<PAGE>   1
                                                                  EXHIBIT 10.1




                                 Section 363

                             Asset Sale Agreement
<PAGE>   2
                               TABLE OF CONTENTS



<TABLE>
<S>     <C>                                                                                                   <C>
                                               ARTICLE I
                                          CERTAIN DEFINITIONS  . . . . . . . . . . . . . . . . . . . . . . .   2

                                               ARTICLE II
                            TRANSFER OF ASSETS AND ASSUMPTION OF LIABILITIES . . . . . . . . . . . . . . . .  25

2.1     Purchase and Sale of Assets; Assumption of Liabilities . . . . . . . . . . . . . . . . . . . . . . .  25
2.2     Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  27
2.3     Closing; Payment of Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  27
2.4     Closing Adjustment Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  31
2.5     Calculation of Adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  35
2.6     Adjustment for Post-Closing Terminated Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . .  38
2.7     Final Settlement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  40
2.8     Prorations.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  41

                                              ARTICLE III
                             REPRESENTATIONS AND WARRANTIES OF THE COMPANY   . . . . . . . . . . . . . . . .  43

3.1     Organization; Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  43
3.2     Authority; No Violation  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  43
3.3     Consents and Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  46
3.4     Financial Information  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  47
3.5     Contracts  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  48
3.6     Title to Assets  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  49
3.7     Brokers and Finders  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  50
3.8     Legal Proceedings  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  50
3.9     Mortgage Banking Licenses and Qualifications . . . . . . . . . . . . . . . . . . . . . . . . . . . .  51
3.10    Mortgage Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  52
3.11    Enforceability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  54
3.12    Title to Certain Mortgage Loans;           Mortgage Servicing Agreements . . . . . . . . . . . . . .  55
3.13    No Recourse  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  56
3.14    Mortgage Servicing Agreements  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  56
3.15    Compliance with Mortgage Banking           Regulations . . . . . . . . . . . . . . . . . . . . . . .  57
3.16    Custodial Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  61
3.17    Inquiries  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  63
3.18    Advances; Accounts Receivable  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  64
3.19    Physical Damage  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  65
3.20    Pool Certification and Recertification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  65
</TABLE>





<PAGE>   3
<TABLE>
<S>     <C>                                                                                                  <C>
3.21    Payment of Taxes, Insurance Premiums, Other Amounts  . . . . . . . . . . . . . . . . . . . . . . . .  66
3.22    Tax Identification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  67
3.23    Single Family Loans  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  67
3.24    ARMs and Conversion Loans  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  68
3.25    Taxes  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  69
3.26    FHA, VA and PMI Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  69
3.27    Fairness Opinion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  69
3.28    RIS Agreement  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  70
3.29    Trade Names  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  70
3.30    No Material Violation  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  71

                                               ARTICLE IV
                                REPRESENTATIONS AND WARRANTIES OF BUYER  . . . . . . . . . . . . . . . . . .  72

4.1     Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  72
4.2     Authority; No Violation  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  72
4.3     Consents and Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  75
4.4     Financing  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  75
4.5     Mortgage Banking Licenses and Qualifications . . . . . . . . . . . . . . . . . . . . . . . . . . . .  75
4.6     Brokers and Finders  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  76
4.7     No Material Violation  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  76

                                               ARTICLE V
                                               COVENANTS   . . . . . . . . . . . . . . . . . . . . . . . . .  77

5.1     Conduct Prior to Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  77
5.2     Regulatory Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  81
5.3     Access to Information  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  84
5.4     Legal Conditions to Transaction  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  87
5.5     Advice of Changes  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  88
5.6     Transfer Fees and Certain Other Costs  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  89
5.7     Additional Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  92
5.8     Submission for Court Approval  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  93
5.9     Assignment of Mortgages and Endorsements of Notes  . . . . . . . . . . . . . . . . . . . . . . . . .  94
5.10    Final Certification and Re-Certification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  95
5.11    Employees  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  98
5.12    Insurance Solicitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  98
5.13    Non-Solicitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  99
5.14    Remittances  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
5.15    Bills  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
5.16    Interest Rate Adjustments  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
5.17    Acquisition Proposals; Overbid Provisions  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
5.18    Forwarding of Payments and Other Items . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
5.19    Assignment of Certain Contracts  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106
</TABLE>





<PAGE>   4
<TABLE>
<S>     <C>                                                                                                  <C>
5.20    Custodial Fund Interest and Reporting  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
5.21    IRS Reporting  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
5.22    Information Reporting  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108
5.23    Reconciliation of Suspense Accounts  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
5.24    ARM Loan Review  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
5.25    Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
5.26    Trade Names License  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
5.27    Subservicing and Transition Services Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
5.28    Establishment of Escrow Account under RIS Agreement  . . . . . . . . . . . . . . . . . . . . . . . . 111

                                               ARTICLE VI
                                               CONDITIONS  . . . . . . . . . . . . . . . . . . . . . . . . . 112

6.1     Conditions to Each Party's Obligations Under This Agreement  . . . . . . . . . . . . . . . . . . . . 112
6.2     Additional Conditions to the Obligations of the Company Under This Agreement . . . . . . . . . . . . 113
6.3     Additional Conditions to Buyer's Obligations Under This Agreement  . . . . . . . . . . . . . . . . . 115

                                              ARTICLE VII
                                            INDEMNIFICATION  . . . . . . . . . . . . . . . . . . . . . . . . 120

7.1     Indemnification  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120

                                              ARTICLE VIII
                                   TERMINATION, WAIVER AND AMENDMENT   . . . . . . . . . . . . . . . . . . . 137

8.1     Termination  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137
8.2     Effect of Termination  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139
8.3     Amendment, Extension and Waiver  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140
8.4     Termination Payment  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141

                                               ARTICLE IX
                                             MISCELLANEOUS   . . . . . . . . . . . . . . . . . . . . . . . . 142

9.1     Survival; Buyer's Rights Following Closing   . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142
9.2     Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143
9.3     Release and Settlement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143
9.4     Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144
9.5     Parties in Interest  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144
9.6     Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144
9.7     Notices  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145
9.8     Captions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146
</TABLE>





<PAGE>   5
<TABLE>
<S>     <C>                                                                                                  <C>
9.9     Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146
9.10    Governing Law  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147
9.11    Exclusive Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147
</TABLE>





<PAGE>   6

                                                                  EXECUTION COPY

                        SECTION 363 ASSET SALE AGREEMENT

                 THIS SECTION 363 ASSET SALE AGREEMENT (this "Agreement")
amended and restated as of January 4, 1996, is made by and between FIRST
NATIONWIDE MORTGAGE CORPORATION, a Delaware corporation ("Buyer"), and LOMAS
MORTGAGE USA, INC., a Connecticut corporation (the "Company").

                              W I T N E S S E T H:

                 WHEREAS, the Company is engaged in the business of servicing,
subservicing and master servicing mortgage loans pursuant to the Mortgage
Servicing Agreements (as defined herein) (the "Servicing Business"); and

                 WHEREAS, the Company filed a voluntary petition (the
"Petition") for reorganization relief pursuant to Chapter 11 of title 11 of the
United States Code, 11 U.S.C. sections 101 et seq., as amended by the
Bankruptcy Reform Act of 1994 (the "Bankruptcy Code"), in the United States
Bankruptcy Court for the District of Delaware (the "Bankruptcy Court") on
October 10, 1995; and

                 WHEREAS, Buyer desires to purchase and acquire from the
Company certain assets and rights, and the Company desires to sell, convey,
assign and transfer all





<PAGE>   7
of such assets and rights to Buyer, in the manner and subject to the terms and
conditions set forth herein and in accordance with Sections 105, 363 and 365 of
the Bankruptcy Code; and

                 WHEREAS, the Company desires to assign to Buyer and Buyer
desires to assume from the Company certain liabilities, in the manner and
subject to the terms and conditions set forth herein and in accordance with
Sections 105, 363 and 365 of the Bankruptcy Code.

                 NOW, THEREFORE, in consideration of the premises and of the
mutual covenants, agreements, representations and warranties herein contained,
and intending to be legally bound hereby, the parties hereto do hereby agree as
follows:
                                   ARTICLE I
                              CERTAIN DEFINITIONS

                 For purposes of this Agreement, except as otherwise expressly
provided herein or unless the context otherwise requires, the terms defined in
this Article I shall have the meanings assigned to them in this Article I and
shall include the plural as well as the singular.

                 Accounts Receivable -- The accounts receivable which comprise
those general ledger accounts of the Company set forth on Schedule I hereto.





                                       2
<PAGE>   8
                 Acquisition -- The acquisition by Buyer of all of the Assets
and the assumption by Buyer of all of the Assumed Liabilities pursuant to this
Agreement.

                 Acquisition Proposal -- As defined in Section 5.17(a).

                 Adjusted Base Price -- As defined in Section 2.5(h).

                 Advances -- Amounts that have been advanced by the Company in
connection with servicing, subservicing or master servicing the Mortgage Loans
(including, without limitation, principal, interest, taxes and insurance
premiums) and which are required or permitted to be paid by the Company as the
servicer, subservicer or master servicer of the Mortgage Loans pursuant to
applicable Investor requirements or the terms of the applicable Mortgage
Servicing Agreements.

                 Affiliate -- With respect to any Person, any Person directly
or indirectly controlling, controlled by, or under common control with such
other Person, and any Subsidiary of such Person.  For purposes of this
definition, "control" (including with correlative meaning, the terms
"controlled by" and "under common control with") as used with respect to any
Person, means the possession, directly or indirectly, of the power to direct or
cause





                                       3
<PAGE>   9
the direction of the management and policies of such Person, whether through
ownership of voting securities, by contract or otherwise.

                 Agency -- FHA, VA, GNMA, FNMA, FHLMC, FmHA, the Texas
Veterans' Land Board or a State Agency, as applicable.

                 Agreement -- As defined in the recitals hereof, including all
schedules and exhibits hereto, amendments hereof and supplements thereof.

                 Ancillary Income -- Charges for late Mortgage Loan payments,
charges for dishonored checks, pay-off fees, assumption fees, commissions and
administrative fees on insurance and other fees and charges collected from or
assessed against the mortgagor, other than those charges payable to an Agency
or Investor under the terms of the Mortgage Servicing Agreements.

                 Assets -- As defined in Section 2.1(a).

                 Assumed Contracts -- The contract rights, licenses, permits,
approvals, authorizations and franchises set forth on Schedule II hereto,
together with any additional contract rights added to such schedule pursuant to
Section 5.7 hereof.

                 Assumed Liabilities -- As defined in Section 2.1(c).





                                       4
<PAGE>   10
                 Bankruptcy Code -- As defined in the recitals hereof.

                 Bankruptcy Court -- As defined in the recitals hereof.

                 Base Portfolio -- The Mortgage Servicing Portfolio on July 31,
1995, as set forth in a tape (magnetic media) delivered to Buyer, provided,
however, that the Base Portfolio shall not include (i) any Mortgage Loan which
on July 31, 1995 was an Excluded Loan or (ii) any Mortgage Loan for which the
Company is not the primary servicer.

                 Base Portfolio Loan -- Any Mortgage Loan included in the Base
Portfolio.

                 Base Purchase Price -- As defined in Section 2.2.

                 Book Value -- Book value calculated in accordance with GAAP
consistently applied without allowance for reserves.

                 Burdensome Condition -- As defined in Section 6.2(d).

                 Buydown -- The waiver by Buyer of a portion of the
indebtedness of a Mortgage Loan, which can take the form of a reduction of the
principal, a credit to escrow or unapplied funds accounts, the forgiveness of
accrued





                                       5
<PAGE>   11
interest or any combination of the foregoing, and which causes the VA to pay
off the remaining amount of the indebtedness owed and acquire the Collateral.

                 Buyer -- As defined in the recitals hereof.

                 Buyer Schedule -- As defined in Section 4.2(b).

                 Citicorp Agreement -- As defined in Section 2.6(e).

                 Closing -- The closing of the Acquisition as defined in
Section 2.3(a).

                 Closing Adjustment Documents -- As defined in Section 2.4(a).

                 Closing Portfolio -- The Mortgage Servicing Portfolio on the
Closing Date, provided, however, that the Closing Portfolio shall not include
(i) any Mortgage Loan which on the Closing Date is an Excluded Loan or (ii) any
Mortgage Loan for which the Company is not the primary servicer.

                 Closing Portfolio Loan -- Any Mortgage Loan included in the
Closing Portfolio.

                 Closing Date -- The date and time of Closing as defined in
Section 2.3(a).

                 Code -- The Internal Revenue Code of 1986, as amended.





                                       6
<PAGE>   12
                 Collateral -- The property securing a Mortgage Loan.

                 Company Schedule -- As defined in Section 3.2.

                 Confidentiality Agreement -- As defined in Section 5.3.

