as a loss
mitigation effort by the Servicer, will cause the aggregate outstanding
principal balance of the Notes to be greater than the Pool Principal Balance.
Such excess (the "Liquidation Loss Amount") shall be applied by the Indenture
Trustee first, as a reduction of the Adjusted Note Balance with respect to the
Class M-2 Notes and, then, if the Note Balance of the Class M-2 Notes is less
than such Liquidation Loss Amount, a reduction of the Adjusted Note Balance of
the Class M-1 Notes.

                                   ARTICLE IX

                             SUPPLEMENTAL INDENTURES

      Section 9.01 Supplemental Indentures Without Consent of Noteholders.

      (a)   Without the consent of the Holders of any Notes but with prior
notice to the Rating Agencies, the Issuer and the Indenture Trustee, when
authorized by an Issuer Request, at any time and from time to time, may enter
into one or more indentures supplemental hereto

                                       44
<PAGE>

(which shall conform to the provisions of the TIA as in force at the date of the
execution thereof), in form satisfactory to the Indenture Trustee, for any of
the following purposes:

            (i)   to correct or amplify the description of any property at any
      time subject to the lien of this Indenture, or better to assure, convey
      and confirm unto the Indenture Trustee any property subject or required to
      be subjected to the lien of this Indenture, or to subject to the lien of
      this Indenture additional property;

            (ii)  to evidence the succession, in compliance with the applicable
      provisions hereof, of another person to the Issuer, and the assumption by
      any such successor of the covenants of the Issuer herein and in the Notes
      contained;

            (iii) to add to the covenants of the Issuer, for the benefit of the
      Holders of the Notes, or to surrender any right or power herein conferred
      upon the Issuer;

            (iv)  to convey, transfer, assign, mortgage or pledge any property
      to or with the Indenture Trustee;

            (v)   to cure any ambiguity, to correct or supplement any provision
      herein or in any supplemental indenture that may be inconsistent with any
      other provision herein or in any supplemental indenture;

            (vi)  to make any other provisions with respect to matters or
      questions arising under this Indenture or in any supplemental indenture;
      provided, that such action (as evidenced by either (i) an Opinion of
      Counsel delivered to the Servicer and the Indenture Trustee or (ii)
      confirmation from the Rating Agencies that such amendment will not result
      in the reduction or withdrawal of the rating of any Class of Notes) shall
      not materially and adversely affect the interests of the Holders of the
      Notes;

            (vii) to evidence and provide for the acceptance of the appointment
      hereunder by a successor trustee with respect to the Notes and to add to
      or change any of the provisions of this Indenture as shall be necessary to
      facilitate the administration of the trusts hereunder by more than one
      trustee, pursuant to the requirements of Article VI hereof; or

            (viii) to modify, eliminate or add to the provisions of this
      Indenture to such extent as shall be necessary to effect the qualification
      of this Indenture under the TIA or under any similar federal statute
      hereafter enacted and to add to this Indenture such other provisions as
      may be expressly required by the TIA;

provided, however, that no such indenture supplements shall be entered into
unless the Indenture Trustee shall have received an Opinion of Counsel as to the
enforceability of any such indenture supplement and to the effect that (i) such
indenture supplement is permitted hereunder and (ii) entering into such
indenture supplement will not result in a "substantial modification" of the
Notes under Treasury Regulation Section 1.1001-3 or adversely affect the status
of the Notes as indebtedness for federal income tax purposes.

                                       45
<PAGE>

      The Indenture Trustee is hereby authorized to join in the execution of any
such supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained.

      (b)   The Issuer and the Indenture Trustee, when authorized by an Issuer
Request, may, also without the consent of any of the Holders of the Notes and
prior notice to the Rating Agencies, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of the Holders of the Notes under this
Indenture; provided, however, that such action as evidenced by an Opinion of
Counsel, (i) is permitted by this Indenture, and shall not (ii) adversely affect
in any material respect the interests of any Noteholder (which may be evidenced
by confirmation from the Rating Agencies that such amendment will not result in
the reduction or withdrawal of the rating of any Class of Notes) or (iii) if
100% of the Certificates are not owned by Origen REIT or a direct or indirect
qualified REIT subsidiary of Origen REIT, cause the Issuer to be subject to an
entity level tax for federal income tax purposes.

      Section 9.02 Supplemental Indentures With Consent of Noteholders. The
Issuer and the Indenture Trustee, when authorized by an Issuer Request, also
may, with prior notice to the Rating Agencies and, with the consent of the
Holders of not less than a majority of the Note Balance of each Class of Notes
affected thereby, by Act (as defined in Section 10.03 hereof) of such Holders
delivered to the Issuer and the Indenture Trustee, enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of, this Indenture
or of modifying in any manner the rights of the Holders of the Notes under this
Indenture; provided, however, that no such supplemental indenture shall, without
the consent of the Holder of each Note affected thereby:

            (i)   change the date of payment of any installment of principal of
      or interest on any Note, or reduce the principal amount thereof or the
      interest rate thereon, change the provisions of this Indenture relating to
      the application of collections on, or the proceeds of the sale of, the
      Trust Estate to payment of principal of or interest on the Notes, or
      change any place of payment where, or the coin or currency in which, any
      Note or the interest thereon is payable, or impair the right to institute
      suit for the enforcement of the provisions of this Indenture requiring the
      application of funds available therefor, as provided in Article V, to the
      payment of any such amount due on the Notes on or after the respective due
      dates thereof;

            (ii)  reduce the percentage of the Note Balances of the Notes, the
      consent of the Holders of which is required for any such supplemental
      indenture, or the consent of the Holders of which is required for any
      waiver of compliance with certain provisions of this Indenture or certain
      defaults hereunder and their consequences provided for in this Indenture;

            (iii) modify or alter the provisions of the proviso to the
      definition of the term "Outstanding" or modify or alter the exception in
      the definition of the term "Holder";

                                       46
<PAGE>

            (iv)  reduce the percentage of the Note Balances of the Notes
      required to direct the Indenture Trustee to direct the Issuer to sell or
      liquidate the Trust Estate pursuant to Section 5.04 hereof;

            (v)   modify any provision of this Section 9.02 except to increase
      any percentage specified herein or to provide that certain additional
      provisions of this Indenture or the Basic Documents cannot be modified or
      waived without the consent of the Holder of each Note affected thereby;

            (vi)  modify any of the provisions of this Indenture in such manner
      as to affect the calculation of the amount of any payment of interest or
      principal due on any Note on any Payment Date (including the calculation
      of any of the individual components of such calculation); or

            (vii) permit the creation of any lien ranking prior to or on a
      parity with the lien of this Indenture with respect to any part of the
      Trust Estate or, except as otherwise permitted or contemplated herein,
      terminate the lien of this Indenture on any property at any time subject
      hereto or deprive the Holder of any Note of the security provided by the
      lien of this Indenture;

and provided, further, that such action shall not, as evidenced by an Opinion of
Counsel, cause the Issuer (if 100% of the Certificates are not owned by Origen
REIT or a direct or indirect qualified REIT subsidiary of Origen REIT) to be
subject to an entity level tax.

      Any such action shall not (as evidenced by either (i) an Opinion of
Counsel delivered to the Servicer and the Indenture Trustee or (ii) confirmation
from the Rating Agencies that such amendment will not result in the reduction or
withdrawal of the rating of any Class of Notes) adversely affect in any material
respect the interest of any Holder (other than a Holder who shall consent to
such supplemental indenture).

      It shall not be necessary for any Act of Noteholders under this Section
9.02 to approve the particular form of any proposed supplemental indenture, but
it shall be sufficient if such Act shall approve the substance thereof.

      Promptly after the execution by the Issuer and the Indenture Trustee of
any supplemental indenture pursuant to this Section 9.02, the Indenture Trustee
shall mail to the Holders of the Notes to which such amendment or supplemental
indenture relates a notice setting forth in general terms the substance of such
supplemental indenture. Any failure of the Indenture Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.

      Section 9.03 Execution of Supplemental Indentures. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modification thereby of the trusts created
by this Indenture, the Indenture Trustee shall be entitled to receive, and
subject to Sections 6.01 and 6.02 hereof, shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of the supplemental
indenture is authorized or permitted under the Indenture and all conditions
precedent under the Indenture to the execution of such supplemental indenture
have been met. The Indenture Trustee may, but

                                       47
<PAGE>

shall not be obligated to, enter into any such supplemental indenture that
affects the Indenture Trustee's own rights, duties, liabilities or immunities
under this Indenture or otherwise.

      Section 9.04 Effect of Supplemental Indenture. Upon the execution of any
supplemental indenture pursuant to the provisions hereof, this Indenture shall
be and shall be deemed to be modified and amended in accordance therewith with
respect to the Notes affected thereby, and the respective rights, limitations of
rights, obligations, duties, liabilities and immunities under this Indenture of
the Indenture Trustee, the Issuer and the Holders of the Notes shall thereafter
be determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.

      Section 9.05 Conformity with Trust Indenture Act. Every amendment of this
Indenture and every supplemental indenture executed pursuant to this Article IX
shall conform to the requirements of the Trust Indenture Act as then in effect
so long as this Indenture shall then be qualified under the Trust Indenture Act.

      Section 9.06 Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.

                                   ARTICLE X

                                  MISCELLANEOUS

      Section 10.01 Compliance Certificates and Opinions, etc.

      (a)   Upon any application or request by the Issuer to the Indenture
Trustee to take any action under any provision of this Indenture, the Issuer
shall furnish to the Indenture Trustee (i) an Officer's Certificate stating that
all conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with and (ii) an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with, except that, in the case of any such application or request
as to which the furnishing of such documents is specifically required by any
provision of this Indenture, no additional certificate or opinion need be
furnished.

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

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

                                       48
<PAGE>

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

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

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

            (v)   if the signatory of such certificate or opinion is required to
      be Independent, the statement required by the definition of the term
      "Independent Certificate."

      (b)   (i) Prior to the deposit of any Collateral or other property or
securities with the Indenture Trustee that is to be made the basis for the
release of any property or securities subject to the lien of this Indenture, the
Issuer shall, in addition to any obligation imposed in Section 10.01(a) or
elsewhere in this Indenture, furnish to the Indenture Trustee an Officer's
Certificate certifying or stating the opinion of each person signing such
certificate as to the fair value (within 90 days prior to such deposit) to the
Issuer of the Collateral or other property or securities to be so deposited and
a report from a nationally recognized accounting firm verifying such value.

            (ii)  Whenever the Issuer is required to furnish to the Indenture
      Trustee an Officer's Certificate certifying or stating the opinion of any
      signer thereof as to the matters described in clause (i) above, the Issuer
      shall also deliver to the Indenture Trustee an Independent Certificate
      from a nationally recognized accounting firm as to the same matters, if
      the fair value of the securities to be so deposited and of all other such
      securities made the basis of any such withdrawal or release since the
      commencement of the then current fiscal year of the Issuer, as set forth
      in the certificates delivered pursuant to clause (i) above and this clause
      (ii), is 10% or more of the Note Balances of the Notes, but such a
      certificate need not be furnished with respect to any securities so
      deposited, if the fair value thereof as set forth in the related Officer's
      Certificate is less than $25,000 or less than one percent of the Note
      Balances of the Notes.

            (iii) Whenever any property or securities are to be released from
      the lien of this Indenture, the Issuer shall also furnish to the Indenture
      Trustee an Officer's Certificate certifying or stating the opinion of each
      person signing such certificate as to the fair value (within 90 days prior
      to such release) of the property or securities proposed to be released and
      stating that in the opinion of such person the proposed release will not
      impair the security under this Indenture in contravention of the
      provisions hereof.

            (iv)  Whenever the Issuer is required to furnish to the Indenture
      Trustee an Officer's Certificate certifying or stating the opinion of any
      signer thereof as to the matters described in clause (iii) above, the
      Issuer shall also furnish to the Indenture

                                       49
<PAGE>

      Trustee an Independent Certificate as to the same matters if the fair
      value of the property or securities and of all other property or
      securities released from the lien of this Indenture since the commencement
      of the then-current calendar year, as set forth in the certificates
      required by clause (iii) above and this clause (iv), equals 10% or more of
      the Note Principal Balances of the Notes, but such certificate need not be
      furnished in the case of any release of property or securities if the fair
      value thereof as set forth in the related Officer's Certificate is less
      than $25,000 or less than one percent of the then Note Principal Balances
      of the Notes.

      Section 10.02 Form of Documents Delivered to Indenture Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.

      Any certificate or opinion of an Authorized Officer of the Issuer may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate of an Authorized Officer or Opinion of Counsel
may be based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an officer or officers of the Seller or the
Issuer, stating that the information with respect to such factual matters is in
the possession of the Seller or the Issuer, unless such counsel knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.

      Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.

      Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth and
accuracy of any statement or opinion contained in any such document as provided
in Article VI.

      Section 10.03 Acts of Noteholders.

      (a)   Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders

                                       50
<PAGE>

in person or by agents duly appointed in writing; and except as herein otherwise
expressly provided, such action shall become effective when such instrument or
instruments are delivered to the Indenture Trustee, and, where it is hereby
expressly required, to the Issuer. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Noteholders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and (subject to Section 6.01
hereof) conclusive in favor of the Indenture Trustee and the Issuer, if made in
the manner provided in this Section 10.03 hereof.

      (b)   The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.

      (c)   The ownership of Notes shall be proved by the Note Registrar.

      (d)   Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Notes shall bind the Holder of every
Note issued upon the registration thereof or in exchange therefor or in lieu
thereof, in respect of anything done, omitted or suffered to be done by the
Indenture Trustee or the Issuer in reliance thereon, whether or not notation of
such action is made upon such Note.

      Section 10.04 Notices etc., to Indenture Trustee Issuer and Rating
Agencies. Any request, demand, authorization, direction, notice, consent, waiver
or Act of Noteholders or other documents provided or permitted by this Indenture
shall be in writing and if such request, demand, authorization, direction,
notice, consent, waiver or act of Noteholders is to be made upon, given or
furnished to or filed with:

            (i)   the Indenture Trustee by any Noteholder or by the Issuer shall
      be sufficient for every purpose hereunder if made, given, furnished or
      filed in writing to or with the Indenture Trustee at the Corporate Trust
      Office. The Indenture Trustee shall promptly transmit any notice received
      by it from the Noteholders to the Issuer; or

            (ii)  the Issuer by the Indenture Trustee or by any Noteholder shall
      be sufficient for every purpose hereunder if in writing and mailed
      first-class, postage prepaid to the Issuer addressed to: Origen
      Manufactured Housing Contract Trust [20__-_], in care of [ Name ], [
      Address ], or at any other address previously furnished in writing to the
      Indenture Trustee by the Issuer. The Issuer shall promptly transmit any
      notice received by it from the Noteholders to the Indenture Trustee.

      Notices required to be given to the Rating Agencies by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, mailed first-class
postage pre-paid, to (i) in the case of [Moody's], at the following address:
[Moody's Investors Service, Inc., Residential Mortgage Monitoring Department, 99
Church Street, New York, New York 10007] and (ii) in the case of [S&P], at the
following address: [Standard & Poor's, 55 Water Street, 41st Floor, New York,
New York 10041, Attention of Asset Backed Surveillance Department]; or as to
each of the foregoing, at such other address as shall be designated by written
notice to the other parties.

                                       51
<PAGE>

      Section 10.05 Notices to Noteholders; Waiver. Where this Indenture
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at such Person's address as it appears on the Note Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Noteholders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular Noteholder shall affect the sufficiency of such notice with
respect to other Noteholders, and any notice that is mailed in the manner herein
provided shall conclusively be presumed to have been duly given regardless of
whether such notice is in fact actually received.

      Where this Indenture provides for notice in any manner, such notice may be
waived in writing by any Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Noteholders shall be filed with the Indenture Trustee but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such a waiver.

      In case, by reason of the suspension of regular mail service as a result
of a strike, work stoppage or similar activity, it shall be impractical to mail
notice of any event to Noteholders when such notice is required to be given
pursuant to any provision of this Indenture, then any manner of giving such
notice as shall be satisfactory to the Indenture Trustee shall be deemed to be a
sufficient giving of such notice.

      Where this Indenture provides for notice to the Rating Agencies, failure
to give such notice shall not affect any other rights or obligations created
hereunder, and shall not under any circumstance constitute an Event of Default.

      Section 10.06 Conflict with Trust Indenture Act. If any provision hereof
limits, qualifies or conflicts with another provision hereof that is required to
be included in this Indenture by any of the provisions of the TIA, such required
provision shall control.

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

      Section 10.07 Effect of Headings. The Article and Section headings herein
are for convenience only and shall not affect the construction hereof.

      Section 10.08 Successors and Assigns. All covenants and agreements in this
Indenture and the Notes by the Issuer shall bind its successors and assigns,
whether so expressed or not. All agreements of the Indenture Trustee in this
Indenture shall bind its successors, co-trustees and agents.

      Section 10.09 Separability. In case any provision in this Indenture or in
the Notes shall be invalid, illegal or unenforceable, the validity, legality,
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.

                                       52
<PAGE>

      Section 10.10 Third Party Beneficiary. The Owner Trustee shall be an
express third-party beneficiary of this Indenture and shall be entitled to
enforce the provisions hereof to the same extent as if the Owner Trustee was a
party hereto.

      Section 10.11 Legal Holidays. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such date,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.

      Section 10.12 GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (EXCEPT SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

      Section 10.13 Counterparts. This Indenture may be executed in any number
of counterparts, each of which so executed shall be deemed to be an original,
but all such counterparts shall together constitute but one and the same
instrument.

      Section 10.14 Recording of Indenture. If this Indenture is subject to
recording in any appropriate public recording offices, such recording is to be
effected by the Issuer and at its expense accompanied by an Opinion of Counsel
at its expense (which may be counsel to the Indenture Trustee or any other
counsel reasonably acceptable to the Indenture Trustee) to the effect that such
recording is necessary either for the protection of the Noteholders or any other
Person secured hereunder or for the enforcement of any right or remedy granted
to the Indenture Trustee under this Indenture.

      Section 10.15 Issuer Obligation. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the Notes or under this Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any
owner of a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director, employee or agent of the Indenture
Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or
of any successor or assign of the Indenture Trustee or the Owner Trustee in its
individual capacity, except as any such Person may have expressly agreed (it
being understood that the Indenture Trustee and the Owner Trustee have no such
obligations in their individual capacity) and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by applicable
law, for any unpaid consideration for stock, unpaid capital contribution or
failure to pay any installment or call owing to such entity. For all purposes of
this Indenture, in the performance of any duties or obligations of the Issuer
hereunder, the Owner Trustee shall be subject to, and entitled to the benefits
of, the terms and provisions of Article VI, VII and VIII of the Trust Agreement.

                                       53
<PAGE>

      Section 10.16 No Petition. The Indenture Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree
that they will not at any time prior to one year from the date of termination
hereof, institute against the Depositor or the Issuer, or join in any
institution against the Depositor or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States federal or state bankruptcy or similar law
in connection with any obligations relating to the Notes, this Indenture or any
of the Basic Documents, except for filing proofs of claim.

      Section 10.17 Inspection. The Issuer agrees that, at its expense, on
reasonable prior notice, it shall permit any representative of the Indenture
Trustee, during the Issuer's normal business hours, to examine all the books of
account, records, reports and other papers of the Issuer, to make copies and
extracts therefrom, to cause such books to be audited by Independent certified
public accountants, and to discuss the Issuer's affairs, finances and accounts
with the Issuer's officers, employees, and Independent certified public
accountants, all at such reasonable times and as often as may be reasonably
requested. The Indenture Trustee shall cause its representatives to hold in
confidence all such information except to the extent disclosure may be required
by law (and all reasonable applications for confidential treatment are
unavailing) and except to the extent that the Indenture Trustee may reasonably
determine that such disclosure is consistent with its obligations hereunder.

      Section 10.18 No Recourse to Owner Trustee. It is expressly understood and
agreed by the parties hereto that (a) this Indenture is executed and delivered
by [_____________], not individually or personally, but solely as Owner Trustee
of Origen Manufactured Housing Contract Trust [20__-_], in the exercise of the
powers and authority conferred and vested in it, (b) each of the
representations, undertakings and agreements herein made on the part of the
Issuer is made and intended not as personal representations, undertakings and
agreements by [______________] but is made and intended for the purpose for
binding only the Issuer, (c) nothing herein contained shall be construed as
creating any liability of [______________], individually or personally, to
perform any covenant either expressed or implied contained herein, all such
liability, if any, being expressly waived by the parties hereto and by any
Person claiming by, through or under the parties hereto and (d) under no
circumstances shall [______________] be personally liable for the payment of any
indebtedness or expenses of the Issuer or be liable for the breach or failure of
any obligation, representation, warranty or covenant made or undertaken by the
Issuer under this Indenture or any other related documents.

      Section 10.19 Proofs of Claim. The Indenture Trustee is authorized to file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Indenture Trustee (including any
claim for the reasonable compensation, expenses, disbursements and advances of
the Indenture Trustee, its agents and counsel) and the Noteholders allowed in
any judicial proceedings relative to the Issuer (or any other obligor upon the
Notes), its creditors or its property and shall be entitled and empowered to
collect, receive and distribute any money or other property payable or
deliverable on any such claims and any custodian in any such judicial proceeding
is hereby authorized by each Noteholder to make such payments to the Indenture
Trustee, as administrative expenses associated with any such proceeding, and, in
the event that the Indenture Trustee shall consent to the making of such
payments directly to the Noteholder to pay to the Indenture Trustee any amount
due to it for the reasonable compensation, expenses, disbursements and advances
of the Indenture Trustee, its

                                       54
<PAGE>

agents and counsel, and any other amounts due to the Indenture Trustee under
Section 6.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Indenture Trustee, its agents and
counsel, and any other amounts due the Indenture Trustee under Section 6.07
hereof out of the estate in any such proceeding, shall be denied for any reason,
payment of the same shall be secured by a Lien on, and shall be paid out of, any
and all distributions, dividends, money, securities and other properties that
the Noteholders may be entitled to receive in such proceeding whether in
liquidation or under any plan of reorganization or arrangement or otherwise.
Nothing herein contained shall be deemed to authorize the Indenture Trustee to
authorize or consent to or accept or adopt on behalf of any Noteholder any plan
of reorganization, arrangement, adjustment or composition affecting the
Noteholder of the rights of any Noteholder thereof, or to authorize the
Indenture Trustee to vote in respect of the claim of any Noteholder in any such
proceeding.

                                       55
<PAGE>

      IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused their
names to be signed hereto by their respective officers thereunto duly
authorized, all as of the day and year first above written.

                                     ORIGEN MANUFACTURED HOUSING
                                     CONTRACT TRUST [20__-_], as Issuer

                                     By: [______________], not in its individual
                                     capacity but solely as Owner Trustee

                                     By:
                                         _______________________________________
                                     Name:
                                     Title:

                                     [______________], as Indenture Trustee

                                     By:
                                         _______________________________________
                                     Name:
                                     Title:

<PAGE>

STATE OF [___________] )
                       ) ss.:
COUNTY OF [_________]  )

      On this ___ day of ________, 20__, before me personally appeared
[______________] to me known, who being by me duly sworn, did depose and say,
that he is an Attorney-In-Fact of the Indenture Trustee, one of the corporations
described in and which executed the above instrument; and that he signed his
name thereto by like order.

                                     Notary Public

                                     ___________________________________________
                                     NOTARY PUBLIC

[NOTARIAL SEAL]

<PAGE>

STATE OF [____________]  )
                         ) ss.:
COUNTY OF [____________] )

      On this ____ day of __________, 20__, before me personally appeared
[______________] to me known, who being by me duly sworn, did depose and say,
that such person is a Financial Services Officer of the Owner Trustee on behalf
of Origen Manufactured Housing Contract Trust [20__-_], a Delaware statutory
trust, one of the entities described in and which executed the above instrument;
and that she signed her name thereto by like order.

                                     Notary Public

                                     ___________________________________________
                                     NOTARY PUBLIC

[NOTARIAL SEAL]

<PAGE>

                                   EXHIBIT A-1

                            FORM OF CLASS A-[_] NOTES

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

THE HOLDER OF THIS NOTE OR BENEFICIAL OWNER OF ANY INTEREST HEREIN WILL BE
DEEMED TO REPRESENT TO ONE OF THE REPRESENTATIONS CONTAINED IN SECTION 4.15 OF
THE INDENTURE.

THIS NOTE IS A NON-RECOURSE OBLIGATION OF THE ISSUER, AND IS LIMITED IN RIGHT OF
PAYMENT TO AMOUNTS AVAILABLE FROM THE TRUST AS PROVIDED IN THE INDENTURE
REFERRED TO BELOW. THE ISSUER IS NOT OTHERWISE PERSONALLY LIABLE FOR PAYMENTS ON
THIS NOTE.

PRINCIPAL OF THIS NOTE IS PAYABLE OVER TIME AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING NOTE BALANCE OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.

                                     A-1-1
<PAGE>

                   ORIGEN MANUFACTURED HOUSING CONTRACT TRUST
                             NOTES, SERIES [20__-_]
                           CLASS [A-1][A-2][A-3][A-4]

AGGREGATE NOTE BALANCE:                         NOTE RATE: [___]% (Subject to
$ __________________                            Available Funds Rate, in the
                                                case of Class A-4)

INITIAL NOTE BALANCE OF THIS BOND:              BOND NO. 1
$ __________________

PERCENTAGE INTEREST: 100%                       CUSIP NO. [ ]

      Origen Manufactured Housing Contract Trust [20__-_] (the "Issuer"), a
Delaware statutory trust, for value received, hereby promises to pay to Cede &
Co. or registered assigns, the principal sum of ($____) in monthly installments
on the fifteenth day of each month or, if such day is not a Business Day, the
next succeeding Business Day (each a "Payment Date"), commencing in [________
20__] and ending on or before the Payment Date occurring on the Final Stated
Maturity Date and to pay interest on the Note Balance of this Note (this "Note")
outstanding from time to time as provided below.

      This Note is one of a duly authorized issue of the Origen Manufactured
Housing Contract Trust Notes, Series [20__-_] (the "Notes"), issued under an
Indenture dated as of [_________, 20__] (the "Indenture"), between the Issuer
and [______________], as indenture trustee (the "Indenture Trustee", which term
includes any successor Indenture Trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights thereunder of the Issuer, the Indenture
Trustee, the Owner Trustee and the Holders of the Notes and the terms upon which
the Notes are to be authenticated and delivered. All terms used in this Note
which are defined in the Indenture shall have the meanings assigned to them in
the Indenture.

      Payments of principal and interest on this Note will be made on each
Payment Date to the Noteholder of record as of the related Record Date. The
"Note Balance" of a Note as of any date of determination is equal to the initial
Note Balance thereof, reduced by the aggregate of all amounts previously paid
with respect to such Note on account of principal on all prior Payment Dates.

      The principal of, and interest on, this Note are due and payable as
described in the Indenture, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts. All payments made by the Issuer with respect to this Note shall
be equal to this Note's pro rata share of the aggregate payments on all Class
[A-1][A-2][A-3][A-4] Notes as described above, and shall be applied as between
interest and principal as provided in the Indenture.

                                     A-1-2
<PAGE>

      All principal and interest accrued on the Notes, if not previously paid,
will become finally due and payable at the Final Stated Maturity Date.

      The Notes are subject to redemption in whole, but not in part, by the
Servicer on any Payment Date on or after the Payment Date on which the Pool
Principal Balance is less than or equal to 20% of the aggregate Principal
Balance of the Assets as of Cut-off Date.

      The Issuer shall not be liable upon the indebtedness evidenced by the
Notes except to the extent of amounts available from the Trust Estate which
constitute security for the payment of the Notes. The assets included in the
Trust Estate will be the sole source of payments on the Notes, and each Holder
hereof, by its acceptance of this Note, agrees that (i) such Note will be
limited in right of payment to amounts available from the Trust Estate as
provided in the Indenture and (ii) such Holder shall have no recourse to the
Issuer, the Owner Trustee, the Indenture Trustee, the Seller, the Originator,
the Servicer or any of their respective affiliates, or to the assets of any of
the foregoing entities, except the assets of the Issuer pledged to secure the
Notes pursuant to the Indenture and the rights conveyed to the Issuer under the
Indenture.

      Any payment of principal or interest payable on this Note shall be paid to
the Person in whose name such Note is registered at the close of business on the
Record Date for such Payment Date by wire transfer to an account in the United
States designated by such Holder, except for the final installment of principal
and interest payable with respect to such Note, which shall be payable as
provided below. Notwithstanding the foregoing, upon written request with
appropriate instructions by the Holder of this Note delivered to the Indenture
Trustee at least five Business Days prior to the Record Date, any payment of
principal or interest, other than the final installment of principal or
interest, shall be made by check mailed to such person's address as it appears
in the Note Register on such Record Date. All reductions in the Note Balance of
a Note (or one or more predecessor Notes) effected by payments of principal made
on any Payment Date shall be binding upon all Holders of this Note and of any
note issued upon the registration of transfer thereof or in exchange therefor or
in lieu thereof, whether or not such payment is noted on such Note. The final
payment of this Note shall be payable upon presentation and surrender thereof on
or after the Payment Date thereof at the Corporate Trust Office or the office or
agency of the Issuer maintained by it for such purpose pursuant to Section 3.02
of the Indenture.

      Subject to the foregoing provisions, each Note delivered under the
Indenture, upon registration of transfer of or in exchange for or in lieu of any
other Note shall carry the right to unpaid principal and interest that were
carried by such other Note.

      If an Event of Default as defined in the Indenture shall occur and be
continuing with respect to the Notes, the Notes may become or be declared due
and payable in the manner and with the effect provided in the Indenture. If any
such acceleration of maturity occurs prior to the payment of the entire unpaid
Note Balance of the Notes, the amount payable to the Holder of this Note will be
equal to the sum of the unpaid Note Balance of the Notes, together with accrued
and unpaid interest thereon as described in the Indenture. The Indenture
provides that, notwithstanding the acceleration of the maturity of the Notes,
under certain circumstances specified therein, all amounts collected as proceeds
of the Trust Estate securing the Notes or

                                     A-1-3
<PAGE>

otherwise shall continue to be applied to payments of principal of and interest
on the Notes as if they had not been declared due and payable.

      The Holder of this Note or Beneficial Owner of any interest herein is
deemed to represent that either (1) it is not acquiring this Note with Plan
Assets or (2) (A) the acquisition, holding and transfer of this Note will not
give rise to a nonexempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code and (B) this Note is rated investment grade or better
and such person believes that this Note is properly treated as indebtedness
without substantial equity features for purposes of the DOL Regulations, and
agrees to so treat this Note. Alternatively, regardless of the rating of this
Note, such person may provide the Indenture Trustee and the Owner Trustee with
an opinion of counsel, which opinion of counsel will not be at the expense of
the Issuer, the Seller, the Originator, any Underwriter, the Owner Trustee, the
Indenture Trustee, the Servicer or any successor servicer which opines that the
acquisition, holding and transfer of this Note or interest herein is permissible
under applicable law, will not constitute or result in a non-exempt prohibited
transaction under ERISA or Section 4975 of the Code and will not subject the
Issuer, the Seller, the Originator, the Depositor, any Underwriter, the Owner
Trustee, the Indenture Trustee, the Servicer or any successor servicer to any
obligation in addition to those undertaken in the Indenture.

      As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note may be registered on the Note Register of
the Issuer. Upon surrender for registration of transfer of, or presentation of a
written instrument of transfer for, this Note at the office or agency designated
by the Issuer pursuant to the Indenture, accompanied by proper instruments of
assignment in form satisfactory to the Indenture Trustee, one or more new Notes
of any authorized denominations and of a like aggregate initial Note Balance,
will be issued to the designated transferee or transferees.

      Prior to the due presentment for registration of transfer of this Note,
the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this Note is registered as the owner
of such Note (i) on the applicable Record Date for the purpose of making
payments and interest of such Note and (ii) on any other date for all other
purposes whatsoever, as the owner hereof, whether or not this Note be overdue,
and neither the Issuer, the Indenture Trustee nor any such agent of the Issuer
or the Indenture Trustee shall be affected by notice to the contrary.

      The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer and the Holders of a majority of all Notes at the time
outstanding. The Indenture also contains provisions permitting the Holders of
Notes representing specified percentages of the aggregate Note Balance of the
Notes on behalf of the Holders of all the Notes, to waive any past Default under
the Indenture and its consequences. Any such waiver by the Holder, at the time
of the giving thereof, of this Note (or any one or more predecessor Notes) shall
bind the Holder of every Note issued upon the registration of transfer hereof or
in exchange hereof or in lieu hereof, whether or not notation of such consent or
waiver is made upon such Note. The Indenture also permits the Issuer and the
Indenture Trustee to amend or waive certain terms and conditions set forth in
the Indenture without the consent of the Holders of the Notes issued thereunder.

                                     A-1-4
<PAGE>

      Initially, this Note will be registered in the name of Cede & Co. as
nominee of DTC, acting in its capacity as the Depository for this Note. This
Note will be delivered by the clearing agency in denominations as provided in
the Indenture and subject to certain limitations therein set forth. This Note is
exchangeable for a like aggregate initial Note Balance of Notes of different
authorized denominations, as requested by the Holder surrendering same.

      Unless the Certificate of Authentication hereon has been executed by the
Indenture Trustee by manual signature, this Note shall not be entitled to any
benefit under the Indenture, or be valid or obligatory for any purpose.

      AS PROVIDED IN THE INDENTURE, THIS NOTE AND THE INDENTURE CREATING THIS
NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.

                                     A-1-5
<PAGE>

      IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed by [______________], not in its individual capacity but solely as Owner
Trustee.

Dated: [__________, 20__]

                                     ORIGEN MANUFACTURED HOUSING
                                     CONTRACT TRUST [20__-_]

                                     BY: [______________], not in its individual
                                     capacity but solely in its capacity as
                                     Owner Trustee

                                     By:
                                         _______________________________________
                                                  Authorized Signatory

                INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION

     This is one of the Notes referred to in the within-mentioned Indenture.

[___________],
as Indenture Trustee

By:
   ____________________________
       Authorized Signatory

                                     A-1-6
<PAGE>

                                  ABBREVIATIONS

      The following abbreviations, when used in the inscription on the face of
the Note, shall be construed as though they were written out in full according
to applicable laws or regulations:

               TEN COM         --      as tenants in common

               TEN ENT         --      as tenants by the entireties

               JT TEN          --      as joint tenants with right of
                                       survivorship and not as tenants in common

               UNIF GIFT MIN ACT       __________Custodian
                                       _________________________________________
                                                    (Cust)           (Minor)

                                       under Uniform Gifts to Minor Act
                                       _________________________

                                                                         (State)

     Additional abbreviations may also be used though not in the above list.

                                     A-1-7
<PAGE>

                                   ASSIGNMENT

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

     PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE:

                      ____________________________________

                      ____________________________________

                      ____________________________________
  (Please print or typewrite name and address, including zip code, of assignee)

________________________________________________________________________________
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints_________________ attorney to transfer said Note on the books kept
for registration thereof, with full power of substitution in the premises.

Dated:
       _______________            ________________________________

Signature Guaranteed by
                        __________________________________

      NOTICE: The signature(s) to this assignment must correspond with the name
as it appears upon the face of the within Note in every particular, without
alteration or enlargement or any change whatsoever. Signature(s) must be
guaranteed by a commercial bank or by a member firm of the New York Stock
Exchange or another national securities exchange. Notarized or witnessed
signatures are not acceptable.

                                     A-1-8
<PAGE>

                                   EXHIBIT A-2

                            FORM OF CLASS M-[_] NOTES

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

THE HOLDER OF THIS NOTE OR BENEFICIAL OWNER OF ANY INTEREST HEREIN WILL BE
DEEMED TO REPRESENT TO ONE OF THE REPRESENTATIONS CONTAINED IN SECTION 4.15 OF
THE INDENTURE.

THIS NOTE IS A NON-RECOURSE OBLIGATION OF THE ISSUER, AND IS LIMITED IN RIGHT OF
PAYMENT TO AMOUNTS AVAILABLE FROM THE TRUST AS PROVIDED IN THE INDENTURE
REFERRED TO BELOW. THE ISSUER IS NOT OTHERWISE PERSONALLY LIABLE FOR PAYMENTS ON
THIS NOTE.

PRINCIPAL OF THIS NOTE IS PAYABLE OVER TIME AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING NOTE BALANCE OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.

THIS NOTE IS SUBORDINATE TO THE CLASS A NOTES [AND CLASS M-1 NOTES] TO THE
EXTENT DESCRIBED IN THE INDENTURE REFERRED TO HEREIN.

                                     A-2-1
<PAGE>

                   ORIGEN MANUFACTURED HOUSING CONTRACT TRUST
                             NOTES, SERIES [20__-_]
                                    CLASS M-1

AGGREGATE NOTE BALANCE:                         NOTE RATE: [___]% (Subject to
$ __________________                            Available Funds Rate)

INITIAL NOTE BALANCE OF THIS BOND:              BOND NO. 1
$__________________

PERCENTAGE INTEREST: 100%                       CUSIP NO. [ ]

      Origen Manufactured Housing Contract Trust [20__-_] (the "Issuer"), a
Delaware statutory trust, for value received, hereby promises to pay to Cede &
Co. or registered assigns, the principal sum of ($____) in monthly installments
on the fifteenth day of each month or, if such day is not a Business Day, the
next succeeding Business Day (each a "Payment Date"), commencing in [___________
20__] and ending on or before the Payment Date occurring on the Final Stated
Maturity Date and to pay interest on the Note Balance of this Note (this "Note")
outstanding from time to time as provided below.

      This Note is one of a duly authorized issue of the Origen Manufactured
Housing Contract Trust Notes, Series [20__-_] (the "Notes"), issued under an
Indenture dated as of [_________, 20__] (the "Indenture"), between the Issuer
and [______________], as indenture trustee (the "Indenture Trustee", which term
includes any successor Indenture Trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights thereunder of the Issuer, the Indenture
Trustee, the Owner Trustee and the Holders of the Notes and the terms upon which
the Notes are to be authenticated and delivered. All terms used in this Note
which are defined in the Indenture shall have the meanings assigned to them in
the Indenture.

      Payments of principal and interest on this Note will be made on each
Payment Date to the Noteholder of record as of the related Record Date. The
"Note Balance" of a Note as of any date of determination is equal to the initial
Note Balance thereof, reduced by the aggregate of all amounts previously paid
with respect to such Note on account of principal on all prior Payment Dates.

      The principal of, and interest on, this Note are due and payable as
described in the Indenture, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts. All payments made by the Issuer with respect to this Note shall
be equal to this Note's pro rata share of the aggregate payments on all Class
[M-1][M-2] Notes as described above, and shall be applied as between interest
and principal as provided in the Indenture.

                                     A-2-2
<PAGE>

      All principal and interest accrued on the Notes, if not previously paid,
will become finally due and payable at the Final Stated Maturity Date.

      The Notes are subject to redemption in whole, but not in part, by the
Servicer on any Payment Date on or after the Payment Date on which the Pool
Principal Balance of the Assets as of the end of the prior Due Period is less
than or equal to 20% of the aggregate Principal Balance of the Assets as of
Cut-off Date.

      The Issuer shall not be liable upon the indebtedness evidenced by the
Notes except to the extent of amounts available from the Trust Estate which
constitute security for the payment of the Notes. The assets included in the
Trust Estate will be the sole source of payments on the Notes, and each Holder
hereof, by its acceptance of this Note, agrees that (i) such Note will be
limited in right of payment to amounts available from the Trust Estate as
provided in the Indenture and (ii) such Holder shall have no recourse to the
Issuer, the Owner Trustee, the Indenture Trustee, the Seller, the Originator,
the Servicer or any of their respective affiliates, or to the assets of any of
the foregoing entities, except the assets of the Issuer pledged to secure the
Notes pursuant to the Indenture and the rights conveyed to the Issuer under the
Indenture.

      Any payment of principal or interest payable on this Note shall be paid to
the Person in whose name such Note is registered at the close of business on the
Record Date for such Payment Date by wire transfer to an account in the United
States designated by such Holder, except for the final installment of principal
and interest payable with respect to such Note, which shall be payable as
provided below. Notwithstanding the foregoing, upon written request with
appropriate instructions by the Holder of this Note delivered to the Indenture
Trustee at least five Business Days prior to the Record Date, any payment of
principal or interest, other than the final installment of principal or
interest, shall be made by check mailed to such person's address as it appears
in the Note Register on such Record Date. All reductions in the Note Balance of
a Note (or one or more predecessor Notes) effected by payments of principal made
on any Payment Date shall be binding upon all Holders of this Note and of any
note issued upon the registration of transfer thereof or in exchange therefor or
in lieu thereof, whether or not such payment is noted on such Note. The final
payment of this Note shall be payable upon presentation and surrender thereof on
or after the Payment Date thereof at the Corporate Trust Office or the office or
agency of the Issuer maintained by it for such purpose pursuant to Section 3.02
of the Indenture.

      Subject to the foregoing provisions, each Note delivered under the
Indenture, upon registration of transfer of or in exchange for or in lieu of any
other Note shall carry the right to unpaid principal and interest that were
carried by such other Note.

      If an Event of Default as defined in the Indenture shall occur and be
continuing with respect to the Notes, the Notes may become or be declared due
and payable in the manner and with the effect provided in the Indenture. If any
such acceleration of maturity occurs prior to the payment of the entire unpaid
Note Balance of the Notes, the amount payable to the Holder of this Note will be
equal to the sum of the unpaid Note Balance of the Notes, together with accrued
and unpaid interest thereon as described in the Indenture. The Indenture
provides that, notwithstanding the acceleration of the maturity of the Notes,
under certain circumstances specified therein, all amounts collected as proceeds
of the Trust Estate securing the Notes or

                                     A-2-3
<PAGE>

otherwise shall continue to be applied to payments of principal of and interest
on the Notes as if they had not been declared due and payable.

      The Holder of this Note or Beneficial Owner of any interest herein is
deemed to represent that either (1) it is not acquiring this Note with Plan
Assets or (2) (A) the acquisition, holding and transfer of this Note will not
give rise to a nonexempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code and (B) this Note is rated investment grade or better
and such person believes that this Note is properly treated as indebtedness
without substantial equity features for purposes of the DOL Regulations, and
agrees to so treat this Note. Alternatively, regardless of the rating of this
Note, such person may provide the Indenture Trustee and the Owner Trustee with
an opinion of counsel, which opinion of counsel will not be at the expense of
the Issuer, the Seller, the Originator, any Underwriter, the Owner Trustee, the
Indenture Trustee, the Servicer or any successor servicer which opines that the
acquisition, holding and transfer of this Note or interest herein is permissible
under applicable law, will not constitute or result in a non-exempt prohibited
transaction under ERISA or Section 4975 of the Code and will not subject the
Issuer, the Seller, the Originator, the Depositor, any Underwriter, the Owner
Trustee, the Indenture Trustee, the Servicer or any successor servicer to any
obligation in addition to those undertaken in the Indenture.

      As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note may be registered on the Note Register of
the Issuer. Upon surrender for registration of transfer of, or presentation of a
written instrument of transfer for, this Note at the office or agency designated
by the Issuer pursuant to the Indenture, accompanied by proper instruments of
assignment in form satisfactory to the Indenture Trustee, one or more new Notes
of any authorized denominations and of a like aggregate initial Note Balance,
will be issued to the designated transferee or transferees.

      Prior to the due presentment for registration of transfer of this Note,
the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this Note is registered as the owner
of such Note (i) on the applicable Record Date for the purpose of making
payments and interest of such Note and (ii) on any other date for all other
purposes whatsoever, as the owner hereof, whether or not this Note be overdue,
and neither the Issuer, the Indenture Trustee nor any such agent of the Issuer
or the Indenture Trustee shall be affected by notice to the contrary.

      The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer and the Holders of a majority of all Notes at the time
outstanding. The Indenture also contains provisions permitting the Holders of
Notes representing specified percentages of the aggregate Note Balance of the
Notes on behalf of the Holders of all the Notes, to waive any past Default under
the Indenture and its consequences. Any such waiver by the Holder, at the time
of the giving thereof, of this Note (or any one or more predecessor Notes) shall
bind the Holder of every Note issued upon the registration of transfer hereof or
in exchange hereof or in lieu hereof, whether or not notation of such consent or
waiver is made upon such Note. The Indenture also permits the Issuer and the
Indenture Trustee to amend or waive certain terms and conditions set forth in
the Indenture without the consent of the Holders of the Notes issued thereunder.

                                     A-2-4
<PAGE>

      Initially, this Note will be registered in the name of Cede & Co. as
nominee of DTC, acting in its capacity as the Depository for this Note. This
Note will be delivered by the clearing agency in denominations as provided in
the Indenture and subject to certain limitations therein set forth. This Note is
exchangeable for a like aggregate initial Note Balance of Notes of different
authorized denominations, as requested by the Holder surrendering same.

      Unless the Certificate of Authentication hereon has been executed by the
Indenture Trustee by manual signature, this Note shall not be entitled to any
benefit under the Indenture, or be valid or obligatory for any purpose.

      AS PROVIDED IN THE INDENTURE, THIS NOTE AND THE INDENTURE CREATING THIS
NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.

                                     A-2-5
<PAGE>

      IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed by [______________], not in its individual capacity but solely as Owner
Trustee.

Dated[___________, 20__]

                                     ORIGEN MANUFACTURED HOUSING
                                     CONTRACT TRUST [20__-_]

                                     BY: [______________], not in its individual
                                     capacity but solely in its capacity as
                                     Owner Trustee

                                     By:
                                         _______________________________________
                                                 Authorized Signatory

                INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION

     This is one of the Notes referred to in the within-mentioned Indenture.

[_________],
as Indenture Trustee

By:
    _________________________________
          Authorized Signatory

                                     A-2-6
<PAGE>

                                  ABBREVIATIONS

      The following abbreviations, when used in the inscription on the face of
the Note, shall be construed as though they were written out in full according
to applicable laws or regulations:

               TEN COM         --      as tenants in common

               TEN ENT         --      as tenants by the entireties

               JT TEN          --      as joint tenants with right of
                                       survivorship and not as tenants in common

               UNIF GIFT MIN ACT       ______________Custodian

                                       ________________________________
                                               (Cust)            (Minor)

                                       under Uniform Gifts to Minor Act
                                       ____________________________

                                                                         (State)

        Additional abbreviations may also be used though not in the list.

                                     A-2-7
<PAGE>

                                   ASSIGNMENT

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

     PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE:

                     ____________________________________

                      ____________________________________

                      ____________________________________
  (Please print or typewrite name and address, including zip code, of assignee)

________________________________________________________________________________
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ______ attorney to transfer said Note on the books kept for
registration thereof, with full power of substitution in the premises.

Dated:
       _______________           _________________________________

Signature Guaranteed by
                        __________________________________

      NOTICE: The signature(s) to this assignment must correspond with the name
as it appears upon the face of the within Note in every particular, without
alteration or enlargement or any change whatsoever. Signature(s) must be
guaranteed by a commercial bank or by a member firm of the New York Stock
Exchange or another national securities exchange. Notarized or witnessed
signatures are not acceptable.

                                     A-2-8
<PAGE>

                                   EXHIBIT B-1

                                LIST OF CONTRACTS

                                (Filed Manually)

                                     B-1-1
<PAGE>

                                   EXHIBIT B-2

                             MORTGAGE LOAN SCHEDULE

                                (Filed Manually)

                                     B-2-1
<PAGE>

                                    EXHIBIT C

                               CUSTODIAL AGREEMENT

                     [copy to be attached following closing]

                                      C-1
<PAGE>

                                   APPENDIX A

                                   DEFINITIONS

      "Administrator": Origen Servicing, Inc. in the performance of its duties
pursuant to Article VIE under the Servicing Agreement.

      "Adjusted Note Balance": Any of the Class M-1 Adjusted Note Balance or
Class M-2 Adjusted Note Balance.

      "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.