                 Contracts -- The Assumed Contracts, the Leases and the
Mortgage Servicing Agreements.

                 Conversion Date -- For any Mortgage Loan, the date the
servicing of such Mortgage Loan shall have been fully converted and transferred
from the Company's operating systems to those of Buyer.

                 Custodial Accounts -- All escrow, impound, suspense (loan
level and other) and custodial accounts maintained with respect to the Mortgage
Loans for purposes of receiving and disbursing payments of principal, interest,
taxes, insurance, assessments and similar charges (and interest, if any,
accrued on such funds for the benefit of mortgagors) relating to Mortgage
Loans.

                 Disagreement -- As defined in Section 2.4(b).

                 Disputed Claim -- As defined in Section 7.1(j).

                 Employees -- As defined in Section 5.11.

                 Encumbrance -- Any lien, pledge, security interest, claim,
charge, easement, limitation, commit-





                                       7
<PAGE>   13
ment, restriction or encumbrance of any kind or nature whatsoever.

                 Escrow Funds -- Amounts held in Custodial Accounts, with
respect to Mortgage Loans held for the purpose of paying property taxes, hazard
insurance premiums, assessments and other such items as provided in the
Mortgage and the Regulations.

                 Excluded Assets -- As defined in Section 2.1(b).

                 Excluded Liabilities -- As defined in Section 2.1(d).

                 Excluded Loan -- A Mortgage Loan with respect to which as of a
specified date:

                 (i)        the Mortgage Loan is two months or more past due
         (for purposes of this Agreement a Mortgage Loan is two months or more
         "past due" if a scheduled monthly payment of principal, interest and
         (if required) escrow due on the first day of a month is not paid by
         the mortgagor on or before the last calendar day of the next
         succeeding month);

                 (ii)       the first action necessary to be taken to commence
         proceedings in foreclosure, or a sale under power of sale, or other
         acquisition of title to the Collateral based upon a default by the
         mort-





                                       8
<PAGE>   14
         gagor under the Note or Mortgage, under the law of the state wherein
         the Collateral is located, has been taken under the terms of the Note
         or Mortgage and the relevant Mortgage Servicing Agreement;

                 (iii)      any litigation is pending relating to a Mortgage
         Loan the adverse outcome of which would have a material adverse effect
         on the enforceability of the Mortgage Loan or on the economic value of
         the related Servicing Rights;

                 (iv)       the mortgagor has sought relief under or has
         otherwise been subjected to the federal bankruptcy laws or any other
         similar federal or state laws of general application for the relief of
         debtors, through the institution of appropriate proceedings, and such
         proceedings are continuing;

                 (v)        a demand for Repurchase has been received by the
         Company and the basis for the Repurchase demand has not been cured
         prior to the due date for such Repurchase; or

                 (vi)       the Mortgage Loan is identified on the Company's
         books and records as a "fraudulent loan."

                 FF&E -- The furniture, fixtures and equipment owned or leased
by the Company and set forth on Schedule X hereto.





                                       9
<PAGE>   15
                 FHA -- Federal Housing Administration.

                 FHA Loans -- Mortgage Loans which are insured by FHA, or which
are intended by the Company to be insured by FHA, or with respect to which a
representation has been made to the mortgagor (in a commitment letter, truth-
in-lending disclosure statement or otherwise in writing) that such Mortgage
Loan is or will be insured by FHA.

                 FHLMC -- Federal Home Loan Mortgage Corporation.

                 Final Order -- An order or judgment of a court, the
implementation or operation or effect of which has not been stayed and as to
which order or judgment (or any revision, modification or amendment thereof
reasonably acceptable to Buyer) the time to appeal or seek review or rehearing
or writ of certiorari has expired and as to which no appeal or petition for
review or rehearing or certiorari has been taken.

                 Final Settlement  -- As defined in Section 2.7.

                 Final Settlement Date  -- As defined in Section 2.7.

                 First Order -- An order of the Bankruptcy Court, in form and
substance reasonably satisfactory to Buyer, which approves, among other things,
(i) sales





                                       10
<PAGE>   16
procedures relating to disposition of the Assets set forth in Section 5.17
hereof and (ii) payment of the  Termination Payment to Buyer pursuant to
Section 8.4.

                 First Payment -- As defined in Section 2.3(c).

                 FmHA -- The Farmers Home Administration, now known as the
Rural Housing and Community Development Service.

                 FmHA Loans -- Mortgage Loans which are insured by FmHA, or
which are intended by the Company to be insured by FmHA, or with respect to
which a representation has been made to the mortgagor (in a commitment letter,
truth-in-lending disclosure statement or otherwise in writing) that such
Mortgage Loan is or will be insured by FmHA.

                 FNMA -- Federal National Mortgage Association.

                 Foreclosure -- The acquisition of title to Collateral in a
foreclosure sale or pursuant to any other comparable procedure allowed under
applicable law or Regulation, including pending foreclosures where the first
step required under applicable Regulations to initiate a foreclosure proceeding
has been taken or could have been taken.

                 GAAP -- Generally accepted accounting principles as used in
the United States of America as in effect





                                       11
<PAGE>   17
at the time any applicable financial statements were prepared.

                 GNMA -- Government National Mortgage Association.

                 Governmental Entity -- Any government or any agency, bureau,
board, commission, court, department, official, political subdivision, tribunal
or other instrumentality of any government having authority in the United
States or any other nation, whether federal, state or local.

                 HSR Act -- The Hart-Scott-Rodino Antitrust Improvements Act of
1976.

                 HUD -- United States Department of Housing and Urban
Development.

                 Indemnification Cap -- As defined in Section 7.1(h).

                 Independent Accounting Firm -- Price Waterhouse LLP, or if
Price Waterhouse LLP shall be unwilling to serve in such capacity, any "Big
Six" accounting firm or its successor (other than the present independent
public accountants of Buyer, the Company or any of their Affiliates or any
independent public accountants who were such within the previous two years).





                                       12
<PAGE>   18
                 Injunction -- As defined in Section 6.1(b).

                 Insurer -- A Person who insures or guarantees all or any
portion of the risk of loss upon borrower default on any of the Mortgage Loans,
including, without limitation, the FHA, the VA and any private mortgage
insurer, and providers of life, hazard, disability, title or other insurance
with respect to any of the Mortgage Loans or the Collateral.

                 Investments -- The investment assets relating to the Servicing
Business which comprise those general ledger accounts of the Company set forth
on Schedule III hereto.

                 Investor -- Any Person who owns a Mortgage Loan or
mortgage-backed security backed by a Mortgage Loan, or the servicing rights or
master servicing rights to a Mortgage Loan or mortgage-backed security backed
by a Mortgage Loan, subserviced, serviced or master serviced by the Company
pursuant to a Mortgage Servicing Agreement.

                 Leased Properties -- The leasehold interests of the Company in
real property pursuant to the Leases.

                 Leases -- The leases set forth on Schedule IV hereto pursuant
to which the Company leases real property or FF&E.





                                       13
<PAGE>   19
                 Licenses -- As defined in Section 3.9.

                 Loan Documents -- The file or files containing the photostatic
copy or copies on other media and, to the extent required by the Regulations,
original documents, of the Mortgage, the Note and other loan documents with
respect to each Mortgage Loan, as well as the related credit and closing
packages, disclosures, custodial documents, and all other files, books, records
and documents reasonably necessary to (i) establish the eligibility of the
Mortgage Loans for insurance by an Insurer or for sale or delivery to an
Investor, (ii) service the Mortgage Loans in accordance with the Regulations,
and (iii) comply with the Regulations regarding the Mortgage Loan documentation
to be maintained by a servicer of the Mortgage Loans or its document custodian.

                 Loss -- Any liability, loss, cost, damage, penalty, fine,
obligation or expense of any kind whatsoever (including, without limitation,
reasonable attorneys', accountants', consultants' or experts' fees and
disbursements, interest, at the Federal Funds Rate plus 1% (as published in the
"Money Rates" section of The Wall Street Journal as in effect from time to
time), on any amounts that the Buyer is required to pay or pledge (including,
without limitation, those amounts paid or





                                       14
<PAGE>   20
pledged with respect to a lost note, bond or letter of credit) in connection
with an indemnifiable event and any direct marginal internal costs actually
incurred (to the extent that the Buyer has received the prior approval of the
Company to utilize its internal staff, which approval shall not be unreasonably
withheld or delayed, provided that adequate information, including but not
limited to, an estimate of such internal costs, is given to the Company)).

                 Material Adverse Effect -- A material adverse effect on the
Assets, the Assumed Liabilities or the Servicing Business, in each case taken
as a whole, or on the Company's ability to consummate the transactions
contemplated by this Agreement.

                 Mortgage -- With respect to a Mortgage Loan, a mortgage, deed
of trust or other security instrument creating a lien upon real property and
any other property described therein which secures a Note, together with any
assignment, reinstatement, extension, endorsement or modification of any
thereof.

                 Mortgage Loan -- Any closed mortgage loan in the Mortgage
Servicing Portfolio, whether or not the related mortgage is included in a
securitized portfolio,





                                       15
<PAGE>   21
as evidenced by a note or notes duly secured by mortgages or deeds of trust.

                 Mortgage Servicing Agreements -- The contracts or arrangements
between the Company and an Investor, as set forth on Schedule V hereto,
pursuant to which the Company subservices, services or master services Mortgage
Loans for such Investor, together with any additional mortgage servicing
agreements added to such Schedule V pursuant to Section 5.7 hereof.

                 Mortgage Servicing Portfolio -- The portfolio of mortgage
loans subserviced, serviced or master serviced by the Company pursuant to
Mortgage Servicing Agreements.

                 Non-Amortizing Loan -- A Mortgage Loan intended to be
self-amortizing but which will have a principal amount due to be paid to
Investors notwithstanding payment by the mortgagor of the full amount scheduled
to be paid to retire the indebtedness of the Mortgage Loan.

                 Note -- With respect to a Mortgage Loan, a promissory note or
notes, or other evidence of indebtedness, with respect to such Mortgage Loan
secured by a Mortgage or Mortgages, together with any assignment,
reinstatement, extension, endorsement or modification thereof.





                                       16
<PAGE>   22
                 Notice of Disagreement -- As defined in Section 2.4(b).

                 Origination and Servicing Representation--Those
representations and warranties of the Company contained in Article III hereof
the breach or inaccuracy of which would constitute or result in a failure by
the Company to originate, service, subservice or master service the Mortgage
Loans in accordance with applicable Regulations.

                 Other Assets -- The assets relating to the Servicing Business
which comprise those general ledger accounts of the Company set forth on
Schedule VI hereto.

                 Overbid Notice -- As defined in Section 5.17(a) hereof.

                 Overbid Transaction -- An Acquisition Proposal made in writing
by a Qualified Third Party (i) which provides for consideration having a fair
market value, as determined by the Board of Directors of the Company which
exceeds the Base Purchase Price (or, if Buyer has delivered a Topping Offer to
the Company, the Topping Offer Amount) by at least $1,500,000 and (ii) the
terms and conditions of which (including the amount and value of the
consideration thereunder) are reasonably determined by the Board of Directors
of the Company to be, when taken in their entirety, no less favorable to the
Company





                                       17
<PAGE>   23
than the terms and conditions set forth in this Agreement.

                 Parent -- As defined in Section 3.7.

                 Person -- Any individual, corporation, company, partnership
(limited or general), joint venture, association, trust or other entity.

                 Petition -- As defined in the recitals hereof.

                 PMI -- Private mortgage insurance.

                 Pool -- An aggregate of one or more Mortgage Loans that have
been pledged or granted to secure mortgage-backed securities or participation
certificates.

                 Post-Closing Terminated Loan -- Each Closing Portfolio Loan
with respect to which the Investor, other than GNMA, FNMA or FHLMC (i) shall
have successfully objected to the assumption of the related Mortgage Servicing
Agreement by Buyer pursuant to the 365 Order, or (ii) shall have terminated, or
given notice of termination of, the related Mortgage Servicing Agreement in
accordance with its terms (other than due to repayment in full of such Closing
Portfolio Loans or the breach by Buyer of the terms of such Mortgage Servicing
Agreement).

                 Qualified Institution -- A firm or individual mutually
agreeable to the parties who possesses expertise in the relevant areas of the
mortgage banking business,





                                       18
<PAGE>   24
to whom Disputed Claims will be submitted for resolution.  If the parties are
unable to agree on a Qualified Institution, each party shall designate a
nationally recognized mortgage banking expert, and the two designated experts
shall jointly select a third expert, which shall be the Qualified Institution.

                 Qualified Third Party -- A Third Party who the Board of
Directors of the Company has determined in the exercise of its fiduciary duty
(i) is financially able to consummate an Overbid Transaction and (ii) has the
licenses and qualifications set forth in Section 4.5.

                 Records -- All records and original documents which pertain to
and are utilized to administer, reflect, monitor, evidence or record
information respecting, the Assets, including without limitation the Loan
Documents.

                 Recourse Loan -- Any Mortgage Loan as to which the Company has
an obligation to repurchase, reimburse, indemnify or hold harmless any Person
based solely upon the default under or the foreclosure or sale of the
Collateral for the Mortgage Loan without regard to a breach or default of any
contractual representation, warranty or undertaking or misfeasance or
malfeasance by the Company.





                                       19
<PAGE>   25
                 Regulations -- (i) Federal, state and local laws, rules and
regulations with respect to the origination, insuring, purchase, sale, pooling,
servicing, subservicing, master servicing or filing of claims in connection
with a Mortgage Loan, (ii) the responsibilities and obligations relating to the
Mortgage Loans set forth in any agreement between the Company and an Investor
or private mortgage insurer (including, without limitation, Mortgage Servicing
Agreements and selling and servicing guides), (iii) the laws, rules,
regulations, guidelines, handbooks and other requirements of an Investor,
Agency, private mortgage insurer, public housing program or Investor program
with respect to the origination, insuring, purchase, sale, pooling, servicing,
subservicing, master servicing or filing of claims in connection with a
Mortgage Loan and (iv) the terms and provisions of the Loan Documents.

                 REO -- Any residential real property owned in fee simple by
the Company as a result of a Foreclosure instituted in the conduct of the
Servicing Business.

                 Repurchase -- The purchase of a Mortgage Loan out of a Pool or
an Investor's portfolio by Buyer or the Company.





                                       20
<PAGE>   26
                 Requisite Regulatory Approvals -- As defined in Section
6.1(a).

                 Reserve -- As defined in Section 7.1(k).

                 RIS Agreement -- The Excelis Service Bureau Agreement, dated
as of December 16, 1994, by and between Residential Information Services
Limited Partnership and the Company.

                 Scheduled Liabilities -- As defined in Section 2.1(c).

                 Second Order -- An order of the Bankruptcy Court, in form
reasonably satisfactory to Buyer approving the consummation of the Acquisition.

                 Second Payment -- As defined in Section 2.3(d).

                 Servicing Business -- As defined in the recitals hereto.

                 Servicing Rights -- The right to receive the servicing fees
and any Ancillary Income the servicer, subservicer or master servicer is
entitled to receive arising from or connected to the Mortgage Loans and the
related obligations to (i) administer and collect payments for the reduction of
principal and interest, (ii) pay taxes and insurance premiums, (iii) remit all
amounts in accordance with any servicing agreements, (iv) provide foreclosure
services and full escrow administration and





                                       21
<PAGE>   27
(v) perform such other obligations as may, from time to time, be imposed under
Agency or Investor guidelines and the Mortgage Servicing Agreements.

                 State Agency -- Any state agency with authority to regulate
the business of the Company, determine the investment or servicing requirements
with regard to loans originated, purchased or serviced by the Company or
otherwise participate in or promote mortgage lending.

                 Subservicing and Transition Services Agreement -- As defined
in Section 5.27.

                 Subsidiary -- With respect to any Person, any corporation,
partnership or other organization, whether incorporated or unincorporated,
which is required by GAAP to be consolidated with such Person for financial
reporting purposes.

                 Taxes -- All taxes, charges, fees, levies or other assessments
imposed by any United States Federal, state, local or foreign taxing authority,
including, but not limited to, income, excise, property, sales, transfer, use,
profits, franchise, payroll, employment, unemployment, back-up withholding,
gains, withholding, ad valorem, social security, stamp or other taxes
(including any interest, additions to tax or penalties applicable thereto).





                                       22
<PAGE>   28
                 Tax Return -- Any return, report, information return, schedule
or other document, including any related or supporting information, with
respect to Taxes.

                 Termination Payment -- As defined in Section 8.4.

                 Third Party -- Any Person other than the Company, Buyer or any
of their respective Affiliates.

                 Third Party Claim -- As defined in Section 7.1(d).

                 365 Order -- As defined in Section 6.2(c).

                 Topping Offer -- As defined in Section 5.17(b).

                 Topping Offer Amount -- The base purchase price specified in
the most recent Topping Offer delivered by Buyer to the Company pursuant to
Section 5.17(b) hereof, which base purchase price exceeds the base purchase
price in the most recent Overbid Transaction by at least $1,500,000.

                 Topping Right -- As defined in Section 5.17(b).

                 Trade Names -- The brand names, copyrights, patents, service
marks, trademarks, trade names, state or federal common law usages and
registration or applications for registration of any of the foregoing, each as
set forth on Schedule IX hereto.





                                       23
<PAGE>   29
                 Treasury Regulations -- The regulations promulgated under the
Code.

                 Turkey Pile Loan -- Any whole mortgage loan owned by the
Company which was bought out of a Pool or otherwise repurchased from an
Investor.

                 Undisputed Claim -- As defined in Section 7.1(j).

                 VA -- The United States Department of Veterans' Affairs.

                 VA Loans -- Mortgage Loans which are guaranteed by the VA, or
which are intended by the Company to be guaranteed by the VA, or with respect
to which a representation has been made to the mortgagor (in a commitment
letter, truth-in-lending disclosure statement or otherwise in writing) that
such Mortgage Loan is or will be guaranteed by the VA.

                 VA No-Bid -- A delinquent VA Loan with respect to which the VA
has notified Buyer or the Company that the VA intends to exercise its option to
pay the amount guaranteed by the VA and relinquish all rights in the Collateral
securing such VA Loan to Buyer or the Company.





                                       24
<PAGE>   30
                                   ARTICLE II
                TRANSFER OF ASSETS AND ASSUMPTION OF LIABILITIES

                 2.1      Purchase and Sale of Assets;
                          Assumption of Liabilities

                 (a)      Upon the terms and subject to the conditions set 
forth in this Agreement, at the Closing the Company shall sell, convey, assign,
transfer and deliver to Buyer, and Buyer shall purchase and accept from the
Company, all of the Company's right, title and interest in and to, as of the
Closing Date, the following assets (collectively, the "Assets"):

                          (i)          the Servicing Rights;

                          (ii)         the REO;

                          (iii)        the Accounts Receivable;

                          (iv)         the FF&E;

                          (v)          the Contracts;

                          (vi)         the Records;

                          (vii)        the Custodial Accounts and the Escrow
                                       Funds;

                          (viii)       the Trade Names;

                          (ix)         the Investments and the Other Assets;
                                       and
 
                          (x)          the Turkey Pile Loans.


                 (b)      It is understood and agreed that Buyer is not 
acquiring from the Company, and the Company shall





                                       25
<PAGE>   31
retain ownership of, all right, title and interest in and to, any property or
asset which is not being transferred pursuant to this Section 2.1
(collectively, the "Excluded Assets").

                 (c)      Upon the terms and subject to the conditions set 
forth in this Agreement, except as otherwise provided herein, on the Closing
Date, the Company shall assign to Buyer, and Buyer shall accept and assume from
the Company, and Buyer agrees to pay, honor, perform and discharge all
obligations with respect to, and shall be solely and exclusively liable for
(except to the extent indemnifiable pursuant to Article VII hereof), all of the
liabilities and obligations of the Company that arise under or relate to (i)
the Servicing Rights, (ii) the Contracts, and (iii) those liabilities which
comprise the general ledger accounts of the Company set forth on Schedule VII
hereto (the "Scheduled Liabilities"), in each case which liabilities and
obligations become due and payable on or after the Closing Date (the "Assumed
Liabilities").

                 (d)      It is understood and agreed that, except as expressly
set forth in this Agreement, Buyer shall not assume or be liable for any of the
debts, obligations or liabilities (including without limitation any liability





                                       26
<PAGE>   32
for Taxes) of the Company or any of its Subsidiaries of any kind or nature
whatsoever (whether or not accrued or fixed, absolute or contingent, known or
unknown), and the Company and its Subsidiaries shall remain and be solely and
exclusively liable with regard to such debts, liabilities and obligations
(collectively, the "Excluded Liabilities").

                 2.2      Purchase Price

                 The aggregate purchase price to be paid to the Company for the
Assets shall be $178,260,000 (the "Base Purchase Price"), provided, however,
that (i) such Base Purchase Price shall be adjusted in accordance with Sections
2.4, 2.5 and 2.6 hereof and (ii) $10,000,000 of the Base Purchase Price shall
be paid subject to and in accordance with the provisions of Exhibit 2.2 hereto.
The purchase price as finally determined shall be paid by Buyer to the Company
in accordance with the terms and provisions of this Article II and Article VII.

                 2.3      Closing; Payment of
                          Purchase Price

                 (a)      The sale and purchase of the Assets and assumption of
the Assumed Liabilities hereunder (the "Closing") shall occur at the offices of
Skadden, Arps, Slate, Meagher & Flom, New York, New York, or at such





                                       27
<PAGE>   33
other place as shall be mutually agreeable to the parties.  The Closing shall
take place on January 31, 1996 (the "Closing Date").

                 (b)      At the Closing, the Company shall deliver, or shall 
cause to be delivered, to Buyer the following:

                          (i)     an executed Bill of Sale and Assignment in
         substantially the form of Exhibit 2.3(b)(i);

                          (ii)    Lease Assignment and Assumption Agreements
         substantially in the form of Exhibit 2.3(b)(ii) with respect to all of
         the Leases, executed and acknowledged by the Company in recordable
         form;

                          (iii)   all documentation required to exempt the
         Company from the withholding requirement of Section 1445 of the Code,
         consisting of an affidavit from the Company to Buyer stating under
         penalty of perjury that the Company is not a foreign person and
         providing the Company's U.S. taxpayer identification number.
         Notwithstanding anything to the contrary set forth herein, if the
         Company fails to provide Buyer with such affidavit, Buyer shall be
         entitled to withhold the requisite amounts from the





                                       28
<PAGE>   34
         purchase price in accordance with Section 1445 of the Code;

                          (iv)      a copy of resolutions duly adopted by the
         Board of Directors of the Company authorizing the execution of this
         Agreement and the consummation of the transactions contemplated
         hereby, certified as of the Closing Date by the Secretary or Assistant
         Secretary of the Company;

                          (v)       the consents and other documents required
         to be delivered pursuant to Section 6.3; and

                          (vi)      such other documents, agreements and
         instruments as Buyer shall reasonably request to effect the transfer
         of the Assets from the Company to Buyer.

                 (c)      At the Closing, Buyer shall take the following 
actions:

                          (i)       Buyer shall pay to the Company $49,750,000,
         by wire transfer to such account as the Company shall designate in
         writing at least one business day prior to the Closing Date (such
         amount paid by Buyer pursuant to this clause (i), the "First
         Payment");





                                       29
<PAGE>   35
                          (ii)      Buyer shall deliver an executed Assumption
         Agreement in substantially the form of Exhibit 2.3(c);

                          (iii)     Buyer shall deliver a copy of resolutions
         duly adopted by the Board of Directors of Buyer authorizing the
         execution of this Agreement and the consummation of the transactions
         contemplated hereby, certified as of the Closing Date by the Secretary
         or Assistant Secretary of Buyer; and

                          (iv)      Buyer shall deliver the documents required
to be delivered pursuant to Section 6.2.

                 (d)      On the 120th day following the Closing Date, Buyer
shall pay to the Company, by wire transfer to such account as the Company shall
specify in writing at least one business day prior thereto, the amount obtained
(the "Second Payment") by subtracting from the Adjusted Base Price (as defined
in Section 2.5(h) hereof) the sum of (W) the amount of the First Payment plus
(X) $10 million (to be paid pursuant to the provisions of Exhibit 2.2), plus
(Y) $20,510,000 plus (Z) the greater of $16,000,000 or the 12% Holdback (as
defined below), provided, however, that if the Adjusted Base Price is in
Disagreement or has otherwise not been determined as of such date, the amount
to be used in lieu thereof to





                                       30
<PAGE>   36
calculate the Second Payment shall be an amount equal to the arithmetic mean of
Buyer's and the Company's respective good faith estimates of such Adjusted Base
Price at such time.  The remaining portion of the purchase price (other than
the $10 million to be paid pursuant to the provisions of Exhibit 2.2) shall be
paid on the Final Settlement Date, subject to the terms and conditions set
forth in Section 2.7.  The "12% Holdback" shall be an amount equal to 12% of
the difference obtained by subtracting $30,510,000 from the Adjusted Base
Price.