      "Amount Available": As to any Payment Date, an amount equal to

      (a)   the sum of

            (i)   all payments of interest and principal, including all partial
      Principal Prepayments applied and all Principal Prepayments in full and
      interest thereon, collected by the Servicer with respect to the Assets
      during the related Due Period,

            (ii)  the Repurchase Price of each Asset which, during the related
      Due Period, the Originator purchased under the Asset Purchase Agreement on
      account of breaches of the Originator's representations and warranties,
      and

            (iii) all Liquidation Proceeds with respect to each Asset that
      became a Liquidated Asset during the related Due Period, minus

      (b)   the sum of

            (i)   amounts permitted to be withdrawn by the Servicer from the
      Collection Account pursuant to clauses (c) - (f), inclusive, of Section
      3.06 of the Servicing Agreement as of the close of business on the
      Business Day preceding such Payment Date;

            (ii)  amounts payable to the Indenture Trustee and the Administrator
      to reimburse it for any tax imposed on the Trust and paid by the Indenture
      Trustee or the Administrator, and any expenses incurred in respect of tax
      filings, in connection with Section 6.06 of the Indenture and Section
      8.01(c) of the Servicing Agreement, respectively; and

            (iii) the Interest Deficiency Remedy Amount withdrawn from the
      Collection Account for the immediately preceding Payment Date.

                                    App A-1
<PAGE>

      "Amounts Held for Future Distribution": As to any Payment Date, all
payments of interest and principal, including all partial Principal Prepayments
applied and all Principal Prepayments in full and interest thereon, collected by
the Servicer with respect to the Assets during the period commencing on the
first day of the month in which such Payment Date occurs to and including the
second Business Day preceding such Payment Date minus amounts permitted to be
withdrawn by the Servicer from the Collection Account pursuant to clauses (c) -
(f), inclusive, of Section 3.06 of the Servicing Agreement as of the close of
business on the second Business Day preceding such Payment Date with respect to
such amounts collected.

      "Asset": A Contract or Mortgage Loan.

      "Asset Documents": Collectively, the documents contained in the Contract
Files, Land-and-Home Contract Files and the Trustee Mortgage Loan Files.

      "Asset File": With respect to any Contract, Land-and-Home Contract and
Mortgage Loan, the related Contract File, the Land-and-Home Contract File and
the Trustee Mortgage Loan File, respectively.

      "Asset Purchase Agreement": The asset purchase agreement, dated as of
__________, 20__, among the Seller, the Depositor and the Originator.

      "Asset Rate": As to any Asset, the related Contract Rate or Mortgage Rate,
as applicable.

      "Asset Schedule": The list or lists attached to this Agreement consisting
of the related List of Contracts, if any, and the related Mortgage Loan
Schedule, if any.

      "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 the definition
of "Land-and-Home Contract File" or "Mortgage Loan File," as applicable, or
returned by the appropriate 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.

      "Authorized Newspaper": A newspaper of general circulation in the Borough
of Manhattan, The City of New York, printed in the English language and
customarily published on each Business Day, whether or not published on
Saturdays, Sundays or holidays.

      "Authorized Officer": With respect to the Issuer, any officer of the Owner
Trustee who is authorized to act for the Owner Trustee in matters relating to
the Issuer and who is identified on the list of Authorized Officers delivered by
the Owner Trustee to the Indenture Trustee on the Closing Date (as such list may
be modified or supplemented from time to time thereafter) and any authorized
officer of the Servicer in its capacity as administrator of the Issuer pursuant
to Article VIII of the Servicing Agreement.

                                      A-2
<PAGE>

      "Available Funds Cap Carry-Forward Amount": For the Class A-4 Notes or a
Class of Mezzanine Notes and any Payment Date on which the Note Rate therefor is
the Available Funds Rate, will be the sum of:

                  (1)   the excess, if any, of (a) the amount of interest
            accrued thereon for such Payment Date calculated pursuant to clause
            (i) of the definition of Note Rate for the related Notes over (b)
            the amount of interest accrued thereon at the Available Funds Rate
            for such Payment Date;

                  (2)   any unpaid shortfall in interest owed to the related
            Notes pursuant to clause(1) on prior Payment Dates; and

                  (3)   interest on the amount in clause (2) at the related Note
            Rate.

      "Available Funds Rate": For any Payment Date will be the rate per annum
equal to the weighted average of the Contract Rates on such Payment Date
(weighted on the basis of the principal balance of the Contracts as of the first
day of the related Due Period), net of the sum of the Indenture Trustee Fee
Rate, the Servicing Fee Rate [and the Monthly Backup Servicing Fee expressed as
a per annum rate multiplied by the Pool Principal Balance for the previous
Payment Date], multiplied by a fraction the numerator of which is the Pool
Principal Balance for the immediately preceding Payment Date and the denominator
of which is the sum of the aggregate Note Balance of the Class A Notes as of the
day immediately prior to such Payment Date, the Class M-l Adjusted Note Balance
for such Payment Date and the Class M-2 Adjusted Note Balance for such Payment
Date.

      "Average Sixty-Day Delinquency Ratio": The arithmetic average of the
Sixty-Day Delinquency Ratios for such Payment Date and for the two immediately
preceding Payment Dates.

      ["Backup Servicer": [_____________________________] its successors in
interest or any successor backup servicer appointed under the Servicing
Agreement.]

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

      "Basic Documents": The Trust Agreement, the Certificate of Trust, the
Indenture, the Servicing Agreement, the Asset Purchase Agreement, the Custodial
Agreement and the other documents and certificates delivered in connection with
any of the above.

      "Beneficial Owner": With respect to any Note, the Person who is the
beneficial owner of such Note as reflected on the books of the Depository or on
the books of a Person maintaining an account with such Depository (directly as a
Depository Participant or indirectly through a Depository Participant, in
accordance with the rules of such Depository).

      "Book-Entry Notes": Notes held by a nominee of the Depository, beneficial
interests in which Notes, ownership and transfers of which shall be made through
book entries by the Depository as described in Section 4.06 of the Indenture.

                                      A-3
<PAGE>

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

      "Certificate Distribution Account": The account or accounts created and
maintained pursuant to Section 3.10(c) of the Trust Agreement. The Certificate
Distribution Account shall be an Eligible Account.

      "Certificate Paying Agent": The meaning specified in Section 3.10 of the
Trust Agreement.

      "Certificate Percentage Interest": With respect to each Certificate, the
Percentage Interest stated on the face thereof.

      "Certificate Register": The register maintained by the Certificate
Registrar in which the Certificate Registrar shall provide for the registration
of Certificates and of transfers and exchanges of Certificates.

      "Certificate Registrar": Initially, the Indenture Trustee, in its capacity
as Certificate Registrar, or any successor to the Indenture Trustee in such
capacity.

      "Certificate of Trust": The Certificate of Trust filed for the Trust
pursuant to Section 3810(a) of the Statutory Trust Statute.

      "Certificates" or "Trust Certificates": The Origen Manufactured Housing
Contract Trust Series [20___-___] Trust Certificates, evidencing the beneficial
ownership interest in the Issuer and executed by the Trust in substantially the
form set forth in Exhibit A to the Trust Agreement.

      "Certificateholder" or "Holder": The Person in whose name a Certificate is
registered in the Certificate Register.

      "Charged-off Contract": A Contract with respect to which the Servicer has
written down the outstanding principal balance thereof to zero following
determination made by the Servicer that the circumstances concerning such
Contract and/or valuation of the underlying collateral make the write-off of the
contract balance prudent, with or without the repossession of the underlying
collateral.

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

      "Class A Notes": Any of the Class A-l, Class A-2, Class A-3 or Class A-4
Notes.

      "Class A-l Notes": Any one of the Class A-l Notes executed, authenticated
and delivered by the Indenture Trustee, substantially in the form annexed as
Exhibit A-1 to the Indenture.

                                      A-4
<PAGE>

      "Class A-2 Notes": Any one of the Class A-2 Notes executed, authenticated
and delivered by the Indenture Trustee, substantially in the form annexed as
Exhibit A-1 to the Indenture.

      "Class A-3 Notes": Any one of the Class A-3 Notes executed, authenticated
and delivered by the Indenture Trustee, substantially in the form annexed as
Exhibit A-1 to the Indenture.

      "Class A-4 Notes": Any one of the Class A-4 Notes executed, authenticated
and delivered by the Indenture Trustee, substantially in the form annexed as
Exhibit A-1 to the Indenture.

      "Class A Principal Payment Amount": For any Payment Date will equal the
lesser of (i) the Required Principal Payment Amount for such Payment Date and
(ii) the aggregate Note Balance of the Class A Notes as of the day immediately
preceding such Payment Date less the Class A Target Balance for such Payment
Date.

      "Class A Target Balance": (i) For each Payment Date (a) prior to the
Stepdown Date, (b) on which a Trigger Event is in effect or (c) on which the
Pool Principal Balance is less than or equal to [20]% of the Pool Principal
Balance as of the Cut-off Date, zero and (ii) for each Payment Date on or after
the Stepdown Date provided that a Trigger Event is not in effect and that the
Pool Principal Balance is greater than [20]% of the Pool Principal Balance as of
the Cut-off Date, the Pool Principal Balance minus the greater of (x) [_______]%
of the Pool Principal Balance and (y) the Overcollateralization Target Amount
for such Payment Date; provided, however, that, in no event will the Class A
Target Balance for any Payment Date be greater that the Class A Note Balance as
of the day immediately preceding such Payment Date.

      "Class M-l Adjusted Note Balance": For any Payment Date will be the lesser
of (i) the Class M-l Note Balance as of the day immediately preceding such
Payment Date and (ii) the Pool Principal Balance for the previous Payment Date
minus the aggregate Note Balance of the Class A Notes as of the day immediately
preceding such Payment Date.

      "Class M-1 Liquidation Loss Interest Amount": For any Payment Date and the
Class M-l Notes will be equal to the sum of:

                  (1)   interest at the related Note Rate that accrued during
            the related Interest Accrual Period on the Class M-l Loss Balance,

                  (2)   any unpaid shortfall in interest owed to the Class M-1
            Notes pursuant to clause(1) on prior Payment Dates, and

                  (3)   interest on the amount in clause (2) at the related Note
            Rate.

      "Class M-1 Loss Balance": With respect to any Payment Date will be the
Outstanding Note Balance of the Class M-l Notes immediately preceding such
Payment Date less the Class M-l Adjusted Note Balance for such Payment Date.

                                      A-5
<PAGE>

      "Class M-l Note": Any one of the Class M-l Notes executed, authenticated
and delivered by the Indenture Trustee, substantially in the form annexed as
Exhibit A-5 to the Indenture.

      "Class M-l Principal Payment Amount": For any Payment Date will equal the
lesser of (i) Required Principal Payment Amount for such Payment Date minus the
Class A Principal Payment Amount for such Payment Date and (ii) the Class M-l
Note Balance as of the day immediately preceding such Payment Date less the
Class M-l Target Balance for such Payment Date.

      "Class M-l Target Balance": (i) For each Payment Date (a) prior to the
Stepdown Date, (b) on which a Trigger Event is in effect or (c) on which the
Pool Principal Balance is less than or equal to [20]% of the Pool Principal
Balance as of the Cut-off Date, zero and (ii) for each Payment Date on or after
the Stepdown Date provided that a Trigger Event is not in effect and that the
Pool Principal Balance is greater than [20]% of the Pool Principal Balance as of
the Cut-off Date, (1) the Pool Principal Balance minus the greater of (x)
[_________]% of the Pool Principal Balance and (y) the Overcollateralization
Target Amount for such Payment Date minus (2) the Class A Target Balance for
such Payment Date; provided, however, that, in no event will the Class M-l
Target Balance for any Payment Date be greater that the Class M-l Note Balance
as of the day immediately preceding such Payment Date.

      "Class M-2 Adjusted Note Balance": For any Payment Date will be the lesser
of (i) the Class M-2 Note Balance as of the day immediately preceding such
Payment Date and (ii) the Pool Principal Balance for the previous Payment Date
minus the sum of the aggregate Note Balance of the Class A Notes and the Class
M-l Notes as of the day immediately preceding such Payment Date.

      "Class M-2 Liquidation Loss Interest Amount": For any Payment Date and the
Class M-2 Notes will be equal to the sum of:

            (1)   interest at the related Note Rate that accrued during the
      related Interest Accrual Period on the Class M-2 Loss Balance,

            (2)   any unpaid shortfall in interest owed to the Class M-2 Notes
      pursuant to clause (1) on prior Payment Dates, and

            (3)   interest on the amount in clause (2) at the related Note Rate.

      "Class M-2 Loss Balance": With respect to the any Payment Date will be the
Outstanding Note Balance of the Class M-2 Notes immediately preceding such
Payment Date less the Class M-2 Adjusted Note Balance for such Payment Date.

      "Class M-2 Note": Any one of the Class M-2 Notes executed, authenticated
and delivered by the Indenture Trustee, substantially in the form annexed as
Exhibit A-6 to the Indenture.

      "Class M-2 Principal Payment Amount": For any Payment Date will equal the
lesser of (i) Required Principal Payment Amount for such Payment Date minus the
Class A Principal Payment Amount and the Class M-l Principal Payment Amount for
such Payment Date and (ii)

                                      A-6
<PAGE>

the Class M-2 Note Balance as of the day immediately preceding such Payment Date
less the Class M-2 Target Balance for such Payment Date.

      "Class M-2 Target Balance": (i) For each Payment Date (a) prior to the
Stepdown Date, (b) on which a Trigger Event is in effect or (c) on which the
Pool Principal Balance is less than or equal to [20]% of the Pool Principal
Balance as of the Cut-off Date, zero and (ii) for each Payment Date on or after
the Stepdown Date provided that a Trigger Event is not in effect and that the
Pool Principal Balance is greater than [20]% of the Pool Principal Balance as of
the Cut-off Date, (1) the Pool Principal Balance minus the greater of (x)
[_________]% of the Pool Principal Balance and (y) the Overcollateralization
Target Amount for such Payment Date minus (2) the sum of the Class A Target
Balance and the Class M-l Target Balance for such Payment Date; provided,
however, that, in no event will the Class M-2 Target Balance for any Payment
Date be greater that the Class M-2 Note Balance as of the day immediately
preceding such Payment Date.

      "Closing Date": ______________, 20____.

      "Code": The Internal Revenue Code of 1986.

      "Collateral": The meaning specified in the Granting Clause of the
Indenture.

      "Collection Account": The account or accounts created and maintained, or
caused to be created and maintained, by the Servicer pursuant to Section 3.05(a)
of the Servicing Agreement, which shall be entitled "Origen Servicing, Inc., as
Servicer for [________________________], as Indenture Trustee, in trust for the
registered holders of Origen Manufactured Housing Contract Trust Collateralized
Notes, Series 20____-___." The Collection Account must be an Eligible Account.

      "Commission": The Securities and Exchange Commission.

      "Computer Tape": The computer tape generated by the Seller which provides
information relating to the Contracts and which was used by the Seller in
selecting the Contracts, and includes the master file and the history file.

      "Contract File": As to each Contract, other than a Land-and-Home Contract,
(a) the fully executed original copy of the Contract and security agreement (if
separate), and all modifications thereto, executed by the Obligor evidencing
indebtedness in connection with the purchase of a Manufactured Home, assigned in
blank by the Seller or the Originator (which maybe by blanket assignment), (b)
the assignment of the Contract to the Seller or the Originator, (c) the
originals of all assumptions, modifications, consolidation or extension
agreements, if any, signed by the Obligor, with evidence of recording thereon,
if applicable, or copies thereof with a certification that such copy represents
a true and correct copy of the original and that such original has been
submitted for recordation, if applicable, in the appropriate governmental
recording office of the jurisdiction in which the Manufactured Home is located,
(d) either (i) the original title document for the related Manufactured Home or
(ii) a duplicate certified by the appropriate governmental authority which
issued the original thereof or the application for such title document, (e)
evidence of one or more of the following types of perfection of the security
interest in the related Manufactured Home granted by such Contract, as
appropriate: (i) notation of such security

                                      A-7
<PAGE>

interest on the title document, (ii) an original or copy of the UCC-1 financing
statements, certified as true and correct by the Seller or the Originator and
all necessary UCC-3 continuation statements with evidence of filing thereon or
copies thereof certified by the Seller or the Originator to have been sent for
filing, and UCC-3 assignments executed by the Seller or the Originator in blank,
which UCC-3 assignments shall be in form and substance acceptable for filing, or
(iii) such other evidence of perfection of a security interest in a manufactured
housing unit as is customarily relied upon in the jurisdiction in which the
related Manufactured Home is located, (f) an original notarized Obligor's power
of attorney for each Contract, if any, signed by the Obligor, (g) insurance
certificates or other evidence of the issuance of insurance, (h) the original of
any guarantee executed in connection with the Contract, if any, (i) the loan
transfer agreement, if any, and (j) evidence of any other collateral security,
including with respect to a Land-in-Lieu Contract, the mortgage or deed of
trust, if any.

      "Contract Loan-to-Value Ratio": With respect to each Contract including
retail contracts sourced through dealers or brokers, Land-and-Home Contracts
sourced through dealers and correspondents, direct private sales and bulk
purchases, a fraction, the numerator of which is the principal balance of the
contract (total amount financed), and the denominator of which is the sum of the
down payment (the sum of cash, trade-in and land value) plus the principal
balance of the contract (amount financed).

      "Contract Rate": With respect to any particular Contract, the rate of
interest specified in that Contract and computed either on a "simple interest"
basis or a precomputed basis, as specified in the related Contract.

      "Contracts": The manufactured housing installment sales contracts and
installment loan agreements, including any Land-and-Home Contracts, described in
the List of Contracts and constituting part of the corpus of the Trust, which
Contracts are to be assigned and conveyed by the Seller to the Depositor and by
the Depositor to the Trust, and includes, without limitation, all related
security interests and any and all rights to receive payments which are due
pursuant thereto after the applicable Cut-off Date, but excluding any rights to
receive payments which are due pursuant thereto on or before the applicable
Cut-off Date.

      "Corporate Trust Office": With respect to the Indenture Trustee,
Certificate Registrar, Certificate Paying Agent and Paying Agent, the principal
corporate trust office of the Indenture Trustee and Note Registrar at which at
any particular time its corporate trust business shall be administered, which
office at the date of the execution of this instrument is located at 4 New York
Plaza, 6th Floor, New York, New York 10004, Attention: Institutional Trust
Services, Origen 2004-A. With respect to the Owner Trustee, the principal
corporate trust office of the Owner Trustee at which at any particular time its
corporate trust business shall be administered, which office at the date of the
execution of this Trust Agreement is located at Wilmington Trust Company, Rodney
Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001,
Attention: Corporate Trust Administration.

      "Current Realized Loss Ratio": As to any Payment Date, a fraction,
expressed as a percentage, the numerator of which is the aggregate Realized
Losses for such Payment Date and each of the two immediately preceding Payment
Dates, multiplied by four, and the denominator

                                      A-8
<PAGE>

of which is the arithmetic average of the Pool Principal Balance as of the third
preceding Payment Date and the Pool Principal Balance as of such Payment Date.

      "Custodial Agreement": The agreement for the retention of each File and
other documents, in the form set forth as Exhibit C to the Indenture.

      "Custodian": The custodian under the Custodial Agreement, which may be the
Indenture Trustee or any affiliate of the Indenture Trustee, or its successor in
interest or any successor to the Custodian under the Custodial Agreement as
therein provided.

      "Cut-off Date": The close of business on [_____________, 20____].

      "Cut-off Date Pool Principal Balance": The aggregate of the Cut-off Date
Principal Balances of the Assets.

      "Cut-off Date Principal Balance": As to any Asset, the unpaid principal
balance thereof at the Cut-off Date, after giving effect to all installments of
principal actually received by the Servicer during or prior to the related Due
Period.

      "Default": Any occurrence which is or with notice or the lapse of time or
both would become an Event of Default.

      "Definitive Notes": The meaning specified in Section 4.06 of the
Indenture.

      "Depositor": Origen Residential Securities, Inc., a Delaware corporation,
or its successor in interest.

      "Depository" or "Depository Agency": The Depository Trust Company or a
successor appointed by the Indenture Trustee. Any successor to the Depository
shall be an organization registered as a "clearing agency" pursuant to Section
17A of the Exchange Act and the regulations of the Securities and Exchange
Commission thereunder.

      "Depository Institution": Any depository institution or trust company,
including the Indenture 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-l by Moody's
and A-1+ by S&P.

      "Depository Participant": A Person for whom, from time to time, the
Depository effects book-entry transfers and pledges of securities deposited with
the Depository.

      "Determination Date": With respect to any Payment Date, the fourth
Business Day before such Payment Date.

      "Due Date": With respect to each Asset, the day of the month on which each
scheduled monthly payment is due.

                                      A-9
<PAGE>

      "Due Period": With respect to each Payment Date, the calendar month
preceding the month in which such Payment Date occurs.

      "Electronic File": A file in form and substance acceptable to the
Indenture Trustee prepared by the Servicer pursuant to Section 3.04(c) of the
Servicing Agreement with such additions, deletions and modifications as agreed
to by the Indenture Trustee and the Servicer.

      "Electronic Ledger": The electronic master record of installment sale
contracts and mortgage loans of the Seller.

      "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 segregated, non-interest bearing trust
account or accounts maintained with the corporate trust department of a federal
or state chartered depository institution or trust company acting in its
fiduciary capacity. Eligible Accounts may bear interest.

      "Eligible Servicer": Origen Financial L.L.C., Origen Servicing, Inc., or
any Person qualified to act as Servicer of the Contracts under applicable
federal and state laws and regulations, which Person services not less than an
aggregate of $50,000,000 in outstanding principal amount of manufactured housing
conditional sales contracts and installment loan agreements.

      "Eligible Substitute Asset": As to any Replaced Asset for which such
Eligible Substitute Asset is being substituted pursuant to Section 2.03(b) of
the Servicing Agreement, an Asset that (a) as of the date of its substitution,
satisfies all of the representations and warranties (which, except when
expressly stated to be as of origination, shall be deemed to be determined as of
the date of its substitution rather than as of the Cut-off Date or the Closing
Date) in Section 3.3 or 3.4 of the Asset Purchase Agreement and does not cause
any of the representations and warranties in Section 3.3 or 3.4 of the Asset
Purchase Agreement, after giving effect to such substitution, to be incorrect,
(b) after giving effect to the scheduled payment due in the month of such
substitution, has a Principal Balance that is not greater than the Principal
Balance of such Replaced Asset, (c) has an Asset Rate that is at least equal to
the Asset Rate of such Replaced Asset, (d) has a remaining term to scheduled
maturity that is not greater than the remaining term to scheduled maturity of
the Replaced Asset and (e) is a Land-and-Home Contract if the Replaced Asset is
a Land-and-Home Contract and is otherwise secured by a Manufactured Home or
Mortgaged Property that is similar in type and value to the collateral serving
the Replaced Asset. If more than one Asset is being substituted pursuant to
Section 3.7 of the Asset Purchase Agreement for more than one Replaced Asset on
a particular date, then the conditions specified above shall be applied to the
Assets being substituted, in the aggregate, and the Replaced Assets, in the
aggregate.

      "ERISA": The Employee Retirement Income Security Act of 1974, as amended.
"Escrow Payment": As defined in Section 3.09 of the Servicing Agreement.

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

      "Event of Default": With respect to the Indenture, any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary

                                      A-10
<PAGE>

or be effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body):

            (i)   a failure by the Issuer to pay the Interest Payment Amount on
      any of the Notes and, if the Class A Notes are no longer outstanding, the
      related Liquidation Loss Interest Amount due on the most senior Class of
      Notes Outstanding, for a period of six consecutive [30 days]; or

            (ii)  the failure by the Issuer on the Final Stated Maturity Date to
      reduce the Note Balance of any of the Notes to zero; or

            (iii) a breach by the Issuer of a negative covenant set forth in
      Section 3.16 of the Indenture; or

            (iv)  there occurs a default in any material respect in the
      observance or performance of any covenant or agreement of the Issuer made
      in the Indenture, or any representation or warranty of the Issuer made in
      the Indenture or in any certificate or other writing delivered pursuant
      hereto or in connection herewith proving to have been incorrect in any
      material respect as of the time when the same shall have been made, and
      such default or breach shall continue or not be cured, or the circumstance
      or condition in respect of which such representation or warranty was
      incorrect shall not have been eliminated or otherwise cured, for a period
      of 30 days after there shall have been given, by registered or certified
      mail, to the Issuer by the Indenture Trustee or to the Issuer and the
      Indenture Trustee by the Holders of at least 25% of the aggregate Note
      Balance of the Outstanding Notes, a written notice specifying such default
      or incorrect representation or warranty and requiring it to be remedied
      and stating that such notice is a notice of default hereunder; or

            (v)   there occurs the filing of a decree or order for relief by a
      court having jurisdiction in the premises in respect of the Issuer or any
      substantial part of the Trust Estate in an involuntary case under any
      applicable federal or state bankruptcy, insolvency or other similar law
      now or hereafter in effect, or appointing a receiver, liquidator,
      assignee, custodian, trustee, sequestrator or similar official of the
      Issuer or for any substantial part of the Trust Estate, or ordering the
      winding-up or liquidation of the Issuer's affairs, and such decree or
      order shall remain unstayed and in effect for a period of 60 consecutive
      days; or

            (vi)  there occurs the commencement by the Issuer of a voluntary
      case under any applicable federal or state bankruptcy, insolvency or other
      similar law now or hereafter in effect, or the consent by the Issuer to
      the entry of an order for relief in an involuntary case under any such
      law, or the consent by the Issuer to the appointment or taking possession
      by a receiver, liquidator, assignee, custodian, trustee, sequestrator or
      similar official of the Issuer or for any substantial part of the assets
      of the Trust Estate, or the making by the Issuer of any general assignment
      for the benefit of creditors, or the failure by the Issuer generally to
      pay its debts as such debts become due, or the taking of any action by the
      Issuer in furtherance of any of the foregoing.

                                      A-11
<PAGE>

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

      "Expenses": The meaning specified in Section 7.02 of the Trust Agreement.

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

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

      "File": An Asset File.

      "Final Stated Maturity Date": The Payment Date occurring in _____________,
20____, with respect to the Class A-l Notes; _____________, 20____, with respect
to the Class A-2 Notes; _____________, 20____, with respect to the Class A-3
Notes; and _____________, 20____, with respect to the Class A-4, Class M-l and
Class M-2 Notes.

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

      "Grant": Pledge, bargain, sell, warrant, alienate, remise, release,
convey, assign, transfer, create, and grant a lien upon and a security interest
in and right of set-off against, deposit, set over and confirm pursuant to the
Indenture. A Grant of the Collateral or of any other agreement or instrument
shall include all rights, powers and options (but none of the obligations) of
the granting party thereunder, including the immediate and continuing right to
claim for, collect, receive and give receipt for principal and interest payments
in respect of such collateral or other agreement or instrument and all other
moneys payable thereunder, to give and receive notices and other communications,
to make waivers or other agreements, to exercise all rights and options, to
bring proceedings in the name of the granting party or otherwise, and generally
to do and receive anything that the granting party is or may be entitled to do
or receive thereunder or with respect thereto.

      "Hazard Insurance Policy": With respect to each Asset, the policy of fire
and extended coverage insurance required to be maintained for the related
Manufactured Home or Mortgaged Property, as provided in Section 3.10 of the
Servicing Agreement, and which, as provided in said Section 3.10 of the
Servicing Agreement, may be a blanket mortgage impairment policy maintained by
the Servicer in accordance with the terms and conditions of said Section 3.10 of
the Servicing Agreement.

      "Indemnified Party": The meaning specified in Section 7.02 of the Trust
Agreement.

      "Indenture": The indenture dated as of _____________, 20____, between the
Issuer and the Indenture Trustee, relating to the Origen Manufactured Housing
Contract Trust Collateralized Notes, Series [20___-___].

      "Indenture Trustee": [_______________________], and its successors and
assigns or any successor indenture trustee appointed pursuant to the terms of
the Indenture.

                                      A-12
<PAGE>

      "Indenture Trustee Fee": With respect to each Payment Date, an amount
equal to $_________.

      "Independent": When used with respect to any specified Person, the Person
(i) is in fact independent of the Issuer, any other obligor on the Notes, the
Seller, the Servicer, the Depositor and any Affiliate of any of the foregoing
Persons, (ii) does not have any direct financial interest or any material
indirect financial interest in the Issuer, any such other obligor, the Seller,
the Servicer, the Depositor or any Affiliate of any of the foregoing Persons and
(iii) is not connected with the Issuer, any such other obligor, the Seller, the
Servicer, the Depositor or any Affiliate of any of the forego ing Persons as an
officer, employee, promoter, underwriter, trustee, partner, director or person
performing similar functions.

      "Independent Certificate": A certificate or opinion to be delivered to the
Indenture Trustee under the circumstances described in, and otherwise complying
with, the applicable requirements of Section 10.01 of the Indenture, made by an
independent appraiser or other expert appointed by an Issuer Request, and such
opinion or certificate shall state that the signer has read the definition of
"Independent" in this Indenture and that the signer is Independent within the
meaning thereof.

      "Initial Note Balance": With respect to the Class A-l Notes,
$[______________]. With respect to the Class A-2 Notes, $[______________]. With
respect to the Class A-3 Notes, $[______________]. With respect to the Class A-4
Notes, $[______________]. With respect to the Class M-l Notes,
$[______________]. With respect to the Class M-2 Notes, $[______________].

      "Insurance Proceeds": Proceeds paid by any insurer pursuant to any
insurance policy or contract.

      "Interest Accrual Period": With respect to any Payment Date and the Class
A Notes and the Mezzanine Notes, the calendar month preceding the month in which
the Payment Date occurs.

      "Interest Deficiency Remedy Amount": With respect to any Payment Date, the
sum of (a) that amount by which (i) the Interest Payment Amounts due to each
class of Notes on such Payment Date exceed (ii) the Amount Available for such
Payment Date remaining after payments pursuant to Section 8.02(a)(I) required to
be paid prior to payment of the Interest Payment Amount for such Class and (b)
that amount by which (i) the Liquidation Loss Interest Amounts due to each class
of Notes on such Payment Date exceed (ii) the Amount Available for such Payment
Date remaining after payments pursuant to Sections 8.02(aXI) required to be paid
prior to payment of the Liquidation Loss Interest Amount for such Class;
provided, that no Interest Deficiency Remedy Amount shall be payable on any
Class after the cumulative amount of Interest Deficiency Remedy Amounts paid on
that Class exceeds the applicable amount set forth below (which equals three
months' interest on the Initial Note Balance of such Class).

<TABLE>
<CAPTION>
Class                             Cumulative Amount
-----                             -----------------
<S>                               <C>
 A-l                                $
 A-2                                $
</TABLE>

                                      A-13
<PAGE>

<TABLE>
<S>                               <C>
 A-3                                $
 A-4                                $
 M-l                                $
 M-2                                $
</TABLE>

      "Interest Payment Amount": With respect to any Payment Date and any Class
A Notes and Mezzanine Notes, the sum of:

                  (1)   interest at the related Note Rate that accrued during
            the related Interest Accrual Period on, in the case of the Class A
            Notes, the related Note Balance and, in the case of the Class M
            Notes, the related Adjusted Note Balance,

                  (2)   any unpaid shortfall in interest owed to the Notes
            pursuant to clause (1) on prior Payment Dates, and

                  (3)   interest on the amount in clause (2) at the related Note
            Rate.

      "Investment Company Act": The Investment Company Act of 1940, as amended,
and any amendments thereto.

      "IRS": The Internal Revenue Service.

      "Issuer": Origen Manufactured Housing Contract Trust [20___-___], a
Delaware statutory trust, or its successor in interest.

      "Issuer Request": A written order or request signed in the name of the
Issuer by any one of its Authorized Officers and delivered to the Indenture
Trustee.

      "Land-and-Home Contract": A Contract that is secured by a Mortgage on real
estate on which the related Manufactured Home is situated, and which
Manufactured Home is considered or classified as part of the real estate under
the laws of the jurisdiction in which it is located.

      "Land-and-Home Contract File": As to each Land-and-Home Contract, (a) the
fully executed original copy of the Land-and-Home Contract and security
agreement (if separate), and all modifications thereto, executed by the Obligor
evidencing indebtedness in connection with the purchase of a Manufactured Home,
assigned in blank by the Seller or the Originator; (b) the original related
Mortgage with evidence of recording thereon (or, if the original Mortgage has
not yet been returned by the applicable recording office, a copy thereof,
certified by such recording office, which will be replaced by the original
Mortgage when it is so returned) and any title policy, commitment or other title
document for the related Manufactured Home; (c) the assignment of the
Land-and-Home Contract and the related Mortgage from the originator to the
Seller or the Originator; (d) an endorsement of such Land-and-Home Contract by
the Seller or the Originator to the Indenture Trustee or in blank; (e) an
assignment of the related Mortgage to the Indenture Trustee or in blank; and (f)
the originals of all assumptions, modifications, consolidation or extension
agreements, if any, signed by the Obligor, with evidence of recording thereon,
if applicable, or copies thereof with a certification that such copy represents
a true and correct copy of the original and that such original has been
submitted for recordation in the

                                      A-14
<PAGE>

appropriate governmental recording office of the jurisdiction in which the
Manufactured Home is located.

      "Land-in-Lieu Contract": A Contract that is secured by (i) a security
interest in a Manufactured Home and (ii) a mortgage or deed of trust on real
estate on which such Manufactured Home is situated, but such Manufactured Home
is not considered or classified as part of the real estate under the laws of the
jurisdiction in which it is located.

      "Lien": Any mortgage, deed of trust, pledge, conveyance, hypothecation,
assignment, participation, deposit arrangement, encumbrance, lien (statutory or
other), preference, priority right or interest or other security agreement or
preferential arrangement of any kind or nature whatsoever, including, without
limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing and the filing of any financing statement under the UCC (other than
any such financing statement filed for informational purposes only) or
comparable law of any jurisdiction to evidence any of the foregoing; provided,
however, that any assignment pursuant to Section 6.03 of the Servicing Agreement
shall not be deemed to constitute a Lien.

      "Liquidated Asset": Any defaulted Asset as to which the Servicer has
determined that all amounts which it expects to recover from or on account of
such Asset have been recovered; provided that any defaulted Asset in respect of
which the related Manufactured Home or Mortgaged Property, have been realized
upon and disposed of and the proceeds of such disposition have been received
shall be deemed to be a Liquidated Asset.

      "Liquidation Expenses": Out-of-pocket expenses (exclusive of any overhead
expenses) which are incurred by the Servicer in connection with the liquidation
of any defaulted Contract, on or prior to the date on which the related
Manufactured Home or Mortgaged Property, are disposed of, including, without
limitation, legal fees and bankruptcy expenses, and any related and unreimbursed
expenditures for property taxes, property preservation or restoration of the
property to marketable condition.

      "Liquidated Loss Amount": As defined in Section 8.08 of the Indenture.

      "Liquidation Loss Interest Amounts": As to any Payment Date, the Class M-l
Liquidation Loss Interest Amount and the Class M-2 Liquidation Loss Interest
Amount for such Payment Date.

      "Liquidation Proceeds": Cash (including Insurance Proceeds) received in
connection with the liquidation of defaulted Assets, whether through
repossession, foreclosure sale or otherwise, including any rental income
realized from the repossessed Manufactured Home.

      "List of Contracts": The lists identifying each Contract constituting part
of the corpus of the Trust Estate, and which lists are delivered pursuant to
Section 3.01 of the Trust Agreement, as such lists may be amended from time to
time pursuant to Section 3.7 of the Asset Purchase Agreement to add Eligible
Substitute Assets and delete Replaced Assets. Each List of Contracts shall set
forth as to each Contract identified on it (i) the Cut-off Date Principal
Balance, (ii) the amount of monthly payments due from the Obligor, (iii) the
Contract Rate and (iv) the maturity date.

                                      A-15
<PAGE>

      "Loan-to-Value Ratio": For any Asset, the related Contract Loan-to-Value
Ratio or the related Mortgage Loan-to-Value Ratio, as applicable.

      "Majority Certificateholder": A Holder of more than a 50% Certificate
Percentage Interest of the Certificates.

      "Manufactured Home": A unit of manufactured housing, including all
accessions thereto, securing the indebtedness of the Obligor under the related
Contract.

      "Mezzanine Note": Any Class M-l Note or Class M-2 Note.

      ["Monthly Backup Servicing Fee": With respect to any Payment Date,
_____________________________.]

      "Monthly Report": Has the meaning assigned in Section 4.01 of the
Servicing Agreement.

      "Monthly Servicing Fee": As of any Payment Date, one-twelfth of the
product of [1.25]% and the Pool Principal Balance for the immediately preceding
Payment Date (or, with respect to the first Payment Date, the Cut-off Date Pool
Principal Balance.

      "Mortgage": The mortgage, deed of trust, security deed or similar evidence
of lien, creating a first lien on an estate in fee simple in the real property
securing a Land-and-Home Contract or Mortgage Loan.

      "Mortgage Insurer": The insurance company or companies which issue any
Primary Mortgage Insurance Policies with respect to any Mortgage Loans.

      "Mortgage Loan": A mortgage loan (not including any Land-and-Home
Contract) secured by a first lien on a one-to-four-family residential real
property.

      "Mortgage Loan Documents": With respect to each Mortgage Loan, the
following documents:

      (a)   the original Mortgage Note bearing a complete chain of endorsements,
      if necessary, from the initial payee thereunder to the Seller or the
      Originator, with a further endorsement without recourse from the Seller or
      the Originator in blank or to the Indenture Trustee or its Custodian, in a
      form specified in the Asset Purchase Agreement, together with all related
      riders and addenda and any related surety or guaranty agreement, power of
      attorney and buydown agreement;

      (b)   the original recorded Mortgage (or a copy thereof certified to be a
      true and correct reproduction of the original thereof by the appropriate
      public recording office) with evidence of recordation noted thereon or
      attached thereto, or, if the Mortgage is in the process of being recorded,
      a photocopy of the Mortgage, certified by an officer of the Seller, the
      Originator or the loan originator, the related title insurance company,
      the related closing/settlement/escrow agent or the related closing
      attorney to be a true and correct copy of the Mortgage submitted for
      recordation;

                                      A-16
<PAGE>

      (c)   the original recorded Assignment of the Mortgage from the Seller or
      the Originator to the Indenture Trustee or its Custodian, in a form
      specified in the Asset Purchase Agreement (or a copy thereof certified to
      be a true and correct reproduction of the original thereof by the
      appropriate public recording office) with evidence of recordation noted
      thereon or attached thereto, or, if the Assignment is in the process of
      being recorded, a photocopy of the Assignment, certified by an officer of
      the Seller or the Originator to be a true and correct copy of the
      Assignment submitted for recordation;

      (d)   each original recorded intervening Assignment of the Mortgage as is
      necessary to show a complete chain of title from the initial mortgagee (or
      beneficiary, in the case of a deed of trust) to the Seller or the
      Originator (or a copy of each such assignment certified to be a true and
      correct reproduction of the original thereof by the appropriate public
      recording office) with evidence of recordation noted thereon or attached
      thereto, or, if an assignment is in the process of being recorded, a
      photocopy of the assignment, certified by an officer of the Seller or the
      Originator to be a true and correct copy of the assignment submitted for
      recordation;

      (e)   an original Title Insurance Policy or, if such policy has not yet
      been issued or is otherwise not available, (1) a written commitment to
      issue such policy issued by the applicable title insurance company and an
      officer's certificate of the Seller or the Originator certifying that all
      of the requirements specified in such commitment have been satisfied, (2)
      a preliminary title report if the related Mortgaged Property is located in
      a state in which preliminary title reports are acceptable evidence of
      title insurance, (3) a certificate of an officer of the Seller or the
      Originator certifying that a Title Insurance Policy is in full force and
      effect as to the related Mortgage and that such Title Insurance Policy is
      freely assignable to and will inure to the benefit of the Indenture
      Trustee (subject to recordation of the related Assignment of Mortgage) or
      (4) an Opinion of Counsel with respect to the title of the related
      Mortgaged Property;

      (f)   for each Mortgage Loan identified in the related Agreement as having
      in place a Primary Mortgage Insurance Policy, a Primary Mortgage Insurance
      Policy or a certificate of primary mortgage insurance issued by the
      related Mortgage Insurer or its agent indicating that such a policy is in
      effect as to such Mortgage Loan or, if neither a policy nor a certificate
      of insurance from the related Mortgage Insurer is available, a certificate
      of an officer of the related Seller or the Originator certifying that a
      Primary Mortgage Insurance Policy is in effect as to such Mortgage Loan;

      (g)   each related assumption agreement, modification, written assurance
      or substitution agreement, if any; and

      (h)   proof of the maintenance of a Hazard Insurance Policy (and a flood
      insurance policy, if applicable) as to the related Mortgaged Property.

      "Mortgage Loan-to-Value Ratio": As to a Mortgage Loan, the ratio,
expressed as a percentage, of the principal amount of such Mortgage Loan at the
time of determination, to either (i) the sum of the appraised value of the land
and improvements, and the amount of any prepaid finance charges or closing costs
that are financed or (ii) the sum of the purchase price of the

                                      A-17
<PAGE>

home (including taxes, insurance and any land improvements), the appraised value
of the land and the amount of any prepaid finance charges or closing costs that
are financed.

      "Mortgage Loan Schedule": The list attached to the Asset Purchase
Agreement identifying each Mortgage Loan assigned thereunder (which may be
presented together with any related List of Contracts in a single Asset
Schedule), which list shall (a) identify each Mortgage Loan and (b) set forth
(or describe the method of determining) as to each such Mortgage loan (1) the
Cut-off Date Principal Balance thereof, (2) the amount of each Monthly Payment,
(3) the Mortgage Rate thereof, (4) the original term to maturity thereof, (5)
the date of origination thereof, (6) the original Mortgage Loan-to-Value Ratio
thereof, (7) the state in which the related Mortgaged Property is located, and
(8) any other information as may be reasonably requested by the Indenture
Trustee prior to the Closing Date.

      "Mortgage Note": A manually executed written instrument evidencing a
Obligor's promise to repay a stated sum of money, plus interest, to the holder
of such instrument on or before a specific date according to a schedule of
principal and interest payments.

      "Mortgaged Property": The property subject to the lien of a Mortgage.

      "Mortgage Rate": With respect to each Mortgage Loan, the interest rate
specified in the related Mortgage Note.

      "Net Liquidation Loss": As to a Liquidated Asset, the amount, if any, by
which (a) the outstanding principal balance of such Liquidated Asset plus
accrued and unpaid interest thereon to the date on which such Liquidated Asset
became a Liquidated Asset exceeds (b) the Net Liquidation Proceeds for such
Liquidated Asset.

      "Net Liquidation Proceeds": As to a Liquidated Asset, all Liquidation
Proceeds received on or prior to the last day of the month in which such Asset
became a Liquidated Asset, net of Liquidation Expenses.

      "Nonrecoverable Advance": Any Servicing Advances which are not recovered,
or which the Servicer reasonably believes will not be recovered, by the Servicer
from late collections from the Obligor of the item advanced, or from Liquidation
Proceeds on the related Asset, and any Servicing Advances incurred by the
Servicer in connection with a delinquent or defaulted Asset which is
subsequently reinstated, worked out, or otherwise cured. In determining whether
a Servicing Advance is or will be nonrecoverable, the Servicer need not take
into account that it might receive any amounts in a deficiency judgment. The
determination by the Servicer that any Servicing Advance is, or if made would
constitute, a Nonrecoverable Advance, shall be evidenced by a certificate of a
Servicing Officer of the Servicer delivered to the Indenture Trustee stating the
reasons for such determination.

      "Note": Any one of the Origen Manufactured Housing Contract Trust
Collateralized Notes, Series [20___-___], Class A-1, Class A-2, Class A-3, Class
A-4, Class M-1 and Class M-2 issued under the Indenture.

                                      A-18
<PAGE>

      "Note Balance": With respect to each Class of Notes as of any date of
determination, the Initial Note Balance less all amounts previously paid to
Holders of such Class on account of principal.

      "Note Owner": The Beneficial Owner of a Note.

      "Note Payment Account": The trust account or accounts created and
maintained by the Indenture Trustee pursuant to Section 3.01 of the Indenture,
which shall be entitled "____________________, as Indenture Trustee, in trust
for the registered holders of Origen Manufactured Housing Contract Trust
Collateralized Notes, Series [20___-___]." The Note Payment Account must be an
Eligible Account.

      "Note Rate": With respect to the Class A-1 Notes and any Payment Date, a
rate per annum equal to [_____]%. With respect to the Class A-2 Notes and any
Payment Date, a rate per annum equal to [_____]%. With respect to the Class A-3
Notes and any Payment Date, a rate per annum equal to [_____]%. With respect to
the Class A-4 Notes and any Payment Date, a rate per annum equal to the least of
(i) [_____]% and (ii) the Available Funds Rate for such Payment Date. With
respect to the Class M-1 Notes and any Payment Date, a rate per annum equal to
the least of (i) [_____]% and (ii) the Available Funds Rate for such Payment
Date. With respect to the Class M-2 Notes and any Payment Date, a rate per annum
equal to the least of (i) [_____]% and (ii) the Available Funds Rate for such
Payment Date.

      "Note Register": The register maintained by the Note Registrar in which
the Note Registrar shall provide for the registration of Notes and of transfers
and exchanges of Notes.

      "Note Registrar": The Indenture Trustee, in its capacity as Note
Registrar, or any successor to the Indenture Trustee in such capacity.

      "Noteholder" or "Holder": The Person in whose name a Note is registered in
the Note Register, except that, any Note registered in the name of the
Depositor, the Issuer, the Indenture Trustee, the Seller or the Servicer or any
Affiliate of any of them shall be deemed not to be a holder or holders, nor
shall any so owned be considered outstanding, for purposes of giving any
request, demand, authorization, direction, notice, consent or waiver under the
Indenture or the Trust Agreement; provided that, in determining whether the
Indenture Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes that a
Responsible Officer of the Indenture Trustee or the Owner Trustee actually knows
to be so owned shall be so disregarded. Owners of Notes that have been pledged
in good faith may be regarded as Holders if the pledgee establishes to the
satisfaction of the Indenture Trustee or the Owner Trustee the pledgee's right
so to act with respect to such Notes and that the pledgee is not the Issuer, any
other obligor upon the Notes or any Affiliate of any of the foregoing Persons.

      "Obligor": Each Person who is indebted under a Contract or a Mortgage
Loan.

      "Officer's Certificate": With respect to the Servicer, a certificate
signed by the President, Managing Director, a Director, a Vice President or an
Assistant Vice President, of the Servicer and delivered to the Indenture
Trustee. With respect to the Issuer, a certificate signed by any Authorized
Officer of the Issuer, under the circumstances described in, and otherwise
complying

                                      A-19
<PAGE>

with, the applicable requirements of Section 10.01 of the Indenture, and
delivered to the Indenture Trustee. Unless otherwise specified, any reference in
the Indenture to an Officer's Certificate shall be to an Officer's Certificate
of any Authorized Officer of the Issuer.

      "Opinion of Counsel": A written opinion of counsel acceptable to the
Indenture Trustee, in its reasonable discretion which counsel may be in-house
counsel for the Servicer if acceptable to the Indenture Trustee and the Rating
Agencies or counsel for the Depositor, as the case may be.

      "Originator": Origen Financial L.L.C., or its successor in interest, in
its capacity as originator of the Contracts.

      "Origen REIT": Origen Financial, Inc., a Delaware corporation.

      "Outstanding": With respect to the Notes, as of the date of determination,
all Notes theretofore executed, authenticated and delivered under this Indenture
except:

            (i)   Notes theretofore canceled by the Note Registrar or delivered
      to the Indenture Trustee for cancellation; and

            (ii)  Notes in exchange for or in lieu of which other Notes have
      been executed, authenticated and delivered pursuant to the Indenture
      unless proof satisfactory to the Indenture Trustee is presented that any
      such Notes are held by a holder in due course;

      "Outstanding Advance Amounts": As to any Payment Date, all servicing
advances less the aggregate of all amounts actually received by the Servicer
prior to such Payment Date in reimbursement for any such advances.