                 2.4      Closing Adjustment Documents

                 In order to prepare for the final determination of the
Adjusted Base Price as contemplated in Section 2.5 hereof, the parties shall
proceed as follows:

                 (a)      As soon as reasonably practicable following the
Closing Date, and in no event more than 120 days thereafter, the Company shall
prepare and deliver to Buyer (i) a schedule of the Closing Portfolio Loans,
which schedule shall set forth, with respect to each such loan, the unpaid
principal balance thereof as of the Closing Date, (ii) a schedule of the
Excluded Loans as of the Closing Date, which schedule shall set forth with
respect to each such loan the unpaid principal amount thereof as of the Closing
Date, (iii) a schedule setting





                                       31
<PAGE>   37
forth in reasonable detail the Book Value, as of the Closing Date, of the
Accounts Receivable, (iv) a schedule setting forth in reasonable detail the
Book Value, as of the Closing Date, of the Scheduled Liabilities, (v) a
schedule setting forth the unpaid principal balance of each Closing Portfolio
Loan with respect to which a reduction to the Base Purchase Price shall be made
pursuant to Section 2.5(d) hereof, (vi) a schedule setting forth in reasonable
detail the Book Value, as of the Closing Date, of the Investments and the Other
Assets,  (vii) a schedule setting forth in reasonable detail the Book Value, as
of the Closing Date, of the REO, (viii) a schedule setting forth in reasonable
detail the aggregate Book Value, as of the Closing Date, of the Turkey Pile
Loans, and (ix) a schedule setting forth in reasonable detail the calculations
contemplated by Section 2.5 below (collectively, the "Closing Adjustment
Documents").  The parties shall cooperate in the preparation of the Closing
Adjustment Documents in accordance with this Section 2.4 and Section 2.5
hereof, including such additional documents as may be necessary to calculate
the adjustments to the Base Purchase Price.  Without limiting the generality of
the foregoing, to the extent necessary, Buyer shall provide the Company and its
designees with reasonable





                                       32
<PAGE>   38
access to Buyer's books, records, personnel and representatives which relate to
the Assets and the Assumed Liabilities and such other information as the
Company may require in connection with the preparation of the Closing
Adjustment Documents and with respect to the resolution of any Disagreement (as
defined below).

                 (b)      Within twenty days after delivery of the Closing
Adjustment Documents to Buyer, Buyer may dispute all or any portion of the
Closing Adjustment Documents by giving written notice (a "Notice of
Disagreement") to the Company setting forth in reasonable detail the basis for
any such dispute (any such dispute being hereinafter called a "Disagreement").
The parties shall promptly commence good faith negotiations with a view to
resolving all such Disagreements.  If Buyer does not give a Notice of a
Disagreement in accordance with the provisions of the first sentence of this
paragraph (b) within the twenty-day period set forth therein, Buyer shall be
deemed to have irrevocably accepted the Closing Adjustment Documents in the
form delivered to Buyer by the Company, provided, however, that such acceptance
of the Closing Adjustment Documents by Buyer shall not be deemed to preclude or
otherwise limit Buyer's rights to indemnification in accordance with Article
VII hereof.





                                       33
<PAGE>   39
                 (c)      If Buyer shall deliver a Notice of Disagreement and
the Company shall not dispute all or any portion of such Notice of Disagreement
by giving written notice to Buyer setting forth in reasonable detail the basis
for such dispute within twenty days following the delivery of such Notice of
Disagreement, the Company shall be deemed to have irrevocably accepted the
Closing Adjustment Documents as modified in the manner described in the Notice
of Disagreement.  If the Company disputes all or any portion of the Notice of
Disagreement within the twenty-day period described in the previous sentence,
and within twenty days following the delivery to Buyer of the notice of such
dispute Buyer and the Company do not resolve the Disagreement (as evidenced by
a written agreement among the parties hereto), such Disagreement shall be
referred to the Independent Accounting Firm for a resolution of such
Disagreement in accordance with the terms of this Agreement.  The
determinations made by such firm with respect to any Disagreement shall be
final and binding upon the parties and the amount so determined shall be used
to complete the final Closing Adjustment Documents.  Buyer and the Company
shall use their best efforts to cause the Independent Accounting Firm to render
its determination as soon as practicable after





                                       34
<PAGE>   40
referral of the Disagreement to such firm, and each shall cooperate with such
firm and provide such firm with reasonable access to the books, records,
personnel and representatives of it and its Subsidiaries and such other
information as such firm may require in order to render its determination.  All
of the fees and expenses of any Independent Accounting Firm retained pursuant
to this paragraph (c) shall be paid one-half by Buyer and one-half by the
Company.

                 2.5      Calculation of Adjustments

                 In connection with the calculation of the Adjusted Base Price
(as defined below) and the preparation and delivery of the Closing Adjustment
Documents, the following adjustments shall be made to the Base Purchase Price:

                 (a)      Closing Portfolio.  The Base Purchase Price shall be
(i) increased by an amount equal to 1.50% of the amount of the unpaid principal
balance of all Closing Portfolio Loans which were not Base Portfolio Loans
(except that, with respect to all Closing Portfolio Loans which were Excluded
Loans at July 31, 1995, the adjustment to be made pursuant to this clause (i)
shall be 0.95% of the amount of the unpaid principal balance of such loans as
of the Closing Date) and (ii) decreased by





                                       35
<PAGE>   41
an amount equal to 0.95% of the reduction in the amount of the unpaid principal
balance of all Base Portfolio Loans between July 31, 1995 and the Closing Date.

                 (b)      Book Value of Accounts Receivable.  The Base Purchase
Price shall be (i) increased by the amount, if any, by which the aggregate Book
Value of the Accounts Receivable as of the Closing Date exceeds $72,601,000 or
(ii) decreased by the amount, if any, by which $72,601,000 exceeds the
aggregate Book Value of the Accounts Receivable as of the Closing Date.

                 (c)      Book Value of Scheduled Liabilities.  The Base
Purchase Price shall be (i) increased by the amount, if any, by which
$17,166,000 exceeds the aggregate Book Value, as of the Closing Date, of the
Scheduled Liabilities, or (ii) decreased by the amount, if any, by which the
aggregate Book Value, as of the Closing Date, of the Scheduled Liabilities
exceeds $17,166,000.

                 (d)      Adjustment for Prepayments of Loans.  If at any time
on or prior to the sixtieth (60th) day following the Closing Date, the
outstanding principal balance of a Closing Portfolio Loan is paid in full prior
to the expiration of the scheduled term thereof, the Base Purchase Price will
be reduced by an amount equal to 0.95% (except with respect to Mortgage Loans 
funded and





                                       36
<PAGE>   42
entered on the Company's system after July 31, 1995, for which a multiple of
1.50% shall be used) of the unpaid principal amount of such loan as of the
Closing Date.

                 (e)      Book Value of Investments and Other Assets.  The Base
Purchase Price shall be (i) increased by the amount by which the aggregate Book
Value of the Investments and the Other Assets as of the Closing Date exceeds
$6,100,000 or (ii) decreased by the amount by which $6,100,000 exceeds the
aggregate Book Value of the Investments and the Other Assets as of the Closing
Date.

                 (f)      Book Value of REO.  The Base Purchase Price shall be
(i) increased by the amount by which the aggregate Book Value of the REO as of
the Closing Date exceeds $6,092,000 or (ii) decreased by the amount by which
$6,092,000 exceeds the aggregate Book Value of the REO as of the Closing Date.

                 (g)      Adjustment for Turkey Pile Loans.  The Base Purchase
Price shall be increased by an amount equal to the aggregate Book Value of all
Turkey Pile Loans, if any, as of the Closing Date.

                 (h)      Netting of Adjustments.  The adjustments to the Base
Purchase Price described in paragraphs (a) through (g) of this Section 2.5
shall be netted, such that there shall be determined an aggregate increase or





                                       37
<PAGE>   43
decrease in the Base Purchase Price.  The Base Purchase Price, as adjusted in
the manner provided in Sections 2.4, 2.5 and 2.6(a) hereof, and as further
adjusted pursuant to the terms of Section 2.6(b), is referred to herein as the
"Adjusted Base Price."

                 2.6      Adjustment for Post-Closing Terminated Loans.

                 (a)      With respect to any Closing Portfolio Loan which is a
Post-Closing Terminated Loan as of the 120th day after the Closing Date, the
Base Purchase Price shall be reduced by an amount equal to (i) 0.95% of the
aggregate unpaid principal balance as of the Closing Date of any such loan
which was a Base Portfolio Loan or (ii) 1.50% of the aggregate unpaid principal
balance as of the Closing Date of any other such loan (except that, with
respect to all Closing Portfolio Loans which were Excluded Loans at July 31,
1995, the adjustment to be made pursuant to this clause (ii) shall be 0.95% of
the amount of the unpaid principal balance of such loans as of the Closing
Date).

                 (b)      With respect to any Closing Portfolio Loan which 
became a Post-Closing Terminated Loan after the 120th day after the Closing
Date and before the first anniversary of the Closing Date, the Adjusted Base
Price





                                       38
<PAGE>   44
shall be further reduced by an amount equal to (i) 0.95% of the aggregate
unpaid principal balance as of the Closing Date of any such loan which was a
Base Portfolio Loan or (ii) 1.50% of the aggregate unpaid principal balance as
of the Closing Date of any other such loan (except that, with respect to all
Closing Portfolio Loans which were Excluded Loans at July 31, 1995, the
adjustment to be made pursuant to this clause (ii) shall be 0.95% of the amount
of the unpaid principal balance of such loans as of the Closing Date).

                 (c)      The amount of the reduction in the Base Purchase Price
and the Adjusted Base Price as calculated in accordance with subsection (a) or
(b) of this Section 2.6 shall be offset by the amount of any termination or
similar fees or charges actually received by Buyer in connection with the
termination of the servicing of such Post-Closing Terminated Loans.

                 (d)      Not less than five business days prior to the 120th 
day after the Closing Date or the Final Settlement Date, as the case may be,
Buyer shall deliver to the Company a schedule setting forth in reasonable
detail the Post-Closing Terminated Loans and a statement of the calculations
contemplated by paragraphs (a) or (b), as the case may be, of this Section 2.6.





                                       39
<PAGE>   45
                 (e)      With respect to the Mortgage Loans serviced by the
Company pursuant to the Mortgage Servicing Purchase and Sale Agreement, dated
as of July 31, 1987, by and between Citicorp Mortgage, Inc. ("Citicorp") and
the Company, as amended by Addendum Number One dated December 1, 1992 (the
"Citicorp Agreement"), the Company and Buyer agree to the terms and provisions
set forth on Exhibit 2.6(e) hereto.

                 2.7      Final Settlement

                 (a)      No later than ten business days following the one-year
anniversary of the Closing Date (the "Final Settlement Date"), the parties
hereto shall effect a settlement (the "Final Settlement"), either by telephone
or in person at a mutually convenient location.  On the Final Settlement Date,
Buyer shall wire transfer in immediately available funds to an account
specified by the Company on the business day immediately preceding the Final
Settlement Date an amount equal to the balance of the Adjusted Base Price as
determined below.  The balance of the Adjusted Base Price shall be determined
by adjusting the Adjusted Base Price determined as of the 120th day after the
Closing Date to reflect the resolution of any Disagreements and any further
purchase price adjustments pursuant to Section 2.6(b) and then subtracting





                                       40
<PAGE>   46
therefrom the sum of the First Payment, plus the Second Payment, plus the $10
million being paid pursuant to Exhibit 2.2, plus the amount of all Undisputed
Claims, plus the aggregate amount of the Reserve to be established by Buyer on
the one-year anniversary of the Closing Date pursuant to Section
7.1(k)(provided, however, that the aggregate amount to be withheld from the
balance of the Adjusted Base Price with respect to Undisputed Claims and the
Reserve established pursuant to Section 7.1(k) shall not exceed the
Indemnification Cap).

                 (b)      The amount payable by Buyer at the Final Settlement
(exclusive of any amount by which $20,510,000 exceeds the Reserve established
in accordance with Section 7.1(k)) shall be accompanied by interest on such
amount calculated at the Federal Funds Rate plus 1% as published in the "Money
Rates" section of The Wall Street Journal as in effect from time to time for
the period from the Closing Date to the Final Settlement Date.

                 2.8      Prorations.

                 Any payments made or due under or pursuant to the Leases and
the Assumed Contracts (including without limitation amounts paid by the Company
prior to the Closing for maintenance and repair services to be provided after
the Closing, prepaid postage or machine rental





                                       41
<PAGE>   47
for any period after the Closing), all use, real and personal property Taxes,
all water and sewer charges not based upon consumption and all assessments for
public improvements, if any, related to the Assets shall be prorated between
Buyer and the Company on the basis of a 365-day year and the number of days
elapsed through the Closing Date, with the Company being liable for amounts
attributable to periods through the Closing Date and Buyer being liable for
amounts attributable to periods after the Closing Date.  With respect to any
products sold or services rendered pursuant to the Assumed Contracts, the
Company and Buyer shall use their best efforts to arrange for vendors to bill
the Company directly for the same through the Closing Date for products sold or
services rendered on or prior to the Closing Date and to bill Buyer directly
after the Closing Date for products sold or services rendered after the Closing
Date.





                                       42
<PAGE>   48
                                  ARTICLE III
                 REPRESENTATIONS AND WARRANTIES OF THE COMPANY

                 The Company hereby represents and warrants to Buyer as
follows:

                 3.1      Organization; Capitalization

                          The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Connecticut.  The
Company has full corporate power and authority to conduct the Servicing
Business as now conducted and to own or lease the Assets and is duly licensed
or qualified to do business and is in good standing in each state or
jurisdiction where the ownership or leasing of the Assets or the conduct of the
Servicing Business requires such licensing or qualification, except where the
failure to be so licensed or qualified would not have a Material Adverse
Effect.

                 3.2      Authority; No Violation

                 (a)      Subject to the entry of the Second Order, the Company
has full corporate power and authority to execute and deliver this Agreement
and any documents, agreements or instruments to be executed by it pursuant to
this Agreement and to consummate the transactions contemplated hereby and
thereby.  Subject to the entry of the Second Order, the execution and delivery
of this





                                       43
<PAGE>   49
Agreement and any documents, agreements or instruments to be executed and
delivered by the Company pursuant to this Agreement, and the consummation of
the transactions contemplated hereby and thereby, have been duly and validly
authorized by all requisite corporate action in respect thereof on the part of
the Company and Parent, and no other corporate proceedings on the part of the
Company or Parent are necessary to consummate the transactions contemplated
hereby and thereby.  This Agreement has been duly and validly executed and
delivered by the Company and, subject to the entry of the Second Order and
assuming this Agreement constitutes a valid and binding obligation of Buyer,
such agreement constitutes a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, and the other
documents, agreements and instruments to be delivered by the Company pursuant
to this Agreement will, when executed and delivered, be duly executed and
delivered by the Company and will constitute legal, valid and binding
obligations of the Company, enforceable against the Company in accordance with
their terms (in all cases, subject to applicable bankruptcy, insolvency and
similar laws affecting creditors' rights generally and subject,





                                       44
<PAGE>   50
as to enforceability, to general principles of equity (whether applied in a
proceeding in equity or at law)).

                 (b)      Except as set forth in Section 3.2(b) of the
disclosure schedule which has previously been delivered by the Company to Buyer
(the "Company Schedule"), and subject to the entry of the Second Order, neither
the execution and delivery by the Company of this Agreement or any document,
agreement or instrument to be executed by the Company pursuant to this
Agreement, nor the consummation by the Company of the transactions contemplated
hereby or thereby, nor compliance by the Company with any of the terms or
provisions hereof, will (i) conflict with or result in a breach of any
provision of the articles of incorporation, by-laws or similar governing
documents of the Company or (ii) assuming the consents, permits,
authorizations, approvals, filings and registrations referred to in Section 3.3
hereof and Section 3.3 of the Company Schedule are obtained or made, (x)
violate any statute, code, ordinance, rule, regulation, judgment, order, writ,
decree or injunction applicable to the Company or any Subsidiary of the Company
or any of their respective properties or assets or (y) violate, conflict with,
result in a breach of any provisions of, constitute a default (or an event
which, with notice or lapse of





                                       45
<PAGE>   51
time, or both, would constitute a default) under, result in the termination of,
accelerate the performance required by, or result in a right of termination or
acceleration or the creation of any Encumbrance upon any of the Assets under,
any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, deed of trust, license, lease, agreement (including without
limitation any Mortgage Servicing Agreement) or other instrument or obligation
to which the Company or any Subsidiary of the Company is a party, or by which
the Company or any Subsidiary of the Company or any of their respective assets
may be bound or affected, except, in the case of clause (y) above, for such
violations, conflicts, breaches or defaults which, either individually or in
the aggregate, would not have a Material Adverse Effect.

                 3.3      Consents and Approvals

                 Except as set forth in Section 3.3 of the Company Schedule,
and subject to the entry of the Second Order, no consents, permits,
authorizations or approvals of, or filings or registrations with, any
Governmental Entities, government-sponsored agencies or corporations or other
Persons are necessary to be obtained or made by the Company or any Subsidiary
of the Company in connec-





                                       46
<PAGE>   52
tion with the execution and delivery by the Company of this Agreement or any
document, agreement or instrument to be executed by the Company pursuant to
this Agreement or the consummation by the Company of the transactions
contemplated hereby or thereby, except for such consents, permits,
authorizations or approvals the failure of which to obtain would not,
individually or in the aggregate, have a Material Adverse Effect.

                 3.4      Financial Information

                 The Company maintains records which accurately reflect
transactions relating to the Assets and the Assumed Liabilities in reasonable
detail, and maintains accounting controls, policies and procedures sufficient
to ensure that such transactions are (i) executed in accordance with its
management's general or specific authorization, as applicable, and (ii)
recorded in a manner which permits the preparation of financial statements in
accordance with GAAP and applicable regulatory accounting requirements, and the
documentation pertaining thereto is retained, protected and duplicated in all
material respects in accordance with prudent business practices and applicable
regulatory requirements.  The transactions recorded in the books and records of
the Company reflect only actual transactions.  The Accounts





                                       47
<PAGE>   53
Receivable, Investments, Other Assets, REO and Scheduled Liabilities are
carried on the Company's balance sheet in accordance with GAAP consistently
applied.

                 3.5      Contracts

                 (a)      The Company has made available to Buyer a correct and
complete copy of each written Contract listed on Schedules II, IV and V.  With
respect to each Contract: (A) the Contract is valid, binding and in full force
and effect; (B) the Company is not in breach or default thereof (except for
breaches and defaults of the type referred to in Section 365(b)(2) of the
Bankruptcy Code), and, to the knowledge of the Company, no event has occurred
which, with notice or lapse of time or both, would constitute a breach or
default (except for breaches and defaults of the type referred to in Section
365(b)(2) of the Bankruptcy Code) by the Company, or would permit termination,
modification, or acceleration against the Company under such Contract; (C) the
Company has not repudiated or waived any material provision of any such
Contract other than in the ordinary course of business; (D) all amounts due and
payable by the Company through the Closing Date pursuant to such Contract have
been or will be paid; and (E) to the knowledge of the Company, no other party
to any such Contract is in breach or default





                                       48
<PAGE>   54
thereunder and no event has occurred which, with notice or lapse of time or
both, would constitute a breach or default by such other party, or would permit
termination, modification, or acceleration against such other party, under such
Contract.

                 (b)      With respect to each Lease relating to real property,
except as set forth on Section 3.5(b) of the Company Schedule, (A) no waiver or
indulgence or postponement of any material obligation thereunder has been
granted by any lessor or sublessor; (B) neither the Company nor any of its
Subsidiaries has entered into any sublease or assignment with respect to its
interest as tenant in such Lease; and (C) neither the Company nor any
Subsidiary of the Company has received any notice that it has breached any
material term, condition or covenant of any such Lease (except for breaches of
the type referred to in Section 365(b)(2) of the Bankruptcy Code).

                 3.6      Title to Assets

                 The Company has good and marketable title to (or, as to leased
property, a valid leasehold interest in) all of the Assets, free and clear of
all Encumbrances, except (i) as set forth on Section 3.6 of the Company
Schedule, (ii) for statutory liens for amounts not yet delinquent or which are
being contested in good faith,





                                       49
<PAGE>   55
(iii) for Encumbrances securing the Assumed Liabilities, and (iv) such
Encumbrances that do not in the aggregate materially detract from the value or
interfere with the use or operations of the Asset subject thereto.  The Company
as lessee has the right under valid and subsisting Leases to occupy, use,
possess and control all of the Leased Property leased by the Company, as
presently occupied, used, possessed and controlled by the Company, or to use
and possess the leased FF&E as presently used and possessed by the Company, as
the case may be.

                 3.7      Brokers and Finders

                 Neither the Company nor any of its officers, directors,
employees, agents or Affiliates has employed any broker, finder or financial
advisor or incurred any liability for any broker's or finder's fees or
commissions in connection with the transactions contemplated hereby that will
result in or give rise to any liability to Buyer.

                 3.8      Legal Proceedings

                 Except as set forth in Section 3.8 of the Company Schedule,
neither the Company nor any of its Subsidiaries is a party to any, and there
are no pending or, to the knowledge of the Company, threatened, legal,
administrative, arbitral or other proceedings, claims,





                                       50
<PAGE>   56
actions or governmental or regulatory investigations of any nature (i) against
the Company or any of its Subsidiaries and relating to or involving the Assets
or the Assumed Liabilities, as to which there is a reasonable probability of an
adverse determination and which, if adversely determined, would, individually
or in the aggregate, have a Material Adverse Effect, or (ii) challenging the
validity or propriety of the transactions contemplated by this Agreement.
Except as otherwise disclosed in Section 3.8 of the Company Schedule, there is
no injunction, order, judgment, decree or regulatory restriction imposed upon
the Company or any of its Subsidiaries and relating to or involving the Assets
or the Assumed Liabilities which has had a Material Adverse Effect.

                 3.9      Mortgage Banking Licenses
                          and Qualifications

                 (a)      The Company (i) is qualified (A) by FHA as a
mortgagee and servicer for FHA Loans, (B) by the VA as a lender and servicer
for VA Loans, (C) by FNMA and FHLMC as a seller/servicer of single-family and
multifamily mortgage loans to FNMA and FHLMC and (D) by GNMA as an authorized
issuer and servicer of GNMA-guaranteed mortgage-backed securities, and (ii) has
all other certifica-





                                       51
<PAGE>   57
tions, authorizations, licenses, permits and other approvals (together with the
items set forth in clause (i) above, the "Licenses") necessary to conduct the
Servicing Business, and is in good standing under all applicable federal, state
and local laws and regulations thereunder as a mortgage lender and servicer.

                 (b)      The Company has complied with all such Licenses, and
the Company knows of no threatened suspension, cancellation or invalidation of,
or penalties (including fines or refunds) under, any such License.

                 (c)      To the Company's knowledge, each broker or
correspondent involved in the origination of the Mortgage Loans, and all prior
servicers thereof, had all such Licenses necessary to conduct such activities
at the time so conducted.

                 3.10     Mortgage Loans

                 The Company has previously delivered to Buyer a tape (magnetic
media) which sets forth certain information regarding the Mortgage Loans as of
July 31, 1995.  The information contained in such tape is true, complete and
correct in all material respects as of July 31, 1995.  Except as set forth in
Section 3.10 of the Company Schedule, each Mortgage Loan is (i) evidenced by a
Note with such terms as are customary in the business, (ii) duly





                                       52
<PAGE>   58
secured by a Mortgage with such terms as are customary in the business and
which grants the holder thereof a first priority lien (except as otherwise
indicated in the tape referred to above) on the subject property (including any
improvements thereon), each such Mortgage constituting a security interest that
has been duly perfected and maintained (or is in the process of perfection in
due course) as a first lien subject only to Taxes and assessments not yet
delinquent, and to such other matters as evidenced by a lender's title
insurance policy and, where applicable, subject to the interests of the Texas
Veterans' Land Board, and is in full force and effect, (iii) accompanied by a
hazard insurance policy (and a flood insurance policy and certification where
required under the terms of the National Flood Insurance Act of 1968 and the
Flood Disaster Protection Act of 1973, each as amended) covering improvements
on the premises subject to such Mortgage, with a loss payee clause in favor of
the Company or an assignee of the Company, such insurance policy covering such
risks as are customarily insured against in accordance with industry practice
and which are required to be insured against pursuant to Investor requirements,
and (iv) accompanied by a mortgage insurance certificate or a loan guarantee
certificate, in either case, as





                                       53
<PAGE>   59
required by applicable Regulations.  The Company has complied in all material
respects with all of its obligations under the insurance policies described in
the previous sentence.

                 3.11      Enforceability

                 All Mortgage Loans (except for certain of the Mortgage Loans
included in the First Eastern Portfolio (as defined in Section 7.1(a)) are
valid and legally binding obligations of the borrowers thereunder, to the
knowledge of the Company have been duly executed by a borrower of legal
capacity, are enforceable in accordance with their terms (except as enforcement
thereof may be limited by (i) bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity (whether applied in a proceeding in equity or at law),
(ii) state laws requiring creditors to proceed against the collateral before
pursuing the borrower, and (iii) state laws on deficiencies), and conform to
all applicable Regulations.  Neither the operation of any of the terms of any
Mortgage Loan, nor the exercise of any right thereunder, has rendered or will
render the related Mortgage or Note unenforceable, in whole or in part, or
subject it to any right of rescission, setoff, counterclaim or defense, and





                                       54
<PAGE>   60
no such right of rescission, setoff, counterclaim or defense has been asserted
with respect thereto.  The Loan Documents were in compliance in all material
respects with applicable Regulations and Agency, Investor and Insurer
requirements upon origination of the underlying Mortgage Loan and are complete
in all material respects.