      "Overcollateralization Amount": With respect to any Payment Date, the
excess, if any, of (a) the Pool Principal Balance for such Payment Date over (b)
the aggregate Note Balance of the Class A Notes and the Mezzanine Notes after
giving effect to payments to be made on such Payment Date.

      "Overcollateralization Target Amount": (i) For each Payment Date prior to
the Stepdown Date, [_____]% of the Cut-off Date Pool Principal Balance, (ii) for
each Payment Date on or after the Stepdown Date provided a Trigger Event is not
in effect, the lesser of (x) [_____]% of the Cut-off Date Pool Principal Balance
and (y) the greater of (1) [_____]% of the Pool Principal Balance for such
Payment Date and (2) $[_____________], and (iii) for each Payment Date on or
after the Stepdown Date and on which a Trigger Event is in effect, the
Overcollateralization Target Amount for the immediately preceding Payment Date.
Notwithstanding the foregoing, on any Payment Date on which the Pool Principal
Balance is less than or equal to [20]% of the Pool Principal Balance as of the
Cut-off Date, the Overcollateralization Target Amount will equal 100% of the
then-current Pool Principal Balance.

      "Owner Trust Estate": The corpus of the Issuer created by the Trust
Agreement which consists of items referred to in Section 3.01 of the Trust
Agreement.

                                      A-20
<PAGE>

      "Owner Trustee": [_____________________________], acting not in its
individual capacity but solely as Owner Trustee, and its successors and assigns
or any successor owner trustee appointed pursuant to the terms of the Trust
Agreement.

      "Owner Trustee Fee": With respect to a Payment Date, $[_____].

      "Paying Agent": Any paying agent or co-paying agent appointed pursuant to
Section 3.03 of the Indenture, which initially shall be the Indenture Trustee.

      "Payment Date": The [15th] day of any month, or if such [15th] day is not
a Business Day, the Business Day immediately following such [15th] day,
commencing in [________, 20___].

      "Percentage Interest": With respect to any Note, the percentage obtained
by dividing the Note Balance of such Note by the aggregate Note Balances of all
Notes of that Class. With respect to any Certificate, the percentage as stated
on the face thereof.

      "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 Indenture 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 ["AAAm" or
      "AAAm-G" by S&P] (for which the Indenture Trustee may act as sponsor,
      administrator or the like and receive a fee); and

                                      A-21
<PAGE>

            (vii) if previously confirmed in writing to the Indenture 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 Notes;

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.

      "Person": Any individual, corporation, partnership, 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.

      "Plan Assets": Assets of a Plan within the meaning of Department of Labor
regulation 29C.F.R. Section 2510.3-101.

      "Pool Principal Balance": As of any Payment Date, the aggregate Principal
Balance at the end of the related Due Period of all Assets that were outstanding
during such Due Period.

      "Preliminary Prospectus Supplement": That certain Preliminary Prospectus
Supplement dated [____________, 20_____] relating to the public offering of the
Class A Notes and the Mezzanine Notes.

      "Prepayment Assumption": As set forth in the Prospectus Supplement.

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

      "Primary Mortgage Insurance": The insurance provided under any Primary
Mortgage Insurance Policy.

      "Primary Mortgage Insurance Policy": A primary mortgage insurance policy,
if applicable, covering certain conventional Mortgage Loans for which the
initial Mortgage Loan-to-Value Ratios exceeded 80%.

      "Principal Balance": As to any Contract and any Payment Date, the Cut-off
Date Principal Balance, minus all collections credited against the Principal
Balance of such Contract prior to the last day of the related Due Period. For
purposes of this definition, a Liquidated Contract shall be deemed to have a
Principal Balance equal to the Principal Balance of the related Contract
immediately prior to the final recovery of related Liquidation Proceeds and a
Principal Balance of zero thereafter.

                                      A-22
<PAGE>

      "Principal Prepayment": Any payment of principal made by the Obligor on an
Asset 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; provided that such a payment in an amount less than the next
scheduled monthly payment may be held by the Servicer and applied to the next
monthly payment due on the next due date under the related Asset.

      "Proceeding": Any suit in equity, action at law or other judicial or
administrative proceeding.

      "Prospectus Supplement": That certain Prospectus Supplement dated
[_________________, 20_____] relating to the public offering of the Class A
Notes and the Mezzanine Notes.

      "Purchaser Information": The information in the Prospectus and the
information relating to the Underwriter in the Prospectus Supplement under the
caption "Method of Distribution" and any Derived Information. The term "Derived
Information" means such information, if any, in Term Sheet that is not contained
in either (i) the Prospectus, the Preliminary Prospectus Supplement or
Prospectus Supplement, taking into account information incorporated therein by
reference or (ii) any Pool Information, except to the extent that any Derived
Information results from a Pool Error. "Pool Information" is information
concerning the characteristics of the Contracts furnished to the Underwriter by
the Originator, the Seller or the Servicer for use in the preparation of the
Term Sheet. "Pool Error" is uncorrected Pool Information.

      "Rating Agency" or "Rating Agencies": [________________________] 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 Indenture Trustee and the Servicer.

      "Realized Losses": As to any Payment Date, the aggregate Net Liquidation
Losses of all Assets that became Liquidated Assets during the immediately
preceding month.

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

      "Redemption Price": As defined in Section 8.07 of the Indenture.

      "Registered Holder": The Person in whose name a Note is registered in the
Note Register on the applicable Record Date.

      "Related Documents": With respect to each Asset, the documents specified
in the definition of "Contract File," "Land-and-Home Contract File," and
"Trustee Mortgage Loan File," as applicable, and any documents required to be
added to such documents pursuant to the Asset Purchase Agreement, the Trust
Agreement, Indenture or the Servicing Agreement.

                                      A-23
<PAGE>

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

      "REO Property": A Mortgaged Property acquired by the Servicer on behalf of
the Certificateholders through foreclosure or deed-in-lieu of foreclosure, as
further described in the Servicing Agreement.

      "REO Property Disposition": The receipt by the Servicer of Insurance
Proceeds and other payments and recoveries (including Liquidation Proceeds)
which the Servicer recovers from the sale or other disposition of an REO
Property.

      "Replaced Asset": Has the meaning assigned in Section 2.03 of the
Indenture.

      "Repurchase Price": With respect to an Asset to be repurchased pursuant to
Section 2.03 of the Servicing Agreement, an amount equal to (a) the remaining
principal amount outstanding on such Asset, plus (b) interest at the Asset Rate
on such Asset from the end of the Due Period with respect to which the Obligor
last made a payment through the end of the immediately preceding Due Period.

      "Required Principal Payment Amount": For any Payment Date will be the
amount by which (i) the sum of the Note Balances of the Class A Notes and
Mezzanine Notes, as of the day immediately preceding such Payment Date, exceeds
(ii) the Pool Principal Balance as of such Payment Date minus the
Overcollateralization Target Amount for such Payment Date.

      "Responsible Officer": When used with respect to the Indenture Trustee or
the Owner 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.

      "Scheduled Payment": As to any Due Period and each Asset, the scheduled
monthly payment of principal and/or interest required to be made by an Obligor
on the related Asset.

      "Securities Act": The Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder.

      "Seller": [Origen Securitization Company, LLC], and its successors and
assigns, in its capacity as seller under the Asset Purchase Agreement.

      "Seller Information": The information in the Term Sheet, the Preliminary
Prospectus Supplement and Prospectus Supplement other than the Purchaser
Information.

      "Service Transfer": As defined in Section 6.02 of the Servicing Agreement.

                                      A-24
<PAGE>

      "Servicer": Origen Servicing, Inc., or any successor servicer appointed as
provided in the Servicing Agreement, in its capacity as Servicer under the
Servicing Agreement.

      "Servicer Event of Default": One or more of the events described in
Section 6.01 of the Servicing Agreement.

      "Servicer Mortgage Loan File": As to each Mortgage Loan, a file maintained
by the Servicer that contains (1) an original Hazard Insurance Policy (and flood
insurance policy, if required pursuant to this Agreement) relating to the
underlying Mortgaged Property or a certificate of insurance issued by the
insurer or its agent indicating that a Hazard Insurance Policy (and a flood
insurance policy, if required pursuant to this Agreement) is in effect with
respect to such Mortgaged Property, (2) originals or copies of all documents
submitted to a Mortgage Insurer for credit and property underwriting approval,
(3) the originals of all RESPA and Regulation Z disclosure statements executed
by the related Obligors, (4) the appraisal report made in connection with the
origination of the Mortgage Loan, (5) the settlement statement for the purchase
and/or refinancing of the underlying Mortgaged Property by the related Obligor
under the related Mortgage Note and Mortgage, (6) the originals of any tax
service contracts, (7) documentation relating to any approvals by the Servicer
of any modifications of the original related Mortgage Loan Documents and any
releases of collateral supporting the related Mortgage Loan, together with
copies of the documentation effecting any such modifications or releases, (8)
collection notices or form notices sent to the related Obligor, (9) foreclosure
correspondence and legal notifications, if applicable, (10) water and irrigation
company stock certificates, if applicable, and (11) all other documents relating
to such Mortgage Loan which would customarily be maintained in a mortgage loan
file by the Servicer in order to service the mortgage loan properly, as well as
any other documents relating to such Mortgage Loan (other than Mortgage Loan
Documents) that come into the Servicer's possession.

      "Servicer Remittance Date": With respect to any Payment Date, by 1:00 p.m.
New York time on the Business Day preceding such Payment Date.

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

      "Servicing Advance": Any Liquidation Expense incurred by the Servicer
pursuant to Section 3.09 or 3.11 of the Servicing Agreement, and any advance
made by the Servicer pursuant to Sections 3.06(f), 3.10 or 3.14 of the Servicing
Agreement.

      "Servicing Agreement": The Servicing Agreement dated as of [___________,
20____], among the Servicer, [the Backup Servicer,] the Originator, the Issuer
and the Indenture Trustee.

      "Servicing Fee": With respect to each Asset 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 Obligor 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 Asset 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.

                                      A-25
<PAGE>

      "Servicing Fee Rate": [1.25]% per annum.

      "Servicing Officer": Any officer of the Servicer involved in, or
responsible for, the administration and servicing of Assets whose name appears
on a list of servicing officers appearing in an Officer's Certificate furnished
to the Indenture Trustee by the Servicer, as the same may be amended from time
to time.

      "Sixty-Day Delinquency Ratio": As to any Payment Date, a fraction,
expressed as a percentage, the numerator of which is the aggregate of the
outstanding balances of all Assets that were delinquent 60 days or more as of
the end of the related Due Period (including Assets in respect of which the
related Manufactured Homes or Mortgaged Properties have been repossessed but are
still in inventory), and the denominator of which is the Pool Principal Balance
as of such Payment Date.

      "Staged Funded Loan": A Land-and-Home Contract or Mortgage Loan that has
not been fully funded and for which the unfunded amount of the original
Principal Balance is scheduled to be funded at interim periods during the
acquisition of the related real estate and Manufactured Home or Mortgaged
Property and the conversion of the interim funding to a permanent loan.

      "Statutory Trust Statute": Chapter 38 of Title 12 of the Delaware Code, 12
Del. Code Sections 3801 et seq., as the same may be amended from time to time.

      "Stepdown Date": The earlier to occur of (i) the Payment Date on which the
aggregate Note Balance of the Class A Notes has been reduced to zero and (ii)
the Payment Date occurring in [_____________, 20____].

      "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 of the Servicing Agreement.

      "Sub-Servicing Agreement": The written contract between the Servicer and a
Sub-Servicer relating to servicing and administration of certain Assets pursuant
to Section 3.12 of the Servicing Agreement.

      "Term Sheet": That certain term sheet dated [_____________, 20____]
distributed to investors in connection with the offering of the Notes.

      "Trigger Event": A Trigger Event is in effect with respect to any Payment
Date if:

      (a)   the Average Sixty Day Delinquency Ratio Test as of such Payment Date
exceeds 8.00%; 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 Contracts as of the Cut-off Date exceeds the applicable
percentages set forth below with respect to such Payment Date:

                                      A-26
<PAGE>

<TABLE>
<CAPTION>
       Payment Date Occurring In                            Percentage
       -------------------------                            ----------
<S>                                                         <C>
[____________]through [____________]                        [_____]%
[____________]through [____________]                        [_____]%
[____________]through [____________]                        [_____]%
[____________]and thereafter                                [_____]%
</TABLE>

      (c)   the Current Realized Loss Ratio as of such Payment Date exceeds
[_____]%.

      "Trust": The Origen Manufactured Housing Contract Trust [20___-___]
created pursuant to the Trust Agreement.

      "Trust Agreement": The Trust Agreement, dated [____________________,
20____], among the Owner Trustee, the Depositor and
[__________________________], as Certificate Registrar and Certificate Paying
Agent, relating to the Trust.

      "Trust Estate": As defined in the Granting Clause of the Indenture.

      "Trust Indenture Act" or "TIA": The Trust Indenture Act of 1939, as
amended from time to time, as in effect on any relevant date.

      "Trustee Mortgage Loan File": With respect to any Mortgage Loan, a file
containing all of the related Mortgage Loan Documents.

      "UCC": The Uniform Commercial Code, as amended from time to time, as in
effect in any specified jurisdiction.

      "Underwriter": [______________________], or its successors.

                                      A-27<PAGE>

                                                                    EXHIBIT 10.1

                                                                [EXECUTION COPY]

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

                              TRANSACTION AGREEMENT

                                      among

                            CENTERPOINT ENERGY, INC.,

                              UTILITY HOLDING, LLC,

                              NN HOUSTON SUB, INC.,

                           TEXAS GENCO HOLDINGS, INC.,

                              HPC MERGER SUB, INC.

                                       and

                            GC POWER ACQUISITION LLC

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

                            Dated as of July 21, 2004

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

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

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                       PAGE
<S>                                                                                    <C>
ARTICLE I PUBLIC COMPANY MERGER.....................................................      3
Section 1.1    The Public Company Merger............................................      3
Section 1.2    Time and Place of Public Company Merger Closing......................      3
Section 1.3    Effective Time of the Public Company Merger..........................      4
Section 1.4    Directors and Officers...............................................      4
Section 1.5    Articles of Incorporation and Bylaws.................................      4
Section 1.6    Effect of Public Company Merger on Capital Stock.....................      4
Section 1.7    Exchange of Certificates.............................................      5

ARTICLE II OTHER TRANSACTIONS.......................................................      7
Section 2.1    Genco LP Division....................................................      7
Section 2.2    Merger Agreements....................................................      8
Section 2.3    Non-STP Acquisition..................................................      8
Section 2.4    Time and Place of Non-STP Acquisition Closing........................      9
Section 2.5    STP Acquisition......................................................      9
Section 2.6    Time and Place of STP Acquisition Closing............................     10
Section 2.7    FIRPTA Certificate...................................................     11
Section 2.8    Director and Officer Resignations....................................     11

ARTICLE III REPRESENTATIONS AND WARRANTIES OF CENTERPOINT...........................     11
Section 3.1    Organization; Etc....................................................     11
Section 3.2    Authority Relative to this Agreement.................................     11
Section 3.3    Ownership of Shares..................................................     12
Section 3.4    Consents and Approvals; No Violations................................     12
Section 3.5    Affiliate Transactions...............................................     13
Section 3.6    Separation Transactions..............................................     13
Section 3.7    Brokers; Finders and Fees............................................     14

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF GENCO HOLDINGS.........................     14
Section 4.1    Organization; Etc....................................................     14
Section 4.2    Authority Relative to this Agreement.................................     15
Section 4.3    Capitalization.......................................................     16
Section 4.4    Ownership of Shares, Company Securities..............................     17
Section 4.5    Consents and Approvals; No Violations................................     17
Section 4.6    Reports and Financial Statements.....................................     18
Section 4.7    Absence of Undisclosed Liabilities...................................     20
Section 4.8    Absence of Certain Changes...........................................     20
Section 4.9    Litigation...........................................................     20
Section 4.10   Compliance with Law..................................................     20
Section 4.11   Employee Benefit Plans...............................................     21
Section 4.12   Labor and Employment Matters.........................................     24
Section 4.13   Taxes................................................................     24
Section 4.14   Title, Ownership and Related Matters.................................     26
</TABLE>

                                        i
<PAGE>

<TABLE>
<S>                                                                                      <C>
Section 4.15   Environmental........................................................     27
Section 4.16   Brokers; Finders and Fees............................................     29
Section 4.17   Texas Business Combination Law.......................................     30
Section 4.18   Intellectual Property................................................     30
Section 4.19   Contracts............................................................     30
Section 4.20   Insurance............................................................     31
Section 4.21   Regulatory Matters...................................................     32
Section 4.22   Affiliate Transactions...............................................     35
Section 4.23   Derivative Products..................................................     36
Section 4.24   Fairness Opinion.....................................................     36
Section 4.25   Board Recommendation.................................................     36
Section 4.26   Ownership of Assets..................................................     37

ARTICLE V REPRESENTATIONS AND WARRANTIES OF BUYER...................................     37
Section 5.1    Organization; Etc....................................................     37
Section 5.2    Authority Relative to this Agreement.................................     37
Section 5.3    Consents and Approvals; No Violations................................     38
Section 5.4    Debt Financing.......................................................     38
Section 5.5    Litigation...........................................................     38
Section 5.6    Investigation by Buyer...............................................     38
Section 5.7    Brokers; Finders and Fees............................................     40
Section 5.8    Buyer's ERCOT Generation.............................................     40
Section 5.9    Ownership of Genco Holding Stock.....................................     40

ARTICLE VI COVENANTS OF THE PARTIES.................................................     40
Section 6.1    Covenants of Genco Holdings..........................................     40
Section 6.2    Access to Information................................................     44
Section 6.3    Consents; Cooperation................................................     45
Section 6.4    Commercially Reasonable Efforts......................................     48
Section 6.5    Public Announcements.................................................     48
Section 6.6    Tax Matters..........................................................     49
Section 6.7    Debt Financing.......................................................     55
Section 6.8    Employees; Employee Benefits.........................................     58
Section 6.9    Insurance............................................................     66
Section 6.10   No Solicitation of Transactions......................................     69
Section 6.11   Tax Exempt Financing.................................................     70
Section 6.12   NRC Approval.........................................................     75
Section 6.13   Preparation of Information Statement; SEC Filings....................     76
Section 6.14   Directors' and Officers' Indemnification and Insurance...............     78
Section 6.15   Section 16 Matters...................................................     78
Section 6.16   Intercompany Accounts and Agreements.................................     78
Section 6.17   Transition Services and Other Intercompany Arrangements..............     80
Section 6.18   Power Purchase Agreement.............................................     80
Section 6.19   Decommissioning Undertakings.........................................     80
Section 6.20   True-up Proceeds.....................................................     81
Section 6.21   Environmental Reporting Regarding NOx Emission Reductions............     81
</TABLE>

                                       ii
<PAGE>

<TABLE>
<S>                                                                                     <C>
Section 6.22   Leases...............................................................     82

ARTICLE VII CONDITIONS TO CONSUMMATION OF THE PUBLIC COMPANY MERGER.................     82
Section 7.1    Conditions to Genco Holdings and Merger Sub's Obligations
               to Consummate the Public Company Merger..............................     82

ARTICLE VIII CONDITIONS TO CONSUMMATION OF THE NON-STP ACQUISITION..................     83
Section 8.1    Conditions to Buyer, Genco Holdings and CenterPoint's
               Obligations to Consummate the Non-STP Acquisition....................     83
Section 8.2    Further Conditions to Genco Holdings and CenterPoint's Obligations...     83
Section 8.3    Further Conditions to Buyer's Obligations............................     84
Section 8.4    Additional Conditions to Genco Holdings and CenterPoint's
               Obligations..........................................................     85
Section 8.5    Additional Conditions to Buyer's Obligations.........................     86

ARTICLE IX CONDITIONS TO CONSUMMATION OF THE STP ACQUISITION........................     86
Section 9.1    Conditions to CenterPoint and Buyer's Obligations to
               Consummate the STP Acquisition.......................................     86
Section 9.2    Further Conditions to Buyer's Obligations............................     87

ARTICLE X TERMINATION AND ABANDONMENT...............................................     88
Section 10.1   Termination..........................................................     88
Section 10.2   Procedure for and Effect of Termination..............................     89

ARTICLE XI MISCELLANEOUS PROVISIONS.................................................     90
Section 11.1   Representations and Warranties.......................................     90
Section 11.2   Amendment and Modification...........................................     90
Section 11.3   Entire Agreement; Assignment.........................................     90
Section 11.4   Severability.........................................................     91
Section 11.5   Notices..............................................................     91
Section 11.6   Governing Law........................................................     93
Section 11.7   Descriptive Headings.................................................     93
Section 11.8   Counterparts.........................................................     93
Section 11.9   Fees and Expenses....................................................     93
Section 11.10  Interpretation.......................................................     94
Section 11.11  Third-Party Beneficiaries............................................     95
Section 11.12  No Waivers...........................................................     95
Section 11.13  Specific Performance.................................................     96
Section 11.14  Acknowledgments......................................................     96
Section 11.15  Parent Undertaking...................................................     96
Section 11.16  Special Committee....................................................     96

Exhibit A -- Form of Parent Written Consent
</TABLE>

                                      iii
<PAGE>

Exhibit B -- Form of MergerAgreement for the Genco LP Division

Exhibit C -- Form of Merger Agreement for the Genco II LP Acquisition

Exhibit D -- Form of Merger Agreement for the Genco Services Acquisition

Exhibit E -- Form of Transition Services Agreement

Schedule 2.3   -- Non-STP Purchase Price Allocation

Schedule 6.17(b) -- Separation Amendments

Schedule 6.18 -- Power Purchase Arrangements

                                       iv
<PAGE>

                              TRANSACTION AGREEMENT

            TRANSACTION AGREEMENT, dated as of July 21, 2004 (this "AGREEMENT"),
by and among CenterPoint Energy, Inc., a Texas corporation ("CENTERPOINT"),
Utility Holding, LLC, a Delaware limited liability company and wholly-owned
subsidiary of CenterPoint ("UTILITY HOLDING" and, together with CenterPoint,
sometimes collectively referred to as "PARENTS" and, individually, a "PARENT"),
NN Houston Sub, Inc., a Texas corporation and a direct wholly-owned subsidiary
of Utility Holding ("MERGER SUB"), Texas Genco Holdings, Inc., a Texas
corporation ("GENCO HOLDINGS"), GC Power Acquisition LLC, a Delaware limited
liability company ("BUYER"), and HPC Merger Sub, Inc., a Texas corporation and a
wholly-owned subsidiary of Buyer ("STP MERGER SUB"). Parents, Merger Sub, Genco
Holdings, Buyer and STP Merger Sub are hereinafter collectively referred to as
the "parties" and each individually as a "party."

            WHEREAS, Utility Holding owns 64,764,240 shares (the "SHARES") of
common stock, par value $.001 per share ("COMMON STOCK"), of Genco Holdings; and

            WHEREAS, the Shares represent approximately 80.96% of the total
outstanding shares of Common Stock of Genco Holdings; and

            WHEREAS, Genco Holdings, through its direct and indirect
subsidiaries identified in Section 4.3(a) of the Companies Disclosure Letter (as
defined below) (Genco Holdings and such direct and indirect subsidiaries and any
direct or indirect subsidiaries of Genco Holdings formed after the date hereof
are collectively referred to herein as the "COMPANIES," and, individually, each
as a "COMPANY"), (a) owns 11 electric power generation facilities, and a 30.8%
(subject to potential increase pursuant to the exercise of a right of first
refusal) interest in South Texas Project Nuclear Electric Generating Station
(the "SOUTH TEXAS PROJECT" or "STP"), all of which are located in Texas, and (b)
sells wholesale electric generation capacity, energy and ancillary services in
the Electric Reliability Council of Texas, Inc. market (the "ERCOT MARKET")
(such business referred to herein as the "GENCO BUSINESS"); and

            WHEREAS, the respective Boards of Directors of CenterPoint, Genco
Holdings and Merger Sub, and the sole manager of Utility Holding, have approved,
and deem it advisable to consummate, the merger of Merger Sub with and into
Genco Holdings (the "PUBLIC COMPANY MERGER"), with Genco Holdings surviving as
the Surviving Corporation (as defined below), on terms and subject to the
conditions set forth in this Agreement; and

            WHEREAS, concurrently with the execution and delivery of this
Agreement and as a condition to Buyer's willingness to enter into this
Agreement, Utility Holding will deliver its written consent in the form attached
hereto as Exhibit A (the "PARENT WRITTEN CONSENT"), pursuant to which Utility
Holding will approve this Agreement and the transactions contemplated hereby
(including the Public Company Merger); and

<PAGE>

            WHEREAS, concurrently with the execution and delivery of this
Agreement and as a condition to Buyer's willingness to enter into this
Agreement, Texas Genco, LP, a Texas limited partnership and an indirect
wholly-owned subsidiary of Genco Holdings ("GENCO LP"), has entered into a
Master Power Purchase and Sale Agreement between Genco LP and J. Aron & Company,
dated the date hereof (the "POWER PURCHASE AGREEMENT"); and

            WHEREAS, concurrently with the execution and delivery of this
Agreement and as a condition to Parents' and Genco Holdings' willingness to
enter into this Agreement, Buyer has entered into a commitment letter (the "DEBT
FINANCING LETTER") with financing sources with respect to the debt financing
(the "DEBT FINANCING") for the transactions contemplated hereby other than the
Public Company Merger, which financing will include (a) a $775.0 million senior
first prior secured term loan facility, (b) a $475.0 million delayed draw term
loan facility (the "DELAYED DRAW TERM FACILITY"), (c) a $200.0 million senior
first priority secured revolving credit facility, (d) a $200.0 million senior
first priority secured letter of credit facility, (e) a $425.0 million senior
first priority secured letter of credit facility, and (f) the issuance of
$1,250.0 million of senior second priority secured notes or, alternatively,
$1,250.0 million under senior second priority secured increasing rate bridge
loans; and

            WHEREAS, Annex E to the Debt Financing Letter (the "PUBLIC COMPANY
MERGER DEBT TERM SHEET") provides for debt financing to Genco Holdings for the
Public Company Merger, which financing will consist of a $717.0 million
overnight bridge loan (the "OVERNIGHT BRIDGE LOAN"); and

            WHEREAS, prior to the Public Company Merger Closing Date (as defined
below), upon the terms and subject to the conditions set forth in this
Agreement, a Texas limited partnership to be formed by Genco Holdings as a
wholly-owned indirect subsidiary of Genco Holdings ("GENCO II LP"), will merge
with Genco LP, and as a result of that merger be allocated all of the Non-STP
Assets and Liabilities (as defined below) other than those held by Texas Genco
Services, LP, a Texas limited partnership wholly-owned by Genco Holdings ("GENCO
SERVICES") (such transaction, the "GENCO LP DIVISION"); and

            WHEREAS, on the first business day following consummation of the
Public Company Merger or as soon as possible thereafter, upon the terms and
subject to the conditions set forth in this Agreement, (1) a Texas limited
partnership to be formed by Buyer as a wholly-owned indirect subsidiary of Buyer
("NEWCO"), will merge with and into Genco II LP (such merger, the "GENCO II LP
ACQUISITION"), with Genco II LP being the surviving entity in the Genco II LP
Acquisition as an indirect wholly-owned subsidiary of Buyer, and (2) a Texas
limited partnership to be formed by Buyer as a wholly-owned indirect subsidiary
of Buyer ("NEWCO2") will merge with and into Genco Services (such merger, the
"GENCO SERVICES ACQUISITION"), with Genco Services being the surviving entity in
the Genco Services Acquisition as an indirect wholly-owned subsidiary of Buyer
(the Genco II LP Acquisition and the Genco Services Acquisition, collectively,
the "NON-STP ACQUISITION"); and

                                        2
<PAGE>

            WHEREAS, following consummation of the Public Company Merger and the
Non-STP Acquisition, upon the terms and subject to the conditions set forth in
this Agreement, STP Merger Sub will merge with and into Genco Holdings (the "STP
ACQUISITION"), with Genco Holdings being the surviving corporation in the STP
Acquisition as a direct wholly-owned subsidiary of Buyer; and

            WHEREAS, Buyer is owned by Blackstone Capital Partners IV L.P.,
Hellman & Friedman Capital Partners IV, L.P., KKR Millennium Fund, L.P., TPG
Partners IV, L.P. and their respective affiliates (collectively, the
"INVESTORS");

            NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements contained in this
Agreement, and intending to be legally bound, the parties agree as follows:

                                   ARTICLE I

                              PUBLIC COMPANY MERGER

            Section 1.1 The Public Company Merger. On the terms and subject to
the conditions of this Agreement and in accordance with the Texas Business
Corporation Act ("TBCA"), at the Public Company Merger Effective Time (as
defined in Section 1.3), Merger Sub shall be merged with and into Genco
Holdings. As a result of the Public Company Merger, the separate corporate
existence of Merger Sub shall cease and Genco Holdings shall survive the Public
Company Merger (sometimes hereinafter referred to as the "SURVIVING
CORPORATION"). From and after the Public Company Merger Effective Time, the
Public Company Merger shall have the effects provided in Article 5.06A of the
TBCA. All rights, titles and interests to all properties owned by Genco Holdings
and Merger Sub shall be allocated to and vested in the Surviving Corporation
without reversion or impairment, without further act or deed, and without any
transfer or assignment having occurred, but subject to any existing Liens
thereon. All liabilities and obligations of Genco Holdings and Merger Sub shall
become liabilities and obligations of the Surviving Corporation.

            Section 1.2 Time and Place of Public Company Merger Closing. Unless
this Agreement shall have been terminated and the transactions herein
contemplated shall have been abandoned pursuant to Section 10.1 and subject to
the satisfaction or waiver of the conditions set forth in Article VII, the
closing of the Public Company Merger (the "PUBLIC COMPANY MERGER CLOSING") will
take place at the offices of Baker Botts L.L.P., One Shell Plaza, 910 Louisiana
Street, Houston, Texas 77002-4995 at 9:00 a.m. (local time) on the first
business day (that is a day that is followed by three consecutive days that are
all business days) following the date on which all of the conditions set forth
in Article VII (other than those that by their nature are intended to be
satisfied at the Public Company Merger Closing) have been satisfied or waived,
or at such other date, place or time as the parties may agree. The date on which
the Public Company Merger Closing occurs and the transactions contemplated by
the Public Company Merger become effective is referred to as the "PUBLIC COMPANY
MERGER CLOSING DATE."

                                       3
<PAGE>

            Section 1.3 Effective Time of the Public Company Merger. On the
Public Company Merger Closing Date, the parties shall cause the Public Company
Merger to be consummated by filing the articles of merger (the "ARTICLES OF
MERGER") with the Secretary of State of the State of Texas (the "TEXAS SECRETARY
OF STATE") in such form as is required by, and executed in accordance with, the
relevant provisions of the TBCA and shall make any other filings or recordings
required under the TBCA (the date and time of the issuance of a certificate of
merger by the Texas Secretary of State pursuant to Article 5.05 of the TBCA (or
such later time as is specified in the Articles of Merger) on the Public Company
Merger Closing Date, being the "PUBLIC COMPANY MERGER EFFECTIVE TIME").

            Section 1.4 Directors and Officers. The directors of Merger Sub
immediately prior to the Public Company Merger Effective Time shall be the
initial directors of the Surviving Corporation following the Public Company
Merger, and the officers of Genco Holdings immediately prior to the Public
Company Merger Effective Time shall be the initial officers of the Surviving
Corporation following the Public Company Merger, in each case until their
respective successors are duly elected or appointed or until their earlier
death, resignation or removal in accordance with the articles of incorporation
and bylaws of the Surviving Corporation.

            Section 1.5 Articles of Incorporation and Bylaws. Following the
Public Company Merger Effective Time, the articles of incorporation of Genco
Holdings shall be the articles of incorporation of the Surviving Corporation
until thereafter changed or amended in accordance with the provisions thereof
and applicable Law. Following the Public Company Merger Effective Time, the
bylaws of Genco Holdings shall be the bylaws of the Surviving Corporation until
thereafter changed or amended in accordance with the provisions thereof and
applicable Law.

            Section 1.6 Effect of Public Company Merger on Capital Stock. As of
the Public Company Merger Effective Time, by virtue of the Public Company Merger
and without any action on the part of Genco Holdings, Merger Sub or any holder
of any shares of capital stock of Genco Holdings or any shares of capital stock
of Merger Sub:

            (a) Common Stock of Merger Sub. Each share of common stock of Merger
Sub issued and outstanding immediately prior to the Public Company Merger
Effective Time shall be converted into one validly issued, fully paid and
non-assessable share of common stock, par value $.001 per share, of the
Surviving Corporation (such shares, the "SURVIVING CORPORATION SHARES").

            (b) Cancellation of Certain Common Stock. Each share of Common Stock
that is owned by CenterPoint or any of its subsidiaries (including Utility
Holding, Genco Holdings or Merger Sub), in each case immediately prior to the
Public Company Merger Effective Time shall automatically be cancelled and
retired and shall cease to exist, and no cash or other consideration shall be
delivered or deliverable in exchange therefor.

                                       4
<PAGE>

            (c) Conversion of Common Stock. Subject to the provisions of this
Section 1.6, each share of Common Stock, other than Dissent Shares and shares
cancelled pursuant to Section 1.6(b), issued and outstanding immediately prior
to the Public Company Merger Effective Time shall, by virtue of the Public
Company Merger and without any action on the part of the holder thereof, be
converted into the right to receive $47.00 in cash payable without interest (the
"PUBLIC COMPANY MERGER CONSIDERATION") deliverable, in each case, to the holder
of such share, upon surrender, in the manner provided in Section 1.7, of a
certificate formerly evidencing such share (a "CERTIFICATE").

            (d) Dissenters' Rights. Notwithstanding anything in this Agreement
to the contrary, shares of Common Stock that are issued and outstanding
immediately prior to the Public Company Merger Effective Time and that are held
by any person who is entitled to dissent from and properly dissents from this
Agreement pursuant to, and who complies in all respects with, Articles 5.11,
5.12 and 5.13 of the TBCA (the "DISSENTERS' STATUTE"), in each case to the
extent applicable ("DISSENT SHARES"), shall not be converted into a right to
receive the Public Company Merger Consideration as provided in Section 1.6(c),
but rather the holders of Dissent Shares shall be entitled to the right to
receive payment of the fair value of such Dissent Shares in accordance with the
Dissenters' Statute upon surrender of the certificate or certificates duly
endorsed representing such Dissent Shares; provided, however, that if any such
holder shall fail to perfect or otherwise shall effectively waive, withdraw or
lose the right to receive payment of the fair value under the Dissenters'
Statute, then the right of such holder to be paid the fair value of such
holder's Dissent Shares shall cease and such Dissent Shares shall be deemed to
have been converted as of the Public Company Merger Effective Time into the
right to receive the Public Company Merger Consideration as provided in Section
1.6(c). Genco Holdings shall give prompt notice to Buyer (and, until the STP
Acquisition Closing (as defined in Section 2.6), CenterPoint) of any objections
or demands received by Genco Holdings for payment of the fair value of Common
Stock pursuant to the Dissenters' Statute, and Buyer (and, until the STP
Acquisition Closing, CenterPoint) shall have the right to direct all
negotiations and proceedings with respect to such objections or demands. Genco
Holdings shall not, without the prior written consent of Buyer (and until the
STP Acquisition Closing, CenterPoint), make any payment with respect to, or
settle or offer to settle, any such objections or demands, or agree to do any of
the foregoing.

            Section 1.7 Exchange of Certificates.

            (a) Deposit with Payment Agent. Prior to the Public Company Merger
Effective Time, CenterPoint shall appoint a bank or trust company reasonably
acceptable to Buyer and Genco Holdings to act as agent (the "PAYING AGENT") for
the delivery of the Public Company Merger Consideration upon surrender of the
Certificates in accordance with this Article I. At or promptly after the Public
Company Merger Effective Time, the Surviving Corporation shall deposit with the
Paying Agent an amount of cash required for the payment of the Public Company
Merger Consideration upon surrender of Certificates in accordance with this
Article I. Such funds shall be invested by the Paying Agent as directed by the
Surviving Corporation, provided that such investments shall be in obligations of
or guaranteed by the United States of America or any agency or

                                       5
<PAGE>

instrumentality thereof, in commercial paper obligations rated A-1 or P-1 or
better by Moody's Investors Services, Inc. or Standard & Poor's Corporation,
respectively, or in certificates of deposit, bank repurchase agreements or
banker's acceptances of commercial banks with capital exceeding $500,000,000.
Any net profit resulting from, or interest or income produced by, such
investments will be payable to the Surviving Corporation.

            (b) Exchange and Payment Procedures. As soon as reasonably
practicable after the Public Company Merger Effective Time, the Paying Agent
shall mail to each holder of record of a Certificate (i) a form of letter of
transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates held by such person shall pass, only upon
proper delivery of the Certificates to the Paying Agent and shall be in
customary form and have such other provisions as the parties may reasonably
specify) and (ii) instructions for use in effecting the surrender of the
Certificates in exchange for the Public Company Merger Consideration. Upon
surrender of a Certificate for cancellation to the Paying Agent or to such other
agent or agents as may be appointed by the Surviving Corporation, together with
such letter of transmittal, duly completed and validly executed, and such other
documents as may reasonably be required by the Paying Agent, the holder of such
Certificate shall be entitled to receive in exchange therefor the Public Company
Merger Consideration in respect of the shares formerly represented by such
Certificate pursuant to Section 1.6(c), and the Certificate so surrendered shall
forthwith be cancelled. In the event of a transfer of ownership of Common Stock
that is not registered in the share transfer books of Genco Holdings, the Public
Company Merger Consideration may be paid and delivered in exchange therefor to a
person other than the person in whose name the Certificate so surrendered is
registered if such Certificate shall be properly endorsed or otherwise be in
proper form for transfer and the person requesting such Public Company Merger
Consideration shall pay any transfer or other Taxes required by reason of the
payment to a person other than the registered holder of such Certificate or
establish to the reasonable satisfaction of the Surviving Corporation that such
Tax has been paid or is not applicable. No interest shall be paid or shall
accrue on the Public Company Merger Consideration payable upon surrender of any
Certificate.

            (c) No Further Ownership Rights in Common Stock. Until surrendered
as contemplated by Section 1.7(b), each Certificate shall be deemed at any time
after the Public Company Merger Effective Time to represent only the right to
receive upon such surrender the Public Company Merger Consideration as
contemplated by this Article I. The Public Company Merger Consideration
delivered upon the surrender of a Certificate in accordance with the terms of
this Article I shall be deemed to have been delivered at the Public Company
Merger Effective Time in full satisfaction of all rights pertaining to the
shares of Common Stock formerly represented by such Certificate. At the close of
business on the date on which the Public Company Merger Effective Time occurs,
the share transfer books of Genco Holdings shall be closed, and there shall be
no further registration of transfers on the share transfer books of the
Surviving Corporation of the shares of Common Stock that were outstanding
immediately prior to the Public Company Merger Effective Time. If, after the
close of business on the date on which the Public Company Merger Effective Time
occurs,

                                       6
<PAGE>

Certificates are presented to the Surviving Corporation or the Paying Agent for
transfer or any other reason, they shall be cancelled and exchanged as provided
in this Article I.

            (d) No Liability. None of the parties to this Agreement, the
Surviving Corporation and the Paying Agent shall be liable to any person in
respect of any cash or property delivered to a public official pursuant to any
applicable abandoned property, escheat or similar Law. Any portion of the Public
Company Merger Consideration deposited with the Paying Agent pursuant to this
Article I which remains undistributed to the holders of the Certificates for
twelve months after the Public Company Merger Effective Time (or immediately
prior to such earlier date on which any cash or property in respect of such
Certificate would otherwise escheat to or become the property of any
Governmental Authority) shall be delivered to the Surviving Corporation, upon
demand. Any holders of Certificates who have not theretofore complied with this
Article I shall thereafter look only to the Surviving Corporation and only as
general creditors thereof for payment of their claim, if any, to which such
holders may be entitled.

            (e) Lost Certificates. If any Certificate shall have been lost,
stolen, defaced or destroyed, upon the making of an affidavit of that fact by
the person claiming such Certificate to be lost, stolen, defaced or destroyed
and, if required by the Surviving Corporation, the posting by such person of a
bond in such reasonable amount as the Surviving Corporation may direct as
indemnity against any claim that may be made against it with respect to such
Certificate, the Paying Agent shall pay in respect of such lost, stolen, defaced
or destroyed Certificate the Public Company Merger Consideration.

            (f) Withholding Rights. The Surviving Corporation or the Paying
Agent shall be entitled to deduct and withhold any applicable Taxes from the
consideration otherwise payable pursuant to this Agreement to any holder of
shares of Common Stock.

                                   ARTICLE II

                               OTHER TRANSACTIONS

            Section 2.1 Genco LP Division . Prior to the Public Company Merger
Closing Date, CenterPoint and Genco Holdings shall cause the Genco LP Division
to be consummated, as follows: Genco LP and Genco II LP shall execute and
deliver a merger agreement substantially in the form attached hereto as Exhibit
B and consummate the Genco LP Division on the terms and conditions set forth
therein pursuant to a multiple survivor merger of Genco LP and Genco II LP
pursuant to which (i) except for the STP Assets and Liabilities (as defined
below), all of Genco LP's right, title and interest in and to any and all
properties, assets, rights, claims, Contracts and Permits and all debts,
liabilities and obligations shall be allocated to Genco II LP (the "GENCO LP
NON-STP ASSETS AND LIABILITIES"), (ii) all of the properties, assets, rights,
claims, Contracts and Permits set forth in Section 2.1(a) of the Companies
Disclosure Letter (as defined herein) shall be allocated to Genco LP (the "STP
ASSETS") and (iii) all of the debts, liabilities and obligations set forth in
Section 2.1(b) of the Companies Disclosure Letter shall be allocated to Genco LP
(the "STP LIABILITIES" and collectively with the STP Assets, the

                                       7
<PAGE>

"STP ASSETS AND LIABILITIES"). CenterPoint and Genco Holdings agree that after
the date of this Agreement Buyer shall have the right to review the items set
forth on Sections 2.1(a) and 2.1(b) of the Companies Disclosure Letter and the
parties agree that to the extent the parties in good faith determine that any
such items are more properly characterized as Non-STP Assets and Liabilities, as
applicable, such items shall be removed from such Sections. The Genco LP Non-STP
Assets and Liabilities together with the assets, rights, claims, Contracts,
Permits, debts, liabilities and obligations of Genco Services immediately prior
to the effective time of the Genco Services Acquisition are referred to
collectively as the "NON-STP ASSETS AND LIABILITIES".

            Section 2.2 Merger Agreements.

            (a) On or prior to the Public Company Merger Date, Genco II LP and
Newco shall execute and deliver a merger agreement substantially in the form of
Exhibit C (the "GENCO II MERGER AGREEMENT").

            (b) On or prior to the Public Company Merger Date, Genco Services
and Newco2 shall execute and deliver a merger agreement substantially in the
form of Exhibit D (the "GENCO SERVICES MERGER AGREEMENT").

            Section 2.3 Non-STP Acquisition. On the first business day after the
Public Company Merger Closing Date or as soon as possible thereafter (the
"NON-STP ACQUISITION CLOSING DATE"), on the terms and subject to the conditions
set forth in Article VIII, at the Non-STP Acquisition Closing (as defined
below), Buyer shall cause Newco and Newco2, and CenterPoint and Genco Holdings
shall cause Genco II LP and Genco Services, as applicable, to consummate the
Non-STP Acquisition, as follows:

            (a) Genco II LP and Newco shall consummate the Genco II LP
Acquisition on the terms and conditions set forth in the Genco II Merger
Agreement, with Genco II LP being the surviving entity in the Genco II LP
Acquisition as an indirectly wholly owned subsidiary of Buyer.

            (b) Genco Services and Newco2 shall consummate the Genco Services
Acquisition on the terms and conditions set forth in the Genco Services Merger
Agreement, with Genco Services being the surviving entity in the Genco Services
Acquisition as an indirectly wholly owned subsidiary of Buyer.

            (c) In the Non-STP Acquisition, (i) Buyer shall cause to be paid in
the Genco II LP Acquisition to the partners of Genco II LP total consideration
of $2,789 million in cash without interest (the "GENCO II LP CONSIDERATION") by
wire transfer of immediately available funds and (ii) Buyer shall cause to be
paid in the Genco Services Acquisition to the partners of Genco Services total
consideration of $24 million in cash without interest (together with the Genco
II LP Consideration, the "NON-STP CONSIDERATION"), in each case to the accounts
specified by Genco Holdings to Buyer in writing at least two business days prior
to the Non-STP Acquisition Closing Date. To the extent Genco Holdings has
received proceeds under the Overnight Bridge Loan prior to the Non-STP
Acquisition Closing, a portion of the Non-STP Consideration shall be paid

                                       8
<PAGE>

directly by Buyer to the lenders thereof to repay such borrowings and interest
thereon in full.

            (d) The parties have agreed in Schedule 2.3 hereto to the proposed
allocation of the Non-STP Consideration among the Non-STP Assets and Liabilities
as of the date hereof in accordance with section 1060 of the Code and the
regulations promulgated thereunder (the "1060 ALLOCATION"). Such 1060 Allocation
shall be amended by agreement of the parties on the Non-STP Acquisition Closing
Date to reflect any changes required by Section 1060 of the Code and the
regulations promulgated thereunder (such 1060 Allocation as amended, the "FINAL
1060 ALLOCATION"). The Final 1060 Allocation shall be used by CenterPoint and
Buyer in preparing Internal Revenue Service Form 8594, Asset Acquisition
Statement (which Form 8594 shall be completed, executed and delivered by such
parties as soon as practicable after the Non-STP Acquisition Closing Date but in
no event later than 15 days prior to the date such form is required to be
filed). CenterPoint and Buyer each shall file, or cause to be filed, Form 8594
prepared in accordance with this Section 2.3(d) with the U.S. federal income Tax
Returns for the taxable period which includes the Non-STP Acquisition Closing
Date. The Final 1060 Allocation shall be binding upon the parties hereto and
upon each of their successors and assigns, and the parties hereto shall report
for tax purposes the transactions contemplated by this Agreement in accordance
with such allocations.

            Section 2.4 Time and Place of Non-STP Acquisition Closing. Unless
this Agreement shall have been terminated and the transactions herein
contemplated shall have been abandoned pursuant to Section 10.1 and subject to
the satisfaction or waiver of the conditions set forth in Article VIII, the
closing of the Non-STP Acquisition (the "NON-STP ACQUISITION CLOSING") will take
place at the offices of Baker Botts L.L.P., One Shell Plaza, 910 Louisiana
Street, Houston, Texas 77002-4995 at 9:00 a.m. (local time) on the Non-STP
Acquisition Closing Date, or at such other date, place or time as CenterPoint
and the Buyer may agree.

            Section 2.5 STP Acquisition. On the terms and subject to the
conditions set forth in Article IX, and in accordance with the TBCA, at the STP
Acquisition Closing (as defined below), the parties hereto shall cause the STP
Acquisition to be consummated as follows:

            (a) STP Merger Sub shall be merged with and into Genco Holdings. As
a result of the STP Acquisition, the separate corporate existence of STP Merger
Sub shall cease and Genco Holdings shall survive the merger (sometimes
hereinafter referred to as the "STP SURVIVOR"). From and after the STP
Acquisition Effective Time (as defined below), the STP Acquisition shall have
the effects provided in Article 5.06A of the TBCA. All rights, titles and
interests to all properties owned by Genco Holdings and STP Merger Sub shall be
allocated to and vested in STP Survivor without reversion or impairment, without
further act or deed, and without any transfer or assignment having occurred, but
subject to any existing Liens thereon. All liabilities and obligations of Genco
Holdings and STP Merger Sub shall become liabilities and obligations of STP
Survivor.