                 3.12      Title to Certain Mortgage Loans;
                           Mortgage Servicing Agreements

                 (a)       All Mortgage Loans held in the account of the
Company (whether or not for future sale or delivery to an Investor) are owned
by the Company free and clear of all Encumbrances.  Such Mortgage Loans have
been duly recorded or submitted for recordation in due course in the
appropriate filing office in the name of the Company as mortgagee.  The Company
has not, with respect to any such Mortgage Loan, released any security
therefor, except upon receipt of reasonable consideration for such release, or
accepted prepayment of any such Mortgage Loan which has not been promptly
applied to such Mortgage Loan.

                 (b)       All of the Mortgage Servicing Agreements and the
Servicing Rights are owned by the Company, free and clear of any Encumbrances,
including without limitation the right to receive servicing fees.





                                       55
<PAGE>   61
                 3.13      No Recourse

                 Except with respect to VA No-Bids, the FmHA Loans and as set
forth in Section 3.13 of the Company Schedule, none of the Mortgage Loans are
Recourse Loans.

                 3.14      Mortgage Servicing Agreements

                 The Company has previously made available to Buyer true and
complete copies of all Mortgage Servicing Agreements set forth on Schedule V
hereto.  The Mortgage Servicing Agreements and the Regulations set forth all
the terms and conditions of the Company's rights against and obligations to the
Agencies and Investors with respect to the Mortgage Loans, and there are no
written or oral agreements that modify or amend any such Mortgage Servicing
Agreement in any material respect.  All of the Mortgage Servicing Agreements
are valid and binding obligations of the Company and all of the other parties
thereto, are in full force and effect, and are enforceable in accordance with
their terms, except as enforcement thereof may be limited by general principles
of equity whether applied in a court of law or a court of equity and by
bankruptcy, insolvency and similar laws affecting creditors' rights and
remedies generally.  Except as set forth in Section 3.14 of the Company
Schedule, there is no default or breach under, or dispute





                                       56
<PAGE>   62
regarding the material terms of, or claim of default or breach by any party
under, any such Mortgage Servicing Agreement, and no event has occurred which
with the passage of time or the giving of notice or both would constitute a
default or breach by any party under any such Mortgage Servicing Agreement or
would permit termination, modification or acceleration of any such Mortgage
Servicing Agreement.  Except as set forth in Section 3.14 of the Company
Schedule, there is no pending or, to the knowledge of the Company, threatened
cancellation of any Mortgage Servicing Agreement, and the Company has not
received written notice to the effect that any Investor or Agency intends to
terminate or is considering terminating its relationship with the Company.
Except as set forth in Section 3.14 of the Company Schedule, no material
sanctions or penalties have been imposed upon the Company subsequent to January
1, 1992 under any Mortgage Servicing Agreement or under any Regulation
applicable to the Company.

                 3.15      Compliance with Mortgage Banking
                           Regulations

                 (a)       The Company and, with respect to each Mortgage Loan,
to the knowledge of the Company, each prior servicer and originator of any such
loan, has been





                                       57
<PAGE>   63
and is (including without limitation, with respect to (i) the ownership and
operation of its properties and (ii) the documentation, underwriting,
origination, purchase, assumption, modification, sale, pooling and servicing,
subservicing and master servicing of Mortgage Loans by the Company and such
prior servicers and originators) in compliance in all material respects with
all Regulations, orders, writs, decrees, injunctions and other requirements of
any court or governmental authorities applicable to any of them (including,
without limitation, (x) the rules, regulations and requirements of FHA, VA,
FmHA, FNMA, HUD, FHLMC and GNMA, (y) any applicable local, state or federal law
or ordinance, and any regulations or orders issued thereunder, governing or
pertaining to fair housing or unlawful discrimination in residential lending
(including without limitation anti-redlining, equal credit opportunity, and
fair credit reporting), truth-in-lending, real estate settlement procedures,
adjustable rate mortgages, adjustable rate mortgage disclosures or consumer
credit (including without limitation the federal Consumer Credit Protection
Act, the federal Truth-in-Lending Act and Regulation Z thereunder, the federal
Real Estate Settlement Procedures Act of 1974 and Regulation X thereunder, and
the federal Equal Credit Opportunity Act





                                       58
<PAGE>   64
and Regulation B thereunder) and (z) all applicable usury and interest
limitations laws), except where the failure to so comply would not have a
Material Adverse Effect.  Without limiting the generality of the foregoing, the
Company and, to the knowledge of the Company, each prior servicer and
originator of the Mortgage Loans has been and is in compliance in all respects
with all servicer and other requirements of the FHA, VA, FmHA, FNMA, FHLMC,
GNMA, Investors and any Insurer (including, without limitation, any applicable
net worth requirements) which are applicable to it, and all applicable
underwriting standards of such Agencies, Investors or Insurers.  To the
knowledge of the Company, each correspondent or broker from whom the Company
has purchased Mortgage Loans had all approvals necessary to enable it to take
applications and close such Mortgage Loans.

                 (b)       The Company has timely filed, or will have timely
filed by the Closing Date, all reports required by any Agency, Investor or
Insurer or by any federal, state or municipal law, regulation or ordinance, and
where the failure to so timely file would have a Material Adverse Effect.
Neither the Company nor, with respect to any Mortgage Loan, to the knowledge of
the Company, any prior originator or servicer of any such





                                       59
<PAGE>   65
loan, has done or failed to do, or has caused to be done or omitted to be done,
any act, the effect of which would operate to invalidate or materially impair
(i) any approvals of the FHA, VA, FmHA, FNMA, FHLMC, GNMA, HUD or any Investor,
(ii) any FHA insurance or commitment of the FHA to insure, (iii) any VA or FmHA
guaranty or commitment of the VA or FmHA to guaranty, (iv) any private mortgage
insurance or commitment of any private mortgage insurer to insure, (v) any
title insurance policy, (vi) any hazard insurance policy, (vii) any flood
insurance policy required by the National Flood Insurance Act of 1968, as
amended, (viii) any fidelity bond, direct surety bond, or errors and omissions
insurance policy required by HUD, GNMA, FNMA, FHA, FHLMC, FmHA, VA or private
mortgage insurers or (ix) any surety or guaranty agreement.

                 (c)       Except as set forth in Section 3.15 of the Company
Schedule, since January 1, 1992, no Agency, Investor or Insurer has (y) claimed
that the Company has violated or has not complied with the applicable
underwriting standards with respect to Mortgage Loans sold by the Company to an
Investor or (z) imposed restrictions on the activities (including commitment
authority) of the Company.  There exist no known facts or circumstances





                                       60
<PAGE>   66
which would entitle an Investor to demand repurchase of a Mortgage Loan from
the Company or which would entitle an Insurer to demand indemnification from
the Company, to cancel any mortgage insurance held for the Company's benefit,
or to reduce any mortgage insurance benefits payable to the Company, or would
lead any Investor to require a letter of credit from the Company, in each case
with respect to any Mortgage Loan.

                 3.16      Custodial Accounts

                 The Company has full power and authority to maintain Custodial
Accounts for all of the Mortgage Loans, as required by applicable Regulations,
and has established Custodial Accounts for all Escrow Funds relating to
Servicing Rights, and is the lawful fiduciary of all Custodial Accounts related
to the Mortgage Loans.  Such Custodial Accounts comply in all material respects
with (i) all applicable Regulations (including without limitation Regulations
governing the appropriate identification of such accounts and the calculation
of the amount of the monthly payments for deposit into Custodial Accounts that
mortgagors are required to make) and (ii) any terms of the Mortgage Loans (and
Mortgage Servicing Agreements) relating thereto.  The Custodial Accounts
contain the amounts shown in the records of the Company,





                                       61
<PAGE>   67
which amounts represent all monies received or advanced by the Company as
required by the applicable Regulations, less amounts remitted by or on behalf
of the Company pursuant to applicable Regulations, except for checks in
process.  Except as to payments that are past due under the terms of the
applicable Loan Documents, all payments of principal and interest due and
payable on the Mortgage Loans and all Custodial Account deposits for Taxes,
assessments, ground rents and fire or hazard insurance have been credited to
the appropriate Custodial Accounts.  The Custodial Accounts do not have any
material funding deficiency.  The escrow analysis with respect to each Mortgage
Loan has been completed for the most recent required date under applicable
Regulations.  Notification to the mortgagor of all payment adjustments or
credits resulting from such escrow analysis, annual statements of Taxes and
interest paid by the mortgagor and any other statement required by all
applicable Regulations has been mailed by the Company or, to the knowledge of
the Company, by the applicable servicer with respect to master serviced loans.
To the extent required by applicable Regulations, funds have been advanced by
the Company or each servicer, as applicable, to each Custodial Account as
necessary to timely make all scheduled escrow dis-





                                       62
<PAGE>   68
bursements.  Except as required by applicable Regulations in effect as of the
date of this Agreement, the Company is not required to pay interest on the
Custodial Accounts.

                 3.17      Inquiries

                 Section 3.17 of the Company Schedule contains a true and
correct list of all of the audits and investigations of the Company by any
Agency, Investor or private mortgage insurer or HUD commenced since January 1,
1992, not made in the ordinary course of business, the result of which audits
and investigations claimed a material failure to comply with applicable
Regulations and resulted in (i) a repurchase of Mortgage Loans or Collateral by
the Company, (ii) indemnification by the Company in connection with Mortgage
Loans, (iii) rescission of an insurance or guaranty contract or agreement in
connection with Mortgage Loans or (iv) payment by the Company of a penalty to
an Agency, HUD, an Investor or an Insurer.  Except as otherwise set forth in
Section 3.17 of the Company Schedule, no such audit or investigation is pending
or, to the knowledge of the Company, threatened.  The Company has made
available to Buyer copies of all written reports and materials received or sent
by the Company in connection with such audits and investigations.





                                       63
<PAGE>   69
                 3.18      Advances; Accounts Receivable

                 Except as set forth in Section 3.18 of the Company Schedule,
there are no pooling, participation, servicing or other agreements to which the
Company is a party which obligate it to make servicing advances with respect to
defaulted or delinquent Mortgage Loans, other than as provided in, FNMA or
FHLMC pooling and servicing agreements.  The Accounts Receivable are valid and
subsisting amounts owing to the Company, are carried on the books of the
Company at values determined in accordance with GAAP and are not subject to any
setoffs or claims of the account debtor arising from acts or omissions of the
Company nor, to the knowledge of the Company, is any Investor or Agency
insolvent or otherwise unable to repay any Accounts Receivable or Advances as
required by applicable Regulations.  Except as set forth in Section 3.18 of the
Company Schedule, the Company has not received notice from an Agency, Investor,
Insurer or other Person disputing or denying a claim by the Company for
reimbursement in connection with any Accounts Receivable or Advances.  As of
July 31, 1995, the aggregate Book Value of the Accounts Receivable was
$72,601,000.





                                       64
<PAGE>   70
                 3.19      Physical Damage

                 Except as set forth on Section 3.19 of the Company Schedule,
to the knowledge of the Company there exists no physical damage to the
Collateral or any REO from fire, flood, windstorm, earthquake, tornado,
hurricane or any other similar casualty, which physical damage would or would
reasonably be expected to cause any Mortgage Loan to become delinquent or
adversely affect the value or marketability of any Mortgage Loan, Servicing
Right, REO or Collateral.

                 3.20      Pool Certification and Recertification

                 Except as set forth in Section 3.20 of the Company Schedule:
(i) each Mortgage Loan included in a Pool meets all eligibility requirements
for inclusion in such Pool, in accordance with all applicable standards of
eligibility for loan pooling; (ii) the Loan Documents for each Mortgage Loan
contain or will contain, within the period required by applicable Regulations,
all items required by applicable Regulations for the certification of Pools by
the appropriate Agency or Investor and such Pools will be in compliance with
all applicable Agency or Investor requirements and guidelines, within the
period required by applicable Regulations; (iii) all Pools relating to the
Mortgage Loans have been or will be,





                                       65
<PAGE>   71
within the period required by applicable Regulations, certified in accordance
with applicable Regulations, and the securities backed by such Pools have been
issued on uniform documents, promulgated in the applicable Agency or Investor
guide without any material deviations therefrom; (iv) all Pools relating to the
Mortgage Loans are or will be, within the period required by applicable
Regulations, eligible for recertification by the appropriate custodian; (v) the
principal balance outstanding and owing on the Mortgage Loans in each Pool
equals or exceeds the amount owing to the corresponding security holder of such
Pool; (vi) no Mortgage Loan has been bought out of a Pool without all required
prior written approvals; and (vii) each Mortgage Loan included in a Pool
satisfied the requirements of Section 3(a)(41)(A)(i) and (ii) of the Securities
Exchange Act of 1934, as amended, so that interests in such Pools constitute
"mortgage related securities" under Section 3(a)(41) of such Act.