                                       9
<PAGE>

            (b) As soon as practicable after the STP Acquisition Closing, the
parties shall cause the STP Acquisition to be consummated by filing articles of
merger (the "STP ARTICLES OF MERGER") with the Texas Secretary of State in such
form as is required by, and executed in accordance with, the relevant provisions
of the TBCA and shall make all other filings or recordings required under the
TBCA (the date and time of the issuance of a certificate of merger by the Texas
Secretary of State pursuant to Article 5.05 of the TBCA (or such later time as
is specified in the STP Articles of Merger) on the STP Acquisition Closing Date,
being the "STP ACQUISITION EFFECTIVE TIME").

            (c) Following the STP Acquisition Effective Time, the articles of
incorporation of Genco Holdings shall be the articles of incorporation of the
STP Survivor until thereafter changed or amended in accordance with the
provisions thereof and applicable Law. Following the STP Acquisition Effective
Time, the bylaws of Genco Holdings shall be the bylaws of the STP Survivor until
thereafter changed or amended in accordance with the provisions thereof and
applicable Law.

            (d) As of the STP Acquisition Effective Time, by virtue of the STP
Acquisition and without any action on the part of Genco Holdings, STP Merger Sub
or any holder of any shares of capital stock of Genco Holdings or any shares of
capital stock of STP Merger Sub:

                  (i) Each share of common stock of STP Merger Sub issued and
      outstanding immediately prior to the STP Acquisition Effective Time shall
      be converted into one validly issued, fully paid and non-assessable share
      of common stock, par value $.001 per share, of the STP Survivor.

                  (ii) The shares of capital stock in Genco Holdings issued and
      outstanding immediately prior to the STP Acquisition Effective Time shall,
      by virtue of the STP Acquisition and without any action on the part of the
      holder thereof, be converted into the right to receive total aggregate
      merger consideration of $700 million in cash without interest (the "STP
      CONSIDERATION") by wire transfer of immediately available funds to an
      account specified by Utility Holding to Buyer in writing at least two
      business days prior to the STP Acquisition Closing Date.

            Section 2.6 Time and Place of STP Acquisition Closing. Unless this
Agreement shall have been terminated and the transactions herein contemplated
shall have been abandoned pursuant to Section 10.1 and subject to the
satisfaction or waiver of the conditions set forth in Article IX, the closing of
the STP Acquisition (the "STP ACQUISITION CLOSING") will take place at the
offices of Baker Botts L.L.P., One Shell Plaza, 910 Louisiana Street, Houston,
Texas 77002-4995 at 9:00 a.m. (local time) on the fifth business day following
the date on which all of the conditions to each party's obligations set forth in
Article IX (other than those that by their nature are intended to be satisfied
at the STP Acquisition Closing) have been satisfied or waived, or at such other
date, place or time as CenterPoint and Buyer may agree. The date on which the
STP Acquisition Closing occurs, which shall be the date of the STP Acquisition
Effective Time, is referred to as the "STP ACQUISITION CLOSING DATE."

                                       10
<PAGE>

            Section 2.7 FIRPTA Certificate. At each of the STP Acquisition
Closing and the Non-STP Acquisition Closing, Parents shall deliver (or in the
case of the Non-STP Acquisition, shall cause Genco Holdings to deliver) a duly
executed and acknowledged certificate, in form and substance reasonably
acceptable to Buyer and in accordance with the Code and Treasury Regulations,
certifying Parents' non-foreign status as provided under Treasury regulation
Section 1.1445-2(b)(2).

            Section 2.8 Director and Officer Resignations. At or prior to the
STP Acquisition Closing, all the directors of Genco Holdings and its
subsidiaries shall deliver to Genco Holdings written resignations and all of the
officers of Genco Holdings and its subsidiaries shall deliver to Genco Holdings
written resignation, or CenterPoint shall cause such officers to be removed, in
each case, from their positions as directors or officers of Genco Holdings and
its subsidiaries, effective as of the STP Acquisition Closing.

                                  ARTICLE III

                  REPRESENTATIONS AND WARRANTIES OF CENTERPOINT

            CenterPoint represents and warrants to Buyer as follows:

            Section 3.1 Organization; Etc. Each of the Parents and Merger Sub
(a) is duly organized, validly existing and in good standing under the laws of
its jurisdiction of organization, (b) has all requisite corporate or limited
liability company power and authority, as applicable, to execute and deliver
this Agreement and all other agreements and instruments executed in connection
herewith or delivered pursuant hereto (including the Parent Written Consent), to
perform its obligations hereunder and to consummate the transactions
contemplated by this Agreement and (c) is duly qualified or licensed to do
business, and is in good standing in each jurisdiction in which the nature of
its business or the ownership, operation or leasing of its properties makes such
qualification or licensing necessary, except where the failure to be so
qualified or licensed would not reasonably be expected to, individually or in
the aggregate, have a Companies Material Adverse Effect.

            Section 3.2 Authority Relative to this Agreement. The execution,
delivery and performance of this Agreement and all other agreements and
instruments executed in connection herewith or delivered pursuant hereto
(including the Parent Written Consent) by the Parents and Merger Sub and the
consummation of the transactions contemplated by this Agreement and all other
agreements and instruments executed in connection herewith or delivered pursuant
hereto have been duly and validly authorized by all requisite corporate or
limited liability company action, as applicable, on the part of each of the
Parents and Merger Sub and no other corporate or similar actions or proceedings
on the part of either Parent is necessary to authorize the execution, delivery
and performance of this Agreement and all other agreements and instruments
executed in connection herewith or delivered pursuant hereto by each of the
Parents and Merger Sub or for the Parents or Merger Sub to consummate the
transactions so contemplated. This Agreement and all other agreements and
instruments executed in

                                       11
<PAGE>

connection herewith or delivered pursuant hereto (including the Parent Written
Consent) have been, or will be, duly and validly executed and delivered by each
of the Parents and Merger Sub and, with respect to this Agreement and any other
such agreement, assuming it has been duly authorized, executed and delivered by
any other party (other than Parents, Merger Sub and any of their affiliates
other than Genco Holdings and its controlled affiliates), constitutes, or will
constitute when executed, a valid and binding agreement of such Parent and
Merger Sub, enforceable against such Parent and Merger Sub in accordance with
its terms, except that (a) enforcement may be subject to any bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer or other laws, now
or hereafter in effect, relating to or limiting creditors' rights generally, and
(b) enforcement of this Agreement, including, among other things, the remedy of
specific performance and injunctive and other forms of equitable relief, may be
subject to equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought. Merger Sub was formed solely for the
purpose of engaging in the transactions contemplated hereby and has not engaged
in any business or conducted any operations other than in connection with the
transaction contemplated hereby.

            Section 3.3 Ownership of Shares

            (a) Except as set forth in Section 3.3(a) of the disclosure letter
delivered by Parents to Buyer concurrently with the execution hereof (the
"PARENTS DISCLOSURE LETTER"), (i) all the Shares are owned beneficially and of
record by Utility Holding free and clear of all Liens and (ii) all of the
membership interests of Utility Holding are owned beneficially and of record by
CenterPoint free and clear of all Liens. The Shares represent approximately
80.96% of the issued and outstanding Common Stock on a primary and fully diluted
basis.

            (b) Except as set forth in Section 3.3(b) of the Parents Disclosure
Letter, after giving effect to the Public Company Merger, Utility Holding will
own 100% of the outstanding capital stock of the Surviving Corporation, free and
clear of all Liens. After giving effect to the merger contemplated by the STP
Acquisition in Section 2.5(a), Buyer will own 100% of the outstanding capital
stock of the STP Survivor, free and clear of all Liens, other than Liens granted
by Buyer. After giving effect to the merger contemplated by the Non-STP
Acquisition in Section 2.3, Buyer will own 100% of the interests in Genco II LP
and 100% of the interests in Genco Services, in each case, free and clear of all
Liens, other than Liens granted by Buyer.

            Section 3.4 Consents and Approvals; No Violations. Except for the
Required Approvals (as defined in Section 4.5) or as set forth in Section 3.4 of
the Parents Disclosure Letter, none of the execution, delivery and performance
of this Agreement and any other agreements and instruments executed in
connection herewith or delivered pursuant hereto (including the Parent Written
Consent) by Parents, nor the consummation by Parents of the transactions
contemplated by this Agreement, will (a) conflict with, violate or result in any
breach of any provision of the certificate of formation, articles of
incorporation, regulations, bylaws or similar documents, as applicable, of
Parents, (b) result in a violation or breach of, or constitute (with or without
due notice or lapse of time or both) a default (or give rise to any right of
termination,

                                       12
<PAGE>

amendment, cancellation or acceleration or any right or obligation to purchase
or sell securities or assets) under, or require any consent or result in a
material loss of a material benefit to Parents under, any contract (written or
oral), obligation, plan, undertaking, arrangement, commitment, note, bond,
mortgage, indenture, agreement, lease, other instrument or Approval (as defined
below) (collectively, "CONTRACTS" and individually, a "CONTRACT") to which
either Parent is a party or by which any of them or any of their respective
businesses, properties or assets are bound, (c) violate any Permit that is
currently in effect applicable to either Parent or its business, properties or
assets, or (d) require any permit, license, authorization, certification,
tariff, consent, approval, concession or franchise from, action by, filing with
or notification to (collectively, "APPROVALS" and, individually, an "APPROVAL"),
any foreign, Federal, state, or local government or regulator or any court,
arbitrator, administrative agency, regional transmission organization, the ERCOT
Market independent system operator, or commission or other governmental,
quasi-governmental, taxing or regulatory (including a stock exchange or other
self-regulatory body) authority, official or agency (including a public utility
commission, public services commission or similar regulatory body), domestic,
foreign or supranational (a "GOVERNMENTAL AUTHORITY"), except in the case of
clauses (b), (c) and (d) of this Section 3.4, those which would not reasonably
be expected to, individually or in the aggregate, have a Companies Material
Adverse Effect, or which become applicable solely as a result of the business or
activities in which Buyer is engaged.

            Section 3.5 Affiliate Transactions. Except as set forth in Section
3.5 of the Parents Disclosure Letter or as disclosed in Genco Holding's proxy
statement relating to the election of directors dated April 23, 2004, there are
no Contracts or transactions between any Company, on the one hand, and any (A)
Parent or its controlled affiliates (other than the Companies), on the other
hand, other than any Contract or transaction entered into in the ordinary course
of business and on terms no less favorable than would have been reached on an
arm's-length basis that is not material to the Company, or (B) (i) officer or
director of any Parent or its affiliates or (ii) affiliate of any such officer
or director, on the other hand, in each case in this clause (B) other than any
Contract or transaction entered into in the ordinary course of business and on
terms no less favorable than would have been reached on an arm's-length basis or
that is not material to the Company (all Contracts and transactions, whether
entered into before or after the date hereof, referred to in clauses (A) or (B),
"PARENT AFFILIATE CONTRACTS"). True and complete copies of the Parent Affiliate
Contracts have been made available to Buyer.

            Section 3.6 Separation Transactions

            (a) The transactions contemplated by the Separation Agreement (the
"SPIN-OFF SEPARATION AGREEMENT") between CenterPoint and Genco Holdings dated
August 31, 2002, including the contribution and transfer by Parents and their
respective affiliates to the Companies of substantially all of the assets and
related liabilities associated with the Genco Business on such date (the
"SEPARATION TRANSACTIONS") have been consummated in all material respects as
described in the Spin-off Separation Agreement. Parents have made available to
Buyer a true and complete copy of the Spin-off Separation Agreement and all
other Contracts among Parents or their affiliates or any

                                       13
<PAGE>

of their respective predecessors (other than any Company) and any Company in
connection with the transactions contemplated by the Spin-off Separation
Agreement (collectively, the "SEPARATION DOCUMENTS"). Parents have made
available to Buyer a true and complete copy of the Master Separation Agreement
(the "MASTER SEPARATION AGREEMENT") between Reliant Energy, Incorporated and
Reliant Resources, Inc. ("RRI") dated December 31, 2000.

            (b) The execution, delivery and performance of the Separation
Documents by any of Parents and their respective affiliates (including the
Companies) party thereto, and the consummation of the transactions contemplated
thereby, were duly and validly authorized by all requisite action. Each of the
Separation Documents was duly and validly executed and delivered by Parents and
their respective affiliates (including the Companies) party thereto and
constitutes a valid and binding agreement of such parties, enforceable against
such persons in accordance with its terms, except that (a) enforcement may be
subject to any bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other laws, now or hereafter in effect, relating to or limiting
creditors' rights generally, and (b) enforcement, including, among other things,
the remedy of specific performance and injunctive and other forms of equitable
relief, may be subject to equitable defenses and to the discretion of the court
before which any proceeding therefor may be brought.

            Section 3.7 Brokers; Finders and Fees. Except for Citigroup Global
Markets Inc., whose fees will be paid by CenterPoint, neither of the Parents or
their respective affiliates (other than the Companies) has employed, engaged or
entered into a Contract with any investment banker, broker, finder, other
intermediary or any other person or incurred any liability for any investment
banking, financial advisory or brokerage fees, commissions, finders' fees or any
other fee in connection with this Agreement or the transactions contemplated by
this Agreement.

                                   ARTICLE IV

                REPRESENTATIONS AND WARRANTIES OF GENCO HOLDINGS

           Genco Holdings represents and warrants to Buyer as follows.

            Section 4.1 Organization; Etc. Each Company (a) is duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization, (b) has all requisite corporate, partnership or limited liability
company power and authority, as applicable, to own, lease and operate all of its
properties and assets and to carry on its business substantially as it is now
being conducted, and (c) is duly qualified or licensed to do business, and is in
good standing in each jurisdiction in which the nature of its business or the
ownership, operation or leasing of its properties makes such qualification or
licensing necessary, except where the failure to be so qualified or licensed
would not reasonably be expected to, individually or in the aggregate, have a
Companies Material Adverse Effect. As used in this Agreement, the term
"COMPANIES MATERIAL ADVERSE EFFECT" means any state of facts, change,
development, event, effect, condition or occurrence materially adverse to the
business, assets, properties, liabilities,

                                       14
<PAGE>

condition (financial or otherwise) or results of operations of the Companies
taken as a whole or that, directly or indirectly, prevents or materially impairs
or delays the ability of any of the Parents or Genco Holdings to perform its
obligations hereunder; provided, however, that (a) any adoption, implementation,
promulgation, repeal, modification, reinterpretation or proposal of any rule,
regulation, ordinance, order, protocol or any other Law of or by any national,
state or regional Governmental Authority (including, for the avoidance of doubt,
the ERCOT Market), (b) changes or developments in national, regional or state
wholesale or retail markets for fuel, including, without limitation, changes in
commodity prices, or related products, (c) changes or developments in national,
regional or state wholesale or retail electric power prices, (d) system-wide
changes or developments in national, regional or state electric transmission or
distribution systems, other than changes or developments involving physical
damage or destruction thereto, and (e) changes or developments in financial or
securities markets or the economy in general shall, in each case, be excluded
from such determination to the extent any such Laws, changes and developments do
not have a disproportionate effect on the Companies as compared to other
entities engaged in the power generation business in any of the relevant
geographic areas with respect to such Laws, changes or developments, as
applicable. In interpreting the definition of "Companies Material Adverse
Effect" with respect to plant outages, the parties agree that the effect of the
unplanned plant outages at the Companies from August 31, 2002 to March 31, 2004
did not in and of themselves have a Companies Material Adverse Effect after
taking into account all relevant facts and circumstances. Genco Holdings has
made available to Buyer a true and complete copy of the certificates of
incorporation and the bylaws (or similar organizational documents) of each of
the Companies, in each case as currently in effect. Genco Holdings has made
available to Buyer true and complete copies of the minutes of all meetings or
written consents of the shareholders (or other equityholders) and the boards of
directors (or similar body) and any committee thereof of each of the Companies
(and, to the extent applicable to the Genco Business, any affiliate of Parent
engaged in the Genco Business that transferred, directly or indirectly, assets
or liabilities to any Company in the Separation Transactions), in each case,
since January 1, 2001.

            Section 4.2 Authority Relative to this Agreement. The execution,
delivery and performance of this Agreement and all other agreements and
instruments executed in connection herewith or delivered pursuant hereto, by the
Companies and the consummation of the transactions contemplated by this
Agreement and all other agreements and instruments executed in connection
herewith or delivered pursuant hereto have been duly and validly authorized by
all requisite corporate, partnership or limited liability company action, as
applicable, on the part of the applicable Company and no other actions or
proceedings on the part of any Company is necessary to authorize the execution,
delivery and performance of this Agreement and all other agreements and
instruments executed in connection herewith or delivered pursuant hereto by any
Company or, upon delivery of the Parent Written Consent, to consummate the
transactions so contemplated. With the receipt of the Parent Written Consent, no
vote of the holders of any class or series of the capital stock of Genco
Holdings is necessary to approve this Agreement or to consummate the
transactions contemplated hereby (including the Public Company Merger). This
Agreement and all other agreements and instruments executed in connection
herewith or delivered pursuant hereto have been, or

                                       15
<PAGE>

will be, duly and validly executed and delivered by the applicable Company and,
with respect to this Agreement and any other such agreement, assuming it has
been duly authorized, executed and delivered by any other party (other than an
affiliate of Genco Holdings other than Parents), constitutes, or will constitute
when executed, a valid and binding agreement of such Company, enforceable
against such Company in accordance with its terms, except that a enforcement may
be subject to any bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other laws, now or hereafter in effect, relating to or limiting
creditors' rights generally, and (b) enforcement of this Agreement, including,
among other things, the remedy of specific performance and injunctive and other
forms of equitable relief, may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.

            Section 4.3 Capitalization.

            (a) The authorized capital stock of Genco Holdings consists of
160,000,000 shares of Common Stock and no preferred stock. Section 4.3(a) of the
disclosure letter delivered by Genco Holdings to Buyer concurrently with the
execution hereof (THE "COMPANIES DISCLOSURE LETTER") sets forth the name,
jurisdiction of incorporation or organization and capitalization of each
Company. As of the date hereof, Genco Holdings has (i) 80,000,000 shares of
Common Stock issued and outstanding and no other issued or outstanding shares of
capital stock and (ii) no shares of Common Stock are held in the treasury of
Genco Holdings. All outstanding shares of capital stock of or interests in each
Company are validly issued, fully paid and nonassessable, and owned by a Company
(except in the case of shares of Genco Holdings) free of preemptive (or similar)
rights and free and clear of any security interests, liens, claims, pledges,
Contracts, limitations in voting, dividend or transfer rights, charges or other
encumbrances of any nature whatsoever ("LIENS"), except as set forth in Section
4.3(a) of the Companies Disclosure Letter. As of the date hereof, except as set
forth in Section 4.3(a) of the Companies Disclosure Letter, there are not (A)
any capital stock or other equity interests or voting securities, in any Company
issued or outstanding, (B) any securities convertible into or exchangeable or
exercisable for shares of any capital stock or equity interests or voting
securities in any Company, (C) any subscriptions, options, warrants, calls,
rights, convertible securities or other Contracts or commitments of any
character obligating any Company to issue, transfer or sell any of its capital
stock or other equity interests or voting securities, or (D) equity equivalents,
interests in the ownership or earnings or similar rights, or any agreements,
arrangements or understandings granting any person any rights in any Company
similar to capital stock or other equity interests or voting securities (the
items in clauses (A), (B), (C) or (D), collectively, "COMPANY SECURITIES").
Except as set forth in Section 4.3(a) of the Companies Disclosure Letter, none
of the Parents and their respective affiliates (other than the Companies) owns
any Company Securities. There are no (1) outstanding obligations of any Company
to repurchase, redeem or otherwise acquire any Company Securities, (2) voting
trusts, proxies, registration rights agreements or other agreements or
understandings with respect to the voting, disposition, dividends or otherwise
or concerning any Company Securities to which the Companies or Parents are a
party or (3) outstanding obligations of any Company to provide funds to or make
any investment (in the form of a loan, capital contribution or otherwise) in any
other Company or any other person, including as a

                                       16
<PAGE>

result of the transactions contemplated by this Agreement. All dividends on the
Common Stock that have been declared or have accrued prior to the date of this
Agreement have been paid in full, and, as of the date of this Agreement, no
dividends have been declared since May 13, 2004.

            (b) No Company has any direct or indirect equity interest in any
person, other than another Company. None of the Companies own any capital stock
of Genco Holdings.

            (c) Section 4.3(c) of the Companies Disclosure Letter sets forth a
true and complete list of each Contract in effect on the date of this Agreement
pursuant to which any Indebtedness (as defined below) of any Company in excess
of $1,000,000 is outstanding or may be incurred, together with the amount
outstanding thereunder as of the date of this Agreement. No Contract pursuant to
which any Indebtedness of any Company is outstanding or may be incurred provides
for the right to vote (or is convertible into, or exchangeable for, securities
having the right to vote) on any matters on which the shareholders of any
Company may vote. "INDEBTEDNESS" means (A) indebtedness for borrowed money or
for the deferred purchase price of property or services (other than current
trade liabilities incurred in the ordinary course of business and payable in
accordance with customary practices), including indebtedness evidenced by a
note, bond, debenture or similar instrument, (B) obligations required to be
classified and accounted for as capital leases on a balance sheet under GAAP,
(C) obligations in respect of outstanding letters of credit, acceptances and
similar obligations created for the account of such person, (D) obligations
under interest rate cap agreements, interest rate swap agreements, foreign
currency exchange agreements and other hedging or similar agreements, (E) to the
extent not otherwise included in the foregoing, any financing of accounts
receivable or inventory and (F) guarantees of any of the foregoing of another
person. No event has occurred which either entitles, or could entitle (with or
without notice or lapse of time or both) the holder of any Indebtedness
described in Section 4.3(c) of the Companies Disclosure Letter to accelerate, or
which does accelerate, the maturity of any such Indebtedness.

            (d) No Company has in effect any stockholder rights plan or similar
device or arrangement, commonly or colloquially known as a "poison pill" or
"anti-takeover" plan, or any similar plan, device or arrangement (a "RIGHTS
PLAN"), and the board of directors of Genco Holdings has not adopted or
authorized the adoption of such a plan, device or arrangement.

            Section 4.4 Ownership of Shares, Company Securities. Except as set
forth in Section 4.4 of the Companies Disclosure Letter, all the Shares are
owned beneficially and of record by Utility Holding and beneficially by
CenterPoint free and clear of all Liens. The Shares represent approximately
80.96% of the issued and outstanding Common Stock on a primary and fully diluted
basis.

            Section 4.5 Consents and Approvals; No Violations. Except for
applicable requirements of the Hart-Scott-Rodino Antitrust Improvement Act of
1976, as amended (the "HSR ACT"), the filing with the SEC of the Information
Statement and a

                                       17
<PAGE>

Rule 13e-3 Transaction Statement pursuant to the applicable requirements of the
Exchange Act and the filing of applications for de-listing of the Common Stock
with the New York Stock Exchange (the "NYSE"), approval from the Nuclear
Regulatory Commission (the "NRC") of any indirect license transfer deemed to be
created by the STP Acquisition (the "NRC APPROVAL"), certification that Genco II
LP is an "exempt wholesale generator" ("EWG") as defined in Section 32 of the
Public Utility Holding Company Act of 1935 ("PUHCA") by the Federal Energy
Regulatory Commission ("FERC"), the filing of articles or certificates of
merger, as applicable, with the Secretary of State of the State of Texas with
respect to the Genco LP Division, the Genco II LP Acquisition, the Genco
Services Acquisition and the STP Acquisition or as set forth in Section 4.5 of
the Companies Disclosure Letter (collectively, the "REQUIRED APPROVALS"), none
of the execution, delivery and performance of this Agreement by Genco Holdings,
nor the consummation by Genco Holdings of the transactions contemplated by this
Agreement, will (a) conflict with, violate or result in any breach of any
provision of the certificate of formation, articles of incorporation,
regulations, bylaws or similar documents, as applicable, of any Company, (b)
result in a violation or breach of, or constitute (with or without due notice or
lapse of time or both) a default (or give rise to any right of termination,
amendment, cancellation or acceleration or any right or obligation to purchase
or sell securities or assets) under, or require any consent or result in a
material loss of a material benefit to the Companies under, any Contract to
which any Company is a party or by which any Company or its businesses,
properties or assets are bound, (c) violate any Order, writ, injunction, decree,
statute, rule or regulation (collectively, "LAWS," and individually, a "LAW") or
Permit applicable to any Company or any of its businesses properties or assets,
or (d) require any Approval from, by or to any Governmental Authority, except in
the case of clauses (b), (c) and (d) of this Section 4.5 for those which would
not reasonably be expected to, individually or in the aggregate, have a
Companies Material Adverse Effect, or which become applicable solely as a result
of the business or activities in which Buyer is engaged.

            Section 4.6 Reports and Financial Statements.

            (a) Since the date Genco Holdings' registration statement on Form 10
was declared effective by the Securities and Exchange Commission (the "SEC")
(December 11, 2002), Genco Holdings and, to the extent applicable, each of the
other Companies, has timely filed (i) with the SEC all forms, reports,
schedules, statements, registration statements and definitive proxy statements
(all such filings, including such registration statement on Form 10, the "GENCO
SEC REPORTS") required to be filed by the Companies under each of the Securities
Act of 1933, as amended, and the respective rules and regulations thereunder
(the "SECURITIES ACT") and the Securities Exchange Act of 1934, as amended, and
the respective rules and regulations thereunder (the "EXCHANGE ACT"), and (ii)
with the SEC, the NRC, the Public Utility Commission of Texas (the "PUC") and
any other Governmental Authority with jurisdiction all material forms, reports,
schedules, registrations, declarations and other filings required to be filed by
it under all applicable Laws, including PUHCA, the Atomic Energy Act of 1954
("AEA") and the Texas Public Utility Regulatory Act, and the respective rules
and regulations thereunder ("PURA"), all of which, as amended if applicable,
complied in all material respects with all applicable requirements of the
appropriate act and the rules and

                                       18
<PAGE>

regulations promulgated thereunder. As of their respective dates the Genco SEC
Reports (including exhibits and all other information incorporated by reference
thereto) did not contain any untrue statement of a material fact or omit to
state a material fact required to be stated or incorporated by reference therein
or necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading. Each of the audited and unaudited
consolidated financial statements (including any related notes) of Genco
Holdings included in the Genco SEC Reports (including exhibits and all other
information incorporated by reference thereto), including its Annual Report on
Form 10-K for the year ended December 31, 2003 (the "GENCO HOLDINGS 10-K") when
filed, complied in all material respects with all applicable accounting
requirements and with the published rules and regulations of the SEC with
respect thereto, was prepared from, and is in accordance with, the books and
records of the Companies, which books and records have been maintained, and
which financial statements were prepared, in accordance with United States
generally accepted accounting principles ("GAAP") (except, in the case of
unaudited quarterly statements, as permitted by Form 10-Q of the SEC) applied on
a consistent basis throughout the periods involved (except as may be indicated
therein or in the notes thereto) and fairly presented in all material respects
the financial position of Genco Holdings and its subsidiaries as of the dates
thereof and the results of their operations, cash flows and changes in financial
position for the periods reported (subject, in the case of unaudited quarterly
statements, to normal year-end audit adjustments that are immaterial to the
Companies as a whole). All of the Companies are consolidated for accounting
purposes.

            (b) Section 4.6(b) of the Companies Disclosure Letter contains true
and complete copies of the audited balance sheet for South Texas Project, as of
December 31, 2003, December 31, 2002 and December 31, 2001, and the audited
statement of income of South Texas Project for the fiscal years ended December
31, 2003, December 31, 2002 and December 31, 2001 (collectively, the "STP
FINANCIAL STATEMENTS"). Each of the STP Financial Statements was prepared from,
and is in accordance with, the books and records of South Texas Project, which
books and records have been maintained, and which financial statements were
prepared, in accordance with GAAP applied on a consistent basis throughout the
periods involved (except as may be indicated therein or in the notes thereto)
and, as of their respective dates, fairly presented in all material respects the
financial position of South Texas Project as of the dates thereof and the
results of their operations, cash flows and changes in financial position for
the periods reported.

            (c) The management of Genco Holdings has (i) implemented disclosure
controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act)
intended to ensure that material information relating to the Companies is timely
made known to the management of Genco Holdings by others within those entities,
and (ii) has disclosed, based on its most recent evaluation, to Genco Holdings'
outside auditors and the audit committee of board of directors of Genco Holdings
(A) all significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting (as defined in Rule
13a-15(f) of the Exchange Act) which could adversely affect Genco Holdings'
ability to record, process, summarize and report financial information on a
timely basis and (B) any fraud, whether or not material, that

                                       19
<PAGE>

involves management or other employees who have a significant role in Genco
Holdings' internal control over financial reporting. A summary of any such
disclosure made by management to Genco Holdings' auditors and audit committee
has been made available to Buyer.

            Section 4.7 Absence of Undisclosed Liabilities. Except (a) for
liabilities and obligations incurred in the ordinary course of business and
consistent with past practice since March 31, 2004, or (b) as otherwise
disclosed in the audited financial statements included in the Genco Holdings
10-K or reflected in the notes thereto, in the unaudited interim financial
statements included in Genco Holding's Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2004 or reflected in the notes thereto, or in
Section 4.7 of the Companies Disclosure Letter, no Company has incurred any
liabilities, debts or obligations of any nature (whether direct, indirect,
accrued, asserted, unasserted, contingent, known or unknown, determined or
determinable, matured or unmatured or otherwise) in excess of $10,000,000,
individually or in the aggregate, that would be required to be reflected or
reserved against in the consolidated balance sheet of Genco Holdings, or in the
notes thereto, prepared in accordance with GAAP as used in preparing the
December 31, 2003 balance sheet included in the audited financial statements in
the Genco Holdings 10-K.

            Section 4.8 Absence of Certain Changes. Except as set forth in
Section 4.8 of the Companies Disclosure Letter or disclosed in the Genco SEC
Reports filed and publicly available prior to the date of this Agreement, since
December 31, 2003 and until the date of this Agreement, the Companies have
conducted their businesses only in the ordinary course and in a manner
consistent with past practice, and since such date there has not been any state
of facts, change, development, event, effect, condition or occurrence that has
or would reasonably be expected to, individually or in the aggregate, have a
Companies Material Adverse Effect. Since December 31, 2003, except as (i)
specifically contemplated by this Agreement, (ii) disclosed in the Genco SEC
Reports filed and publicly available prior to the date of this Agreement or
(iii) set forth in Section 4.8 of the Companies Disclosure Letter, there has not
occurred any action, development, event or occurrence or failure to act that, if
it had occurred after the date of this Agreement, would have required the
consent of Buyer under Section 6.1.

            Section 4.9 Litigation. Except as set forth in Section 4.9 of the
Companies Disclosure Letter, there is no litigation, suit, claim, action,
administrative, arbitral or other proceeding, inquiry, audit, hearing petition,
grievance, complaint or governmental or regulatory investigation (each an
"ACTION") pending or, to the knowledge of the Companies, threatened against any
Company, nor are there any outstanding Orders that affect or bind any Company or
its businesses, properties or assets that would reasonably be expected to,
individually or in the aggregate, have a Companies Material Adverse Effect.

            Section 4.10 Compliance with Law.

            (a) Each Company is, and since December 31, 2001, each Company (and
to the extent related to the Genco Business, any affiliate of a Parent
previously

                                       20
<PAGE>

engaged in the Genco Business that transferred directly or indirectly, assets or
liabilities to any Company in the Separation Transaction) has been in compliance
with all applicable Law and none of the Companies has received any notice
(including through any Action), and there has been no Action filed, commenced
or, to the knowledge of the Companies, threatened against any Company, alleging
any violation of Law, except for any noncompliance or violation that would not
reasonably be expected to, individually or in the aggregate, have a Companies
Material Adverse Effect.

            (b) Except as would not reasonably be expected to, individually or
in the aggregate, have a Companies Material Adverse Effect, (1) the Companies
hold all Approvals, authorizations, certificates, licenses, consents and permits
of Governmental Authorities ("PERMITS") necessary for the Companies to own,
lease and operate their respective properties and assets and to carry on their
respective businesses as currently conducted, and (2) all such Permits are in
full force and effect. Except as would not reasonably be expected to,
individually or in the aggregate, have a Companies Material Adverse Effect, (1)
there has occurred no breach of or default under (with or without notice or
lapse of time or both) any such Permit, and none of the Companies has received
any notice (including through any Action), and (2) to the knowledge of any
Company, there has been no Action filed, commenced or threatened against it,
alleging any such breach or default or otherwise seeking to revoke, terminate,
suspend or modify any Permit or impose any fine, penalty or other sanctions for
violation of any Laws relating to any Permit.

            Section 4.11 Employee Benefit Plans

            (a) Section 4.11(a)(i) of the Companies Disclosure Letter sets
forth, a true and complete list of all "employee benefit plans" (within the
meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), including multi-employer plans within the meaning of
Section 3(37) of ERISA, and all stock purchase, stock option, employment,
change-in-control, collective bargaining, incentive, employee loan, deferred
compensation, pension, profit-sharing, retirement, bonus, retention bonus,
severance and other employee benefit or fringe benefit plans, agreements,
programs, policies or other arrangements, whether or not subject to ERISA
(including any funding mechanism therefor now in effect or required in the
future as a result of the transaction contemplated by this Agreement or
otherwise), whether formal or informal, oral or written, legally binding or not,
under which (i) any current or former employee, director or consultant of any
Company (the "COMPANY EMPLOYEES") has any present or future right to benefits
and which are maintained or sponsored by or with respect to which contributions
are made by any Company, Parent or any subsidiary of a Parent, in any such case,
for the benefit of Company Employees, or (ii) any Company has had or has any
present or future liability (collectively, the "PLANS" and individually, the
"PLAN"). Section 4.11(a)(ii) of the Companies Disclosure Letter identifies each
Plan that is sponsored, established, maintained or contributed to solely by any
Company, or to which solely the Companies are required to contribute or under
which any of the Companies has any liability (collectively, the "COMPANY PLANS"
and individually, the "COMPANY PLAN"). With respect to each Plan, Genco Holdings
has made available to Buyer true and complete copies of (i) the most recent Plan
documents and any

                                       21
<PAGE>

amendments thereto, (ii) the most recent summary plan description and all
related summaries of material modifications, and (iii) for any Plan intended to
be qualified under Section 401(a) of the Internal Revenue Code of 1986, as
amended (the "CODE"), other than the TGN Retirement Plan and the TGN Savings
Plan, as defined in Section 6.8(e) of this Agreement, a copy of the most recent
favorable determination letter received from the Internal Revenue Service (the
"IRS"), and (iv) for the three most recent years (A) the annual report on Form
5500 filed with the IRS, (B) audited financial statements, and (C) actuarial
valuation reports (and, with respect to any Plan other than a Company Plan, such
actuarial valuation separately indicates the valuation of the Plan liabilities
to the Company Employees and a current statement of assets underlying such
liabilities).

            (b) All Plans and their related trusts have been and are, in all
material respects, maintained in accordance with each such Plan's terms and in
operation in compliance with applicable requirements of ERISA, the Code, and all
other applicable Law. Each Plan intended to be "qualified" within the meaning of
Section 401(a) of the Code is so qualified and, other than the TGN Retirement
Plan and the TGN Savings Plan, as defined in Section 6.8(e) of this Agreement,
has been determined to be so qualified by the IRS and, to the knowledge of the
Companies, there are no facts which would adversely affect the qualified status
of any such Plan. Except as would not reasonably be expected, individually or in
the aggregate, to have a Companies Material Adverse Effect, no event has
occurred and no condition exists that would subject any of the Companies, the
Parents or Buyer, either directly or by reason of the Companies' or the Parents'
affiliation with any ERISA Affiliate (as defined below), to any tax, fine, Lien,
penalty or other liability imposed by ERISA, the Code or other applicable Law.
For each Plan with respect to which a Form 5500 has been filed, no material
change has occurred with respect to the matters covered by the most recent Form
since the date thereof. Except as otherwise contemplated by this Agreement,
there is no present intention that any Plan be materially amended, suspended or
terminated, or otherwise modified to adversely change benefits (or the levels
thereof) under any Plan at any time within the 12 months immediately following
the date of this Agreement.

            (c) No Plan or employee pension plan within the meaning of Section
3(2) of ERISA ("EMPLOYEE PENSION BENEFIT PLAN") maintained by any of the
Companies, Parents, or any entity that is required to be treated as a single
employer together with the Companies or Parents under Section 414 of the Code
("ERISA AFFILIATE") that is subject to Section 412 of the Code has had an
"accumulated funding deficiency" (as such term is defined in Section 412 of the
Code and in Section 303 of ERISA), that remains unsatisfied, whether or not
waived, and no unsatisfied liability to the Pension Benefit Guaranty Corporation
("PBGC") has been incurred with respect to any such plan by any Company.

            (d) None of the Companies, Parents or any ERISA Affiliate
contributes to, has at any time within the last ten years had an obligation to
contribute to, or has or had any liability (including withdrawal liability as
defined in Section 4201 of ERISA) under, or with respect to, any multiemployer
plan within the meaning of Section 3(37) of ERISA that remains unsatisfied.

                                       22
<PAGE>

            (e) The requirements of Part 6 of Subtitle B of Title I of ERISA and
Code Section 4980B ("COBRA") have been complied with in all material respects by
each such Plan that is an employee welfare benefit plan, within the meaning set
forth in Section 3(1) of ERISA ("EMPLOYEE WELFARE BENEFIT PLAN"), subject to
COBRA. Except as set forth in Section 4.11(e) of the Companies Disclosure
Letter, none of the Companies or Parents has incurred any current or projected
liability in respect of post-employment or post-retirement health, medical or
life insurance benefits for current, former or retired employees of any of the
Companies, except as required to avoid an excise tax under Section 4980B of the
Code or otherwise except as may be required pursuant to any other applicable
Law.

            (f) Except as set forth in Section 4.11(f) of the Companies
Disclosure Letter, (i) no such Plan that is an Employee Pension Benefit Plan has
been completely or partially terminated or been the subject of a Reportable
Event within the meaning of Section 4043 of ERISA during the six years preceding
the Non-STP Acquisition Closing Date, and (ii) no proceeding by the PBGC to
terminate any such Employee Pension Benefit Plan has been instituted or
threatened and (iii) no administrative investigation, audit or other
administrative proceeding by the Department of Labor, the PBGC, the IRS or other
governmental agencies are pending, threatened or in progress (including any
routine requests for information from the PBGC).

            (g) With respect to each Plan (i) there has been no prohibited
transaction within the meaning of Section 406 of ERISA and Section 4975 of the
Code, and no fiduciary within the meaning of Section 3(21) of ERISA has any
material liability for breach of fiduciary duty or any other failure to act or
comply in connection with the administration or investment of the assets of any
such Plan, and (ii) except as set forth in Section 4.11(g) of the Companies
Disclosure Letter, no Action involving any Plan (other than routine claims for
benefits) is pending or threatened, and, to the knowledge of the Companies or
employees of the Companies with responsibility for employee benefits matters,
there is no basis for any such Action.

            (h) Except as set forth in Section 4.11(h) of the Companies
Disclosure Letter, no Plan is a split-dollar life insurance program or provides
for loans to executive officers of the Companies (within the meaning of the
Sarbanes-Oxley Act of 2002).

            (i) Except as set forth in Section 4.11(i) of the Companies
Disclosure Letter, no Plan exists that, as a result of the execution of this
Agreement, shareholder approval of this Agreement or the transactions
contemplated by this Agreement (whether alone or in connection with any
subsequent event(s)), could (i) entitle any Company Employee to severance pay or
any increase in severance pay upon any termination of employment after the date
of this Agreement, (ii) accelerate the time of payment or vesting or result in
any payment or funding (through a grantor trust or otherwise) of compensation or
benefits under, increase the amount payable or result in any other material
obligation pursuant to, any of the Plans, (iii) limit or restrict the right of
any Company to merge, amend or terminate any of the Plans, (iv) cause any
Company to record additional compensation expense on its income statement with
respect to any

                                       23
<PAGE>

outstanding stock option or other equity-based award, or (v) result in payments
under any of the Plans which would not be deductible under Section 280G of the
Code.

            Section 4.12 Labor and Employment Matters. Except as set forth in
Section 4.12 of the Companies Disclosure Letter, as of the date of this
Agreement there are no collective bargaining agreements or other labor Contracts
relating to any Company or covering any Company Employee to which any Company is
a party or by which it is bound, and, except as would not reasonably be
expected, individually or in the aggregate, to have a Companies Material Adverse
Effect, there are no (a) Actions or Orders pending or, to the knowledge of any
Company, threatened, in each case relating to Company Employees or employment
practices or asserting that any Company has committed an unfair labor practice
or is seeking to compel any Company to bargain with any labor union or labor
organization, (b) pending or, to the knowledge of any Company, threatened labor
strikes or other labor troubles affecting any Company, (c) labor strikes,
disputes, walk-outs, work stoppages, slow-downs, lockouts, arbitrations or
grievances involving any Company (and there has been none with respect to any
Company or the Genco Business in the last five years), (d) representation
questions respecting any of the Company Employees (and there has been none with
respect to any Company or the Genco Business in the last five years), (e) to the
knowledge of any Company, campaigns conducted to solicit cards from Company
Employees to authorize representation by a labor organization or (f) unfair
labor practices committed by the Companies or their employees. Except as would
not reasonably be expected, individually or in the aggregate, to have a
Companies Material Adverse Effect, each Company is in compliance in all respects
with all collective bargaining agreements and all applicable Laws regarding
employment and employment practices, terms and conditions of employment, wages
and hours and occupational safety and health.

            Section 4.13 Taxes. Except as set forth in Section 4.13 of the
Companies Disclosure Letter:

            (a) With respect to each Company, (i) all material Tax Returns
required to be filed have been or will be timely filed in accordance with any
applicable Laws and all such Tax Returns are or will be true and complete in all
material respects, and (ii) all Taxes due have been or will be paid (whether or
not such Taxes are shown as being due on any Tax Returns).

            (b) With respect to each Company, (i) there is no material action,
suit, proceeding, audit, written claim or assessment pending or proposed with
respect to Taxes or with respect to any Tax Return, (ii) there are no waivers or
extensions of any applicable statute of limitations for the assessment or
collection of Taxes with respect to any Tax Return which remain in effect, and
(iii) there are no material Liens for Taxes upon the assets of any Company,
except for Liens for Taxes not yet due and payable or Liens for Taxes being
contested in good faith through appropriate proceedings and for which adequate
reserves have been maintained in accordance with GAAP.

            (c) Genco Holdings is and will be a member of an affiliated group
filing a consolidated federal income tax return of which CenterPoint is the
common

                                       24
<PAGE>

parent. None of the Companies (i) is currently or has ever been a member of an
affiliated group (other than a group the common parent of which is CenterPoint
or any Company) filing a consolidated federal income Tax Return or (ii) has any
liability for the Taxes of any person (other than the affiliated group of which
CenterPoint is the common parent) under Treasury Regulations Section 1.1502-6
(or any similar provision of state, local or foreign Laws), or as a transferee
or successor, by contract or otherwise.

            (d) None of the Companies is a party to, bound by or has any
obligation under, any Tax sharing, Tax indemnity or similar contract with a
party that is not a member of the affiliated group of which CenterPoint is the
common parent.

            (e) Each Company has withheld and paid over all Taxes required to
have been withheld and paid over, and complied in all respects with all
information reporting requirements, in connection with amounts paid or owing to
any employee, creditor, independent contractor or other third party.

            (f) No property of any Company is property that any Company or any
party to this transaction is or will be required to treat as being owned by
another person pursuant to the provisions of Code Section 168(f)(8) (as in
effect prior to its amendment by the Tax Reform Act of 1986) or is "tax exempt
use property" within the meaning of Code Section 168(h).

            (g) None of the Companies has been a party to any distribution
occurring during the last two years in which the parties to such distribution
treated the distribution as one to which Section 355 of the Code is applicable.

            (h) No actions have been taken by Parents or any of their affiliates
that would reasonably be expected to, individually or in the aggregate, have
jeopardized the qualification of the interest as tax-exempt on any tax-exempt
bonds that relate to any assets of the Companies.

            (i) None of the Companies is required to include amounts in income,
or exclude items of deduction, in a taxable period beginning after the STP
Acquisition Closing Date (a "POST-CLOSING TAX PERIOD") as a result of (i) a
change in method of accounting, (ii) a closing agreement as described in section
7121 of the Code (or corresponding or similar provision of state, local or
foreign Tax Laws), (iii) an installment sale or open transaction arising in a
taxable period ending on or before the STP Acquisition Closing Date (a
"PRE-CLOSING TAX PERIOD"), (iv) a prepaid amount received, or paid, in a
Pre-Closing Tax Period or (v) deferred gains that could be recognized in a
Post-Closing Tax Period.

            (j) None of the Companies has engaged in any "reportable
transactions" within the meaning of Treas. Reg. Section 1.6011-4(b).

            (k) All assets that are owned by each Company and required to be
listed on the property tax rolls have been properly listed and described on the
property tax rolls for 2004 and all Pre-Closing Tax Periods and no portion of
each Company's assets constitutes omitted property for property tax purposes.

                                       25
<PAGE>

            (l) Genco Holdings does not hold an interest in any entity treated
as a corporation or partnership for federal income tax purposes and all of the
Companies (other than Genco Holdings) are treated as disregarded entities for
federal income tax purposes.

            Section 4.14 Title, Ownership and Related Matters. Each Company has
good title to, or rights by license, lease or other agreement to use, all
properties and assets (or rights thereto) (other than cash, cash equivalents and
securities and except as contemplated in this Agreement) necessary to permit
each Company to conduct its business as currently conducted, except as set forth
in Section 4.14 of the Companies Disclosure Letter or otherwise where the
failure to have such title or rights would not reasonably be expected to,
individually or in the aggregate, have a Companies Material Adverse Effect.
Without limiting the generality of the foregoing:

            (a) Section 4.14(a)(i) of the Companies Disclosure Letter lists and
identifies the owner of all material real property and material interests in
real property owned by each Company (such real property and interests in real
property, together with (A) all the buildings, improvements, structures and
fixtures now or subsequently located on the fee property owned by each Company
(excluding those structures and fixtures for which title was retained by RRI in
the vesting deeds ("RRI RETAINED STRUCTURES"), and (B) such buildings,
improvements, structures and fixtures now or subsequently located on the
property a non-fee interest in which is owned by each Company that were either
(i) conveyed to such Company by RRI in the vesting deed or easement or (ii)
built by or for such Company or its predecessors (excluding RRI Retained
Structures) (collectively, the "OWNED REAL PROPERTY"). For purposes of this
Section 4.14(a) only, each Company's "predecessors" shall include Genco
Holdings, CenterPoint, Reliant Energy, Incorporated, Houston Lighting & Power
Company and all other predecessors in title of each such entity with respect to
the Real Property. The "ENERGY DEVELOPMENT CENTER" means the tract of land
identified in paragraph (Q) of Section 4.14(a)(i) of the Companies Disclosure
Letter and all the buildings, improvements, structures and fixtures now or
subsequently located thereon. Section 4.14(a)(ii) of the Companies Disclosure
Letter lists all agreements other than easements or rights of way (together with
any amendments, modifications or supplements thereto, the "LEASES") pursuant to
which any Company leases, subleases, licenses or otherwise occupies (whether as
landlord, tenant, subtenant or other occupancy arrangement) any real property or
interest in real property that is material to the Genco Business taken as a
whole (collectively, the "LEASED REAL PROPERTY", together with the Owned Real
Property, the "REAL PROPERTY") and identifies the Company party thereto. With
respect to each of the Real Property and except as would not reasonably be
expected to, individually or in the aggregate, have a Companies Material Adverse
Effect:

                  (i) the identified owner of each parcel of Owned Real Property
      has good, valid and indefeasible fee simple title to the Owned Real
      Property that consists of fee property as contrasted with some lesser
      estate therein, and the identified owner of each parcel of Owned Real
      Property that does not consist of fee property has good title to such
      Owned Real Property, free and clear of all Liens other than (A) Liens for
      current taxes and assessments not yet due and

                                       26
<PAGE>

      payable, (B) inchoate mechanics' and materialmen's Liens for construction
      in progress, (C) workmen's, repairmen's, warehousemen's and carriers'
      Liens arising in the ordinary course of business of the Companies
      consistent with past practice, and (D) all Liens and other imperfections
      of title and encumbrances which would not reasonably be expected to
      materially interfere with the conduct of the Genco Business, taken as a
      whole (collectively, "PERMITTED LIENS");

                  (ii) each Leased Real Property is held subject to a Lease that
      is a valid and subsisting agreement in full force and effect and
      constitutes a valid and binding obligation of, and is legally enforceable
      against, the respective parties thereto and each Company, as applicable,
      has good and valid title to the leasehold estate in the Leased Real
      Property, free and clear of any Liens other than Permitted Liens;

                  (iii) there are no pending or, to the knowledge of the
      Companies, threatened condemnation, expropriation or taking proceedings
      against the Real Property; and

                  (iv) there are no outstanding options or rights of first
      refusal to purchase or lease the Real Property, or any portion thereof or
      interest therein.