                 3.21      Payment of Taxes, Insurance
                           Premiums, Other Amounts

                 The responsibilities of the Company and, to the knowledge of
the Company, all prior servicers and originators of the Mortgage Loans with
respect to all applic-





                                       66
<PAGE>   72
able Taxes (including tax reporting for the period prior to the Closing),
special assessments, ground rents, flood insurance premiums, hazard insurance
premiums and mortgage insurance premiums that are related to the Mortgage Loans
have been met.

                 3.22      Tax Identification

                 All tax identifications for the individual mortgagor under a
Mortgage Loan (or evidence that reasonable attempts have been made to obtain
such in accordance with applicable Regulations) are contained in the Loan
Documents.  All of such tax identifications are correct and complete in all
material respects, and property descriptions contained in any Loan Document are
legally sufficient.

                 3.23      Single Family Loans

                 Except as set forth in Section 3.23 of the Company Schedule,
(i) all Mortgage Loans are secured by single family (i.e., one to four family)
residential real property and (ii) the full principal amount of each note
related to a Mortgage Loan has been advanced to the mortgagor, either by
payment directly to such mortgagor, or by payment made on request or approval
of the mortgagor, and there is no obligation or requirement for future
advances.





                                       67
<PAGE>   73
                 3.24      ARMs and Conversion Loans

                 If the Mortgage Loan documents grant the related mortgagor the
right to convert the Mortgage Loan to a fixed-rate Mortgage Loan and the
related mortgagor previously has exercised such right, or provide that the
interest rate or installment or payment amount of the Mortgage Note may be
adjusted prospectively, then: (i) all of the terms of the Mortgage Loan
documents may be enforced by the holder thereof, its successors and assigns,
subject to bankruptcy, insolvency or other similar laws affecting the
enforcement of creditors' rights generally and general principles of equity
(whether applied in a proceeding in equity or at law), (ii) any such
adjustments will not, or did not, affect the priority of the lien of the
related Mortgage or Note, and (iii) all adjustments have been made (and the
resulting interest rates and payment amounts are correct), and the respective
mortgagors advised thereof, in accordance with the applicable Regulations.  No
mortgagor has made, or to the Company's knowledge, has threatened to make any
claim or complaint that any adjustment was inappropriately made or
inappropriately omitted.  At or prior to the Closing Date, the Company shall
make available to Buyer all loan histories available to the Company on magnetic
media, and





                                       68
<PAGE>   74
all such loan histories are complete and accurate in all material respects.

                 3.25      Taxes

                 Except as set forth in Section 3.25 of the Company Schedule:

                           (a)    The Company and each of its Subsidiaries have
(i) timely filed (or will have timely filed by the Closing Date) with the
appropriate taxing authorities all Tax Returns in respect of the Assets
required to be filed and such Tax Returns are true, complete and correct in all
material respects and (ii) paid in full, or made adequate provision in
accordance with GAAP for the payment of, all Taxes due and payable through the
Closing Date.

                           (b)    There are no liens for Taxes upon any of the
Assets, except liens for Taxes not yet due or payable.

                 3.26       FHA, VA and PMI Claims.

                 All claims submitted, required to be submitted and allowed to
be submitted, by the Company to the FHA, the VA or any provider of PMI, as
applicable, have been properly and timely submitted to FHA, the VA or such
private mortgage insurer.

                 3.27       Fairness Opinion.





                                       69
<PAGE>   75
                 The Company has received an opinion from Salomon Brothers Inc
to the effect that, subject to the terms, conditions and qualifications set
forth therein, as of the date thereof the consideration to be received by the
Company pursuant to the Agreement as originally executed on October 9, 1995 is
fair to the Company from a financial point of view.  Buyer acknowledges that
the foregoing representation is not intended to create any responsibility of
Salomon Brothers Inc to the Buyer in respect of its opinion referred to in the
preceding sentence.

                 3.28       RIS Agreement

                 Upon consummation of the transactions contemplated by this
Agreement, no payment, fee or penalty will be or become payable by Buyer
pursuant to the terms of the RIS Agreement.

                 3.29       Trade Names.  (a)  Schedule IX contains a true and
complete list and description of any Trade Names owned by the Company and any
licenses or similar agreements pursuant to which the Company is granted rights
with respect to any Trade Names.

                 (b)       Except as set forth in Section 3.29 of the Company
Schedule, the Company has the unrestricted right to use the Trade Names, free
and clear of any





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<PAGE>   76
claims by any Person (other than the claims of any licensors under licensing or
similar agreements), and the consummation of the transactions contemplated by
this Agreement will not alter or impair any such right.  No claims have been
asserted by any Person with respect to the use by the Company of any Trade
Names or challenging or questioning the validity or effectiveness of any
license or similar agreement with respect thereto, and, to the knowledge of the
Company, there is no basis for any such claim.  Except as set forth in Section
3.29 of the Company Schedule, no Trade Name is subject to any outstanding
order, judgment, decree, stipulation or agreement restricting the use thereof
by the Company.

                 3.30      No Material Violation.  As of January 4, 1996, the
Company is unaware of any material violation of any of its representations,
warranties or covenants contained herein or any other events or circumstances
that would result in a Material Adverse Effect.





                                       71
<PAGE>   77
                                   ARTICLE IV
                    REPRESENTATIONS AND WARRANTIES OF BUYER

        Buyer hereby represents and warrants to the Company as follows:

                 4.1       Organization

                 Buyer is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, and has full corporate
power and authority to carry on its business as now conducted.

                 4.2       Authority; No Violation

                 (a)       Buyer has full corporate power and authority to
execute and deliver this Agreement and any documents, agreements or instruments
to be executed and delivered by Buyer pursuant to this Agreement and to
consummate the transactions contemplated hereby.  The execution and delivery of
this Agreement and any documents, agreements or instruments to be executed and
delivered by Buyer pursuant to this Agreement, and the consummation of the
transactions contemplated hereby and thereby, have been duly and validly
authorized by all requisite corporate action in respect thereof on the part of
Buyer and no other corporate proceedings on the part of Buyer are necessary to
consummate the transactions contemplated hereby and thereby.  This Agreement
has been duly and





                                       72
<PAGE>   78
validly executed and delivered by Buyer and, assuming this Agreement
constitutes a valid and binding obligation of the Company, such agreement
constitutes a valid and binding obligation of Buyer, enforceable against Buyer
in accordance with its terms, and the other documents, agreements and
instruments to be delivered by Buyer pursuant to this Agreement will, when
executed and delivered, be duly executed and delivered by Buyer and will
constitute legal, valid and binding obligations of Buyer, enforceable against
Buyer in accordance with their terms (in all cases, subject to applicable
bankruptcy, insolvency and similar laws affecting creditors' rights generally
and subject, as to enforceability, to general principles of equity (whether
applied in a proceeding in equity or at law)).

                 (b)       Neither the execution and delivery by Buyer of this
Agreement, or any document, agreement or instrument to be executed by Buyer
pursuant to this Agreement, nor the consummation by Buyer of the transactions
contemplated hereby, nor compliance by Buyer with any of the terms or
provisions hereof, will (i) conflict with or result in a breach of any
provision of the articles of incorporation or by-laws of Buyer or (ii) assuming
the consents, permits, authorizations, approvals,





                                       73
<PAGE>   79
filings and registrations set forth in Section 4.3 of the disclosure schedule
which has previously been delivered by Buyer to the Company (the "Buyer
Schedule") are obtained or made, (A) violate any statute, code, ordinance,
rule, regulation, judgment, order, writ, decree or injunction applicable to
Buyer or any of its properties or assets or (B) violate, conflict with, result
in a breach of any provisions of, constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default) under, result in
the termination of, accelerate the performance required by, or result in a
right of termination or acceleration or the creation of any Encumbrance upon
any of the properties or assets of Buyer under, any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, deed of trust, license,
lease, agreement or other instrument or obligation to which Buyer is a party,
or by which its properties or assets may be bound or affected, except, in the
case of clause (B) above, for such violations, conflicts, breaches or defaults
which, either individually or in the aggregate, would not have a material
adverse effect on Buyer's ability to consummate the transactions contemplated
hereby.





                                       74
<PAGE>   80
                 4.3       Consents and Approvals

                 Except as set forth in Section 4.3 of the Buyer Schedule, and
subject to the entry of the Second Order, no consents, permits, authorizations
or approvals of, or filings or registrations with, any governmental or
regulatory authorities, government-sponsored agencies or corporations or other
Persons are necessary to be obtained or made by Buyer in connection with the
execution and delivery by Buyer of this Agreement or any document, agreement or
instrument to be executed by Buyer pursuant to this Agreement or the
consummation by Buyer of the transactions contemplated hereby.

                 4.4       Financing

                 On or prior to the Closing Date, Buyer shall have sufficient
funds to enable Buyer to consummate the transactions contemplated hereby and to
pay the fees and expenses required to be paid by Buyer related thereto.

                 4.5       Mortgage Banking Licenses
                           and Qualifications

                 Buyer (i) is qualified (A) by FHA as a mortgagee and servicer
for FHA Loans, (B) by the VA as a lender and servicer for VA Loans, (C) by FNMA
and FHLMC as a seller/servicer of first mortgages to FNMA and FHLMC and (D) by
GNMA as an authorized issuer and servicer of GNMA-





                                       75
<PAGE>   81
guaranteed mortgage-backed securities; and (ii) has all other Licenses
necessary to conduct the Servicing Business, and is in good standing under all
applicable federal, state and local laws and regulations thereunder as a
mortgage lender and servicer.

                 4.6       Brokers and Finders

                 Neither Buyer nor any of its officers, directors, employees,
agents or Affiliates has employed any broker, finder or financial advisor or
incurred any liability for any broker's or finder's fees or commissions in
connection with the transactions contemplated hereby, except that Buyer has
engaged, and will pay a fee or commission to, (i) Donaldson, Lufkin and
Jenrette ("DLJ") in accordance with the terms of the letter agreement by and
between DLJ and Buyer and (ii) UBS Securities ("UBS") in accordance with the
terms of the letter agreement by and between UBS and Buyer.

                 4.7       No Material Violation.  As of January 4, 1996, Buyer
is unaware of any material violation of any of the representations, warranties
or covenants of the Company contained herein or any other events or
circumstances that would result in a Material Adverse Effect.





                                       76
<PAGE>   82
                                   ARTICLE V
                                   COVENANTS

                 5.1       Conduct Prior to Closing

                 During the period from the date of this Agreement and
continuing until the Closing Date, except as expressly contemplated or
permitted by this Agreement or with the prior written consent of Buyer, the
Company shall, and shall cause each of its Subsidiaries to, conduct its
business relating to the Assets and the Assumed Liabilities in the ordinary
course consistent with past practice.  Except as may be required by the
Regulations, and subject to the orders of the Bankruptcy Court, the Company
shall, and shall cause each of its Subsidiaries to, use its best efforts to:
(I) preserve its present business organization and relationships intact; (II)
keep available to itself and Buyer the present services of its employees; and
(III) preserve for itself and Buyer the goodwill of the customers of the
Company and its Subsidiaries and others with whom business relationships exist,
in each case, as relates to the Assets and the Assumed Liabilities.  Without
limiting the generality of the foregoing, except as set forth in Section 5.1 of
the Schedule or as otherwise expressly contemplated or permitted by this
Agreement or consented to in writing by





                                       77
<PAGE>   83
Buyer, and subject to the orders of the Bankruptcy Court, the Company shall
not, and shall not permit its Subsidiaries to:

                 (a)       fail to pay and discharge any of its obligations,
bills or other liabilities relating to the Assets or the Assumed Liabilities as
they become due, except to the extent that it is disputing the amounts thereof
in good faith;

                 (b)       acquire, sell, transfer, lease or otherwise dispose
of any of the Assets, other than in the ordinary course of business, provided,
however, that nothing contained herein shall permit the Company to sell or
acquire Servicing Rights or to sell any Mortgage Loans on a servicing released
basis;

                 (c)       except as may be required by applicable Regulations,
materially alter or vary its methods or policies of (i) underwriting, pricing,
originating, warehousing, selling or servicing, or buying or selling rights to
service, mortgage loans, (ii) hedging (which term includes both buying futures
and forward commitments from financial institutions) its mortgage loan
positions or commitments, and (iii) obtaining financing and credit;