            (b) Section 4.14(b) of the Companies Disclosure Letter sets forth a
true and complete list of all material real property or material interests in
real property sold, leased, transferred or disposed of since August 31, 2002.

            (c) Except as would not reasonably be expected to, individually or
in the aggregate, have a Companies Material Adverse Effect, (1) all of the
Companies' properties, rights and assets are in good operating condition and
repair, subject to continued repair and replacement consistent with past
practice, and (2) there are no structural defects in any such properties, rights
and assets.

            Section 4.15 Environmental. Except as set forth in Section 4.15 of
the Companies Disclosure Letter, or as would not reasonably be expected to,
individually or in the aggregate, have a Companies Material Adverse Effect:

            (a) The Companies are in compliance with all applicable
Environmental Laws, and no Company or Parent has received any written
communication from any Governmental Authority that alleges that any of the
Companies (or, to the extent applicable to the Genco Business, any affiliate of
Parents previously engaged in the Genco Business that transferred, directly or
indirectly, assets or liabilities to any Company in the Separation Transactions)
is not in compliance with applicable Environmental Laws;

            (b) Each Company has obtained and possesses all environmental,
health and safety Permits, including all air emissions allowances and water
rights (collectively, the "ENVIRONMENTAL PERMITS") necessary for the
construction and operation of its facilities or the conduct of its business, and
all such Environmental Permits are in good standing or, where applicable, a
renewal application has been timely

                                       27
<PAGE>

filed and is pending approval by any Governmental Authority, and the Companies
are in compliance with all terms and conditions of the Environmental Permits.

            (c) There is no Environmental Claim (as defined below) (i) pending
or, to the knowledge of the Companies, threatened against any Company or (ii) to
the knowledge of the Companies, pending or threatened against any real or
personal property or operations that any Company owns, leases or uses, in whole
or in part, including any off-site facility used by any Company for the
treatment, storage and disposal of any Hazardous Substance.

            (d) To the knowledge of the Companies, there has been no Release (as
defined below) of any Hazardous Substance (as defined below) that has formed or
would reasonably be expected to form the basis of (i) any Environmental Claim
against any Company or against any person (including any predecessor of the
Companies) whose liability for such claim the Companies has or may have retained
or assumed, either by operation of Law or by Contract, or (ii) any requirement
on the part of any Company to undertake Remedial Action.

            (e) To the knowledge of the Companies, each Company has disclosed to
Buyer all facts which such Company reasonably believes forms the basis of (i)
any Environmental Claim against any such Company or (ii) any obligation of any
such Company currently required, or known to be required in the future, to incur
costs for pollution control equipment or environmental remediation under, or
otherwise to comply with, applicable Environmental Laws.

            For purposes of this Agreement:

            "ENVIRONMENTAL CLAIM" means any and all Actions, demands, demand
      letters, directives, Liens or notices of noncompliance or violation by any
      person (including any Governmental Authority) alleging potential liability
      (including potential responsibility for or liability for enforcement
      costs, investigatory costs, cleanup costs, governmental response costs,
      removal costs, remedial costs, natural-resources damages, property
      damages, personal injuries, fines or penalties) arising out of, based on
      or resulting from (A) the presence, or Release or threatened Release into
      the environment, of any Hazardous Substances at any location, whether or
      not owned, operated, leased or managed by the Companies or joint ventures;
      (B) circumstances forming the basis of any violation, or alleged
      violation, of any Environmental Law; or (C) any and all Actions by any
      third party seeking damages, contribution, indemnification, cost recovery,
      compensation or injunctive relief resulting from the presence or Release
      of any Hazardous Substances;

            "ENVIRONMENTAL LAW" means all Laws relating to pollution, the
      environment (including ambient air, surface water, groundwater, land
      surface or subsurface strata) or protection of human health and safety as
      it relates to the environment, including Laws relating to Releases or
      threatened Releases of any Hazardous Substance, or otherwise relating to
      the manufacture, processing,

                                       28
<PAGE>

      distribution, use, treatment, storage, disposal, transport or handling of
      any Hazardous Substance including the Comprehensive Environmental
      Response, Compensation, and Liability Act ("CERCLA") (42 U.S.C. Section
      9601 et seq.), the Hazardous Materials Transportation Act (49 U.S.C.
      Section 1801 et seq.), the Resource Conservation and Recovery Act (42
      U.S.C. Section 6901 et seq.), the Clean Water Act (33 U.S.C. Section 1251
      et seq.), the Clean Air Act (33 U.S.C. Section 7401 et seq.), the Toxic
      Substances Control Act (15 U.S.C. Section 7401 et seq.), the Federal
      Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. Section 136 et
      seq.), and the Occupational Safety and Health Act (29 U.S.C. Section 651
      et seq.) ("OSHA") and the regulations promulgated pursuant thereto, and
      any such applicable state or local statutes, and the regulations
      promulgated pursuant thereto, as such Laws have been and may be amended or
      supplemented to the date of this Agreement;

            "HAZARDOUS SUBSTANCE" means any substance listed, defined or
      classified as hazardous, toxic or radioactive pursuant to any applicable
      Environmental Law, including petroleum and any derivative or by-product
      thereof, and any other substance regulated pursuant to, or the presence or
      exposure to which may form the basis for liability under, any applicable
      Environmental Law;

            "RELEASE" means any spilling, emitting, leaking, pumping, pouring,
      emptying, injecting, escaping, dumping, disposing, discharging, or
      leaching into the environment, or into or out of any property owned,
      operated or leased by the applicable party; and

            "REMEDIAL ACTION" means all actions, including any capital
      expenditures, required by a governmental entity or required under any
      Environmental Law, or voluntarily undertaken to (a) clean up, remove,
      treat, or in any other way ameliorate or address any Hazardous Substance
      in the environment; (b) prevent the Release or threat of Release, or
      minimize the further Release of any Hazardous Substance so it does not
      endanger or threaten to endanger the public health or welfare of the
      indoor or outdoor environment; (c) perform pre-remedial studies and
      investigations or post-remedial monitoring and care pertaining or relating
      to a Release; or (d) bring the applicable party into compliance with any
      Environmental Law.

            Section 4.16 Brokers; Finders and Fees

            (a) Except for RBC Capital Markets Corporation, whose fees will be
paid by Genco Holdings, none of the Companies and their respective controlled
affiliates has employed, engaged or entered into a Contract with any investment
banker, broker, finder, other intermediary or any other person or incurred any
liability for any investment banking, financial advisory or brokerage fees,
commissions, finders' fees or any other fee in connection with this Agreement or
the transactions contemplated by this Agreement.

            (b) Set forth in Section 4.16(b) of the Companies Disclosure Letter
is the Genco Holdings' reasonable estimate of the fees and expenses incurred or
payable, or

                                       29
<PAGE>

to be incurred or payable, by any Company in connection with this Agreement and
the consummation of the transactions contemplated hereby.

            Section 4.17 Texas Business Combination Law. Genco Holdings validly
elected in its original bylaws not to be governed by Part Thirteen of the TBCA
such that Part Thirteen of the TBCA would not apply to the Public Company Merger
and the other transactions contemplated hereby.

            Section 4.18 Intellectual Property. Except as set forth in Section
4.18 of the Companies Disclosure Letter, or as would not reasonably be expected
to, individually or in the aggregate, have a Companies Material Adverse Effect:
(i) the Companies own or have the valid right to use all the Intellectual
Property necessary or desirable to conduct their businesses as currently
conducted and consistent with past practice free and clear of all Liens; (ii)
the Company IP is valid, enforceable and unexpired, has not been abandoned, and
does not infringe, impair, misappropriate, dilute, make unauthorized use of, or
otherwise violate ("INFRINGE") the Intellectual Property of any third party and
is not being Infringed by any third party; (iii) no Action or Order is
outstanding or pending, or to the knowledge of the Companies, threatened that
seeks to cancel, limit or challenge the ownership, use, value, validity or
enforceability of any Company IP, and to the knowledge of the Companies, there
is no valid basis for same; (iv) each Company has taken all necessary steps
(including executing non-disclosure and intellectual property assignment
agreements and filing for statutory protections) to protect, preserve, police,
maintain and safeguard the value, validity and their ownership of its Company
IP, including any confidential Company IP; and (v) each Company has executed all
appropriate agreements with current and past employees, contractors and agents
to assign to the Companies all of their right, title and interest in any Company
IP.

            Section 4.19 Contracts. Section 4.19 of the Companies Disclosure
Letter contains a true and complete list of the following Contracts to which any
Company is a party or by which any Company properties are bound or affected as
of the date of this Agreement:

            (a) Contracts containing covenants restricting the payment of
dividends or limiting the freedom in any material respect of any Company or any
of their respective affiliates to engage in any line of business or compete with
any person or operate at any location;

            (b) Joint venture agreements, limited liability company agreements,
partnership agreements or similar agreements;

            (c) the Transition Services Agreement, dated as of August 31, 2002,
between CenterPoint and Genco Holdings (the "CURRENT TRANSITION SERVICES
AGREEMENT"), the Technical Services Agreement (the "TECHNICAL SERVICES
AGREEMENT") between Genco Holdings and RRI dated as of December 31, 2000, and
the Contract (the "PIPELINE SERVICES AGREEMENT"), effective April 1, 2002
between Genco Holdings and CenterPoint Energy Pipeline Services;

                                       30
<PAGE>

            (d) Contracts (other than employment agreements) involving
expenditures which are reasonably expected to be in excess of $1,000,000 per
annum pursuant to which any person is engaged to perform services replacing, or
similar in nature to, any services provided since July 1, 2003 by any of Parent,
RRI and their respective affiliates in connection with any of the Current
Transition Services Agreement, the Technical Services Agreement and the Pipeline
Services Agreement;

            (e) Contracts involving expenditures (capital or otherwise),
liabilities or revenues to the Companies which are reasonably expected to be in
excess of $5,000,000 per annum or $25,000,000 in the aggregate;

            (f) Contracts with terms of one year or longer, unless expenditures,
liabilities or revenues thereunder are not reasonably expected to be in excess
of $1,000,000 per annum;

            (g) Each lease of personal property (i) requiring lease payments
equal to or exceeding $250,000 per annum or (ii) the loss of which would
reasonably be expected to, individually or in the aggregate with other such
losses, have a Companies Material Adverse Effect;

            (h) The Second Amended and Restated Decommissioning Master Trust
Agreement for the South Texas Project (the "Decommissioning Trust Agreement")
made August 31, 2002, by and between Genco Holdings and Mellon Bank, N.A. and
all Contracts related thereto; and

            (i) Contracts otherwise material to the Companies.

True and complete copies of the written Contracts required to be identified in
Sections 4.3(c), 4.11(a), 4.12, 4.19, 4.20, 4.22 and 4.23 of the Companies
Disclosure Letter (all such Contracts, whether now or hereafter existing,
collectively, the "COMPANY CONTRACTS") (and true and complete written summaries
of any such oral Contracts) have been made available to Buyer, except as set
forth in Section 4.19 of the Companies Disclosure Letter.

Except as would not reasonably be expected, individually or in the aggregate, to
have a Companies Material Adverse Effect, no Company is and, to the knowledge of
the Companies, no other party is in default under, or in breach or violation of,
any Company Contract and, to the knowledge of the Companies, no event has
occurred which would result in any breach or violation of, constitute a default,
require consent or result in the loss of a material benefit under, give rise to
a right to permit or require the purchase or sale of assets or securities under,
give rise to any right of termination, amendment, acceleration or cancellation
of, or result in the creation of a Lien on any of the properties or assets of
any Company (in each case, with or without notice or lapse of time or both) a
connection with to, any Company Contract, and each Company Contract is valid,
binding and enforceable in accordance with its terms and is in full force and
effect.

            Section 4.20 Insurance. Section 4.20 of the Companies Disclosure
Letter contains a true and complete list of the insurance policies and fidelity
bonds of or

                                       31
<PAGE>

for the benefit of any Company or its assets, businesses, operations, employees,
officers or directors (the "COMPANY INSURANCE POLICIES"). Each of the Company
Insurance Policies is valid, enforceable, existing and binding, and the premiums
due thereon have been timely paid. There are no outstanding unpaid claims under
any of the Company Insurance Policies with respect to any Company, except in the
ordinary course of business consistent with past practice. No Company has
received notice of cancellation, termination or non-renewal of any Company
Insurance Policy or has been denied insurance coverage. The Company Insurance
Policies are sufficient for compliance with applicable Law and all Contracts to
which any of the Companies is a party or by which it or any of its assets are
bound, and are in such amounts, against such risks and losses, and on such terms
and conditions as are consistent with industry practice in the business of each
Company.

            Section 4.21 Regulatory Matters

            (a) PUHCA and Utility Regulation. Each of the Companies is subject
to regulation under PUHCA as a "subsidiary" of CenterPoint, which is a
"registered holding company" (as such terms are defined under PUHCA). Genco LP
is subject to regulation (i) under the AEA as a licensee or the owner of
licensee, (ii) under Texas utility Law as a "power generation company" (as such
term is defined under PURA), and (iii) under the ERCOT protocols as a "resource
entity" (as such term is defined in the ERCOT protocols). Except as set forth in
the immediately preceding sentences, the Companies are not subject to regulation
as a public utility, public utility holding company or public service company
(or similar designation) by any Governmental Authority.

            (b) STP Compliance. Except as set forth in Section 4.21(b) of the
Companies Disclosure Letter, the operation of the South Texas Project is and has
since January 1, 1999 been conducted in compliance in all material respects with
applicable health, safety, regulatory and other legal requirements. Such legal
requirements include, but are not limited to, the NRC Facility Operating
Licenses for the South Texas Project issued pursuant to 10 C.F.R. Chapter I, and
all regulations, requirements and orders related in any way thereto; and all
obligations of the owners of South Texas Project pursuant to contracts with the
United States Department of Energy for the disposal of spent nuclear fuel and
high-level radioactive waste, and any Laws of the State of Texas or any agency
thereof. The operations of the South Texas Project are not the subject of any
outstanding notice of violation or material request for information from the NRC
or any other agency with jurisdiction over such facility. The South Texas
Project maintains, and is in compliance in all material respects with, emergency
plans designed to protect the health and safety of the public in the event of an
unplanned release of radioactive materials, and the NRC has determined that such
plans are in compliance with its requirements.

            (c) Exempt Wholesale Generator Status. Genco LP is, and has been
determined by order of the FERC to be, an EWG, and neither such order nor Genco
LP's status as an EWG under PUHCA is the subject of any pending or, to the
knowledge of the Companies, threatened judicial or administrative proceeding to
revoke or modify such

                                       32
<PAGE>

status. To the knowledge of the Companies, there are no facts that are
reasonably likely to cause Genco LP to lose its status as an EWG under PUHCA.

            (d) Qualified Decommissioning Fund. Except as set forth in Section
4.21(d) of the Companies Disclosure Letter:

                  (i) With respect to all periods prior to the STP Acquisition
      Closing Date: (i) Genco Holding's Qualified Decommissioning Fund consists
      of one or more trusts that are validly existing and in good standing under
      the laws of its jurisdiction of formation with all requisite authority to
      conduct its affairs as it now does; (ii) Genco Holding's Qualified
      Decommissioning Fund satisfies the requirements necessary for such fund to
      be treated as a "Nuclear Decommissioning Reserve Fund" within the meaning
      of Code Section 468A(a) and as a "Nuclear Decommissioning Fund" and a
      "Qualified Nuclear Decommissioning Fund" within the meaning of Treas. Reg.
      Section l.468A-l(b)(3); (iii) Genco Holdings' Qualified Decommissioning
      Fund is in compliance in all material respects with all applicable rules
      and regulations of any Governmental Authority having jurisdiction,
      including the NRC, the PUC and the IRS, (iv) Genco Holdings' Qualified
      Decommissioning Fund has not engaged in any acts of "self-dealing" as
      defined in Treas. Reg. Section 1.468A-5(b)(2); (v) no "excess
      contribution," as defined in Treas. Reg. Section 1.468A-5(c)(2)(ii), has
      been made to Genco Holdings' Qualified Decommissioning Fund which has not
      been withdrawn within the period provided under Treas. Reg. Section
      1.468A-5(c)(2)(i); and (vi) except as set forth in Section 4.21(d) of the
      Companies Disclosure Letter, Genco Holdings has made timely and valid
      elections to make annual contributions to Genco Holding's Qualified
      Decommissioning Fund since its inception and Genco Holdings has heretofore
      delivered copies of such elections to Buyer. As used in this Agreement,
      the term "QUALIFIED DECOMMISSIONING FUND" means all amounts contributed to
      qualified funds for administrative costs and costs incurred in connection
      with the entombment, dismantlement, removal and disposal of the
      structures, systems and components of a unit of common facilities,
      including all costs incurred in connection with the preparation for
      decommissioning, such as engineering and other planning expenses incurred
      with respect to the unit of common facilities after actual decommissioning
      occurs, such as physical security and radiation monitoring expenses, as
      part of Genco LP's cost of service required by PURA or as approved by the
      PUC.

                  (ii) Genco Holdings has heretofore delivered to Buyer a copy
      of Genco Holdings' Decommissioning Trust Agreement as in effect on the
      date of this Agreement.

                  (iii) With respect to all periods prior to the STP Acquisition
      Closing Date, (i) Genco Holdings and/or Mellon Bank, N.A. (the "TRUSTEE")
      of Genco Holdings' Qualified Decommissioning Fund has/have filed or caused
      to be filed with the NRC, the IRS and any other Governmental Authority all
      material forms, statements, reports, documents (including all exhibits,
      amendments and

                                       33
<PAGE>

      supplements thereto) required to be filed by Genco Holdings and/or the
      Trustee of Genco Holdings' Qualified Decommissioning Fund; and (ii) there
      are no interim rate orders that may be retroactively adjusted or
      retroactive adjustments to interim rate orders that may affect amounts
      that Buyer may contribute to Genco Holdings' Qualified Decommissioning
      Fund or may require distributions to be made from Genco Holdings'
      Qualified Decommissioning Fund. Genco Holdings has delivered to Buyer a
      copy of the schedule of ruling amounts most recently issued by the IRS for
      Genco Holdings' Qualified Decommissioning Fund and a complete copy of the
      request that was filed with the IRS to obtain such schedule of ruling
      amounts and a copy of any pending request for revised ruling amounts, in
      each case together with all exhibits, amendments and supplements thereto.
      Any amounts contributed to Genco Holdings' Qualified Decommissioning Fund
      while such request is pending before the IRS and which turn out to exceed
      the applicable amounts provided in the schedule of ruling amounts issued
      by the IRS will be withdrawn from Genco Holdings' Qualified
      Decommissioning Fund within the period provided under Treas. Reg. Section
      1.468A-5(c)(2)(i).

                  (iv) Genco Holdings has made available to Buyer a statement of
      assets and liabilities prepared by the Trustee for Genco Holdings'
      Qualified Decommissioning Funds as of December 31, 2003 and as of June 30,
      2004 and will make such a statement available as of the most recently
      available month end preceding the STP Acquisition Closing, and they fairly
      presented and will fairly present as of such dates the financial position
      of each of Genco Holdings' Qualified Decommissioning Funds. Genco Holdings
      has made available to Buyer information from which Buyer can determine the
      Tax Basis of all assets in Genco Holdings' Qualified Decommissioning Fund
      and will make such a statement available as of the most recently available
      month end preceding the STP Acquisition Closing.

                  (v) Genco Holdings has made available to Buyer all material
      contracts and agreements to which the Trustee of Genco Holdings' Qualified
      Decommissioning Fund, in its capacity as such, is a party.

                  (vi) With respect to all taxable periods prior to the STP
      Acquisition Closing Date, Genco Holdings' Qualified Decommissioning Fund
      has filed all material Tax Returns required to be filed, including but not
      limited to returns for estimated Income Taxes, such Tax Returns are true
      and complete in all material respects, and all Taxes have been paid in
      full. No notice of deficiency or assessment has been received from any
      taxing authority with respect to any liability for Taxes of Genco
      Holdings' Qualified Decommissioning Fund which have not been fully paid or
      finally settled. There are no outstanding agreements or waivers extending
      the applicable statutory periods of limitations for any Taxes associated
      with Genco Holdings' Qualified Decommissioning Fund for any period.

            (e) Nonqualified Decommissioning Funds. Except as set forth in
Section 4.21(e) of the Companies Disclosure Letter:

                                       34
<PAGE>

                  (i) With respect to all periods prior to the STP Acquisition
      Closing Date, Genco Holdings' Nonqualified Decommissioning Funds is a
      trust validly existing and in good standing under the laws of its
      jurisdiction of formation with all requisite authority to conduct its
      affairs as it now does. Genco Holdings' Nonqualified Decommissioning Funds
      are in full compliance in all material respects with all applicable rules
      and regulations of any Governmental Authority, including the NRC and the
      PUC. Company's Nonqualified Decommissioning Funds are, and since their
      inception have been, classified as a grantor trust owned by the Parents
      under Section 671 to 677 of the Code. As used in this Agreement, the term
      "NONQUALIFIED DECOMMISSIONING FUNDS" means the nonqualified funds, as
      determined by the Trustee and Texas Genco, LP, established and maintained
      under the Decommissioning Trust Agreement for decommissioning South Texas
      Project Unit No. 1, South Texas Project Unit No. 2 and the common
      facilities to which monies are contributed, which nonqualified funds are
      not subject to the conditions and limitations of Section 468A of the Code.

                  (ii) With respect to all periods prior to the STP Acquisition
      Closing Date, Genco Holdings and the Trustee of Genco Holdings'
      Nonqualified Decommissioning Funds have filed or caused to be filed with
      the NRC and any other Governmental Authority all material forms,
      statements, reports, documents (including all exhibits, amendments and
      supplements thereto) required to be filed by either of them.

                  (iii) Genco Holdings has made available to Buyer a statement
      of assets and liabilities prepared by the Trustee for Genco Holdings'
      Nonqualified Decommissioning Funds as of December 31, 2003 and as of June
      30, 2004 and will make such a statement available as of the end of the
      most recently available month end preceding the STP Acquisition Closing,
      and they fairly presented and will fairly present as of such dates the
      financial position of each of Genco Holdings' Nonqualified Decommissioning
      Funds. Genco Holdings has made available to Buyer all contracts and
      agreements to which the Trustee of Genco Holdings' Nonqualified
      Decommissioning Funds, in its capacity as such, is a party.

                  (iv) Genco Holdings has made available to Buyer all material
      contracts and agreements to which the Trustee of Genco Holdings'
      Nonqualified Decommissioning Funds, in its capacity as such, is a party.

            Section 4.22 Affiliate Transactions. Except as set forth in Section
4.22 of the Companies Disclosure Letter or as disclosed in Genco Holding's proxy
statement relating to the election of directors dated April 23, 2004, there are
no Contracts or transactions between any Company, on the one hand, and any (A)
Parent or its affiliates (other than the Companies), on the other hand, other
than any Contract or transaction entered into in the ordinary course of business
and on terms no less favorable than would have been reached on an arms-length
basis that is not material to the Company, or (B) (i) officer or director of any
Company or Parent or its affiliates, or (ii) affiliate of any such

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<PAGE>

officer or director, on the other hand, in each case in this clause (B) except
those of a type available to Company Employees generally and other than any
Contract or transaction entered into in the ordinary course of business and on
terms no less favorable than would have been reached on an arm's-length basis or
that is not material to the Company (all Contracts and transactions referred to
in clauses (A) or (B), whether entered into before or after the date hereof,
"COMPANY AFFILIATE CONTRACTS").

            Section 4.23 Derivative Products.

            (a) All Derivative Products entered into for the account of any
Company were entered into in accordance with (i) established risk parameters,
limits and guidelines and in compliance with the risk management policies
approved by the board of directors of Genco Holdings (the "TRADING POLICIES"),
in each case both as in effect at the time such Derivative Products were entered
into and as in effect on the date of this Agreement, to restrict the level of
risk that any Company is authorized to take, individually and in the aggregate,
with respect to Derivative Products and monitor compliance with such risk
parameters and (ii) applicable Law and policies of any Governmental Authority.

            (b) Genco Holdings has made available Buyer a true and complete copy
of the Trading Policies, and the Trading Policies contain a true and complete
description of the practice of the Companies with respect to Derivative
Products, as of the date of this Agreement.

            (c) At no time has any Company engaged in any "round trip,"
"sale/buyback" or "wash" trading or any similar transaction.

            (d) For purposes of this Agreement, "DERIVATIVE PRODUCT" means (i)
any swap, cap, floor, collar, futures contract, forward contract, option and any
other derivative financial instrument or Contract, based on any commodity,
security, instrument, asset, rate or index of any kind or nature whatsoever,
whether tangible or intangible, including electricity, natural gas, crude oil
and other commodities, emissions allowances, currencies, interest rates and
indices and (ii) forward contracts for physical delivery, physical output of
assets, and physical load obligations.

            Section 4.24 Fairness Opinion. Genco Holdings has received the
written opinion of RBC Capital Markets Corporation to the effect that, as of the
date of this Agreement, the consideration to be received in the Public Company
Merger by Genco Holdings' shareholders (other than CenterPoint) is fair to such
shareholders from a financial point of view. An executed copy of such opinion
has been delivered to Buyer.

            Section 4.25 Board Recommendation. The board of directors of Genco
Holdings, upon the unanimous recommendation of a special committee thereof, has
unanimously (i) adopted resolutions approving this Agreement and the
transactions contemplated hereby, including the Public Company Merger, in
accordance with the TBCA, (ii) determined that this Agreement and the
transactions contemplated hereby, including the Public Company Merger, are
advisable and fair to and in the best interests

                                       36
<PAGE>

of the shareholders of Genco Holdings, (iii) resolved to recommend approval of
this Agreement and the transactions contemplated hereby, including the Public
Company Merger, to the shareholders of Genco Holdings and (iv) directed that
approval of this Agreement be submitted to Genco Holdings' shareholders.

            Section 4.26 Ownership of Assets. Except as set forth in Section
4.26 of the Companies Disclosure Letter, none of Genco Holdings or any of its
subsidiaries (other than Genco LP, Genco Services and, after the Genco LP
Division, Genco II LP) (i) owns, leases or has any other right, title or
interest in any assets or properties, (ii) is a party to, or is otherwise bound
by or subject to, any Contract, (iii) owns or holds any Permits, or (iv) has any
Company Employees.

                                    ARTICLE V

                     REPRESENTATIONS AND WARRANTIES OF BUYER

            Buyer hereby represents and warrants to Parents and Genco Holdings
as follows:

            Section 5.1 Organization; Etc. Buyer (a) is duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization, (b) has all requisite limited liability company power and
authority to execute and deliver this Agreement and all other agreements and
instruments executed in connection herewith or delivered pursuant hereto, to
perform its obligations hereunder and to consummate the transactions
contemplated by this Agreement and (c) is duly qualified or licensed to do
business, and is in good standing in each jurisdiction in which the nature of
its business or the ownership, operation or leasing of its properties makes such
qualification or licensing necessary, except where the failure to be so
qualified or licensed would not reasonably be expected to, individually or in
the aggregate, have a Buyer Material Adverse Effect. As used in this Agreement,
the term "BUYER MATERIAL ADVERSE EFFECT" means an event, change or circumstance
which would materially adversely affect the ability of Buyer to consummate the
transactions contemplated by this Agreement or directly or indirectly prevent or
materially impair or delay the ability of Buyer to perform its obligations
hereunder.

            Section 5.2 Authority Relative to this Agreement. The execution,
delivery and performance of this Agreement and all other agreements and
instruments executed in connection herewith or delivered pursuant hereto, by
Buyer and the consummation of the transactions contemplated by this Agreement
and all other agreements and instruments executed in connection herewith or
delivered pursuant hereto have been duly and validly authorized by all requisite
corporate or limited liability company action, as applicable, on the part of
Buyer and no other corporate actions or proceedings on the part of Buyer is
necessary to authorize the execution, delivery and performance of this Agreement
and all other agreements and instruments executed in connection herewith or
delivered pursuant hereto by Buyer or to consummate the transactions so
contemplated. This Agreement and all other agreements and instruments executed
in connection herewith or delivered pursuant hereto have been, or will be, duly

                                       37
<PAGE>

and validly executed and delivered by Buyer and, with respect to this Agreement
and any other such agreement, assuming it has been duly authorized, executed and
delivered by any other party (other than an affiliate of Buyer), constitutes, or
will constitute when executed, a valid and binding agreement of Buyer,
enforceable against Buyer in accordance with its terms, except that (a)
enforcement may be subject to any bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or other laws, now or hereafter in effect,
relating to or limiting creditors' rights generally, and (b) enforcement of this
Agreement, including, among other things, the remedy of specific performance and
injunctive and other forms of equitable relief, may be subject to equitable
defenses and to the discretion of the court before which any proceeding therefor
may be brought.

            Section 5.3 Consents and Approvals; No Violations. Except for the
Required Approvals, none of the execution, delivery and performance of this
Agreement by Buyer, nor the consummation by Buyer of the transactions
contemplated by this Agreement, will (a) conflict with, violate or result in any
breach of any provision of the certificate of formation, articles of
incorporation, regulations, bylaws or similar documents, as applicable, of
Buyer, (b) result in a violation or breach of, or constitute (with or without
due notice or lapse of time or both) a default (or give rise to any right of
termination, amendment, cancellation or acceleration or any right or obligation
to purchase or sell securities or assets) under, or require any consent or
result in a material loss of a material benefit to Buyer under, any Contract to
which Buyer is a party or by which any of its businesses, properties or assets
are bound, (c) violate any Law or Permit applicable to Buyer or its business,
properties or assets, or (d) require any Approval from, by or to any
Governmental Authority, except in the case of clauses (b), (c) and (d) of this
Section 5.3 for those which would not reasonably be expected to, individually or
in the aggregate, have a Buyer Material Adverse Effect.

            Section 5.4 Debt Financing. As of the date hereof, Buyer has
delivered to Genco Holdings true and complete copies of (a) the Debt Financing
Letter on Section 5.4(a) of the disclosure letter delivered by Buyer to Parents
and Genco Holdings concurrently with the execution hereof (the "BUYER DISCLOSURE
LETTER") hereto, and (b) the equity letter on Section 5.4(b) of the Buyer
Disclosure Letter.

            Section 5.5 Litigation. There is no Action pending or, to the
knowledge of Buyer, threatened against Buyer by or before any Governmental
Authority, nor are there any Orders that affect or bind any of them or any of
their respective businesses, properties or assets which would not reasonably be
expected to, individually or in the aggregate, have a Buyer Material Adverse
Effect.

            Section 5.6 Investigation by Buyer. Buyer has conducted its own
independent review and analysis of the business, operations, assets,
liabilities, results of operations, financial condition, technology and
prospects of the Genco Business and acknowledges that Buyer has been provided
access to personnel, properties, premises and records of the Genco Business for
such purpose. In entering into this Agreement, Buyer has relied upon, among
other things, its due diligence investigation and analysis of the Companies and
the Genco Business, and Buyer:

                                       38
<PAGE>

            (a) acknowledges and agrees that it has not been induced by and has
not relied upon any representations or warranties, whether express or implied,
made by Parents or any of their respective directors, officers, shareholders,
employees, affiliates, controlling persons, agents, advisors or representatives
(in each case other than Genco Holdings) that are not expressly set forth in
Article III of this Agreement, whether or not any such representations,
warranties or statements were made in writing or orally, and acknowledges and
agrees that all representations and warranties made in Article III are made by
CenterPoint and not Genco Holdings;

            (b) acknowledges and agrees that it has not been induced by and has
not relied upon any representations or warranties, whether express or implied,
made by the Companies or any of their respective directors, officers,
shareholders, employees, affiliates, controlling persons, agents, advisors or
representatives (in each case other than Parents) that are not expressly set
forth in Article IV of this Agreement, whether or not any such representations,
warranties or statements were made in writing or orally, and acknowledges and
agrees that all representations and warranties made in Article IV are made by
Genco Holdings and not CenterPoint;

            (c) acknowledges and agrees that none of Parents and the Companies
or any of their respective directors, officers, shareholders, employees,
affiliates, controlling persons, agents, advisors or representatives makes or
has made any representation or warranty, either express or implied, as to the
accuracy or completeness of any of the information provided or made available to
Buyer or its directors, officers, employees, affiliates, controlling persons,
agents or representatives, including without limitation, any information
included in the Confidential Information Memorandum dated February 2004, as
supplemented to the date of this Agreement, and any information, document, or
material provided or made available, or statements made, to Buyer (including its
directors, officers, employees, affiliates, controlling persons, advisors,
agents or representatives) during site or office visits, in any "data rooms,"
management presentations or supplemental due diligence information provided to
Buyer (including its directors, officers, employees, affiliates, controlling
persons, advisors, agents or representatives) in connection with discussions or
access to management of the Genco Business or in any other form in expectation
of the transactions contemplated by this Agreement, in each case except, with
respect to Parents and Genco Holdings, as applicable, to the extent reflected in
the respective representations and warranties of CenterPoint in Article III or
Genco Holdings in Article IV (collectively, "DUE DILIGENCE INFORMATION");

            (d) acknowledges and agrees that (i) the Due Diligence Information
includes certain projections, estimates and other forecasts, and certain
business plan information, (ii) there are uncertainties inherent in attempting
to make such projections, estimates and other forecasts and plans and Buyer is
familiar with such uncertainties, and (iii) Buyer is taking full responsibility
for making its own evaluation of the adequacy and accuracy of all projections,
estimates and other forecasts and plans so furnished to it and any use of or
reliance by Buyer on such projections, estimates and other forecasts and plans
shall be at its sole risk; and

                                       39
<PAGE>

            (e) agrees, to the fullest extent permitted by Law, that none of
Parents, the Companies or any of their respective directors, officers,
shareholders, employees, affiliates, controlling persons, agents, advisors or
representatives shall have any liability or responsibility whatsoever to Buyer
or its directors, officers, shareholders, employees, affiliates, controlling
persons, agents, advisors or representatives on any basis (including, without
limitation, in contract or tort, under federal or state securities laws or
otherwise) resulting from the furnishing to Buyer, or Buyer's use of, any Due
Diligence Information, except for fraud or intentional misrepresentation.

            Section 5.7 Brokers; Finders and Fees. No broker, finder, investment
banker or other person whose fees or expenses would be payable by the Parents
or, prior to the STP Acquisition Closing, the Companies may be entitled to any
brokerage, finder's or other fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of Buyer.

            Section 5.8 Buyer's ERCOT Generation. Buyer and its affiliates do
not directly or indirectly own, control or have under construction any
generating assets located in or capable of delivering electricity to the ERCOT
Market. Neither Buyer nor its controlled affiliates have a present intention to
acquire or construct any generating assets located in or capable of delivering
electricity to the ERCOT Market except through the Companies.

            Section 5.9 Ownership of Genco Holding Stock. Except as set forth in
Section 5.9 of Buyer Disclosure Letter, as of the date of this Agreement,
neither Buyer nor any of its "affiliates" or "associates" (as those terms are
defined under Rule 12b-2 under the Exchange Act) beneficially owns any shares of
Common Stock or any other security of Genco Holdings.

                                   ARTICLE VI

                            COVENANTS OF THE PARTIES

            Section 6.1 Covenants of Genco Holdings. During the period from the
date of this Agreement to the STP Acquisition Closing, unless otherwise
expressly contemplated by this Agreement, as set forth in Section 6.1 of the
Companies Disclosure Letter or required by applicable Law or unless Buyer gives
its prior written consent, which consent shall not be unreasonably withheld or
delayed, Genco Holdings shall, and shall cause each other Company to, (1)
conduct its businesses only in, and not to take any action except in, the
ordinary course of business, in a manner consistent with past practice, in
compliance with applicable Laws and in accordance with good utility practices
and (2) preserve substantially intact its business organization, to preserve its
assets and properties in good repair and condition and to preserve its present
relationships with Governmental Authorities, customers, suppliers and other
persons with which it has business relations. By way of amplification and not
limitation, during the period from the date of this Agreement to the STP
Acquisition Closing, Genco Holdings agrees that no Company shall directly or
indirectly do, or propose, authorize or commit to do, any of the following, in
each case unless otherwise expressly contemplated by this Agreement, as

                                       40
<PAGE>

set forth in Section 6.1 of the Companies Disclosure Letter or without the prior
written consent of Buyer, which consent shall not be unreasonably withheld or
delayed:

            (a) amend or otherwise change any Company's articles of
incorporation or bylaws (or similar organizational documents);

            (b) except as required under a Contract in force as of the date of
this Agreement, issue, deliver, sell, lease, sell and leaseback, pledge,
license, transfer, mortgage, encumber, dispose of or otherwise subject to any
Lien (i) any Company Securities or (ii) any property or assets, whether tangible
or intangible, of any Company, other than assets sold, leased, pledged,
licensed, transferred, disposed of or encumbered in the ordinary course of
business and in a manner consistent with past practice;

            (c) declare, set aside, make or pay any dividend or other
distribution, payable in cash, stock or other equity interests, property or
otherwise, with respect to any of Company Securities other than (i) dividends by
a direct or indirect wholly-owned subsidiary of Genco Holdings to its parent to
the extent required to fund the dividends referred to in clause (ii) or (iii)
below, (ii) prior to the Public Company Merger Closing Date, regular quarterly
cash dividends with respect to the Common Stock, not in excess of $0.25 per
share per quarter, in each case with usual declaration, record and payment dates
and otherwise in accordance with Genco Holdings' past dividend policy and (iii)
following the Non-STP Acquisition Closing and the repayment of all principal and
interest under the Overnight Bridge Loan, if any, distribution by Genco Holdings
of up to $2,231 million in the aggregate of Non-STP Consideration or other cash;

            (d) reclassify, combine, split, subdivide or redeem, purchase or
otherwise acquire, directly or indirectly, any of the Company Securities;

            (e) repurchase, repay or incur any Indebtedness or issue any
securities in respect of Indebtedness or assume, guarantee or endorse, or
otherwise as an accommodation become responsible for, the obligations or
Indebtedness of any person, other than repayments in the ordinary course of
business and in a manner consistent with past practice under the revolving
credit line under the Credit Agreement dated as of December 23, 2003 among Genco
Holdings, Texas Genco GP, LLC, Texas Genco LP, LLC, Genco Services, Genco LP,
various lenders and Deutsche Bank AG New York Branch, as Administrative and
Collateral Agent (as amended, modified or supplemented prior to the date of this
Agreement or as contemplated by Section 6.7(d), which amendments, modifications
and supplements have been furnished to Buyer, the "CREDIT AGREEMENT") and other
than borrowings under the Overnight Bridge Loan, if any;

            (f) (i) make aggregate payments pursuant to the Company Affiliate
Contracts set forth in Section 4.22 of the Companies Disclosure Letter, other
than any such payments prior to the Non-STP Acquisition Closing Date, not in
excess of $3,000,000 per month, (ii) forgive any liabilities, debts or
obligations under any Company Affiliate Contract set forth in Section 4.22 of
the Companies Disclosure Letter; (iii) take any action outside the ordinary
course of business consistent with past practice pursuant to any Company
Affiliate Contracts set forth in Section 4.22 of the Companies

                                       41
<PAGE>

Disclosure Letter; or (iv) engage in or enter into any Company Affiliate
Contract which would be required to be set forth in Section 4.22 of the
Companies Disclosure Letter if in effect on the date of this Agreement;

            (g) (i) amend in any material respect, terminate, cancel or renew
any Company Contract or enter into any Contract that would be a Company Contract
if in effect on the date of this Agreement, provided that, for the avoidance of
doubt, to the extent any such Contract is entered into after the date of this
Agreement in accordance with this Agreement, such Contract shall be deemed to be
a Company Contract for purposes of this Agreement, (ii) acquire (including by
merger, consolidation or acquisition of stock or assets) any assets (other than
in the ordinary course of business), business or any corporation, partnership,
limited liability company, association or business organization or division
thereof (other than acquisitions prior to the Non-STP Acquisition Closing having
an aggregate consideration of not more than $5,000,000) other than fuel,
supplies, maintenance materials and other inventory items in the ordinary course
of business consistent with past practice, or (iii) except as set forth in
Section 6.1(g) of the Companies Disclosure Letter, authorize or make any capital
expenditures, except such expenditures made prior to the Non-STP Acquisition
Closing Date in an amount not in excess of $5,000,000 individually or
$25,000,000 in the aggregate;

            (h) amend, terminate, cancel or renew the Power Purchase Agreement
or the agreements referred to in Section 6.18;

            (i) except as required by applicable Law (including, for the
avoidance of doubt, ERCOT Market regulation), reactivate or enter into any
"reliability must run" Contract with respect to any generating plant that, as of
the date of this Agreement, is shutdown or "mothballed";

            (j) except to the extent required under applicable Law or the terms
of any Company Plan existing as of the date of this Agreement, (i) increase or
otherwise amend the compensation or fringe benefits of any present or former
director, officer or employee of any Company (except for increases in salary or
hourly wage rates, in the ordinary course of business consistent with past
practice), (ii) grant any retention, severance or termination pay to, or enter
into, or amend, any employment, consulting or severance Contract with any
present or former director, officer or employee of any Company, (iii) loan or
advance any money or other property to any present or former director, officer
or employee of any Company; (iv) establish, enter into, adopt, amend or
terminate any Company Plan, any collective bargaining agreements identified on
Section 4.12 of the Companies Disclosure Letter or any plan, agreement, program,
policy, trust, fund or other arrangement that would be a Company Plan if it were
in existence as of the date of this Agreement; or (v) hire any new employees;

            (k) fail to maintain its books and records in accordance with GAAP
in any material respect or, except as may be required as a result of a change in
Law or in GAAP, and subject to the establishment of the TGN Retirement Plan
pursuant to Section 6.8(e) of this Agreement, change material Tax, pension,
regulatory or financial accounting policies, procedures, practices or principles
used by it;

                                       42
<PAGE>

            (l) make, change or rescind any material Tax election; fail to duly
and timely file all material Tax Returns and other documents required to be
filed with any Governmental Authority, subject to timely extensions permitted by
applicable Law; extend the statute of limitations with respect to any Tax; or,
except in the ordinary course of business, settle or compromise any material
federal, state, local or foreign Tax liability;

            (m) waive, release, assign, settle or compromise any pending or
threatened Action which is material, which relates to the transactions
contemplated hereby or which is brought by any current, former or purported
holder of any Company Securities in such capacity;

            (n) adopt a plan of complete or partial liquidation, dissolution,
merger, consolidation, restructuring, recapitalization or other reorganization
of any Company;

            (o) pay, discharge or satisfy any material claims, liabilities or
obligations (absolute, accrued, asserted or unasserted, contingent or
otherwise), other than the payment, discharge or satisfaction when due or
otherwise in the ordinary course of business and consistent with past practice
of liabilities reflected or reserved against in the balance sheet or incurred in
the ordinary course of business after March 31, 2004 and consistent with past
practice;

            (p) make any loans, advances or capital contributions (including any
"keep well" or other Contract to maintain any financial statement condition of
another person) to, or investments in, any other person, except for loans,
advances and capital contributions to Companies that are wholly-owned by Genco
Holdings and are in existence on the date of this Agreement (other than any loan
by Genco LP or Genco Services);

            (q) other than in the ordinary course of business and in a manner
consistent with past practice or as required by applicable Law, (i) modify in
any material respect the Trading Policies or any similar policy, other than
modifications which are more restrictive to any Company, or (ii) enter into any
Contract or transaction related to any Derivative Product or any similar
transaction (other than as permitted by the Trading Policies);

            (r) enter into, amend, terminate, cancel or renew any Contract or
other transaction other than in the ordinary course of business and in a manner
consistent with past practice, as required by applicable Law, or otherwise that,
individually or in the aggregate with all other Contracts or transactions, would
conflict with, violate or otherwise would not be permitted under the Trading
Policies or any similar purchasing policy;

            (s) fail to maintain in full force and effect insurance policies
covering the Companies and their respective properties, assets and businesses in
a form and amount consistent with good utility practice, including the Company
Insurance Policies

                                       43
<PAGE>

(except in the ordinary course of business to the extent any such policies
expire in accordance with their term and they are replaced with policies
consistent with good utility practice) and to promptly and diligently prosecute
claims under such policies;

            (t) except to the extent required by applicable Law, take any action
that would reasonably be expected to result in (i) any representation and
warranty of the Companies set forth in this Agreement (A) that is qualified as
to materiality or Companies Material Adverse Effect becoming untrue or (B) that
is not so qualified becoming untrue in any material respect or (ii) any
condition to the Public Company Merger set forth in Article VII not being
satisfied;

            (u) fail to take any action that would reasonably be expected to,
directly or indirectly, prevent or materially impair or delay the consummation
of the transactions contemplated hereby (except to the extent specifically
permitted by Section 10.1); or

            (v) take, offer, propose to take or enter into or amend any Contract
to take, offer or propose any of the actions described above in Sections 6.1(a)
through 6.1(u).

            Section 6.2 Access to Information.

            (a) From the date of this Agreement to the STP Acquisition Closing,
Genco Holdings will, and will cause each other Company and its and their
respective officers, directors, employees, accountants, auditors, counsel,
financial advisors and other agents and representatives (collectively,
"REPRESENTATIVES") to (i) give Buyer and its Representatives and potential
financing sources for the transactions contemplated by this Agreement reasonable
access during normal business hours to the officers, employees, agents,
properties (including the South Texas Project), offices, plants and other
facilities and to the books, personnel, Contracts and records of Genco Holdings
or any Company, (ii) permit Buyer to make such copies and inspections thereof as
Buyer may reasonably request, and (iii) furnish Buyer with such financial,
trading, marketing and operating data and other information concerning the
business, properties (including the South Texas Project), Contracts, assets,
liabilities, personnel and other aspects of any Company, as Buyer and its
Representatives and potential financing sources may from time to time reasonably
request, provided, however, that any access to properties of the Companies shall
be conducted at Buyer's expense, at a reasonable time, under the reasonable
supervision of the Companies' personnel and in such a manner as to not interfere
unreasonably with the operation of the businesses of Genco Holdings or the
Companies; provided, further, that Genco Holdings shall not be required to
provide access to any information (i) that is subject to attorney-client
privilege to the extent doing so would reasonably be expected to cause such
privilege to be waived or (ii) that is subject to contractual prohibition
against disclosure to the extent doing so would violate such prohibition, it
being agreed that Genco Holdings shall use its commercially reasonable efforts
to seek to furnish any such information in a manner that does not result in any
such waiver or violation, including entering into joint defense agreements and
obtaining requisite consents.

                                       44
<PAGE>

            (b) All such information and access shall be subject to the terms
and conditions of the letter agreements (collectively, the "CONFIDENTIALITY
AGREEMENT") between the Investors and CenterPoint, until the STP Acquisition
Closing Date, with respect to the STP Assets and Liabilities, and until the
Non-STP Acquisition Closing Date with respect to the Non-STP Assets and
Liabilities. Notwithstanding anything to the contrary contained in this
Agreement, none of Parents, the Companies or any of their affiliates will have
any obligation to make available or provide to Buyer or its representatives a
copy of any consolidated, combined or unitary Tax Return filed by Genco
Holdings, or any of their affiliates, or any related material other than any
portions of such Tax Returns that relate to the Companies.

            Section 6.3 Consents; Cooperation.

            (a) Each of Parents and Buyer shall cooperate, and use commercially
reasonable efforts, to take, or cause to be taken, all actions, and to do, or
cause to be done, and to assist and cooperate with the other party in doing, all
things necessary, proper or advisable to consummate and make effective the
transactions contemplated hereby as promptly as practicable, including, but not
limited to making all filings and obtaining all Approvals and third party
consents necessary to consummate the transactions contemplated by this
Agreement, provided, however, that, with respect to the foregoing, (i) such
efforts shall not require Parents, Merger Sub, the Companies, Buyer or any of
their respective subsidiaries to make any payment to obtain any such Approval or
third-party consent, other than nominal transfer fees or filing fees and/or the
costs and expenses of third parties pursuant to the terms of any Contract, (ii)
Parents, Merger Sub and the Companies shall not be permitted to consent to any
action or to make or offer to make any substantive commitment or undertaking or
incur any liability or obligation with respect to the Companies without the
consent of Buyer, which shall not be unreasonably withheld and (iii) that,
notwithstanding the foregoing, the actions of Parents, Merger Sub, the Companies
and Buyer with respect to filings, approvals and other matters (A) pursuant to
the HSR Act and any local, state, federal (other than the HSR Act) or foreign
antitrust statute, antitrust law, antitrust regulation or antitrust rule
applicable to Parents, the Companies or Buyer ("OTHER ANTITRUST REGULATIONS")
shall be governed by subsections (b), (c), (d) and (e) of this Section 6.3 and
(B) related to the NRC Approval shall be governed by Section 6.12 hereof.

            (b) CenterPoint and Buyer shall file with (i) the United States
Federal Trade Commission (the "FTC") and the United States Department of Justice
(the "DOJ"), the notification and report form required for the transactions
contemplated by this Agreement and any supplemental information requested in
connection with such notification and report form pursuant to the HSR Act, and
(ii) any other applicable Governmental Authority, all filings, reports,
information and documentation required for the consummation of the transactions
contemplated by this Agreement pursuant to the Other Antitrust Regulations. Each
of CenterPoint and Buyer shall furnish to each other's counsel such necessary
information and reasonable assistance as the other party may reasonably request
in connection with its preparation of any filing or submission that is necessary
under the HSR Act and Other Antitrust Regulations. Each of CenterPoint and Buyer
shall consult with each other as to the appropriate time of making such filings
and

                                       45
<PAGE>

submissions and shall use commercially reasonable efforts to make such filings
and submissions at the agreed upon time.

            (c) Each of Parents, the Companies and Buyer shall keep each other
apprised of the status of any communications with, and any inquiries or requests
for additional information from, the FTC and the DOJ and other governmental or
regulatory entities and shall comply promptly by responding to any such inquiry
or request.

            (d) Each of Parents, the Companies and Buyer shall use commercially
reasonable efforts to vigorously defend, lift, mitigate and rescind the effect
of any Action materially and adversely affecting this Agreement or the ability
of the parties to consummate the transactions contemplated by this Agreement,
including promptly appealing any adverse Order.

            (e) Prior to the date specified in Section 10.1(b) (as it may be
extended pursuant thereto), each of Genco Holdings and Buyer shall take any and
all steps necessary to avoid or eliminate each and every impediment under the
HSR Act and any Other Antitrust Regulations that may be asserted by any
Governmental Authority with respect to the transactions contemplated by this
Agreement so as to enable the Public Company Merger Closing, the Non-STP
Acquisition Closing and the STP Acquisition Closing to occur as soon as
reasonably possible, including proposing, negotiating, committing to and
effecting, by consent decree, hold separate order or otherwise, the sale,
divestiture or disposition of such assets or businesses of Buyer or any of its
subsidiaries or otherwise take or commit to take any action that limits its
freedom of action with respect to, or its ability to retain, any of the
businesses, product lines or assets of Buyer or its subsidiaries, as may be
required in order to avoid the entry of, or to the effect the dissolution of,
any injunction, temporary restraining order or other order in any suit or
proceeding, which would otherwise have the effect of preventing or delaying the
Public Company Merger Closing, the Non-STP Acquisition Closing or the STP
Acquisition Closing. At the request of CenterPoint, Buyer shall agree to divest,
hold separate or otherwise take or commit to take any action that limits its
freedom of action with respect to, or its ability to retain, any of the
businesses or assets of Buyer or any of its subsidiaries, provided that (i) any
such action may be conditioned upon the consummation of the transactions
contemplated by this Agreement and (ii) any such actions do not and would not
reasonably be expected to have, individually or in the aggregate, a Companies
Material Adverse Effect.

            (f) With respect to any agreements for which any required Approval
or third-party consent is not obtained prior to the Public Company Merger
Closing Date, the Non-STP Acquisition Closing or the STP Acquisition Closing
Date, as applicable, Parents, the Companies and Buyer will each use commercially
reasonable efforts to obtain any such consent or approval after such date until
such consent or approval has been obtained and Parents will provide Buyer or,
after the STP Acquisition Closing Date, any Company, with the same benefits
arising under such agreements, including performance by either Parent as agent,
if legally and commercially feasible, provided that Buyer will provide Parents
with such access to the premises, books and records and personnel as is
necessary to enable Parents to perform their obligations under such

                                       46
<PAGE>

agreements and Buyer shall pay or satisfy the corresponding liabilities for the
enjoyment of such benefits to the extent Buyer would have been responsible
therefor if such consent or approval had been obtained.

            (g) Parents and Genco Holdings shall keep Buyer reasonably apprised
of the status of matters relating to the completion of the transactions
contemplated hereby and shall promptly furnish Buyer with copies of all notices
or other communications received by Parents or by any Company or its or their
Representatives from any third party and/or any Governmental Authorities with
respect to the transactions contemplated hereby. Parents and Genco Holdings
shall promptly furnish to Buyer such necessary information and reasonable
assistance as Buyer may request in connection with the foregoing and shall
promptly provide counsel for Buyer with copies of all filings made by Parents or
the Companies, and all correspondence between Parents or the Companies (and
their respective Representatives) with any Governmental Authority and any other
information supplied by Parents and any Company (and their respective
Representatives) to a Governmental Authority in connection herewith and the
transactions contemplated hereby. Parents and Genco Holdings shall, subject to
applicable Law, permit counsel for Buyer reasonable opportunity to review in
advance, and consider in good faith the views of Buyer in connection with, any
proposed written communication by Parents or the Companies to any Governmental
Authority. Parents, Merger Sub and Genco Holdings agree not to participate, or
to permit any Company to participate, in any substantive meeting or discussion,
either in person or by telephone, with any Governmental Authority in connection
herewith and the transactions contemplated hereby unless it consults with Buyer
in advance and, to the extent not prohibited by such Governmental Authority,
gives Buyer and its counsel the opportunity to attend and participate.

            (h) Buyer shall keep CenterPoint and Genco Holdings reasonably
apprised of the status of matters relating to the completion of the transactions
contemplated hereby and shall promptly furnish CenterPoint and Genco Holdings
with copies of all notices or other communications received by Buyer or its
Representatives from any third party and/or any Governmental Authorities with
respect to the transactions contemplated hereby, other than with respect to the
Debt Financing for which Buyer's obligations shall be governed by Section
6.7(a). Buyer shall promptly furnish to CenterPoint and Genco Holdings such
necessary information and reasonable assistance as CenterPoint and Genco
Holdings may request in connection with the foregoing and shall promptly provide
counsel for CenterPoint and Genco Holdings with copies of all filings made by
Buyer, and all correspondence between Buyer (and its Representatives) with any
Governmental Authority and any other information supplied by Buyer (and its
Representatives) to a Governmental Authority in connection herewith and the
transactions contemplated hereby. Buyer shall, subject to applicable Law, permit
counsel for CenterPoint and Genco Holdings reasonable opportunity to review in
advance, and consider in good faith the views of CenterPoint and Genco Holdings
in connection with, any proposed written communication by Buyer to any
Governmental Authority. Buyer agrees not to participate in any substantive
meeting or discussion, either in person or by telephone, with any Governmental
Authority in connection herewith and the transactions contemplated hereby unless
it consults with CenterPoint and Genco Holdings in advance

                                       47
<PAGE>

and, to the extent not prohibited by such Governmental Authority, gives
CenterPoint and Genco Holdings and its respective counsel the opportunity to
attend and participate.

            (i) In the event and for so long as Buyer actively is prosecuting,
contesting or defending any Action against a third party in connection with (i)
any transactions contemplated under this Agreement or (ii) any fact, situation,
circumstance, status, condition, activity, practice, plan, occurrence, event,
incident, action, failure to act, or transaction involving the Companies arising
out of or related to facts or events, existing prior to the STP Acquisition
Closing, the Parents shall, and shall cause their respective affiliates to,
cooperate with Buyer and, after the STP Acquisition Closing, the Companies and
their counsel in the prosecution, contest or defense, make available its
personnel, and provide such testimony and access to its books and records and
facilities as shall be reasonably necessary in connection with the prosecution,
contest or defense, all at the sole control, cost and expense of the Companies.

            (j) Genco Holdings shall use its reasonable best efforts to obtain
from the IRS prior to the STP Acquisition Closing (i) a ruling that the indirect
transfer of the assets of the Qualified Decommissioning Fund pursuant to this
Agreement is not a taxable event and (ii) a ruling that Genco Holdings will
continue to be entitled to make tax-deductible contributions to the Qualified
Decommissioning Fund after the STP Acquisition Closing. Parent and Genco
Holdings shall keep Buyer apprised of the status of any communications with, and
any inquiries or requests for additional information from, the IRS with respect
to such rulings and shall promptly respond to any such inquiry or request.

            Section 6.4 Commercially Reasonable Efforts. Each of Parents, Genco
Holdings and Buyer shall cooperate, and use commercially reasonable efforts to
take, or cause to be taken, all action, and to do, or cause to be done, all
things necessary, proper or advisable under applicable Laws to consummate the
transactions contemplated by this Agreement. Without limiting the foregoing,
after the Non-STP Acquisition Closing, each of the parties at the reasonable
request of the other shall execute and deliver, or cause to be executed and
delivered, such assignments, deeds, bills of sale and other instruments of
transfer as any party reasonably may request as necessary, proper or advisable
in order to effect or further evidence the Non-STP Acquisition and the other
transactions contemplated thereby. In addition, at the STP Acquisition Closing,
Parents shall deliver, or cause to be delivered, to Buyer all minute books,
stock record books (or similar registries) and corporate (or similar) records
and seals of the Companies held by Parents or their respective affiliates (other
than the Companies) or otherwise not in the possession of the Companies, other
than such items delivered in connection with the Non-STP Acquisition.

            Section 6.5 Public Announcements. Prior to the STP Acquisition
Closing, except as otherwise agreed to by the parties, the parties shall not
issue any report, statement or press release or otherwise make any public
statements with respect to this Agreement and the transactions contemplated by
this Agreement, except as described in the following sentence and in the
reasonable judgment of the party may be required by Law (including in connection
with regulatory proceedings) or in connection with its

                                       48
<PAGE>

obligations as a publicly-held, exchange-listed or Nasdaq-quoted company, in
which case the parties will use their commercially reasonable efforts to reach
mutual agreement as to the language of any such report, statement or press
release. Upon the execution of this Agreement and upon each of the Public
Company Merger Closing, the Non-STP Acquisition Closing and the STP Acquisition
Closing, the parties will consult with each other with respect to the issuance
of a joint report, statement or press release with respect to this Agreement and
the transactions contemplated by this Agreement.

            Section 6.6 Tax Matters.

            (a) No Election Under Section 338(h)(10). CenterPoint and Buyer
agree that they will not make a joint election under Section 338(h)(10) of the
Code or under any comparable provision of state or local Law (an "ELECTION")
with respect to the STP Acquisition.

            (b) Indemnification.

                  (i) Parents' Indemnification of Buyer. Notwithstanding
      anything in the Spin-off Separation Agreement to the contrary, Parents
      shall indemnify Buyer and the Companies from, against and in respect of
      any (A) Taxes (as defined in Section 6.6(n) of this Agreement) with
      respect to the Non-STP Assets and Liabilities for any Taxable period
      ending on or prior to the Non-STP Acquisition Closing Date and the portion
      of any Straddle Period ending on the Non-STP Acquisition Closing Date
      (determined in accordance with the provisions of paragraph (c) below), (B)
      Taxes imposed on any Company (including, without limitation, any Taxes
      attributable to the Non-STP Acquisition or the Genco LP Division) for any
      Taxable period ending on or prior to the STP Acquisition Closing Date and
      the portion of any Straddle Period ending on the STP Acquisition Closing
      Date (determined in accordance with the provisions of paragraph (c)
      below), (C) Taxes for which any Company may be liable under Treasury
      Regulation Section 1.1502-6 (or any corresponding provision of state,
      local or foreign Law), as a member of an affiliated, consolidated or
      combined group, (D) Taxes of any other person for which any Company may be
      liable as a transferee or successor, by contract or otherwise, (E) Taxes
      resulting from any obligation under, any Tax sharing, Tax indemnity or
      similar contract and (F) any Transfer Taxes (as defined below) for which
      either Parent is liable under Section 6.6(f) of this Agreement.

                  (ii) Buyer's Indemnification of Parents. Buyer shall indemnify
      Parents from, against and in respect of any liability of Parents or their
      subsidiaries for any (A) Taxes with respect to the Non-STP Assets and
      Liabilities for any Taxable period beginning after the Non-STP Acquisition
      Closing Date and the portion of any Straddle Period beginning after the
      Non-STP Acquisition Closing Date (determined in accordance with the
      provisions of paragraph (c) below), (B) Taxes imposed on any Company for
      any Taxable period beginning after the STP Acquisition Closing Date and
      the portion of any Straddle Period beginning after the STP Acquisition
      Closing Date (determined in accordance with the provisions

                                       49
<PAGE>

      of paragraph (c) below); and (C) Transfer Taxes for which Buyer is liable
      under Section 6.6(f) of this Agreement.

            (c) Computation of Tax Liabilities; Proration of Taxes and Earnings
and Profits. To the extent permitted by applicable Law or administrative
practice, the taxable years of the Companies shall end on and include the
Non-STP Acquisition Closing Date with respect to any Company acquired (directly
or indirectly) by Buyer on such date or STP Acquisition Closing Date with
respect to any Company acquired (directly or indirectly) by Buyer on such date.
Whenever it is necessary to determine the liability for Taxes, or the earnings
and profits, for a portion of a taxable year or period that begins before and
ends after, as applicable, the Non-STP Acquisition Closing Date or the STP
Acquisition Closing Date (the "APPLICABLE CLOSING DATE") (a "STRADDLE PERIOD"),
the determination of the Taxes or the earnings and profits for the portion of
the year or period ending on, and the portion of the year or period beginning
after, the Applicable Closing Date shall be determined by assuming that the
taxable year or period ended on and included the Applicable Closing Date, except
that exemptions, allowances or deductions that are calculated on an annual basis
and annual property taxes shall be prorated on the basis of the number of days
in the annual period elapsed through the Applicable Closing Date as compared to
the number of days in the annual period elapsing after the Applicable Closing
Date. Notwithstanding anything to the contrary herein, any franchise Tax paid or
payable with respect to any Company shall be allocated to the taxable period
during which the income, operations, assets or capital comprising the base of
such Tax is measured, regardless of whether the right to do business for another
taxable period is obtained by the payment of such franchise Tax.

            (d) Tax Returns.

                  (i) Parents shall prepare, or cause to be prepared, in
      accordance with past practice unless otherwise required by applicable Law,
      and file or cause to be filed when due Tax Returns with respect to the
      Companies for any taxable period, or portion thereof, ending on or before
      the STP Acquisition Closing Date which are required or permitted by
      applicable Law or administrative practice to be filed with respect to a
      taxable period, or portion thereof, ending on or before the STP
      Acquisition Closing Date.

                  (ii) Buyer shall prepare, or cause to be prepared, and file or
      cause to be filed when due all other Tax Returns with respect to the
      Companies required to be filed with respect to a taxable period, or
      portion thereof, ending after the STP Acquisition Closing Date.

                  (iii) If either Buyer or Parents may be liable for any
      material portion of the Tax payable in connection with any Tax Return to
      be filed by the other (or any item reported on such Tax Return is likely
      to affect the Tax liability of such party), the party responsible under
      this Agreement for filing such return (the "PREPARER") shall prepare and
      deliver to the other party (the "PAYOR") a copy of such return and any
      schedules, work papers and other documentation then available that are
      relevant to the preparation of the portion of such return for

                                       50
<PAGE>

      which the Payor is or may be liable under this Agreement not later than 45
      days before the Due Date (as defined in Section 6.6(n) of this Agreement).
      The Preparer shall not file such return until the earlier of either the
      receipt of written notice from the Payor indicating the Payor's consent
      thereto, or the Due Date.

            The Payor shall have the option of providing to the Preparer, at any
time at least 15 days prior to the Due Date, written instructions as to how the
Payor wants any, or all, of the items for which it may be liable (or any item
that is likely to affect the Tax liability of such party) reflected on such Tax
Return. The Preparer shall, in preparing such return, cause the items for which
the Payor is liable under this Agreement to be reflected in accordance with the
Payor's instructions (unless, in the opinion of a partner of a nationally
recognized law firm retained by the Preparer, complying with the Payor's
instructions would likely subject the Preparer to any criminal penalty or to
civil penalties under sections 6662 through 6664 of the Code or similar
provisions of applicable state, local or foreign Law) and, in the absence of
having received such instructions, in accordance with past practice.

            If the Preparer fails to satisfy its obligations under this Section
6.6(d), the Payor shall have no obligation to indemnify the Preparer for any
Taxes which are reflected on any such return or any related loss, and shall
retain any and all remedies it may otherwise have which arise out of such
failure.

            (e)   Contest Provisions.

                  (i)   Notification of Contests. Each of Buyer, on the one
      hand, and Parents, on the other hand (the "RECIPIENT"), shall notify the
      chief tax officer (or other appropriate person) of Parents or Buyer, as
      the case may be, in writing within 15 days of receipt by the Recipient of
      written notice of any pending or threatened audits, adjustments or
      assessments (a "TAX AUDIT") which are likely to affect the liability for
      Taxes of such other party. If the Recipient fails to give such prompt
      notice to the other party, it shall not be entitled to indemnification for
      any Taxes arising in connection with such Tax Audit to the extent that
      such failure to give notice adversely affects the other party's right to
      participate in the Tax Audit.

                  (ii)  Which Party Controls.

                        (a)   Parents' Items. If such Tax Audit relates to any
            taxable period, or portion thereof, ending on or before the
            Applicable Closing Date or for any Taxes for which Parents are
            liable in full under this Agreement, Parents shall, at their
            expense, control the defense and settlement of such Tax Audit.

                        (b)   Buyer's Items. If such Tax Audit relates to any
            taxable period, or portion thereof, beginning on or after the
            Applicable Closing Date or for any Taxes for which Buyer is liable
            in full under this Agreement, Buyer shall, at its expense, control
            the defense and settlement of such Tax Audit.

                                       51
<PAGE>

                        (c)   Combined and Mixed Items. If such Tax Audit
            relates to Taxes for which both Parents and Buyer are liable under
            this Agreement, to the extent practicable such Tax Items (as defined
            in Section 6.6(n) of this Agreement) will be distinguished and each
            party will control the defense and settlement of those Taxes for
            which it is so liable. If such Tax Audit relates to a taxable
            period, or portion thereof, beginning before and ending after the
            Applicable Closing Date and any Tax Item cannot be identified as
            being a liability of only one party or cannot be separated from a
            Tax Item for which the other party is liable, Parents, at their
            expense, shall control the defense and settlement of the Tax Audit,
            provided that such party defends the items as reported on the
            relevant Tax Return and provided further that no such matter shall
            be settled without the written consent of both parties, not to be
            unreasonably withheld.

                        (d)   Participation Rights. Any party whose liability
            for Taxes may be affected by a Tax Audit shall be entitled to
            participate at its expense in such defense and to employ counsel of
            its choice at its expense and shall have the right to consent to any
            settlement of such Tax Audit, (such consent not to be unreasonably
            withheld) to the extent that such settlement would have an adverse
            effect for a period for which that party is liable for Taxes, under
            this Agreement or otherwise.

            (f)   Transfer Taxes. All excise, sales, use, transfer (including

real property transfer or gains), stamp, documentary, filing, recordation and
other similar taxes, together with any interest, additions or penalties with
respect thereto and any interest in respect of such additions or penalties,
resulting directly from the Non-STP Acquisition or the STP Acquisition (the
"TRANSFER TAXES"), shall be shared equally by Parents and Buyer. Notwithstanding
Section 6.6(d) of this Agreement, which shall not apply to Tax Returns relating
to Transfer Taxes, any Tax Returns that must be filed in connection with
Transfer Taxes shall be prepared and filed when due by the party primarily or
customarily responsible under the applicable local Law for filing such Tax
Returns, and such party will use its commercially reasonable efforts to provide
such Tax Returns to the other party at least 10 days prior to the Due Date for
such Tax Returns.

            (g)   Buyer's Claiming, Receiving or Using of Refunds and
Overpayments. If, after the STP Acquisition Closing Date, Buyer or any Company
(i) receives any refund or (ii) actually utilizes the benefit of any overpayment
of Taxes which, in each case (i) and (ii), (A) relates to Taxes paid by Parents
or any Company with respect to a taxable period, or portion thereof, ending on
or before the STP Acquisition Closing Date, or (B) is the subject of
indemnification by Parents under this Agreement, Buyer shall promptly transfer,
or cause to be transferred, to Parents the entire amount of the refund or
overpayment (including interest, if any, received from the Taxing Authority with
respect to such refund) received or actually utilized by Buyer or any Company
(net of any tax thereon), provided, however, that any refund or tax benefit
related to the carryback of any Tax Item of any Company from a taxable period
beginning after the STP Acquisition Closing Date to a taxable period ending on
or before the STP Acquisition Closing Date to the extent permitted by Section
6.6(h) shall be for the

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<PAGE>

account of Buyer. Buyer agrees to notify Parents within 15 days following the
receipt of any such refund or actual utilization of any such overpayment.

            (h)   Buyer shall make, and shall cause the Companies to make,
elections under Section 172(b)(3) and any other applicable provision of the Code
and the Treasury Regulations promulgated thereunder, and under any comparable
provision of any state, local or foreign tax law in any state, locality or
foreign jurisdiction in which any Company files a combined, consolidated or
unitary return with Parents, to relinquish the entire carryback period with
respect to any Tax Item of any Company arising in any taxable period beginning
after the STP Acquisition Closing Date that could be carried back to a taxable
year of such Company ending on or before the STP Acquisition Closing Date;
provided, however, that with respect to any such item for which an election
cannot be made under applicable Law, Parents shall be required to pay to Buyer
or the applicable Company thereof any Tax refund received or credit utilized
that results solely from such carryback net of any costs of Seller in procuring
such Tax refund or credit. To the extent permitted by this Section 6.6(h),
Parents shall permit Buyer or any Company to (or, with respect to consolidated,
combined or unitary income taxes, Parents shall at Buyer's request) amend and
file any Tax Return filed by or including any Company in order to carryback any
Tax Item of any Company from a taxable period beginning after the STP
Acquisition Closing Date to a taxable period ending on or before the STP
Acquisition Closing Date.

            (i)   Resolution of All Tax-Related Disputes. In the event that
Parents and Buyer cannot agree on the calculation of any amount relating to
Taxes or the interpretation or application of any provision of this Agreement
relating to Taxes, such dispute shall be resolved by a partner at a nationally
recognized law firm or nationally recognized accounting firm mutually acceptable
to Parents and Buyer, whose decision shall be final and binding upon all persons
involved and whose expenses shall be shared equally by Parents and Buyer.

            (j)   Post-Closing Actions Which Affect Liability for Taxes.

                        (a)   Buyer shall not permit any Company to take any
            action on or after the Applicable Closing Date which could
            materially increase Parents' liability for Taxes (including any
            liability of Parents to indemnify Buyer and the Companies for Taxes
            under this Agreement). Parents shall not take any action on or after
            the Applicable Closing Date which could materially increase Buyer's
            or any Company's liability for Taxes (including any liability of
            Buyer or any Company to indemnify Parents for Taxes under this
            Agreement).

                        (b)   Except to the extent required by applicable Law,
            or as provided in Sections 6.6(g) and (h), neither Buyer, Parents,
            any Company nor any affiliate of any of them shall, without the
            prior written consent of the other party, amend any Tax Return (with
            respect to any Tax Item of any Company) filed by, or with respect
            to, any Company or any of

                                       53
<PAGE>

            their subsidiaries for any taxable period, or portion thereof,
            beginning before the Applicable Closing Date.

            (k)   Assistance and Cooperation. The parties agree that, after the
Applicable Closing Date:

                  (i)   Each party shall assist (and cause their respective
      affiliates to assist) the other party in preparing any Tax Returns which
      such other party is responsible for preparing and filing;

                  (ii)  The parties shall cooperate fully in preparing for any
      Tax Audits, or disputes with taxing authorities, relating to any Tax
      Returns or Taxes of any Company, including providing access to relevant
      books and records relating to Taxes at issue;

                  (iii) The parties shall make available to each other and to
      any taxing authority as reasonably requested all relevant books and
      records relating to Taxes;

                  (iv)  Each party shall promptly furnish the other party with
      copies of all relevant correspondence received from any taxing authority
      in connection with any Tax Audit or information request relating to Taxes
      for which such other party may have an indemnification obligation under
      this Agreement; and

                  (v)   Except as otherwise provided in this Agreement, the
      party requesting assistance or cooperation shall bear the other party's
      out-of-pocket expenses in complying with such request to the extent that
      those expenses are attributable to fees and other costs of unaffiliated
      third-party service providers.

            (l)   This Section 6.6 alone shall govern the procedure for all Tax
indemnification claims.

            (m)   The Tax Allocation Agreement by and among CenterPoint Energy,
Inc. and its Affiliated Companies and Texas Genco Holdings, Inc. and its
Affiliated Companies dated as of August 31, 2002 (the "Tax Allocation
Agreement"), shall remain in effect until (i) the Non-STP Acquisition Closing
Date, with respect to any Company acquired (directly or indirectly) by Buyer on
such date or (ii) the STP Acquisition Closing Date, with respect to any Company
acquired (directly or indirectly) by Buyer on such date, at which time such
agreement, and any other Tax sharing agreement or arrangements, written or
unwritten, binding any Company shall terminate. Notwithstanding the foregoing,
unless the transactions contemplated by this Agreement are terminated, no
payments shall be made by Genco Holdings or any other Company under the Tax
Allocation Agreement or any Tax sharing agreements or arrangements, other than
payments with respect to current Taxes payable imposed in the ordinary course of
business for the current taxable period (the "Permitted Payments")(for the
avoidance of doubt, such Permitted Payments shall exclude (A) any Taxes relating
to the Non-STP Acquisition or the Genco LP Division and (B) any adjustments
which would otherwise be

                                       54
<PAGE>

made to Taxes paid under such Tax Allocation Agreement by Genco Holdings or any
other Company for prior periods), and provided, however that any Permitted
Payments that would not have been due under the terms of the Tax Allocation
Agreement until after the Non-STP Acquisition Closing Date or STP Acquisition
Closing Date, as applicable, shall be paid on the date set forth in such Tax
Allocation Agreement (notwithstanding the fact that such Tax Allocation
Agreement may have been previously terminated pursuant to this Section 6.6(m)).

            (n)   For purposes of this Agreement, "TAX" or "TAXES" shall mean
taxes (other than the Transfer Taxes) of any kind, levies or other like
assessments, customs, duties, imposts, charges or fees, including income taxes,
gross receipts, ad valorem, value added, excise, real or personal property,
asset, sales, use, license, payroll, transaction, capital, net worth, franchise,
withholding, estimated, social security, utility, workers' compensation,
severance, production, unemployment compensation, occupation, premium, windfall
profits, transfer and gains taxes, unclaimed property and escheat obligations,
franchise fees, street rentals, right-of-way fees and any other fees or
impositions related to the use or occupancy of public rights of way or other
governmental taxes imposed by or payable to the United States, or any state,
county, local or foreign government or subdivision or agency thereof, together
with any interest, penalties or additions with respect thereto and any interest
in respect of such additions or penalties; "DUE DATE" shall mean, with respect
to any Tax Return, the date such return is due to be filed (taking into account
any valid extensions); "TAX ITEM" shall mean, with respect to Taxes, any item of
income, gain, deduction, loss or credit or other tax attribute "TAX RETURN"
shall mean any return, declaration, report, claim for refund or information
return or statement relating to Taxes, including any schedule or attachment
thereto, and including any amendment thereof.

            Section 6.7 Debt Financing.

            (a)   Parents and Genco Holdings agree to provide, and shall cause
each Company and their respective Representatives to provide, all cooperation
reasonably requested by Buyer and necessary in connection with the arrangement
of the Debt Financing, including (i) participation in meetings, drafting
sessions, due diligence sessions, management presentation sessions, "road shows"
and sessions with rating agencies, (ii) preparation by Genco Holdings of
business projections, financial statements, offering memoranda, private
placement memoranda, prospectuses and similar documents and (iii) execution and
delivery by the Companies of any underwriting or placement agreements, pledge
and security documents, other definitive financing documents, including any
indemnity agreements, or other requested certificates or documents, including a
certificate of the chief financial officers of any Company with respect to
solvency matters, comfort letters of accountants, consents of accountants for
use of their reports in any materials relating to the financing to be used in
connection with the transactions contemplated by this Agreement, legal opinions,
engineering reports, environmental reports, surveys and title insurance as may
be reasonably requested by Buyer, provided, however, that no such agreements or
documents shall impose any monetary obligation or liability (i) on the Companies
(excluding, for the avoidance of doubt, the Non-STP Assets and Liabilities in
any Company acquired in the Non-STP

                                       55
<PAGE>

Acquisition) prior to the STP Acquisition Closing other than payment obligations
under the Overnight Bridge Loan, or (ii) on CenterPoint or any of its affiliates
other than the Companies. Parents and Genco Holdings shall use commercially
reasonable efforts to cause Deloitte & Touche LLP, the independent auditors of
the Companies, to provide any unqualified opinions, consents or customary
comfort letters with respect to the financial statements needed in connection
with the Debt Financing. Genco Holdings agrees to allow Buyer's accounting
representatives the opportunity to review the financial statements in draft form
and to allow such representatives access to each Company and supporting
documentation with respect to the preparation of such financial statements and
to use commercially reasonable efforts to cause its independent auditors to
provide reasonable access to their working papers relating to procedures
performed with respect to such financial statements. Buyer shall keep
CenterPoint reasonably apprised of the status of all material matters relating
to the arrangement of the Debt Financing and shall give CenterPoint and Genco
Holdings prompt written notice of (i) any material breach by any party of the
Debt Financing Letter (or any definitive agreements entered into pursuant
thereto) or (ii) any termination of the Debt Financing Letter.

            (b)   Without limiting the generality of the provisions of Section
6.7(a), to the extent reasonably required in connection with the Debt Financing,
Genco Holdings shall use commercially reasonable efforts to provide, or cause
each of the Company and their respective Representatives to provide, the
following:

                  (i)   (1) for each tract of Real Property constituting a power
      generating site and the power generating assets located thereon owned by
      one of the Companies ("Plant Real Property"), and for the Energy
      Development Center, Texas standard form owner's (with respect to the
      portion thereof constituting Owned Real Property) and leasehold (with
      respect to the portion thereof constituting Leased Real Property) title
      insurance policies and, if applicable, a Texas standard form mortgagee's
      policy of title insurance reasonably satisfactory to Buyer's sources of
      Debt Financing ("BUYER'S LENDER") from one or more nationally recognized
      title companies satisfactory to Buyer, Genco Holdings and CenterPoint (the
      "TITLE COMPANY"), with each such policy (A) dated as of the Public Company
      Merger Closing Date, (B) in an amount reasonably acceptable to Buyer, (C)
      accompanied by copies of all documents referenced as exceptions to title,
      (D) insuring good, valid and indefeasible fee simple title to the Owned
      Real Property and good, valid and indefeasible leasehold interest in the
      Leased Real Property in one of the Companies subject only to the Permitted
      Liens and such matters as may be reasonably requested by Buyer, (E) naming
      such Company as "insured" and (F) containing such other available
      endorsements (including, without limitation, non-imputation endorsements)
      and affirmative coverages as Buyer may reasonably request, and (2) duly
      executed affidavits and other documents executed by the Companies,
      consistent with local practice, as are necessary to induce the Title
      Company to issue the policies, endorsements and affirmative coverages
      described in the manner set forth above in subclause (1);

                  (ii)  a new or recertified survey for each Plant Real Property
      and the Energy Development Center (a "SURVEY") of the type and with such
      detail as a

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<PAGE>

      reasonably prudent financial institution making a project financing loan
      for existing electric power generating plants would require (the "SURVEY
      STANDARD"), prepared or recertified on or after the date of this Agreement
      by land surveyors licensed in the states in which the Owned Real Property
      is located, which Surveys have been certified or recertified by said
      surveyors to each Company, Buyer, Buyer's Lender and, to the extent
      necessary to satisfy the Survey Standard set forth above, show the
      following items: (A) no material violation of any setback or building line
      requirement (whether such requirements are imposed by Law or deed or
      plat), unless the Title Company is willing and able to insure over such
      violation; (B) no material encroachment by improvements located on
      adjoining properties onto any material portion of any Plant Real Property
      or the Energy Development Center, or by improvements located on any
      material portion of Plant Real Property or the Energy Development Center,
      onto adjoining properties, easements, utilities or rights of way, unless
      the Title Company is willing and able to insure over such encroachment;
      (C) adequate means of ingress and egress to and from each Plant Real
      Property or the Energy Development Center; and (D) the CEHE Land (if any)
      adjacent to each tract of Owned Real Property constituting Plant Real
      Property;

                  (iii) a current estoppel certificate, in form reasonably
      satisfactory to Buyer, for each Lease, from each lessor thereunder; and

                  (iv)  for all Real Property other than Plant Real Property and
      the Energy Development Center, such evidence of title as a reasonably
      prudent financial institution making a project financing loan for an
      existing portfolio of electric power generating assets would require.

            (c)   Buyer shall use commercially reasonable efforts to arrange the
Debt Financing on the terms and conditions described in the Debt Financing
Letter, including using commercially reasonable efforts (i) to negotiate
definitive agreements with respect thereto on the terms and conditions contained
therein and (ii) to satisfy all conditions applicable to Buyer in such
definitive agreements that are within its control. In the event any portion of
the Debt Financing becomes unavailable in the manner or from the sources
contemplated in the Debt Financing Letter, Buyer shall use commercially
reasonable efforts to arrange any such portion from alternative sources on terms
and conditions which are, in the reasonable judgment of Buyer, comparable or
more favorable (to Buyer) in the aggregate thereto, and to the extent that any
terms and conditions are not set forth in the Debt Financing Letter, on terms
and conditions reasonably satisfactory to Buyer.

            (d)   CenterPoint and Genco Holdings shall use commercially
reasonable efforts to obtain any waivers, amendments, modifications or
supplements necessary in connection with the transactions contemplated by this
Agreement to the Credit Agreement or the Credit Agreement, dated October 7,
2003, among CenterPoint, as Borrower, and JPMorgan Chase Bank, as Administrative
Agent.

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<PAGE>

            (e)   All documented out-of-pocket costs and expenses reasonably
incurred by Parents or the Companies in complying with Sections 6.7(a), (b) or
(c) shall be paid by Buyer, unless this Agreement is terminated prior to the
Public Company Merger Effective Time (i) under circumstances in which Buyer
would have the right to terminate this Agreement under Section 10.1(c) or (ii)
as a result of the failure of the conditions set forth in Section 8.3(a) or
8.3(b) to be satisfied. All documented out-of-pocket costs and expenses incurred
reasonably by Genco Holdings in complying with Section 6.7(d) shall be paid by
CenterPoint.

            Section 6.8 Employees; Employee Benefits.

            (a)   On or as soon as reasonably practicable following the
execution of this Agreement, Genco Holdings shall provide Buyer with a true and
complete list (which shall be confirmed and adjusted as necessary five (5) days
prior to the Non-STP Acquisition Closing Date or, in the case of the employees
listed on Section 6.8(a) of the Companies Disclosure Letter (the "SCHEDULED
EMPLOYEES"), the STP Acquisition Closing Date) of (i) all individuals who are
employed by the Companies on a full-time, permanent or part-time basis
principally at or with respect to the business of the Companies immediately
prior to the Non-STP Acquisition Closing Date or, in the case of the Scheduled
Employees, the STP Acquisition Closing Date (such individuals hereinafter
referred to as the "ACTIVE COMPANY EMPLOYEES"), which list shall include each
Active Company Employee's name, position, hourly wage rate or salary, total
compensation (including incentive and similar compensation), the Company by
which such Active Company Employee is employed, and the vacation time to which
each employee is entitled (for purposes of Section 6.8(b)), and (ii) all
individuals who are employees of the Companies on a full-time, permanent or
part-time basis and are on a leave of absence (due to sickness, disability or
any other reason) immediately prior to the Non-STP Acquisition Closing Date or,
in the case of the Scheduled Employees, the STP Acquisition Closing Date (such
individuals hereinafter referred to as the "EMPLOYEES ON LEAVE"), which list
shall include the same information provided in clause (i) for Active Company
Employees. The parties agree that an Employee on Leave who returns to active
employment with the Companies at his or her former work location not later than
twelve (12) weeks from the Non-STP Acquisition Closing Date or, in the case of
the Scheduled Employees, the STP Acquisition Closing Date (or such later date as
required by Law) shall be considered an Active Company Employee as of the date
such individual returns to active employment with a Company at his or her former
work location. None of the Companies, Buyer or Buyer's affiliates shall have any
obligation under this Agreement to continue the employment of any Active Company
Employee or Employee on Leave following the Non-STP Acquisition Closing Date or,
in the case of the Scheduled Employees, the STP Acquisition Closing Date.
Parents shall retain all responsibility and liability for any wages,
compensation or benefits for any individual employee while such individual is an
Employee on Leave until (and if) such individual becomes an Active Company
Employee.

            (b)   From and after the Non-STP Acquisition Closing Date or, in the
case of the Scheduled Employees, the STP Acquisition Closing Date, Buyer and its
affiliates will honor in accordance with their terms and this Agreement the
executive,

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<PAGE>

employment and other agreements and arrangements set forth in Section 6.8(b) of
the Companies Disclosure Letter, as of the date of this Agreement, between a
Company and certain employees and former employees thereof, and all of the
Plans; provided, however, that nothing herein shall preclude any change in any
Plan, including termination of any Plan, effective on a prospective basis, and
consistent with applicable Law. Beginning immediately after the Non-STP
Acquisition Closing Date or, in the case of the Scheduled Employees, the STP
Acquisition Closing Date, any Employee Welfare Benefit Plan or material fringe
benefit including vacation pay or paid sick leave, that Buyer maintains,
contributes to or participates in (collectively, "BUYER EMPLOYEE BENEFIT PLANS")
shall be made available to each Active Company Employee when, and on the same
terms and conditions, such Buyer Employee Benefit Plan would be made available
to a new employee of Buyer or its controlled affiliates who is similarly
situated to the Active Company Employee; provided, however, that, during the
one-year period commencing on the Non-STP Acquisition Closing Date, and subject
to Section 6.8(h) of this Agreement, health and welfare benefits provided under
the Employee Welfare Benefit Plans of the Companies and Buyer or its affiliates
for the Active Company Employees shall be substantially similar in the aggregate
to such benefits provided to Active Company Employees immediately prior to the
execution of this Agreement by the Companies and Parents, with such changes to
such Plans, but only to the extent permitted under section 6.1(j) of this
Agreement; and provided, further, that nothing in this Section 6.8(b) shall
result in Buyer providing a duplication of benefits to any Company Employees or
Active Company Employees. Buyer and Buyer Employee Benefit Plans shall recognize
(i) all of each Active Company Employee's time of employment and service with
Parents, their affiliates and the Companies, as applicable, from such Active
Company Employee's initial date of hire through the Non-STP Acquisition Closing
Date or, in the case of the Scheduled Employees, the STP Acquisition Closing
Date for the purpose of determining vesting and eligibility (but not for
purposes of benefit accruals) under Buyer Employee Benefit Plans, (ii) the
amount of annual vacation time under Buyer's vacation policy to which an Active
Company Employee shall be entitled, and (iii) all other purposes for which such
service is either taken into account or recognized; provided, however, that such
service need not be credited to the extent it would result in a duplication of
benefits. On and after the Non-STP Acquisition Closing Date until (i) December
31, 2004, if the Non-STP Acquisition Closing occurs in 2004, or (ii) June 30,
2005, if the Non-STP Acquisition Closing occurs in 2005 (such period the
"TRANSITION PERIOD"), each Active Company Employee shall continue to be covered
under the Company vacation policy and sick leave policy in which such Active
Company Employee participated immediately prior to the Non-STP Acquisition
Closing or, in the case of the Scheduled Employees, the STP Acquisition Closing
Date. During the year in which the Non-STP Acquisition Closing or, in the case
of the Scheduled Employees, the STP Acquisition Closing Date occurs, in addition
to vacation time earned or accrued with any Company, Buyer or its affiliate
after the Non-STP Acquisition Closing or, in the case of the Scheduled
Employees, the STP Acquisition Closing Date, each Active Company Employee shall
be entitled to receive any unused earned or accrued vacation time with the
Company, Buyer or its affiliates that he or she may have accrued or earned
immediately prior to the Non-STP Acquisition Closing Date or, in the case of the
Scheduled Employees, the STP Acquisition Closing Date, subject to management

                                       59
<PAGE>

approval for the specific days of vacation required by the Active Company
Employee; provided, however, that, if Buyer deems it necessary to disallow such
Active Company Employee from taking such earned or accrued vacation and such
vacation cannot be rescheduled, Buyer shall be liable for and pay in cash to
each such Active Company Employee an amount equal to the vacation time not taken
as provided under the terms of the vacation policy. Any Active Company Employee
whose employment is voluntarily or involuntarily terminated by Buyer during the
Transition Period shall receive pay for earned or accrued and unused vacation
time in accordance with such Company's vacation policy as in effect immediately
prior to the Non-STP Acquisition Closing or, in the case of the Scheduled
Employees, the STP Acquisition Closing Date.

            (c)   If the Non-STP Acquisition Closing occurs during 2004, then
Buyer shall cause each Company (or its affiliates) to, or, Buyer shall, continue
and maintain in effect and operation the Texas Genco Holdings, Inc. Short-Term
Incentive Plan ("TGN STI PLAN"), as in effect on the date of this Agreement,
subject to such changes as permitted in Section 6.8(c) of the Companies
Disclosure Letter, with the same performance goals and objectives as established
for 2004, for the remainder of 2004, and, provided and to the extent such 2004
performance goals are met, bonuses earned for 2004 shall be paid under the TGN
STI Plan to the Active Company Employees covered by such plan in 2005 in
accordance with the terms of the TGN STI Plan. If the Non-STP Acquisition
Closing occurs after June 30, 2005, then Buyer shall cause each Company (or its
affiliates) or, Buyer shall, continue and maintain in effect and operation the
TGN STI Plan, as in effect on the date of this Agreement, subject to such
changes as are permitted in Section 6.8(c) of the Companies Disclosure Letter,
with the same performance goals and objectives as established for 2005, and,
provided and to the extent such 2005 performance goals are met, bonuses earned
for 2005 shall be paid under the TGN STI Plan to the Active Company Employees
covered by such plan in 2006 in accordance with the terms of the TGN STI Plan.
From the date of this Agreement until the Non-STP Acquisition Closing Date,
Parents shall, or shall cause the Companies to, accrue the target amounts
payable under the TGN STI Plan in respect of the period prior to the Non-STP
Acquisition Closing Date.

            (d)   Notwithstanding anything to the contrary in this Section 6.8,
Parents shall be liable for any amounts to which any Company Employee becomes
entitled under any benefit, retention or severance policy, plan, agreement
arrangement or program which exists or arises or may be deemed to exist or
arise, under any applicable Law or otherwise, as a result of, or in connection
with, the transactions contemplated by this Agreement other than an Active
Company Employee whose employment is terminated (following the Non-STP
Acquisition Closing) on or after the Non-STP Acquisition Closing Date or, in the
case of the Scheduled Employees, the STP Acquisition Closing Date. In the event
that an Active Company Employee's employment is terminated, other than for cause
(as defined in Section 6.8(f)), by Buyer, its affiliates or any Company
(following the Non-STP Acquisition Closing) on or after the Non-STP Acquisition
Closing Date or, in the case of the Scheduled Employees, the STP Acquisition
Closing Date, then Buyer shall be responsible for severance costs for such
Active Company Employee, including any severance benefits due under Section
6.8(f) below. Buyer shall be responsible and assume all liability for all
notices or payments due

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<PAGE>

to any Active Company Employees, and all notices, payments, fines or assessments
due to any governmental authority, under any applicable foreign, federal, state
or local Law with respect to the employment, discharge or layoff of employees by
any Company after the Non-STP Acquisition Closing Date or, in the case of the
Scheduled Employees, the STP Acquisition Closing Date, including, but not
limited to, the Worker Adjustment and Retraining Notification Act and any rules
or regulations as have been issued in connection with the foregoing. On or
promptly after the Non-STP Acquisition Closing or, in the case of the Scheduled
Employees, the STP Acquisition Closing Date, Parents (to the extent Parents have
such information and the Companies do not have such information) and the
Companies shall provide to Buyer a list of all Company Employees whose
employment was terminated within 90 days prior to the Non-STP Acquisition
Closing or, in the case of the Scheduled Employees, the STP Acquisition Closing
Date and the date that each such Company Employee was terminated.

            (e)   Buyer and Parents agree that prior to the Non-STP Acquisition
Closing Date Genco LP (or such other appropriate Company) may establish the
Texas Genco Retirement Plan, and related trust ("TGN RETIREMENT PLAN"), Texas
Genco Savings Plan, and related trust ("TGN SAVINGS PLAN"), and Texas Genco
Benefit Restoration Plan ("TGN BRP") to provide benefits for eligible Company
Employees; provided, however, that prior to the STP Acquisition Closing Date,
the Scheduled Employees shall not be eligible to participate in any such plans.
The TGN Retirement Plan shall be a pension plan, intended to be qualified under
Section 401(a) of the Code, established to provide benefits for Company
Employees that are substantially similar to the benefits provided for such
employees under the CenterPoint Energy, Inc. Retirement Plan (the "CNP
RETIREMENT PLAN"), as in effect as of the date of this Agreement.
Notwithstanding the foregoing, if Genco LP (or such other appropriate Company)
establishes the TGN Retirement Plan prior to the Non-STP Acquisition Closing
Date, such Company and CenterPoint agree to (i) provide for the transfer of
assets to the TGN Retirement Plan from the CNP Retirement Plan on terms that are
consistent with applicable Law, and (ii) provide Buyer with a reasonable
opportunity prior to such transfer to review the proposed transfer and, with
respect to the Scheduled Employees, CenterPoint agrees to transfer the accrued
benefits of the Scheduled Employees from the CNP Retirement Plan to the TGN
Retirement Plan effective as of the STP Acquisition Closing Date, subject to
clause (i) above; provided, however, that CenterPoint shall only have such
obligation if the TGN Retirement Plan has not been terminated and no action has
been taken by Buyer or the plan sponsor to terminate such plan as of such date.
The TGN Savings Plan shall be a savings plan, intended to be qualified under
Section 401(a) of the Code, established to provide benefits for Company
Employees that are substantially similar to the benefits provided for such
employees under the CenterPoint Energy, Inc. Savings Plan ("CNP SAVINGS PLAN"),
as in effect as of the date of this Agreement, which shall include an employee
stock ownership plan within the meaning of Section 4975 of the Code ("ESOP");
provided, however, that except as required by applicable Law, Buyer shall not be
required to continue the ESOP on or after the Non-STP Acquisition Closing Date
and, to the extent required by applicable federal securities law, Parents shall
prepare and file a registration statement on Form S-8, along with a related
prospectus, with respect to the ESOP securities on or before the effective date
of such plan, and maintain the effectiveness of such registration statement
through the Non-

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<PAGE>

STP Acquisition Closing Date to the extent required by applicable Law.
CenterPoint agrees to take such action to cause any plan-to-plan transfer of the
Scheduled Employees' account balances under the CNP Savings Plan to the TGN
Savings Plan as of, or as soon as administratively practicable after, the STP
Acquisition Closing Date; provided, however, that CenterPoint shall only have
such obligation if such plan has not been terminated and no action has been
taken by Buyer or the plan sponsor to terminate such plan as of such date. The
TGN BRP shall be an excess benefits plan related to the TGN Retirement Plan
established to provide benefits for Company Employees that are substantially
similar to the excess benefits provided for such employees under the CenterPoint
Energy, Inc. Benefit Restoration Plan, as in effect as of the date of this
Agreement.

            (f)   Buyer and Parents agree that, prior to the Non-STP Acquisition
Closing Date, Genco Holdings (or Genco II LP) may enter into a severance
agreement with each of the Active Company Employees listed in Section 6.8(f) of
the Companies Disclosure Letter (individually, "TGN SEVERANCE AGREEMENT" and
collectively, "TGN SEVERANCE AGREEMENTS") to provide the severance benefits
described in Section 6.8(f) of the Companies Disclosure Letter to such Active
Company Employees in the event of an eligible termination of employment during
the two-year period commencing on the Non-STP Acquisition Closing Date, and
Buyer and its affiliates will cause Genco Holdings and its successors to honor
such agreements in accordance with their terms and this Agreement. Buyer and
Parents agree that, prior to the STP Acquisition Date, Genco Holding (or Genco
II LP) may establish the Texas Genco Severance Benefits Plan #2060 ("TGN
SEVERANCE PLAN #2060"), which shall provide (i) benefits that are identical to
those provided under the Texas Genco Holdings, Inc. Severance Benefits Plan
#2050 ("TGN SEVERANCE PLAN #2050"), for the Scheduled Employees who were listed
as "Employees" under the TGN Severance Plan #2050 as of such plan's effective
date, and (ii) such Scheduled Employees severance benefits in the event of an
eligible termination of employment during the two-year period commencing on the
STP Acquisition Closing Date. With respect to an Active Company Employee (1) who
is not eligible for benefits under the TGN Severance Plan #2050, the TGN
Severance Plan #2060 or a TGN Severance Agreement and (2) whose employment is
terminated, other than for Cause, by Buyer, its affiliates or any Company within
one year after the Non-STP Acquisition Closing Date, or, in the case of a
Scheduled Employee, the STP Acquisition Closing Date (each a "COVERED
EMPLOYEE"), Buyer shall provide or cause the applicable Company to provide each
such terminated Covered Employee with severance benefits which shall be no less
favorable than the following benefits:

                  (i)   a lump-sum cash severance payment in an amount equal to
      three weeks of the Covered Employee's base salary or annualized base rate
      of pay ("severance pay") multiplied by the number of full years of Service
      credited to the Covered Employee, with a minimum of 12 weeks and a maximum
      of 52 weeks of severance pay to be awarded to a Covered Employee;

                  (ii)  an additional lump-sum cash severance payment in an
      amount equal to the Covered Employee's target award under the TGN STI
      Plan, if any, based upon the Covered Employee's actual eligible earnings
      for the period

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<PAGE>

      commencing on January 1st of the year during which his or her termination
      occurs and ending on the Covered Employee's termination date;

                  (iii) for the applicable period required by COBRA for benefits
      provided to the Covered Employee under a group health plan, as defined in
      Section 5000(b)(1) of the Code, of the Buyer or its affiliates ("BUYER
      MEDICAL PLAN"), the Covered Employee shall pay the active employee rate
      with respect to coverage during the period of time commencing as of his or
      her termination date equal to the total number of weeks used to calculate
      his or her severance benefit in clause (i) above, and thereafter the full
      COBRA rate (which is equal to 102% of the full group rate, which includes
      the employee's and employer's share of the group coverage cost and a 2%
      administrative fee) with respect to such coverage for the remainder of the
      continuation coverage period required by COBRA, with such benefits
      governed by and subject to (a) the terms and conditions of the plan
      documents providing such benefits, including the reservation of the right
      to amend or terminate such benefits under those plan documents at any
      time, and (b) the provisions of COBRA, and such Covered Employee who, as
      of his or her termination date, has (1) attained age 50, but not age 55,
      and (B) completed at least 20 years of Service shall have the same access
      to the Company's or Buyer's retiree medical plan (if any) as such Covered
      Employee would have been eligible to access had the Covered Employee
      terminated his or her employment immediately after attaining age 55;
      provided, however, that such access shall not commence prior to the date
      the Covered Employee actually attains age 55;

                  (iv)  in addition to any benefit the Covered Employee is
      otherwise entitled to under the TGN Retirement Plan, if the Covered
      Employee as of his or her termination date has (a) attained age 50, but
      not yet 55, and (b) completed at least 20 years of Service, then he or she
      shall be deemed eligible to receive a benefit equal to the early
      retirement benefit (payable in a form other than a lump-sum) under the TGN
      Retirement Plan that the Covered Employee would have been eligible to
      receive thereunder had he or she terminated his or her employment
      immediately after attaining age 55; provided, however, that such benefit
      shall not commence prior to the date the Covered Employee actually attains
      age 55 and, for benefit accrual purposes, that the Covered Employee's
      benefit under the TGN Retirement Plan shall be based on his actual Service
      as of his or her termination date; and

                  (v)   the Covered Employee shall be offered outplacement
      services appropriate to his or her employment position on his or her
      termination date as provided in Section 6.8(f)(v) of the Companies
      Disclosure Letter.

For purpose of the severance benefits payable under Section 6.8(f)(i) above, (1)
the term "CAUSE" shall mean termination from employment due to (i) gross
negligence in the performance of duties; (ii) intentional and continued failure
to perform duties; (iii) intentional engagement in conduct which is materially
injurious to Genco Holdings or its affiliates, successors, employees or property
(monetarily or otherwise) or Buyer; an intentional act of fraud, embezzlement or
theft; an intentional wrongful disclosure of

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confidential or proprietary information of the Company or an affiliate; or (iv)
conviction of a felony or a misdemeanor involving moral turpitude; provided,
however, that for this purpose, an act or failure to act on the part of an
Active Company Employee will be deemed "intentional" only if done or omitted to
be done by the Active Company Employee not in good faith and without reasonable
belief that his or her action or omission was in the best interest of the
Company, and no act or failure to act on the part of the Active Company Employee
will be deemed "intentional" if it was due primarily to an error in judgment or
negligence; and (2) the term "SERVICE" shall be defined as in the TGN Retirement
Plan, as in effect on the Non-STP Acquisition Closing Date or, in the case of a
Scheduled Employee, the STP Acquisition Closing Date; provided, however, that
(i) less than six months of Service shall not constitute a year of Service, and
six months or more of Service shall constitute a full year of Service (except in
the event a Covered Employee has a total of less than six months of Service, in
which case the employee shall be deemed to have one year of Service); and (ii)
to the extent not credited as Service under the TGN Retirement Plan, Service
shall include the employee's employment with Genco Holdings or its affiliates
during the period commencing on the Non-STP Acquisition Closing Date or, in the
case of a Scheduled Employee, the STP Acquisition Closing Date and ending on the
employee's termination date. The parties to this Agreement agree that any
severance benefits payable pursuant to this Section 6.8(f) (including benefits
payable under the TGN Severance Plan #2050 and TGN Severance Agreements) shall
be in exchange for, subject to, and conditioned upon, a Covered Employee's
execution of a valid and enforceable waiver and release that shall release
Parents, Parents' affiliates, the Companies, the affiliates of the Companies,
Buyer, Buyer's affiliates, Genco Holdings, Genco Holdings' affiliates and each
of their directors, officers, employees and agents, employee benefit plans, and
the fiduciaries and agents of said plans from liability and damages in any way
related to the Covered Employee's employment with or separation from employment
with Buyer, Parents, the Companies or any of their affiliates.

            (g)   Buyer agrees that upon the Non-STP Acquisition Closing Date,
or, in the case of the Scheduled Employees, the STP Acquisition Closing Date,
each Active Company Employee shall be immediately eligible to participate,
without any waiting time, in a group health plan, as defined in Section
5000(b)(1) of the Code of Buyer or its affiliates ("BUYER MEDICAL PLAN"). Buyer
agrees that Buyer Medical Plan shall credit each Active Company Employee towards
the deductibles, coinsurance and maximum out-of-pocket provisions imposed under
such group health plan, for the calendar year during which the Non-STP
Acquisition Closing Date occurs, with any applicable expenses already incurred
during the portion of the year preceding the Non-STP Acquisition Closing Date
or, in the case of the Scheduled Employees, the STP Acquisition Closing Date,
under the applicable group health plans of Parents.

            (h)   Following the Non-STP Acquisition Closing Date, to the extent
applicable, Parents shall retain all liabilities, obligations and
responsibilities to provide post-retirement medical, health and life insurance
benefits ("RETIREE MEDICAL BENEFITS") to any Company Employee or Active Company
Employee who (A) retired on or prior to the Non-STP Acquisition Closing Date or,
in the case of the Scheduled Employees, the STP Acquisition Closing Date, or (B)
would have, had such Company Employee or

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<PAGE>

Active Company Employee retired prior to the Non-STP Acquisition Closing Date
or, in the case of the Scheduled Employees, the STP Acquisition Closing Date,
been entitled to Retiree Medical Benefits pursuant to the terms of any Plan;
provided, that such Company Employee or Active Company Employee shall be
entitled to elect to receive such benefits upon their termination with Buyer.
Notwithstanding anything to the contrary in this Agreement, including, without
limitation, the provisions of Section 6.8(b) of this Agreement, Buyer shall have
no obligation to continue, establish or maintain any Plan or Employee Welfare
Benefit Plan that provides for Retiree Medical Benefits (except to the extent
required by applicable Law).

            (i)   Except as otherwise provided in this Section 6.8 or under the
Transition Services Agreement referenced in Section 8.3(f) of this Agreement,
Buyer acknowledges that, on and after the Non-STP Acquisition Closing Date with
respect to the Companies other than Genco Holdings and Genco LP, and on and
after the STP Acquisition Closing Date with respect to Genco Holdings and Genco
LP, the participation by the Companies in all Plans not sponsored or maintained
solely by any of the Companies shall terminate as of the applicable date, and
Buyer shall be solely responsible for providing any successor or alternate
plans; provided, however, that nothing in this Section 6.8 shall require Buyer
to provide such plans for the benefit of the Scheduled Employees on or prior to
the STP Acquisition Closing Date.

            (j)   Buyer shall comply with any obligations under any collective
bargaining agreements identified on Section 4.12 of the Companies Disclosure
Letter, to the extent required by applicable Law.

            (k)   After the Non-STP Acquisition Closing Date or, in the case of
the Scheduled Employees, the STP Acquisition Closing Date, Buyer shall be
responsible for, and shall indemnify and hold harmless, Parents, the Companies
and their respective officers, directors, employees, affiliates and agents and
the fiduciaries (including plan administrators) of the Plans, from and against,
any and all claims, losses, damages, costs and expenses (including attorneys'
fees and expenses) and other liabilities and obligations relating to or arising
out of (i) all salaries, commissions and vacation entitlements accrued but
unpaid as of the Non-STP Acquisition Closing or, in the case of the Scheduled
Employees, the STP Acquisition Closing Date and post-closing bonuses (with
respect to the Non-STP Acquisition Closing Date or the STP Acquisition Closing
Date, as applicable), due to any Active Company Employee, (ii) the liabilities
assumed by Buyer under this Section 6.8 or any failure by Buyer to comply with
the provisions of this Section 6.8, and (iii) any claims of, or damages or
penalties sought by, any Active Company Employee, or any governmental entity on
behalf of or concerning any Active Company Employee, with respect to any act or
failure to act by Buyer to the extent arising from the employment, discharge,
layoff or termination of any Active Company Employee who becomes an employee of
Buyer or any Company after the Non-STP Acquisition Closing Date or, in the case
of the Scheduled Employees, the STP Acquisition Closing Date.

            (l)   Parents shall retain responsibility for and continue to pay
all medical, life insurance, disability and other welfare plan expenses and
benefits for each

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Company Employee with respect to claims incurred by such Company Employees or
their covered dependents prior to the Non-STP Acquisition Closing or, in the
case of the Scheduled Employees, the STP Acquisition Closing Date and with
respect to any Company Employee who retired or was terminated prior to the
Non-STP Acquisition Closing Date or, in the case of the Scheduled Employees, the
STP Acquisition Closing Date. Such expenses and benefits with respect to claims
incurred by Company Employees or their covered dependents on or after the
Non-STP Acquisition Closing shall be the responsibility of Buyer. For purposes
of this paragraph, a claim is deemed incurred when the services that are the
subject of the claim are performed; in the case of life insurance, when the
death occurs; and in the case of long-term disability benefits, when the
disability occurs. In addition, after the Non-STP Acquisition Closing Date,
Parents shall be responsible for, and shall indemnify and hold harmless, Buyer
and its officers, directors, employees, affiliates and agents and the
fiduciaries (including plan administrators) of the CenterPoint Energy, Inc.
Savings Plan and the CenterPoint Energy, Inc. Retirement Plan, from and against
any and all claims, losses, damages, costs and expenses (including attorneys'
fees and expenses) and other liabilities and obligations relating to or arising
out of any litigation, arbitration and administrative or other proceeding with
respect to the CenterPoint Energy, Inc. Savings Plan or the CenterPoint Energy
Inc. Retirement Plan.

            (m)   Nothing herein expressed or implied shall confer upon any of
the employees of the Parents, the Companies or any of their affiliates, any
rights or remedies, including any right to employment, or continued employment
for any specified period, of any nature or kind whatsoever under or by reason of
the Agreement.

            Section 6.9 Insurance.

            (a)   From and after the date of this Agreement (including after the
Non-STP Acquisition Closing Date and after the STP Acquisition Closing Date),
CenterPoint shall not take or fail to take, and shall cause each of its
subsidiaries not to take or fail to take, any action (including any termination,
alteration or amendment) if such action or inaction, as the case may be, would
adversely affect the applicability of, or limit or restrict the coverage
available under: (i) any insurance policies (including, without limitation, the
Company Insurance Policies) held by CenterPoint or any of its subsidiaries or
predecessors that cover all or any part of the Genco Business, the Companies or
any liabilities or obligations that were initially assumed or are of the type
initially assumed by Genco Holdings in the Spin-off Separation Agreement
("APPLICABLE INSURANCE POLICIES"); or (ii) any cost sharing, coverage-in-place,
or similar arrangement or agreement related to and/or replacing the Applicable
Insurance Policies ("APPLICABLE INSURANCE AGREEMENTS", and together with the
Applicable Insurance Policies, the "APPLICABLE INSURANCE"). CenterPoint agrees
that from and after August 31, 2002, all Applicable Insurance (including the
proceeds therefrom) directly or indirectly applicable to such assets or
liabilities shall be for the benefit of the Companies. CenterPoint and its
affiliates and, prior to the STP Acquisition Closing Date, Genco Holdings, shall
not agree to any buy out of coverage with respect to liability exposures under
any Applicable Insurance Policies without Buyer's prior written consent (not to
be unreasonably withheld). In connection with any such buy out approved by Genco
Holdings, Genco

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Holdings shall receive a share of any such buyout proceeds as agreed to by
CenterPoint and the Buyer.

            (b)   Any Company shall be entitled to assert any rights such
Company has under any Applicable Insurance. To the extent necessary to satisfy
Section 6.9(a) and permissible under Applicable Insurance Policies without
causing cancellation or loss of rights under Applicable Insurance, CenterPoint
agrees to transfer or assign to the Companies or otherwise cause to be vested in
the Companies the Applicable Insurance with respect to the Non-STP Assets and
Liabilities at or prior to the Non-STP Acquisition Closing Date and at or prior
to the STP Acquisition Closing Date with respect to the STP Assets and
Liabilities. The parties agree that, in the event and to the extent that
CenterPoint is not able to cause all Applicable Insurance to be modified,
amended and/or assigned so that Buyer and its subsidiaries (including, for
clarification, the applicable Companies that become subsidiaries of Buyer as of
such time as those Companies become subsidiaries) are the direct beneficiaries
of, and additional insureds under such Applicable Insurance, with all rights to
directly enforce, obtain the benefit of and take all other action in respect of
such Applicable Insurance, prior to the Non-STP Acquisition Closing Date, the
following provisions shall apply:

                  (i)   The Separation Amendment shall amend the Spin-Off
      Separation Agreement and related agreements and instruments to clarify
      that CenterPoint shall retain all liabilities included in the Non-STP
      Assets and Liabilities, and the STP Assets and Liabilities, to the extent
      and only to the extent that such liabilities are covered under the
      Applicable Insurance (the "INSURED RETAINED LIABILITIES").

                  (ii)  CenterPoint agrees, after receipt of a claim, to use
      commercially reasonable efforts to obtain the maximum available actual
      recovery for any Insured Retained Liabilities under the Applicable
      Insurance, provided that CenterPoint shall have no liability or obligation
      to Buyer or any Company (other than its obligation to comply herewith) for
      any amounts or costs in excess of amounts actually recovered under the
      Applicable Insurance. Buyer agrees to reasonably cooperate in defending
      claims relating to the Insured Retained Liabilities, including, without
      limitation, at CenterPoint's request, providing information, direction and
      guidance to CenterPoint. Buyer further agrees to reimburse CenterPoint
      and/or its counsel for documented out-of-pocket expenses reasonably
      incurred subsequent to the Non-STP Acquisition Closing Date with respect
      to the Non-STP Assets and Liabilities and subsequent to the STP
      Acquisition Closing Date with respect to the STP Assets and Liabilities in
      defending such claims, but only to the extent that such documented
      out-of-pocket expense are not paid under any Applicable Insurance.

                  (iii) To the extent any Insured Retained Liability is
      partially, but not fully, covered by the Applicable Insurance: (a) Buyer
      and its subsidiaries and Representatives shall be entitled to participate
      in all aspects of the defense, litigation, settlement and any other
      proceedings and negotiations regarding such Insured Retained Liability;
      and (b) neither CenterPoint nor any of its affiliates or

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<PAGE>

      Representatives shall enter into any settlement of such Insured Retained
      Liability without Buyer's prior written consent.

                  (iv)  CenterPoint shall promptly notify Buyer in writing of
      any Insured Retained Liability for which: (a) coverage is denied or
      threatened to be denied in part or in full under the Applicable Insurance
      and/or (b) CenterPoint believes that no coverage is available under the
      Applicable Insurance. CenterPoint shall provide together with such notice
      sufficient documentation to demonstrate the basis for any asserted lack of
      coverage for such Insured Retained Liability. To the extent Buyer is
      satisfied that there is no coverage for such Insured Retained Liability,
      such Insured Retained Liability shall cease to qualify as an Insured
      Retained Liability and to such extent shall be deemed a Genco Liability
      (as defined in the Spin-Off Separation Agreement). During the resolution
      of any disputes with respect to the matters set forth in this clause (iv),
      CenterPoint agrees that Buyer and its subsidiaries and Representatives
      shall be entitled to participate in all aspects of the defense,
      litigation, settlement and any other proceedings and negotiations
      regarding the disputed Insured Retained Liability (hereinafter, "DISPUTED
      INSURED RETAINED LIABILITY") except to the extent that such participation
      would jeopardize maintenance of the Applicable Insurance in effect;
      provided that in such event participation shall be allowed to the greatest
      extent that would not jeopardize maintenance of the Applicable Insurance
      in effect.

                  (v)   Notwithstanding the provisions of subsection (iv) above,
      CenterPoint, at Buyer's expense: (a) shall contest any denial or reduction
      of coverage for any Insured Retained Liability; and (b) shall not settle
      any claim related to any Disputed Insured Retained Liability without
      Buyer's prior written consent.

                  (vi)  In no event shall CenterPoint or any of its affiliates
      enter into any cost sharing, coverage-in-place or similar agreement or
      arrangement or any other compromise or settlement relating to any
      Applicable Insurance or Insured Retained Liability without the prior
      written approval of Buyer.

                  (vii) Nothing in this Section 6.9 shall constitute a
      representation or warranty by CenterPoint that coverage is available to
      Buyer and its subsidiaries under the Applicable Insurance for any specific
      claim. Neither this Section 6.9 nor any provision hereof shall be read in
      a manner that violates or conflicts with any provision of any of the
      Applicable Insurance. Nothing in this Section 6.9 shall be deemed (A) to
      constitute an assignment of any Applicable Insurance Policy or any
      interest therein to the Buyer or (B) to provide CenterPoint or any of its
      affiliates with rights to coverage other than as already set forth in the
      Applicable Insurance. To the extent that this Section 6.9 or any provision
      hereof violates or conflicts with any provision of any Applicable
      Insurance Policy or would cause a cancellation or loss of rights under any
      Applicable Insurance Policy, the parties agree that this Section 6.9 shall
      be amended or construed with respect only to such Applicable Insurance
      Policy and to the minimum extent

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<PAGE>

      necessary to cure or avoid such conflict, inconsistency, violation,
      cancellation or loss of rights, provided, however, that this provision
      shall not constitute a representation or warranty that any such conflict,
      purported assignment, inconsistency or violation may be avoided or cured.

                  (viii) CenterPoint agrees promptly to provide Buyer with
      copies of correspondence with insurers and other counterparties under the
      Applicable Insurance in respect of any Insured Retained Liability.

            (c)   Parents and Genco Holdings agree that Buyer and its
subsidiaries may use, following the Non-STP Acquisition Closing Date, the third
party providers, including legal counsel, currently used by Parents and the
Companies to defend and manage the defense of asbestos-related claims involving
the Companies.

            Section 6.10 No Solicitation of Transactions.

            (a)   Each of Parents and Genco Holdings agrees that neither it nor
any other Company shall, and that it shall cause its Representatives and the
Representatives of any Company not to, directly or indirectly, initiate,
solicit, encourage or otherwise facilitate (including by way of furnishing
non-public information) any inquiries or the making or implementation of any
proposal or offer (including any proposal from or offer to its shareholders)
with respect to (i) a merger, reorganization, share exchange, tender offer,
exchange offer, consolidation, business combination, recapitalization,
liquidation, dissolution, joint venture or similar transaction involving any
Company or (ii) any purchase or sale of more than 10% of the assets of the
Companies, taken as a whole, or any Company Securities (any such proposal or
offer being hereinafter referred to as an "ALTERNATIVE PROPOSAL"). Each of
Parents and Genco Holdings further agrees that neither it nor any Company shall,
and that it shall cause its Representative and the Representative of any Company
not to, directly or indirectly, have any discussion with or provide any
confidential information or data to any person relating to an Alternative
Proposal, or engage in any negotiations concerning an Alternative Proposal, or
otherwise facilitate any effort or attempt to make or implement an Alternative
Proposal or accept an Alternative Proposal.

            (b)   CenterPoint shall not, directly or indirectly, sell, transfer,
pledge, hypothecate, encumber, assign or dispose of any membership interests in
Utility Holding (or any beneficial ownership thereof) or its beneficial
ownership interest in the Shares or offer to make such a sale, transfer or other
disposition (collectively, "TRANSFER") to any person, and Utility Holding shall
not Transfer the Shares (or any beneficial ownership thereof).

            (c)   Each of Parents and Genco Holdings (as applicable) shall
notify Buyer promptly (and in any event by 5:00 p.m. New York City time, on the
next business day) of the receipt of any inquiries, proposals or offers relating
to an Alternative Proposal received by any Parent or Company or its
Representatives, indicating, in connection with such notice, the name of such
person and the material terms of any inquiries, proposals or offers. Each of
Parents and Genco Holdings shall keep Buyer reasonably informed of the

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<PAGE>

status of any inquiries, proposals or offers and any modifications thereto. Each
of Parents and Genco Holdings further agrees that neither of the Parents nor any
Company shall enter into any agreement with any person subsequent to the date of
this Agreement with respect to an Alternative Proposal or that prohibits Genco
Holdings from providing such information to Buyer. Genco Holdings agrees that no
Company shall terminate, waive, amend or modify any provision of any standstill
or confidentiality agreement to which it is a party and that each Company shall
use commercially reasonable efforts to enforce the provisions of any such
agreement.

            (d)   Effective as of the date of this Agreement, each of Parents
and Genco Holdings agrees that each Company shall, and each of Parents and Genco
Holdings shall cause any Representative of a Parent or Company to, terminate any
existing activities, discussions or negotiations with any third parties that may
be ongoing with respect to any Alternative Proposal. Genco Holdings shall use
commercially reasonable efforts to inform the Representatives of a Parent or a
Company of the obligations undertaken in this Section 6.10 and shall request
that all confidential information previously furnished to any such third parties
be returned promptly.

            (e)   The board of directors of Genco Holdings (or any committee
thereof) shall not approve or recommend an Alternative Proposal.

            (f)   Genco Holdings and the board of directors of Genco Holdings
may take and disclose to Genco Holdings' shareholders a position in accordance
with Rule 14e-2 under the Exchange Act with respect to an Alternative Proposal;
provided that the foregoing will in no way (i) permit any action that would
otherwise have been prohibited under this Agreement (including Section 6.10(e)),
(ii) limit the obligation of Genco Holdings to comply with its obligations under
this Agreement or (iii) eliminate or modify the effect that any action taken or
disclosure made in accordance with such Rule would have under this Agreement.

            (g)   Genco Holdings shall not, and shall not permit any Company to,
adopt, authorize or enter into any Rights Plan.

            Section 6.11 Tax Exempt Financing. (a) Buyer and CenterPoint
understand and agree that:

                  (i)   the pollution control facilities identified in Section
      6.11(a)(1) of the Parents Disclosure Letter (each a "POLLUTION CONTROL
      FACILITY" and collectively the "POLLUTION CONTROL FACILITIES") have been
      financed or refinanced, in whole or in part, with the proceeds of the
      issuance and sale by various governmental authorities of the industrial
      development revenue bonds or private activity bonds listed in such Section
      6.11(a)(2) (collectively, the "REVENUE BONDS"), the interest on which is
      excludable from gross income for purposes of federal income taxation;
      CenterPoint, or CenterPoint Energy Houston Electric, LLC, a Texas limited
      liability company and indirect wholly-owned subsidiary of CenterPoint
      ("CEHE" and, collectively with CenterPoint, the "CENTERPOINT OBLIGORS"),
      is the entity obligated to make payments to the issuer

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<PAGE>

      and any credit or liquidity provider in connection with each issue of
      Revenue Bonds; the Revenue Bonds listed in Section 6.11(a)(2) of the
      Parents Disclosure Letter are the only outstanding bonds or similar
      obligations the interest on which is excludable from gross income for
      purposes of federal income taxation relating the Genco Business; and
      Section 6.11(a)(1) of the Parents Disclosure Letter accurately reflects
      the generation facilities where the Pollution Control Facilities financed
      by such Revenue Bonds are located;

                  (ii)  the basis for such exclusion is the use of the Pollution
      Control Facilities for one or more of the following purposes: (a) the
      abatement or control of atmospheric pollution or contamination, (b) the
      abatement or control of water pollution or contamination, (c) sewage
      disposal, or (d) the disposal of solid waste, such purposes ("QUALIFYING
      USES") being discussed in more detail in Section 6.11(b) below;

                  (iii) the use of a Pollution Control Facility for a purpose
      other than its current Qualifying Uses indicated in subsection (ii) above
      could impair (a) such excludability from gross income of the interest on
      the issue of Revenue Bonds which were issued to finance or refinance the
      acquisition or construction of that Pollution Control Facility, possibly
      with retroactive effect, unless appropriate remedial action (which could
      include prompt redemption or defeasance of such issue of Revenue Bonds, in
      whole or in part) were taken, or (b) the deductibility of the CenterPoint
      Obligors' payment of interest on such issue of Revenue Bonds;

                  (iv)  any breach by Buyer of its covenants under Section 6.11
      could result in the incurrence by the CenterPoint Obligors of increased
      interest costs on the Revenue Bonds or loss of the interest deduction for
      tax purposes, or transaction costs relating to any refinancing, redemption
      or defeasance of the issue of Revenue Bonds which were issued to finance
      or refinance the acquisition or construction of any particular facilities,
      and, subject to Section 6.11(i), Buyer shall be liable to the CenterPoint
      Obligors to the extent such additional costs and expenses result from a
      breach by Buyer of its covenants under Section 6.11; provided, however,
      that Buyer shall only be liable after a final determination of taxability
      by the IRS to the CenterPoint Obligors for (i) actual costs incurred as a
      result of a final declaration of the IRS declaring any series of Revenue
      Bonds taxable, and, without duplication, (ii) actual costs accruing to the
      CenterPoint Obligors resulting from a loss of the deductibility of
      interest paid on such Revenue Bonds; provided, further, that the
      CenterPoint Obligors will promptly notify Buyer in writing of any audit by
      the IRS which could result in additional costs and expenses for which
      Buyer could be responsible hereunder and allow representatives of Buyer to
      participate in all proceedings and will not agree to any settlement
      without the prior written consent of Buyer (which consent shall not be
      unreasonably withheld); and

                  (v)   notwithstanding the other provisions of this Section
      6.11, neither Buyer nor the Companies will have any liability under this
      Agreement or otherwise to the CenterPoint Obligors arising with respect to
      the Revenue Bonds

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<PAGE>

      and relating to the use of the Pollution Control Facilities for a purpose
      other than a Qualifying Use prior to the Non-STP Acquisition Closing, and
      the CenterPoint Obligors agree to fully release Buyer and the Companies in
      respect of any such liability effective as of the Non-STP Acquisition
      Closing.

            (b)   Subject to Section 6.11(c), Buyer covenants not to use (and to
cause its subsidiaries not to use) the Pollution Control Facilities for any
purpose other than each such Pollution Control Facility's current Qualifying
Uses, which in each case may include:

                  (i)   abating or controlling atmospheric or water pollution or
      contamination by removing, altering, disposing of or storing pollutants,
      contaminants, waste or heat, all as contemplated in U.S. Treasury
      Regulations Section 1.103-8(g);

                  (ii)  the collection, storage, treatment, utilization,
      processing or final disposal of solid waste, all as contemplated in U.S.
      Treasury Regulations Section 1.103-8(f); or

                  (iii) the collection, storage, treatment, utilization,
      processing or final disposal of sewage, all as contemplated in U.S.
      Treasury Regulations Section 1.103-8(f);

unless, in each such case, (i) Buyer has obtained and delivered to the
CenterPoint Obligors, at Buyer's expense, an opinion addressed to the
CenterPoint Obligors of nationally recognized bond counsel reasonably acceptable
to the CenterPoint Obligors ("BOND COUNSEL" and such opinion being an "OPINION
OF BOND COUNSEL") that such a change in use will not impair the excludability
from gross income for federal income tax purposes of the interest on any issue
of Revenue Bonds or that such change in use will not affect the CenterPoint
Obligors' eligibility to deduct interest payments made with respect to such
bonds, or (ii) there are no longer any Revenue Bonds or, to the extent permitted
by this Agreement, tax-exempt bonds issued to refinance Revenue Bonds
outstanding with respect to such Pollution Control Facility. Except with respect
to the Gas Plant Pollution Control Facilities (as defined below), Buyer
reasonably expects that each of the Pollution Control Facilities will continue
to be used for its current Qualifying Uses set forth in subsection (a)(ii)
above, and for no other purpose, for the remainder of the Pollution Control
Facilities' useful lives. Subject to the representations in Section 6.11(i),
Buyer covenants to refrain (and to cause its subsidiaries to refrain) from
making any use of the Pollution Control Facilities, other than each such
Pollution Control Facility's current Qualifying Uses, that would (i) impair the
excludability from gross income for federal income tax purposes of the interest
on any issue of Revenue Bonds, or (ii) impair the deductibility of the
CenterPoint Obligors' payments of interest on such issue of Revenue Bonds.

            (c)   It is expressly understood and agreed that the provisions of
Section 6.11(b) above shall not prohibit Buyer or any of Buyer's subsidiaries
from (i) causing or otherwise permitting the operation of the Pollution Control
Facilities to be

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<PAGE>

suspended on a temporary basis; (ii) causing or otherwise permitting the
termination of the operation of any Pollution Control Facilities on a permanent
basis and the shutting down, retiring, abandoning and/or decommissioning of any
of the Pollution Control Facilities; or (iii) subject to Section 6.11(f),
selling, exchanging or transferring any of the Pollution Control Facilities to a
third party. Notwithstanding the foregoing, except in the case of any of the
Pollution Control Facilities financed or refinanced with the Revenue Bonds
identified on Section 6.11(c) of the Parents Disclosure Letter (such facilities,
the "Gas Plant Pollution Control Facilities"), neither Buyer nor Buyer's
subsidiaries shall cause or otherwise permit the dismantlement of all or any
portion of a Pollution Control Facility unless (i) such dismantlement occurs
subsequent to the end of the expected economic useful life of the Pollution
Control Facility (as determined on the date of issue of the most recent issue of
Revenue Bonds that financed or refinanced prior to the date of this Agreement
such Pollution Control Facility and as set forth in the documentation and tax
information filings with respect to such Revenue Bonds), (ii) in the event such
dismantlement involves the sale (for scrap or otherwise) of all or any portion
of such Pollution Control Facility, the amount received in consideration for
such sale is used by Buyer or such subsidiary, within 90 days of such
dismantlement, to acquire or construct property that is used for the same
Qualifying Use for which such Pollution Control Facility had been used prior to
its dismantlement, (iii) Buyer or such subsidiary first obtains and delivers to
the CenterPoint Obligors at Buyer's or its subsidiary's expense an Opinion of
Bond Counsel addressed to the CenterPoint Obligors that such action will not (x)
impair the exclusion from gross income of the interest on any issue of Revenue
Bonds for federal income tax purposes or (y) affect the CenterPoint Obligors'
eligibility to deduct interest payments made with respect to such bonds, or (iv)
there are no longer any Revenue Bonds or, to the extent permitted by this
Agreement, tax-exempt bonds issued to refinance Revenue Bonds outstanding with
respect to such Pollution Control Facility. In addition, Buyer shall give the
CenterPoint Obligors 120 days advance written notice before Buyer or any
subsidiary of Buyer shall cause or otherwise permit the dismantlement of all or
any portion of any of the Gas Plant Pollution Control Facilities.

            (d)   If Buyer, its successors or assigns desires to finance or
refinance any improvement or addition to any of the Pollution Control
Facilities, the CenterPoint Obligors agree to cooperate, at Buyer's expense,
with all reasonable requests by Buyer in supplying any information, records or
reports necessary or desirable to effect such financing.

            (e)   If the CenterPoint Obligors desire to refund any Revenue
Bonds, Buyer, at the expense of the CenterPoint Obligors, shall cooperate with
all reasonable requests of the CenterPoint Obligors and with Bond Counsel with
respect to the issuance of the refunding bonds and shall provide upon request
any representations, agreements or covenants that are reasonably requested
concerning Buyer's compliance to such date and/or in the future; provided that
Buyer shall not be required to make any covenants, representations or agreements
which will adversely impact Buyer or Buyer's operation of the Genco Business or
Buyer's intended use of the Pollution Control Facilities, including the sale or
discontinuance of use of any Pollution Control Facilities; provided further that
the CenterPoint Obligors agree that they will not undertake any refunding of
Revenue Bonds with tax-exempt bonds that have a maturity that is later than the
latest maturity of

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<PAGE>

any other outstanding series of Revenue Bonds previously issued to finance or
refinance all or a portion of Pollution Control Facilities located at the same
generation facility as the Pollution Control Facilities that were financed or
refinanced (in whole or in part) with the series of Revenue Bonds to be
refunded. If Buyer shall desire to cause an Opinion of Bond Counsel to be
delivered to the CenterPoint Obligors pursuant to Section 6.11(b) or the second
sentence of Section 6.11(c), the CenterPoint Obligors shall cooperate with Buyer
and with Bond Counsel and shall provide upon request copies of documents
relating to the Revenue Bonds and any representations relating to the Revenue
Bonds and the CenterPoint Obligors or any affiliate or predecessor entity's
prior use of the Pollution Control Facilities and compliance with the terms of
the trust indentures, installment payment and bond agreements, tax certificates
and agreements and any other agreements underlying or relating to the Revenue
Bonds or any similar documents relating to any tax-exempt bonds refunded by the
Revenue Bonds that are reasonably requested. Buyer shall cooperate with the
CenterPoint Obligors and with Bond Counsel, and shall provide upon request such
representations as the CenterPoint Obligors may reasonably request in connection
with efforts by the CenterPoint Obligors to obtain any opinions of Bond Counsel
contemplated under the terms of the bond documents relating to the Revenue Bonds
in connection with the transactions contemplated by this Agreement; provided,
that, Buyer shall not be required to provide any representations that would
adversely impact Buyer or Buyer's operation of the Genco Business or Buyer's
intended use of the Pollution Control Facilities, including the sale or
discontinuance of use of any Pollution Control Facilities, and the parties
hereto agree that obtainment of any such opinions of Bond Counsel shall not
constitute a condition to any party's obligation to close any of the
transactions contemplated by this Agreement.

            (f)   If Buyer or any of Buyer's subsidiaries shall sell, exchange,
transfer or otherwise dispose of any of the Pollution Control Facilities or any
subsidiary that owns any of the Pollution Control Facilities to a third party,
Buyer shall cause to be included in the documentation relating to such
transaction covenants and agreements on the part of such third party for the
benefit of the CenterPoint Obligors substantially the same as those on the part
of Buyer contained in Section 6.11; provided that if the third party transferee
makes such agreements, Buyer shall be released from any liability or obligations
under this Section 6.11 (including Section 6.11(a)) with regard to the portion
of Pollution Control Facilities so disposed of arising as a result of a breach
of such agreements by such third party transferee after the closing of such
transaction.

            (g)   The CenterPoint Obligors shall notify Buyer, as soon as
practicable, in writing when any issue of Revenue Bonds has been refunded, paid
in full, defeased or is no longer outstanding.

            (h)   The CenterPoint Obligors shall retain all of their obligations
as borrower, obligor, company or the user contained in each trust indenture,
loan agreement, installment payment and bond amortization agreement, tax
certificate, tax agreement, continuing disclosure agreement, agreement with
credit and liquidity providers or any other agreement relating to the Revenue
Bonds (the "BOND DOCUMENTS") for each issue of Revenue Bonds and any Revenue
Bonds issued to refund any Revenue Bonds and any other legal or offering
document relating to the Revenue Bonds. Buyer shall have only

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<PAGE>

those responsibilities specifically set forth in this Section 6.11 with respect
to the Pollution Control Facilities and the Revenue Bonds.

            (i)   CenterPoint, on behalf of the CenterPoint Obligors, represents
and warrants to Buyer that, except as set forth in Section 6.11(i) of the
Parents Disclosure Letter: (i) there are no Liens on the Pollution Control
Facilities that secure debt or other payment obligations of a CenterPoint
Obligor or any of their affiliates other than the Companies; (ii) each of the
Pollution Control Facilities is being, and since the initial issuance of Revenue
Bonds or tax-exempt bonds refinanced with Revenue Bonds has been, used for its
current Qualifying Uses as set forth in subsection (a)(ii) above, and for no
other purpose; (iii) they have not received any notice that there is any audit
or administrative action pending by the Internal Revenue Service as to the
exemption from federal income taxation of interest on any of the Revenue Bonds,
and they are not aware as of the date of this Agreement of any facts or
circumstances that could give rise to any challenge to such exemption from
federal income taxation of interest on any of the Revenue Bonds; and (iv) no
event of default or default which with the lapse of time could become an event
of default exists under any of the Bond Documents relating to any of the Revenue
Bonds or will occur as a result of the Public Company Merger or any other
transaction contemplated hereby.

            (j)   The CenterPoint Obligors agree that they will provide
information to Buyer prior to Non-STP Acquisition Closing as to any Pollution
Control Facilities, if any, the legal title to which is held by a governmental
issuer of Revenue Bonds. When all Revenue Bonds of such issue are no longer
outstanding and title is transferred to the obligor on such issue of Revenue
Bonds, the CenterPoint Obligors will promptly take all actions necessary to
transfer or cause to be transferred such title to Buyer or its designees,
successors or assigns. If CenterPoint transfers its payment obligations with
respect to the Revenue Bonds it shall require its transferee to convey or cause
such title to be conveyed to Buyer or its designees, successors or assigns.

            (k)   If Buyer incurs any costs or expenses, including the time of
any of its employees, in connection with the CenterPoint Obligors' refunding any
of the Revenue Bonds or a successful defense of an IRS audit, the CenterPoint
Obligors shall pay to Buyer an amount equal to its actual costs reasonably
incurred unless any such costs or expenses arise directly or indirectly out of
Buyer's breach of its obligations under this Section 6.11.

            Section 6.12 NRC Approval.

            (a)   As promptly after the date hereof as may be feasible (and in
any event, within 45 calendar days of the date of this Agreement), Genco
Holdings and Buyer shall jointly prepare and file one or more applications (the
"NRC APPLICATION") with the NRC for approval of the indirect transfer of the NRC
license for the South Texas Project and, to the extent necessary, any conforming
amendment of the NRC license to reflect such indirect transfer. Thereafter,
Parents, Genco Holdings and Buyer shall cooperate with one another to facilitate
review of the NRC Application by the NRC staff, including but not limited to
promptly providing the NRC staff with any and all documents or

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information that the NRC staff may reasonably request or require any of the
parties to provide or generate. In addition, Parents and Genco Holdings shall
provide Buyer with the opportunity to review and comment on any application to
be filed with the NRC relating to Genco LP's exercise of its right of first
refusal to increase its interest in STP and they shall keep Buyer reasonably
apprised as to the status of any such application and cooperate with Buyer to
the extent such application may relate to the NRC Application.

            (b)   The NRC Application shall identify STP Nuclear Operating
Company ("STPNOC"), Genco Holdings and Buyer as separate parties to the NRC
Application, but Genco Holdings and Buyer shall jointly direct and control the
prosecution of the NRC Application. In the event the processing of the NRC
Application by the NRC becomes subject to a hearing or other extraordinary
procedure by the NRC (a "CONTESTED PROCEEDING"), until such Contested Proceeding
becomes final and nonappealable, Genco Holdings, on the one hand, and Buyer, on
the other hand, shall separately appear therein by their own counsel, and shall
continue to cooperate with each other to facilitate a favorable result.

            (c)   Parents, Genco Holdings and Buyer will bear their own costs of
the preparation, submission and processing of the NRC Application, including any
Contested Proceeding that may occur in respect thereof; provided, however, that
Buyer, on the one hand, and Parents, on the other hand, shall equally share the
costs of all NRC staff fees payable in connection with the NRC Application and
costs incurred by South Texas Project Nuclear Operating Company in filing and
prosecuting the NRC Application. In the event that Parents, Genco Holdings and
Buyer agree upon the use of common counsel, they shall share equally the fees
and expenses of such counsel.

            (d)   Buyer will conform to the restrictions on foreign ownership,
control or domination contained in Sections 103d and 104d of the Atomic Energy
Act, 42 U.S.C. Sections 2133(d) and 2134(d), as applicable, and the NRC's
regulations in 10 C.F.R. Section 50.38 and will take, as promptly as practicable
after the date of this Agreement, commercially reasonable efforts to develop and
implement a mitigation plan to address foreign ownership concerns that is
satisfactory to the NRC. For purposes of this Section 6.12(d), commercially
reasonable efforts include the acceptance of licensing conditions similar in all
material respects to those that have been or are being imposed by the NRC on
similarly situated license applicants.

            Section 6.13 Preparation of Information Statement; SEC Filings.

            (a)   Promptly after the execution and delivery of this Agreement,
Genco Holdings shall prepare (in consultation with Buyer and Parents) and file
with the SEC an information statement, which information statement shall relate
to the adoption of this Agreement and approval of the transactions contemplated
hereby, including the Public Company Merger, and shall comply with the
requirements of Rule 13e-3 under the Exchange Act (the "INFORMATION STATEMENT").
The Information Statement shall include the recommendation of the board of
directors of Genco Holdings described in Section 4.25. Genco Holdings shall also
mail a copy of the Information Statement to

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Genco Holdings' shareholders as promptly as practicable following the date of
this Agreement.

            (b)   Each of Buyer, Genco Holdings and Parents (i) shall furnish
all information concerning itself and its subsidiaries to the others as may be
reasonably requested in connection with the preparation, filing and distribution
of the Information Statement and (ii) agrees, as to itself and its subsidiaries,
that none of the information supplied or to be supplied by it or its
subsidiaries (other than, in the case of Parents, the Companies) for inclusion
or incorporation by reference in the Information Statement and any amendment or
supplement thereto will, at the date of mailing to shareholders, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading. Each of
Buyer, Genco Holdings and Parents agrees to promptly correct any information
provided by it for use in the Information Statement that shall have become false
or misleading. Genco Holdings will cause the Information Statement to comply as
to form in all material respects with the applicable provisions of the Exchange
Act and the rules and regulations thereunder.

            (c)   Genco Holdings shall promptly notify Buyer upon the receipt of
any comments from the SEC or its staff or any request from the SEC or its staff
for amendments or supplements to the Information Statement and shall provide
Buyer and Parents with copies of all correspondence between Genco Holdings and
its Representatives, on the one hand, and the SEC and its staff, on the other
hand. Notwithstanding the foregoing, prior to filing or mailing the Information
Statement or any amendment or supplement thereto or responding to any comments
of the SEC with respect thereto, Genco Holdings (i) shall provide Buyer and
Parents an opportunity to review and comment on such document or response and
(ii) shall include in such document or response all comments reasonably proposed
by Buyer and Parents.

            (d)   Each of the Genco SEC Reports to be filed by Genco Holdings
after the date of this Agreement, when filed, will comply in all material
respects with the applicable requirements of the Securities Act and the Exchange
Act, each as in effect on the date so filed. None of the Genco SEC Reports
(including any financial statements or schedules included or incorporated by
reference therein) to be filed by Genco Holdings after the date of this
Agreement, when filed, will contain any untrue statement of a material fact or
omit to state a material fact required to be stated or incorporated by reference
therein or necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.

            (e)   Each of the audited and unaudited financial statements
(including any related notes) included in the Genco SEC Reports to be filed by
Genco Holdings after the date of this Agreement, when filed, will comply in all
material respects with all applicable accounting requirements and with the
published rules and regulations of the SEC with respect thereto, will have been
prepared in accordance with GAAP (except, in the case of unaudited quarterly
statements, as permitted by Form 10-Q of the SEC) applied on a consistent basis
throughout the periods involved (except as may be indicated in the notes
thereto) and will fairly present the consolidated financial position of Genco

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Holdings and its subsidiaries at the respective date thereof and the
consolidated results of its and their operations and cash flows for the periods
indicated (subject, in the case of unaudited quarterly statements, to normal
year-end audit adjustments, which were not and are not expected to be material
in amount).

            Section 6.14 Directors' and Officers' Indemnification and Insurance.
(a) The articles of incorporation and bylaws of the Surviving Corporation shall
contain the provisions regarding liability of directors and indemnification of
directors and officers that are set forth, as of the date of this Agreement, in
the articles of incorporation and the bylaws, respectively, of Genco Holdings
and shall provide indemnification with respect to claims arising from facts or
events that occurred prior to the Public Company Merger Effective Time to the
fullest extent permitted by and in accordance with the TBCA and other applicable
Law from time to time, which provisions shall not be amended, repealed or
otherwise modified for a period of six years from the Public Company Merger
Effective Time in any manner that would affect adversely the rights thereunder
of individuals who at or at any time prior to the Public Company Merger
Effective Time were Company Employees.

            (b)   The Surviving Corporation shall cause to be obtained at the
Public Company Merger Effective Time "tail" insurance policies with a claims
period of at least six years from the Public Company Merger Effective Time with
respect to directors' and officers' liability insurance in amount and scope at
least as favorable as the Genco Holdings' existing policies for claims arising
from facts or events that occurred prior to the Public Company Merger Effective
Time; provided that if such "tail" insurance policies are not available at a
cost not greater than the amount set forth on Section 6.14 of the Companies
Disclosure Letter (the "INSURANCE CAP"), the Surviving Corporation shall cause
to be obtained as much comparable insurance for as long a period (not to exceed
six years from the Public Company Merger Effective Time) as is available for a
cost not to exceed the Insurance Cap.

            Section 6.15 Section 16 Matters. Prior to the Public Company Merger
Closing, Genco Holdings and CenterPoint shall take all such steps as may be
required to cause to be exempt under Rule 16b-3 promulgated under the Exchange
Act any dispositions of Common Stock (including derivative securities with
respect to Common Stock) that are treated as dispositions to Genco Holdings
under such rule and result from the Public Company Merger by each individual who
is subject to the reporting requirements of Section 16(a) of the Exchange Act
with respect to Genco Holdings or CenterPoint.

            Section 6.16 Intercompany Accounts and Agreements.

            (a)   Except as set forth in Section 6.16(a) of the Parents
Disclosure Letter and Section 6.6(m) of this Agreement, any intercompany
accounts and all amounts due under intercompany leases and other agreements
between any of the Companies, on the one hand, and Parents and their affiliates
(other than the Companies), on the other hand, related to the Non-STP Assets and
Liabilities shall be paid or otherwise settled in cash, and all such agreements
shall be terminated, as of the Non-STP Acquisition

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Closing; provided, that, any intercompany accounts between any of the Companies,
on the one hand, and Parents and their affiliates (other than the Companies), on
the other hand, relating to the Texas Genco Money Pool Agreement dated as of
October 22, 2003 (the "MONEY POOL AGREEMENT") shall be paid or otherwise settled
in cash and such agreement shall be terminated as of such date with respect to
Genco II LP and Genco Services and from such date until the STP Acquisition
Closing Date, no person other than a Company may borrow funds under the Money
Pool Agreement; provided, further, that all amounts payable under any fuel
purchase Contracts and the Current Transition Services Agreement shall be paid
in the ordinary course consistent with past practice. Such payment, settlement
or termination shall be made effective at or prior to the Non-STP Acquisition
Closing or as promptly thereafter as practicable. No adjustment shall be made to
the Non-STP Consideration as a result of any such payment, settlement or
termination.

            (b)   Except as set forth in Section 6.16(b) of the Parents
Disclosure Letter and Section 6.6(m) of this Agreement, any intercompany
accounts and all amounts due under intercompany leases and other agreements
between any of the Companies, on the one hand, and Parents and their affiliates
(other than the Companies), on the other hand, related to the STP Assets and
Liabilities shall be paid or otherwise settled in cash, and all such agreements
shall be terminated, as of the STP Acquisition Closing; provided, that, any
intercompany accounts between any of the Companies, on the one hand, and Parents
and their affiliates (other than the Companies), on the other hand, relating to
the Money Pool Agreement shall be paid or otherwise settled in cash and such
agreement shall be terminated as of such date with respect to all Companies;
provided, further, that all amounts payable under the Transition Services
Agreement shall be paid in the ordinary course consistent with past practice.
Such payment, settlement or termination shall be made effective at or prior to
the STP Acquisition Closing or as promptly thereafter as practicable. No
adjustment shall be made to the STP Consideration as a result of any such
payment, settlement or termination.

            (c)   Parents and Genco Holdings agree that, to the extent any
intercompany leases or agreements between any of the Companies, on the one hand,
and the Parents or their affiliates, on the other hand, have not been disclosed
in Section 4.22 of the Companies Disclosure Letter, to the extent and as Buyer
reasonably requests that any such lease or agreement survive the Non-STP
Acquisition Closing or the STP Acquisition Closing, as applicable, Parents
shall, or shall cause their applicable affiliate to, cause such lease or
contract to survive the Non-STP Acquisition Closing or the STP Acquisition
Closing, as applicable.

            (d)   Prior to the Non-STP Acquisition Closing Date, neither Genco
LP nor Genco Services shall, and Genco Holdings shall not make any payment,
incur any liability to or enter into any Contract or transaction with, Parent or
any of its affiliates (including the Companies, other than Genco LP and Genco
Services), except pursuant to Company Affiliate Contracts in effect on the date
of this Agreement or with Buyer's prior written consent.

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            Section 6.17 Transition Services and Other Intercompany
Arrangements. (a) Each of Buyer and CenterPoint agree to enter into the
Transition Services Agreement on the Non-STP Acquisition Closing Date. At the
Non-STP Acquisition Closing, all data processing, accounting, insurance,
banking, personnel, legal, communications, information technology and other
products and services provided to the Companies or Genco II LP by or at the
expense of CenterPoint or any of its affiliates (other than a Company),
including any agreements or understandings (written or oral) with respect
thereto with respect to the Genco Business, will terminate, except to the extent
provided in the Transition Services Agreement or as set forth in Sections
6.16(a) and (b) of the Parents Disclosure Letter.

      (b)   On or prior to the Public Company Merger Closing Date, CenterPoint,
Genco Holdings, Buyer and Genco LP, as applicable, shall execute an amendment to
the Spin-off Separation Agreement substantially in the form attached as Schedule
6.17(b), which amendment shall be effective as of or after the Public Company
Merger Effective Time (the "SEPARATION AMENDMENT").

            Section 1.18 Power Purchase Agreement. On or prior to the Non-STP
Acquisition Closing Date, Genco LP and Genco II LP shall enter into a power
purchase agreement on the terms set forth on Schedule 6.18 attached hereto and
otherwise on terms and conditions reasonably satisfactory to Buyer and Genco
Holdings.

            Section 1.19 Decommissioning Undertakings. Buyer covenants and
agrees that following the STP Acquisition, Buyer shall cause its subsidiary that
owns the STP interest to maintain the Decommissioning Trust in compliance in all
material respects with applicable Laws, including regulations or rulings of the
IRS, NRC and the PUC (or any successor entity having jurisdiction over the
Decommissioning Trust and the collection of decommissioning funds). CenterPoint
covenants and agrees to cause its transmission and distribution subsidiary,
CenterPoint Energy Houston Electric, LLC ("CEHE") (i) to maintain in its
tariffed rates for the delivery of electricity the non-bypassable STP
decommissioning funding charge established in CEHE's most recent rate order,
with such changes to the charge as may be authorized or ordered by the PUC from
time to time, (ii) to deposit the decommissioning revenues collected by CEHE
through the decommissioning charges into Buyer's nuclear decommissioning trust
for STP (or, as applicable, into a decommissioning trust for STP maintained by
an entity succeeding to or having acquired all or part of Buyer's interest in
STP). CenterPoint and Buyer shall cooperate with the other, and shall cause each
of their subsidiaries to cooperate, at Buyer's expense with respect to
documented out-of-pocket expenses reasonably incurred, in providing information
for and otherwise supporting filings with the PUC in connection with the
decommissioning charge, including any rate proceeding filed by CEHE. Such
support shall include: (i) Buyer or its subsidiary providing decommissioning
studies and information as may be required to substantiate Buyer's proposed
decommissioning charge levels, (ii) CenterPoint causing CEHE to provide
information as may be required to substantiate Buyer's proposed decommissioning
charge levels, including any necessary testimony or information relating to
sales forecasts and rate design, (iii) Buyer and CenterPoint supporting, and
causing their subsidiaries to support, the maintenance of the decommissioning
charge and any increase to such charge proposed by Buyer or its

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subsidiary or any request by Buyer or its subsidiary that such charge be
established as a separate non-bypassable charge in CEHE's rates and (iv) Buyer
and CenterPoint opposing, and causing their subsidiaries to oppose, positions
taken by other parties to reduce, delay the recovery of or impose other terms or
conditions relating to the annual decommissioning funding amount to the extent
that Buyer or its subsidiary does not support such position. CenterPoint shall
cause CEHE to timely file proposed tariff and any other information necessary to
implement PUC orders effecting a change in the annual decommissioning funding
amount for STP included in CEHE's rates, and CenterPoint shall cooperate with
Buyer and its subsidiaries in complying with Code Section 468A and the Treasury
Regulations thereunder including filing any necessary elections or rulings with
the IRS or other authorities. Buyer and CenterPoint agree that the provisions of
this Section 6.19 shall be binding upon and shall benefit their respective
successors and assigns. CenterPoint agrees that it will not enter into any
transaction the effect of which would be to transfer, allocate, vest or assign
(whether by merger, operation of law or otherwise) all or any part of its
transmission or distribution business or the requirement to collect all or any
portion of such non-bypassable STP decommissioning fund charge to any other
person without obtaining the agreement of such person to be bound by and abide
by the terms of this Section 6.19 or substantially similar terms, and Buyer
agrees that it will not enter into any transaction the effect of which would be
to transfer, allocate, vest or assign (whether by merger, operation of law or
otherwise) its interest in STP to any other person without obtaining the
agreement of such person to be bound by and abide by the terms of this Section
6.19 or substantially similar terms. All references in this Section 6.19 to
Buyer, CenterPoint or CEHE shall include each such party's successors and
assigns.

            Section 6.20 True-up Proceeds. Buyer acknowledges that it has no
claim or entitlement to any recovery or other amount resulting from any final
order issued by the PUC in the stranded cost true-up proceeding now pending
before the PUC in Docket No. 29526 or to any proceeds from any securitization
bonds that may be issued by a subsidiary of CenterPoint to recover amounts
CenterPoint and its subsidiaries may be entitled to recover as a result of that
proceeding. In the event that Buyer or any subsidiary receives any stranded cost
recovery, amount or proceeds referred to in the prior sentence, Buyer shall (or
shall cause such subsidiary to) immediately pay such recovery, amount or
proceeds over to CenterPoint.

            Section 6.21 Environmental Reporting Regarding NOx Emission
Reductions. Unless CenterPoint notifies Buyer that CenterPoint is not required
to furnish such information to the PUC, within 90 days after December 31, 2004,
2005 and 2006, Buyer shall furnish or cause to be furnished to CenterPoint a
statement detailing the capital expenditures made by Buyer and its subsidiaries
for purposes of reduction of emissions of NOx during the prior year. Such
statement shall be in a form agreed by Buyer and CenterPoint in order to permit
CenterPoint to file reports required by the PUC. This provision does not require
Buyer to make any capital expenditures for these purposes or subject Buyer to
any liability with respect to CenterPoint's filings with the PUC, but is solely
a reporting obligation to enable CenterPoint to comply with its obligations.

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            Section 6.22 Leases. Prior to the Genco LP Division, CenterPoint
shall (or shall cause its applicable subsidiary to) enter into one or more lease
agreements with Genco LP or its designated affiliate on the terms set forth in
Section 6.22 of the Companies Disclosure Letter and otherwise on terms and
conditions reasonably acceptable to Buyer.

                                   ARTICLE VII

             CONDITIONS TO CONSUMMATION OF THE PUBLIC COMPANY MERGER

            Section 7.1 Conditions to Genco Holdings and Merger Sub's
Obligations to Consummate the Public Company Merger. The respective obligations
of Genco Holdings and Merger Sub to consummate the Public Company Merger are
subject to the satisfaction on or prior to the Public Company Merger Closing
Date of each of the following conditions:

            (a)   No Law or Order shall exist or shall have been enacted,
      entered, promulgated or enforced by any Governmental Authority which
      prohibits or makes illegal consummation of the Public Company Merger or
      the Non-STP Acquisition or any of the other transactions related thereto;

            (b)   Any waiting period applicable to the Public Company Merger or
      the Non-STP Acquisition, under applicable U.S. antitrust or trade
      regulation laws and regulations, including under the HSR Act, shall have
      expired or been terminated;

            (c)   The consummation of the Public Company Merger is permitted by
      Rule 14c-2 promulgated under the Exchange Act;

            (d)   The Companies shall have access to immediately available funds
      under the Overnight Bridge Loan as contemplated by the Public Company
      Merger Debt Term Sheet, the Buyer shall have received proceeds from the
      Debt Financing in an amount equal to the Non-STP Consideration (or such
      amount shall have been funded into escrow as contemplated by the Debt
      Financing Letter) and the Delayed Draw Term Facility shall be in full
      force and effect, in each case on the terms and conditions set forth in
      the Debt Financing Letter or the Public Company Merger Debt Term Sheet, as
      applicable, or upon terms and conditions which are, in the judgment of
      Buyer, comparable or more favorable (to Buyer) in the aggregate thereto,
      and to the extent that any terms and conditions are not set forth in the
      Debt Financing Letter, on terms and conditions reasonably satisfactory to
      Buyer and, with respect to the Public Company Merger Debt Term Sheet,
      Genco Holdings;

            (e)   Buyer shall have delivered to Parents a certificate, dated as
      of the date scheduled for the Public Company Merger Closing and effective
      so long as the Public Company Merger is consummated on such date, to the
      effect that, in reliance on the certificates referred to in Section
      8.3(d), and based on the

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      satisfaction or waiver by Buyer of the conditions precedent set forth in
      Section 8.3(e) and 8.3(f), Buyer is prepared to consummate the Non-STP
      Acquisition on the following business day (subject to the satisfaction of
      the conditions set forth in Section 8.1 and 8.5), and upon delivery of
      such certificate, all the conditions in Section 8.3 shall be deemed
      satisfied or waived, so long as the Public Company Merger is consummated
      on the date scheduled for the Public Company Merger, and the Non-STP
      Acquisition occurs on the following business day or as soon as possible
      thereafter;

            (f)   The conditions in Section 8.2 shall have been satisfied; and

            (g)   Genco II LP shall have been certified as an EWG by the FERC.

Genco Holdings shall not waive the conditions set forth in subsection (a), (b)
or (c) of this Section 7.1 without Buyer's consent.

                                  ARTICLE VIII

              CONDITIONS TO CONSUMMATION OF THE NON-STP ACQUISITION

            Section 8.1 Conditions to Buyer, Genco Holdings and CenterPoint's
Obligations to Consummate the Non-STP Acquisition. The respective obligations of
Buyer, Genco Holdings and CenterPoint to consummate the Non-STP Acquisition are
subject to the satisfaction on or prior to the Non-STP Acquisition Closing Date
of each of the following conditions:

            (a)   No Law or Order shall exist or shall have been enacted,
      entered, promulgated or enforced by any Governmental Authority which
      prohibits or makes illegal consummation of the Non-STP Acquisition or any
      of the other transactions related thereto.

            (b)   Any waiting period applicable to the Non-STP Acquisition under
      applicable U.S. antitrust or trade regulation laws and regulations,
      including under the HSR Act, shall have expired or been terminated.

            (c)   The Public Company Merger shall have been consummated.

            Section 8.2 Further Conditions to Genco Holdings and CenterPoint's
Obligations. The obligation of Genco Holdings and CenterPoint to consummate the
Non-STP Acquisition is further subject to satisfaction or, if permitted by
applicable Law, waiver by Genco LP and CenterPoint, on or prior to the Public
Company Merger Closing Date of each of the following conditions:

            (a)   Representations and Warranties. Each of the representations
      and warranties of Buyer set forth in Article V of this Agreement shall be
      true and correct as of the date of this Agreement and on and as of the
      Public Company Merger Closing Date as though such representations and
      warranties were made on and as of such date, except for representations
      and warranties which speak as of

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<PAGE>

      an earlier date or period which shall be true and correct as of such date
      or period; provided, however, that for purposes of this clause, such
      representations and warranties shall be deemed to be true and correct
      unless the failure or failures of all such representations and warranties
      to be so true and correct, without giving effect to any qualification as
      to materiality or Buyer Material Adverse Effect set forth in such
      representations or warranties, would reasonably be expected, in the
      aggregate, to have a Buyer Material Adverse Effect.

            (b)   Performance Obligations of Buyer. Buyer shall have performed
      in all material respects all obligations required to be performed by it
      under this Agreement at or prior to the Public Company Merger Closing.

            (c)   Officer's Certificate. Genco LP and CenterPoint shall have
      received a certificate, dated the Public Company Merger Closing Date,
      signed on behalf of Buyer by an officer of Buyer certifying as to the
      matters described in Sections 8.2(a) and 8.2(b).

            Section 8.3 Further Conditions to Buyer's Obligations. The
obligation of Buyer to consummate the Non-STP Acquisition shall be further
subject to the satisfaction or, if permitted by applicable Law, waiver by Buyer,
on or prior to the Public Company Merger Closing Date, of each of the following
conditions:

            (a)   Representations and Warranties. Each of the representations
      and warranties of Parents and Genco Holdings (i) set forth in Articles III
      and IV of this Agreement shall be true and correct as of the date of this
      Agreement and as of the Public Company Merger Closing Date as though such
      representations and warranties were made on and as of such date, except
      for representations and warranties that speak as of an earlier date or
      period which shall be true and correct as of such date or period;
      provided, however, that for purposes of this clause, such representations
      and warranties shall be deemed to be true and correct unless the failure
      or failures of all such representations and warranties to be so true and
      correct, without giving effect to any qualification as to materiality or
      Companies Material Adverse Effect set forth in such representations or
      warranties, would reasonably be expected, in the aggregate, to have a
      Companies Material Adverse Effect and (ii) set forth in Sections 3.3 and
      4.3 shall be true and correct in all material respects as of the date of
      this Agreement and as of the Public Company Merger Closing Date as though
      made on and as of the Public Company Merger Closing Date, except for
      representations and warranties which speak as of an earlier date or period
      which shall be true and correct as of such date or period.

            (b)   Performance Obligations. Each of Parents and Genco Holdings
      shall have performed in all material respects all obligations required to
      be performed by it under this Agreement at or prior to the Public Company
      Merger Closing Date, including, without limitation, causing the
      consummation of the Genco LP Division.

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<PAGE>

            (c)   No Material Adverse Effect. Since the date of this Agreement,
      there shall not have occurred any state of facts, change, development,
      event, effect, condition or occurrence that, individually or in the
      aggregate, has had or would reasonably be expected to have a Companies
      Material Adverse Effect.

            (d)   Officer's Certificate. Buyer shall have received a
      certificate, dated the Public Company Merger Closing Date, signed on
      behalf of (i) the Parents by the Chief Executive Officer or Chief
      Financial of CenterPoint and (ii) Genco Holdings by the Chief Executive
      Officer or Chief Financial of Genco Holdings, in each case certifying as
      to the matters described in Section 8.3(a), 8.3(b) and 8.3(c).

            (e)   Receipt of Debt Financing. Genco Holdings shall have access to
      immediately available funds under the Overnight Bridge Loan as
      contemplated by the Public Company Merger Debt Term Sheet, Buyer shall
      have received proceeds from the Debt Financing in an amount equal to the
      Non-STP Consideration (or such amount shall have been funded into escrow
      as contemplated by the Debt Financing Letter) and the Delayed Draw Term
      Facility shall be in full force and effect, in each case on the terms and
      conditions set forth in the Debt Financing Letter or the Public Company
      Merger Debt Term Sheet, as applicable, or upon terms and conditions which
      are, in the judgment of Buyer, comparable or more favorable (to Buyer) in
      the aggregate thereto, and to the extent that any terms and conditions are
      not set forth in the Debt Financing Letter, on terms and conditions
      reasonably satisfactory to Buyer and, with respect to the Public Company
      Merger Debt Term Sheet, Genco Holdings.

            (f)   Ancillary Agreements. At the request of Buyer delivered prior
      to the Public Company Merger Closing Date, (i) CenterPoint and Buyer shall
      have entered into a Transition Services Agreement, dated as of the Non-STP
      Acquisition Closing Date, between CenterPoint and Buyer, in substantially
      the form attached as Exhibit E to this Agreement (the "TRANSITION SERVICES
      AGREEMENT"), and (ii) the parties thereto shall have entered into the
      Separation Amendment, and each such agreement shall not have been revoked,
      terminated or amended.

            (g)   EWG Certification. Genco II LP shall have been certified as an
      EWG by the FERC.

            (h)   Genco II LP and Genco Services shall hold all Permits
      necessary to operate the Non-STP Assets and Liabilities consistent with
      past practice, except where the failure to hold such Permits would not,
      individually or in the aggregate, reasonably be expected to have a
      Material Adverse Effect.

            Section 8.4 Additional Conditions to Genco Holdings and
CenterPoint's Obligations. The obligation of Genco Holdings and CenterPoint to
consummate the Non-STP Acquisition shall be further subject to the satisfaction
or, if permitted by applicable Law, waiver by Genco Holdings and CenterPoint, on
or prior to

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the Non-STP Acquisition Closing Date, of the following conditions with respect
to the Power Purchase Agreement:

            (a)   All Bonds (as defined in the Phase I Lien Annex to the Power
      Purchase Agreement) issued by Genco LP under the Phase I Lien Annex to the
      Power Purchase Agreement shall have been cancelled and returned to the
      Trustee (as defined in the Phase I Lien Annex to the Power Purchase
      Agreement).

            Section 8.5 Additional Conditions to Buyer's Obligations. The
obligation of Buyer to consummate the Non-STP Acquisition shall be further
subject to the satisfaction or, if permitted by applicable Law, waiver by Buyer,
on or prior to the Non-STP Acquisition Closing Date, of the following
conditions:

            (a)   Performance Obligations. Each of Parents and Genco Holdings
      shall have performed in all material respects all obligations required to
      be performed by it under this Agreement in order to consummate the Non-STP
      Acquisition and all obligations required to be performed by it under this
      Agreement from the Public Company Merger Closing Date through and prior to
      the Non-STP Acquisition Closing.

            (b)   Officer's Certificate. Buyer shall have received a
      certificate, dated the Non-STP Acquisition Closing Date, signed on behalf
      of (i) the Parents by the Chief Executive Officer or Chief Financial of
      CenterPoint and (ii) Genco Holdings by the Chief Executive Officer or
      Chief Financial of Genco Holdings, in each case certifying as to the
      matters described in Section 8.5(a).

            (c)   Provided that Buyer has satisfied the condition set forth in
      Section 8.4(a), (i) the Indenture (as defined in the Phase I Lien Annex to
      the Power Purchase Agreement) shall have been satisfied and discharged or
      (ii) (A) Genco II LP shall have been released and discharged from all
      obligations and covenants under such Indenture and on and under all
      Securities (as defined in the Indenture) then Outstanding (as defined in
      the Indenture) and (B) all assets (including all property, real, personal
      and mixed) of Genco II LP shall have been released from all liens under
      the Indenture.

                                   ARTICLE IX

                CONDITIONS TO CONSUMMATION OF THE STP ACQUISITION

            Section 9.1 Conditions to CenterPoint and Buyer's Obligations to
Consummate the STP Acquisition. The respective obligations of CenterPoint and
Buyer to consummate the STP Acquisition are subject to the satisfaction on or
prior to the STP Acquisition Closing Date of each of the following conditions:

            (a)   No Law or Order shall exist or shall have been enacted,
      entered, promulgated or enforced by any Governmental Authority which
      prohibits or makes illegal consummation of the STP Acquisition or any of
      the other transactions related thereto;

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            (b)   Any waiting period applicable to the STP Acquisition under
      applicable U.S. antitrust or trade regulation laws and regulations,
      including under the HSR Act, shall have expired or been terminated;

            (c)   The NRC Approval shall have been obtained and shall be in full
      force and effect, any waiting period prescribed by Law before the STP
      Acquisition may be consummated shall have expired, no rehearing or appeal
      of such NRC Approval shall be pending or to Genco Holdings' or Buyer's
      knowledge threatened; and

            (d)   The Non-STP Acquisition shall have been consummated.

            Section 9.2 Further Conditions to Buyer's Obligations. The
obligation of Buyer to consummate the STP Acquisition shall be further subject
to the satisfaction or, if permitted by applicable Law, waiver by Buyer, on or
prior to the STP Acquisition Closing Date, of each of the following conditions:

            (a)   Representations and Warranties. Each of the representations
      and warranties of Parents and Genco Holdings (i) set forth in Articles III
      and IV of this Agreement relating to the Companies (excluding the Non-STP
      Assets and Liabilities transferred in the Non-STP Acquisition) shall be
      true and correct as of the date of this Agreement and as of the STP
      Acquisition Closing Date as though such representations and warranties
      were made on and as of such date, except for representations and
      warranties that speak as of an earlier date or period which shall be true
      and correct as of such date or period; provided, however, that for
      purposes of this clause, such representations and warranties shall be
      deemed to be true and correct unless the failure or failures of all such
      representations and warranties to be so true and correct, without giving
      effect to any qualification as to materiality or Companies Material
      Adverse Effect set forth in such representations or warranties, would
      reasonably be expected, in the aggregate, to have a Companies Material
      Adverse Effect and (ii) set forth in Section 3.3(b) of this Agreement
      shall be true and correct as of the STP Acquisition Closing Date as though
      such representation was made on and as of such date. For purposes of this
      Section 9.2, in the definition of "Companies Material Adverse Effect", the
      words "Companies taken as a whole" shall be deemed to be followed by the
      phrase "(including the Non-STP Assets and Liabilities as in effect as of
      the date hereof)", so that the only items relevant shall be any state of
      facts, changes, developments, events, effects, conditions and occurrences
      affecting the STP Assets and Liabilities, which shall be compared to the
      Companies taken as a whole as of the date of this Agreement, ignoring any
      such item thereafter affecting the Non-STP Assets and Liabilities.

            (b)   Performance Obligations. From the Non-STP Acquisition Closing
      Date through the STP Acquisition Closing Date, each of Parents and Genco
      Holdings shall have performed in all material respects all obligations
      relating to the Companies (excluding the Non-STP Assets and Liabilities
      transferred in the

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      Non-STP Acquisition) required to be performed by it under this Agreement
      at or prior to the STP Acquisition Closing.

            (c)   No STP Assets Material Adverse Effect. Since the date of this
      Agreement, there shall not have occurred any state of facts, change,
      development, event, effect, condition or occurrence with respect to the
      Companies (for the avoidance of doubt excluding the Non-STP Assets and
      Liabilities transferred in the Non-STP Acquisition) that, individually or
      in the aggregate, has had or would reasonably be expected to have a
      Companies Material Adverse Effect.

            (d)   Officer's Certificate. Buyer shall have received a
      certificate, dated the STP Acquisition Closing Date, signed on behalf of
      CenterPoint by the Chief Executive Officer or Chief Financial of
      CenterPoint certifying as to the matters described in Section 9.2(a),
      9.2(b) and 9.2(c).

                                   ARTICLE X

                           TERMINATION AND ABANDONMENT

            Section 10.1 Termination. This Agreement may be terminated and the
transactions contemplated hereby may be abandoned at any time prior to the STP
Acquisition Closing Date, as follows (the date of any such termination, the
"TERMINATION DATE"):

            (a)   by mutual written consent of CenterPoint, Genco Holdings and
      Buyer;

            (b)   by CenterPoint, Genco Holdings or Buyer if the STP Acquisition

      Closing shall not have been consummated on or before April 30, 2005 (such
      date, as it may be extended under clause (a) of this paragraph, the
      "OPTIONAL TERMINATION DATE"); provided, however, that (a) either
      CenterPoint, Genco Holdings or Buyer may, in its sole discretion, elect to
      extend the Optional Termination Date for up to two consecutive 90-day
      extension periods if, in each case, (i) the conditions set forth in
      Sections 7.1(b), 9.1(b) or 9.1(c) have not been satisfied, (ii) all other
      conditions to consummation of the Public Company Merger, in the case of
      Section 7.1(b), or the STP Acquisition Closing, in the case of Section
      9.1(b) or 9.1(c), are satisfied or capable of then being satisfied (other
      than the condition in Section 9.1(d) in the case of the STP Acquisition
      Closing), and (iii) the sole reason that the Public Company Merger or the
      STP Acquisition Closing, as applicable, has not been consummated by such
      date is that the conditions set forth in Sections 7.1(b), 9.1(b) or
      9.1(c), as applicable, have not been satisfied due to the failure to
      obtain the necessary consents and Approvals under applicable Laws or a
      judgment, injunction, order or decree of a court or governmental or
      regulatory entity of competent jurisdiction shall be in effect and Parents
      and Genco Holdings, on the one hand, or Buyer, on the other hand, as
      applicable, are still attempting to obtain such necessary consents and
      Approvals under applicable Laws, or are contesting (x) the refusal of such
      court or

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      governmental or regulatory entity to give such consents or Approvals or
      (y) the entry of any such judgment, injunction, order or decree, in court
      or through other applicable proceedings; and (b) the right to terminate
      this Agreement pursuant to this Section 10.1(b) shall not be available to
      either of CenterPoint or Genco Holdings, if either of their failure to
      perform, or Buyer, if its failure to perform, its obligations under this
      Agreement has been the cause of, or resulted in, the failure of the Public
      Company Merger or STP Acquisition Closing to have been consummated on or
      before the Termination Date or Optional Termination Date, as applicable;

            (c)   by CenterPoint or Genco Holdings, on the one hand, or Buyer,
      on the other hand, if there shall have been a material breach of any of
      the covenants or agreements or any of the representations or warranties
      set forth in this Agreement on the part of any of Buyer, in the case of
      termination by CenterPoint or Genco Holdings, or the Parents or Genco
      Holdings, in the case of a termination by Buyer, which breach,
      individually or together with all other such breaches, would constitute,
      if occurring or continuing on the Non-STP Acquisition Closing Date or the
      STP Acquisition Closing Date, the failure of any of the conditions set
      forth in Section 8.2, 8.3 or 9.2, as the case may be, and which is not
      cured within 30 days following written notice to the party committing such
      breach or by its nature or timing cannot be cured prior to the Non-STP
      Acquisition Closing Date or the STP Acquisition Closing Date, as the case
      may be;

            (d)   by CenterPoint, Genco Holdings or Buyer if (i) a Governmental
      Authority shall have issued an Order or taken any other action permanently
      restraining, enjoining or otherwise prohibiting the transactions
      contemplated by this Agreement and such Order shall have become final and
      non-appealable or (ii) a Governmental Authority of competent jurisdiction
      shall have denied or otherwise failed to grant a Required Approval and
      such failure or denial shall have become final and non-appealable, a
      result of which the conditions set forth in Section 7.1 or, if the Public
      Company Merger has occurred, Section 8.1 or, if the Non-STP Acquisition
      Closing has occurred, Section 9.1, shall become incapable of being
      satisfied; or

            (e)   by Buyer if the Non-STP Acquisition has not occurred within
      three calendar days after the Public Company Merger Closing Date.

            Section 10.2 Procedure for and Effect of Termination. In the event
of termination of this Agreement and abandonment of the transactions
contemplated by this Agreement by either party as provided under Section 10.1 of
this Agreement, written notice thereof shall be given by a party so terminating
to the other party and this Agreement shall forthwith become void and have no
effect, and the transactions contemplated by this Agreement shall be abandoned
without further action by Parents, Genco Holdings or Buyer, without any
liability or obligation on the part of Buyer, Genco Holdings or Parents, other
than the provisions of Section 6.2(b), this Section 10.2 and Article XI. If this
Agreement is terminated under Section 10.1 of this Agreement:

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<PAGE>

            (a)   each party shall redeliver all documents, work papers and
      other materials of the other parties relating to the transactions
      contemplated by this Agreement which have not been consummated as of the
      date of termination, whether obtained before or after the execution of
      this Agreement, to the party furnishing the same, and all confidential
      information received by any party hereto with respect to the other party
      shall be treated in accordance with the Confidentiality Agreement and
      Section 6.2(b) of this Agreement;

            (b)   all filings, applications and other submissions made pursuant
      hereto shall, to the extent practicable, be withdrawn from the agency or
      other person to which made, to the extent the applicable transaction has
      not been consummated; and

            (c)   there shall be no liability or obligation under this Agreement
      on the part of Parents, Genco Holdings or Buyer or any of their respective
      Representatives, except that nothing contained in this Section 10.2 shall
      relieve any party from liability for its breach of representations,
      warranties, covenants or agreements set forth in this Agreement; and
      except that the obligations provided for in this Section 10.2 shall
      survive any such termination.

Notwithstanding anything to the contrary in this Agreement, in the event of a
termination of this Agreement pursuant to Article X following the consummation
of the Non-STP Acquisition, the provisions of this Agreement shall remain in
effect in accordance with their terms, except for the obligations relating
solely to the STP Assets and Liabilities, including the obligation to consummate
the STP Acquisition.

                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

            Section 11.1 Representations and Warranties. All representations and
warranties in Articles IV and V of this Agreement or in any instrument delivered
pursuant to this Agreement shall not survive and shall terminate at the Public
Company Merger Effective Time (as such representations and warranties relate to
the Non-STP Assets and Liabilities) or at the STP Acquisition Closing
(otherwise) or, subject to Section 10.2(c), upon termination of this Agreement
pursuant to Article X, as the case may be. The representations and warranties
contained in Article III (other than Section 3.4) and Section 6.11(i) of this
Agreement shall survive indefinitely.

            Section 11.2 Amendment and Modification. This Agreement may be
amended, modified or supplemented at any time by the parties to this Agreement,
under an instrument in writing signed by all parties.

            Section 11.3 Entire Agreement; Assignment. This Agreement (including
the Parents Disclosure Letter, Companies Disclosure Letter and Buyer Disclosure
Letter), the Confidentiality Agreement and the Parent Written Consent (a)
constitute the entire agreement between the parties concerning the subject
matter of this Agreement and

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supersede other prior agreements and understandings, both written and oral,
between the parties concerning the subject matter of this Agreement, and (b)
shall not be assigned, by operation of Law or otherwise, by a party, without the
prior written consent of the other parties, and any such assignment without such
prior written consent shall be null and void, except that Buyer may assign its
rights or obligations hereunder to any affiliate or a lender (or agent therefor)
for security purposes, provided that no such assignment shall relieve Buyer of
its obligations hereunder.

            Section 11.4 Severability. The invalidity or unenforceability of any
term or provision of this Agreement in any situation or jurisdiction shall not
affect the validity or enforceability of the other terms or provisions of this
Agreement or the validity or enforceability of the offending term or provision
in any other situation or in any other jurisdiction and the remaining terms and
provisions shall remain in full force and effect, unless doing so would result
in an interpretation of this Agreement which is manifestly unjust.

            Section 11.5 Notices. Unless otherwise provided in this Agreement,
all notices and other communications under this Agreement shall be in writing
and may be given by any of the following methods: (a) personal delivery; (b)
facsimile transmission; (c) registered or certified mail, postage prepaid,
return receipt requested; or (d) overnight delivery service. Such notices and
communications shall be sent to the appropriate party at its address or
facsimile number given below or at such other address or facsimile number for
such party as shall be specified by notice given under this Agreement (and shall
be deemed given upon receipt by such party or upon actual delivery to the
appropriate address, or, in case of a facsimile transmission, upon transmission
by the sender and issuance by the transmitting machine of a confirmation slip
that the number of pages constituting the notice have been transmitted without
error; in the case of notices sent by facsimile transmission, the sender shall
contemporaneously mail a copy of the notice to the addressee at the address
provided for above; provided, however, that such mailing shall in no way alter
the time at which the facsimile notice is deemed received):

            (a)   if to Genco Holdings, to

                  Texas Genco Holdings, Inc.
                  1111  Louisiana Street
                  Houston, Texas 77002
                  Telecopy: (713) 207-0141
                  Attention: David G. Tees

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                  with a copy to

                  Baker Botts L.L.P.
                  One Shell Plaza
                  910 Louisiana Street
                  Houston, Texas 77002-4995
                  Telecopy: (713) 229-7701
                  Attention: J. David Kirkland, Jr.

            (b)   if to Parents, to

                  CenterPoint Energy, Inc,
                  1111 Louisiana Street
                  Houston, Texas 77002
                  Telecopy: (713) 207-0141
                  Attention: Gary Whitlock

                  Utility Holding LLC
                  1011 Centre Road
                  Suite 324
                  Wilmington, Delaware 19805
                  Telecopy: (302) 225-1485
                  Attention: Patricia F. Genzel
                             President and Secretary

                  with a copy to

                  Baker Botts L.L.P.
                  One Shell Plaza
                  910 Louisiana Street
                  Houston, Texas 77002-4995
                  Telecopy: (713) 229-7701
                  Attention: J. David Kirkland, Jr.

            (c)   if to Buyer, to

                  GC Power Acquisition LLC
                  c/o Simpson Thacher & Bartlett LLP
                  425 Lexington Avenue
                  New York, New York 10017
                  Telecopy: (212) 455-2502
                  Attention: David J. Sorkin
                             Brian M. Stadler

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                  with  a copy to

                  Simpson Thacher & Bartlett LLP
                  425   Lexington Avenue
                  New   York, New York 10017
                  Telecopy: (212) 455-2502
                  Attention: David J. Sorkin
                             Brian M. Stadler

            Section 11.6 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York (except to the
extent that mandatory provisions of Texas Law are applicable). All Actions
arising out of or relating to this Agreement shall be heard and determined in
any state or federal court sitting in the City of New York, and the parties
hereby irrevocably submit to the exclusive jurisdiction of such courts in any
such Action and irrevocably waive the defense of an inconvenient forum to the
maintenance of any such Action. Each party irrevocably consents to the service
of any and all process in any such Action by the mailing of copies of such
process to such party at its address specified in Section 11.5. The parties
agree that a final judgment in any such Action shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by Law. Nothing in this Section 11.6 shall affect the right of any
party to serve legal process in any other manner permitted by Law. The consents
to jurisdiction set forth in this Section 11.6 shall not constitute general
consents to service of process in the State of New York and shall have no effect
for any purpose except as provided in this Section 11.6 and shall not be deemed
to confer rights on any person other than the parties. EACH PARTY HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL RIGHTS TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT,
TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY.

            Section 11.7 Descriptive Headings. The table of contents and
descriptive headings used in this Agreement are inserted for convenience of
reference only and shall in no way be construed to define, limit, describe,
explain, modify, amplify, or add to the interpretation, construction or meaning
of any provision of, or scope or intent of, this Agreement nor in any way affect
this Agreement.

            Section 11.8 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but any of which
together shall constitute one and the same instrument.

Section 6.9 Fees and Expenses. Whether or not this Agreement and the
transactions contemplated by this Agreement are consummated, and except as
otherwise expressly set forth in this Agreement, all costs and expenses
(including legal and financial advisory fees and expenses) incurred in
connection with, or in anticipation of, this Agreement and the transactions
contemplated by this Agreement shall be paid by the party incurring such
expenses. Each of the Parents and Genco Holdings, on the one hand,

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and Buyer, on the other hand, shall indemnify and hold harmless the other party
from and against any and all claims or liabilities for financial advisory and
finders' fees incurred by reason of any action taken by such party or otherwise
arising out of the transactions contemplated by this Agreement by any person
claiming to have been engaged by such party.

            Section 11.10 Interpretation.

            (a)   The phrase "TO THE KNOWLEDGE OF" any person or any similar
phrase shall mean such facts and other information which as of the date of
determination are actually known to any executive officer of such person, after
due inquiry. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the parties
and no presumption or burden of proof shall arise favoring or disfavoring any
party by virtue of the authorship of any provisions of this Agreement. When a
reference is made in this Agreement to Sections, Schedules or Exhibits, such
reference shall be to a Section, Schedule or Exhibit of this Agreement,
respectively, unless otherwise indicated. Whenever the words "include,"
"includes" or "including" are used in this Agreement, they shall be deemed to be
followed by the words "without limitation". The words "hereof," "herein" and
"hereunder" and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement. The term "or" is not exclusive. The definitions contained in this
Agreement are applicable to the singular as well as the plural forms of such
terms. References to a person are also to its permitted successors and assigns.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms.

            (b)   For purposes of this Agreement, the term: (i) "AFFILIATE"
means, unless otherwise indicated, any person that directly, or indirectly
through one or more intermediaries, controls, is controlled by or is under
common control with the person specified; (ii) "COMPANY IP" means all
Intellectual Property owned, held or used by any Company, all material patent,
copyright, trademark and service mark registrations and applications, domain
names issued to, assigned to and filed by any Company (or, to the extent
applicable, any affiliate of Parents engaged in the Genco Business who
transferred, directly or indirectly, assets or liabilities to any Company in the
Separation Transactions) and all IP Contracts; (iii) "GOOD UTILITY PRACTICES"
means with respect to each generation facility, any of the practices, methods
and acts generally engaged in or approved by a significant portion of the
electric utility industry in the United States for facilities of similar size,
technology and age in the United States during a particular time period, or any
of such practices, methods, and acts, which, in the exercise of reasonable
judgment in light of the facts known or that reasonably should be known at the
time a decision is made, could have been expected to accomplish the desired
result at a reasonable cost consistent with good business practices,
reliability, safety and expedition; (iv) "INTELLECTUAL PROPERTY" means all U.S.
and foreign intellectual property, including: (a) patents, inventions,
discoveries, processes, designs, techniques, developments, technology, and
related improvements and know-how, whether or not patented or patentable; (b)
copyrights and works of authorship in any media, including computer hardware,
software, firmware, applications, files, systems, networks, databases and

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compilations, documentation and related textual works, graphics, advertising,
marketing and promotional materials, photographs, artwork, drawings, articles,
textual works, and Internet site content; (c) trademarks, service marks, trade
names, brand names, corporate names, domain names, logos trade dress and other
source indicators and the goodwill of any business symbolized thereby; (d) trade
secrets, drawings, blueprints and all non-public, confidential or proprietary
information, documents, materials, analyses, reach and lists; (e) all
registrations, applications and recordings and licenses and other agreements
related thereto; and (f) all rights to obtain renewals, extensions,
continuations, continuations-in-part, reissues, divisions or similar legal
protections related thereto; (v) "PERSON" means any individual, corporation,
partnership, limited liability company, firm, joint venture, association,
joint-stock company, trust, unincorporated organization, representative office,
branch, Governmental Authority or other similar entity such determination; and
(vi) "SUBSIDIARY" means, with respect to any person, any other person of which
such person (either alone or through or together with any other subsidiary)
owns, directly or indirectly, 50% or more of the outstanding equity securities
or securities carrying 50% or more of the voting power in the election of the
board of directors or other governing body of such person; provided that STPNOC
shall be deemed to be a "subsidiary" of Genco Holdings for purposes of the
following Sections of this Agreement: 3.5, 4.1 (other than the last sentence),
4.3, 4.5, 4.6(a) (first sentence only), 4.8 (first sentence only), 4.9, 4.10,
4.14 (first sentence only), 4.15, 4.21, 4.22, 6.1, 6.2, 6.3, 6.6, 6.7 and 6.16;
and provided, further, that the parties acknowledge that Genco Holdings does not
control STPNOC, and accordingly (i) the representations and warranties referred
to above in Article IV are made to the Company's knowledge and (ii) with respect
to the obligations of Genco Holdings to cause the Companies to take various
actions under Sections 6.1, 6.2, 6.3, 6.6, 6.7 and 6.16, Genco Holdings'
obligations under such Sections shall be to cause Genco LP not to approve or
take any other action that would permit STPNOC to take actions under such
Sections that could not be taken by Companies.

            Section 11.11 Third-Party Beneficiaries. This Agreement is solely
for the benefit of Parents, Genco Holdings, CEHE (with respect to Section 6.11
only) and their respective successors and permitted assigns, with respect to the
obligations of Buyer under this Agreement, and for the benefit of Buyer, and its
successors and permitted assigns, with respect to the obligations of Parents and
Genco Holdings, under this Agreement. Notwithstanding anything contained in this
Agreement to the contrary, nothing in this Agreement, expressed or implied, is
intended to confer on any person other than the parties or their respective
successors and assigns any rights, remedies, obligations or liabilities under or
by reason of this Agreement.

            Section 11.12 No Waivers. Except as otherwise expressly provided in
this Agreement, no failure to exercise, delay in exercising, or single or
partial exercise of any right, power or remedy by any party, and no course of
dealing between the parties, shall constitute a waiver of any such right, power
or remedy. No waiver by a party of any default, misrepresentation, or breach of
warranty or covenant under this Agreement, whether intentional or not, shall be
deemed to extend to any prior or subsequent default, misrepresentation, or
breach of warranty or covenant under this Agreement or affect in any way any
rights arising by virtue of any prior or subsequent such occurrence.

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No waiver shall be valid unless in writing and signed by the party against whom
such waiver is sought to be enforced.

            Section 11.13 Specific Performance. The parties to this Agreement
agree that if any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached, irreparable
damage would occur, no adequate remedy at law would exist and damages would be
difficult to determine, and that the parties shall be entitled to specific
performance of the terms of this Agreement and immediate injunctive relief,
without the necessity of proving the inadequacy of money damages as a remedy, in
addition to any other remedy at law or in equity.

            Section 11.14 Acknowledgments. Notwithstanding anything else that
may be expressed or implied in this Agreement, CenterPoint, Utility Holding and
Genco Holdings covenant, agree and acknowledge that no recourse under this
Agreement or any documents or instruments delivered in connection with this
Agreement or any of the transactions contemplated hereby shall be had against
any current or future director, officer, employee, general or limited partner,
member or Affiliate (including the Investors) of Buyer or any of the foregoing,
whether by the enforcement of any assessment or by any legal or equitable
proceeding, or by virtue of any statute, regulation or other applicable Law, it
being expressly agreed and acknowledged that no personal liability whatsoever
shall attach to, be imposed on or otherwise be incurred by any current or future
officer, agent or employee of Buyer or any current or future shareholder of
Buyer or any current or future director, officer, employee, general or limited
partner, member or Affiliate (including the Investors) of any of the foregoing,
as such, for any obligation of Buyer under this Agreement or any documents or
instruments delivered in connection with this Agreement or any of the
transactions contemplated hereby or for any claim based on, in respect of or by
reason of such obligations of Buyer or their creation.

            Section 11.15 Parent Undertaking. CenterPoint agrees to cause
Utility Holding to, and subject to Section 11.16 to use its best efforts to
cause Genco Holdings to, perform the actions required of it under this Agreement
and guarantees the performance of the obligations of Utility Holding and, after
the Public Company Merger, of Genco Holdings.

            Section 11.16 Special Committee. Prior to the Public Company Merger
Effective Time, any action by Genco Holdings to terminate this Agreement
pursuant to Section 10.1, any agreement by Genco Holdings to amend this
Agreement pursuant to Section 11.2 or any waiver by Genco Holdings pursuant to
Section 7.1, 8.1, or 8.2 shall be made, taken or given, as the case may be, only
with the concurrence, or at the direction, of the Special Committee of the Board
of Directors of Genco Holdings which was appointed to act in connection with
this Agreement and related matters.

                                       96
<PAGE>

            IN    WITNESS WHEREOF, each of the undersigned has caused this
Agreement to be duly signed as of the date first above written.

                                           TEXAS GENCO HOLDINGS, INC.

                                           By:__________________________________

                                              Name:_____________________________

                                              Title:____________________________

                                           GC POWER ACQUISITION LLC

                                           By:__________________________________

                                              Name:_____________________________

                                              Title:____________________________

                                           HPC MERGER SUB, INC.

                                           By:__________________________________

                                              Name:_____________________________

                                              Title:____________________________

                                           NN HOUSTON SUB, INC.

                                           By:__________________________________

                                              Name:_____________________________

                                              Title:____________________________

                                           PARENTS:

                                           CENTERPOINT ENERGY, INC.

                                           By:__________________________________

                                              Name:_____________________________

                                              Title:____________________________

                                       97
<PAGE>

                                           UTILITY HOLDING, LLC

                                           By:__________________________________

                                              Name:_____________________________

                                              Title:____________________________

                                       98

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