                 (d)       engage or participate in any material transaction,
or incur or sustain any material obligation,





                                       78
<PAGE>   84
with respect to the Assets, except in the ordinary course of business;

                 (e)       amend, terminate or cancel, or take or fail to take
any other action that is likely to result in an amendment, termination or
cancellation of, any Contract except in the ordinary course of business and
except for actions with respect to Contracts for which the Company would not be
required to give notice to Buyer pursuant to Section 5.7 hereof;

                 (f)       except in the ordinary course of business, take any
action (i) materially impairing Buyer's rights in any Contract or Asset
(including without limitation through the assignment, creation of an
Encumbrance on or other disposition of, any Asset), (ii) waiving any material
right, whether in equity or at law, that it has with respect to any Mortgage
Loan or (iii) otherwise materially adverse to the interest of Buyer with
respect to the Assets or the Assumed Liabilities;

                 (g)       take any action, or fail to take any action, that is
intended to result in a breach or violation of any of the representations and
warranties of the Company contained in this Agreement or would cause any
condition to the transactions contemplated hereby not to





                                       79
<PAGE>   85
be satisfied, except, in every case, as may be required by law;

                 (h)       change its accounting principles or methods in
effect at June 30, 1995, except as required or permitted by GAAP as concurred
with by the Company's auditors or as otherwise specifically contemplated by
this Agreement;

                 (i)       solicit any Mortgage Loan for participation in the
Company's bi-weekly payment program except that the Company may complete any
solicitations commenced prior to the date hereof;

                 (j)       make any improvements to the Leased Properties, 
except with respect to normal maintenance or refurbishing made in the ordinary
course of business or as required pursuant to the terms of any Lease;

                 (k)       amend, terminate or cancel, or take or fail to take
any other action that may result in an amendment, termination or cancellation
of, any Lease, lease relating to FF&E or Contract except in the ordinary course
of business and except for actions with respect to Contracts for which the
Company would not be required to give notice to Buyer pursuant to Section 5.7
hereof; or

                 (l)       agree to do any of the foregoing.





                                       80
<PAGE>   86
                 5.2       Regulatory Matters

                 (a)       The parties hereto shall cooperate with each other 
and use their best efforts to promptly prepare and file all necessary
documentation, to effect all applications, notices, petitions and filings, and
to obtain as promptly as practicable all permits, consents, licenses, approvals
and authorizations of all Governmental Entities (including, without limitation,
the filing required by the HSR Act) and third parties, which are necessary or
advisable to consummate the transactions contemplated by this Agreement (it
being understood that the Company shall be responsible for obtaining all such
approvals, waivers and consents from such parties with whom the Company or any
of its Subsidiaries is in contractual privity).  All filing fees and expenses
incurred in connection with the filing made under the HSR Act shall be borne by
the party making such filing.  Buyer and the Company shall have the right to
review in advance, and to the extent practicable each will consult with the
other on, in each case subject to applicable laws relating to the exchange of
information, all the information relating to Buyer or the Company, as the case
may be, and any of their respective Affiliates, which appear in any filing made
with, or written materials





                                       81
<PAGE>   87
submitted to, any third party or any Governmental Entity in connection with the
transactions contemplated by this Agreement; provided, however, that nothing
contained herein shall be deemed to provide either party with a right to review
any information provided to any Governmental Entity on a confidential basis in
connection with the transactions contemplated hereby.  The parties hereto agree
that they will consult with each other with respect to the obtaining of all
permits, consents, approvals and authorizations of all third parties and
Governmental Entities necessary or advisable to consummate the transactions
contemplated by this Agreement and each party will keep the other apprised of
the status of matters relating to completion of the transactions contemplated
herein.  All consents required in connection with the consummation of the
Acquisition pursuant to the terms of the Mortgage Servicing Agreements shall be
in writing and shall be in form and substance reasonably satisfactory to Buyer.
In exercising the foregoing rights and obligations, each of the parties hereto
shall act reasonably and as promptly as practicable.

                 (b)       Each party shall, upon request, furnish the other
with all information concerning itself, its Subsidiaries, directors, officers,
stockholders and other





                                       82
<PAGE>   88
Affiliates, and such other matters as may be reasonably necessary or advisable
in connection with any statement, filing, notice or application made by or on
behalf of Buyer, the Company or any of their respective Subsidiaries to any
Governmental Entity in connection with the transactions contemplated by this
Agreement.

                 (c)       Buyer and the Company shall promptly advise each
other upon receiving any communication from any Governmental Entity or third
party whose consent or approval is required for consummation of the
transactions contemplated by this Agreement which causes such party to believe
that there is a reasonable likelihood that any such consent or approval will
not be obtained or that the receipt of any such approval will be materially
delayed.

                 (d)       The parties hereto shall cooperate with each other
and use their best efforts to obtain all appropriate Investor consents
necessary to effect a transfer to Buyer, in accordance with all FHLMC
Regulations, of all of the Company's legal right, title and interest in and to
that portion of the Servicing Rights that relates to Mortgage Loans with
respect to which (i) FHLMC owns the beneficial interest in the Mortgage Loans
or in a participation interest in the Mortgage Loans, or





                                       83
<PAGE>   89
(ii) FHLMC has sold participation interests in the Mortgage Loans.

                 5.3       Access to Information

                 (a)       During the period from the date hereof through the
Closing Date, upon reasonable notice and subject to applicable laws relating to
the exchange of information, the Company shall provide to Buyer and its
representatives, accountants and counsel, full and complete access to all of
the properties, books, records, operating reports, audit reports, any reports
of Governmental Entities and responses thereto, operating instructions and
procedures (and all correspondence with Governmental Entities), Tax Returns,
financial statements and other financial information and all other information
relating to the Assets and the Assumed Liabilities, as Buyer may from time to
time reasonably request, to make copies of such books, records and other
documents and to discuss the business affairs, condition (financial and
otherwise), assets and liabilities of the Company, with such third persons,
including, without limitation, their directors, officers, employees, agents,
accountants, attorneys, customers and creditors, as Buyer considers necessary
or appropriate for the purposes of familiarizing itself with the Assets,
Assumed Liabilities and the





                                       84
<PAGE>   90
Mortgage Loans, determining compliance with any of the representations,
warranties and covenants of the Company set forth herein, and obtaining any
necessary orders, consents or approvals of the transactions contemplated by
this Agreement.  In connection with such examination and access, Buyer agrees
to observe any confidentiality agreements between the Company or its
Subsidiaries and third parties related to such information.  The information
and access contemplated by this Section 5.3 shall be provided during normal
business hours, upon reasonable written or oral notice and in such manner as
will not unreasonably interfere with the conduct of the Company's or its
Subsidiaries' respective businesses.  Buyer will hold all such information in
confidence to the extent required by, and in accordance with, the provisions of
the confidentiality agreement dated November 22, 1994, between Buyer and Parent
(the "Confidentiality Agreement").

                 (b)       For purposes of Buyer's investigation pursuant to
this Section 5.3, the Company shall use its reasonable efforts to cause any
document custodian, service bureau, accountant, loan correspondent, third party
servicer or other third party under contract to the Company or any of its
Subsidiaries to furnish to Buyer





                                       85
<PAGE>   91
and to its authorized representatives full access to such party's premises and
all of its books, records and properties, including, without limitation, all
loan, investment, regulatory, financial, accounting, real estate, tax and
property records and files relating to the Assets and the Assumed Liabilities,
including, without limitation, all files, computer records and customer
information necessary for the conversion after the Closing Date of all
accounts, products and operating systems of the Company to such systems as
Buyer may designate.  The Company shall use its reasonable efforts to cause any
document custodian, service bureau, accountant, third party servicer or other
third party to provide adequate space and facilities and the cooperation of its
personnel, including, without limitation, copying facilities, to the end that
such examination shall be completed expeditiously, completely and accurately.
The Company shall, upon request, provide Buyer and its authorized
representatives, with all information relating to the Mortgage Loans, to the
extent legally permissible.  Any such investigation or examination pursuant to
this Section 5.3, shall be at Buyer's expense.

                 (c)       No investigation by Buyer made heretofore or
hereafter shall affect the representations and warran-





                                       86
<PAGE>   92
ties, covenants or indemnification obligations of the Company which are
contained herein and each such provision shall survive such investigation.

                 5.4       Legal Conditions to Transaction

                 Subject to the terms and conditions of this Agreement, each of
Buyer and the Company shall use its commercially reasonable efforts (a) to
take, or cause to be taken, all actions necessary, proper or advisable to
comply promptly with all legal requirements which may be imposed on such
parties or their respective Affiliates with respect to the transactions
contemplated by this Agreement and, subject to the conditions set forth in
Article VI hereof, to consummate the transactions contemplated by this
Agreement and (b) to obtain (and to cooperate with the other party to obtain)
any consent, license, authorization, order or ap-





                                       87
<PAGE>   93
proval of, or any exemption by, any Governmental Entity and any other third
party which is required to be obtained by Buyer or the Company, or any of their
respective Affiliates, in connection with the transactions contemplated by this
Agreement; provided, however, that neither party shall be required to take any
action pursuant to the foregoing if the taking of such action or such
compliance or the obtaining of such consent, authorization, order or approval
or exemption is likely, in the reasonable opinion of such party's board of
directors, to result in the imposition of a Burdensome Condition (as defined
below).  If any required consent or approval of or waiver by such third parties
(excluding Governmental Entities) is not obtained prior to the Closing, or if
the assignment of any Contract would be ineffective or would adversely affect
any material rights or benefits thereunder so that Buyer would not in fact
receive all such rights and benefits, or that Buyer would not be able to assume
the associated obligations and liabilities, the parties, each without cost,
expense or liability to the other (except as provided in Article VII hereof),
shall cooperate in good faith to develop an alternative arrangement to achieve
the economic results intended.

                 5.5       Advice of Changes

                 Prior to the Closing Date, each of Buyer and the Company shall
promptly advise the other party of any change or event which it believes would
or would be reasonably likely to cause or constitute a material breach of any
of its representations, warranties or covenants contained herein or, solely in
the case of the Company, having a Material Adverse Effect.  From time to time
prior to the Closing Date, the parties will promptly





                                       88
<PAGE>   94
supplement or amend the Schedules delivered to each other in connection with
the execution of this Agreement to reflect any matter which, if existing,
occurring or known at the date of this Agreement, would have been required to
be set forth or described in such Schedules or which is necessary to correct
any information in such Schedules which has been rendered inaccurate thereby.
Except for additions provided pursuant to Section 5.7, no supplement or
amendment to such Schedules shall have any effect for the purpose of
determining the satisfaction of the conditions set forth in Section 6.3(a)
hereof, as the case may be, the accuracy of the representations or warranties
of the Company set forth therein, the compliance by the Company with its
covenants set forth herein or the obligation of the Company to indemnify Buyer
or any other Person pursuant to Article VII hereof.

                 5.6       Transfer Fees and Certain Other Costs

                 (a)       The Company shall bear the cost of:  (i) all fees
required to be paid in connection with or obtaining approval for the transfer
of the Assets by the Company to Buyer, including, without limitation, any
transfer fees payable to FNMA, FHLMC, state housing Agencies, Investors and
licensors, (ii) the cost of (and shall arrange for performance of) any required
assign-





                                       89
<PAGE>   95
ments and recordation and re-recordation of assignments and Mortgages securing
Mortgage Loans as a result of transfers to the Company from prior servicers and
as a result of the transfer in connection with the transactions contemplated by
this Agreement, (iii) transfer fees, if any, relating to relevant tax service
contracts, but no more than $10.00 per Mortgage Loan, (iv) all costs and
expenses associated with recertifying all Mortgage Loans serviced for
Investors, within the time required by such Investor, as a result of transfer
to the Company, from prior servicers, including, but not limited to, all
recording and mailing costs, those fees paid by Buyer to its document custodian
in connection with such custodian's review of the Mortgage Loan files (not to
exceed $2.50 per file) and the costs of curing document defects and supplying
missing documents, (v) any custodial termination fees, (vi) providing notices
to HUD, VA and hazard and mortgage insurance providers, (vii) the cost of
preparing and recording any release instruments necessary to clear title to any
Assets, (viii) all Taxes incurred in connection with the transactions
contemplated by this Agreement (in connection therewith, the Company shall file
(or cause to be filed) in the ordinary course all Tax Returns and other
documentation with respect to





                                       90
<PAGE>   96
such Taxes, and if required by applicable law, Buyer shall join in the
execution of such Tax Returns) and (ix) the cost of delivering, by insured
shipping by bulk transfer or other customary industry practice, all Loan
Documents and other Records to Buyer's principal place of business.  Buyer and
the Company shall each pay one-half of the cost of sending notices to borrowers
required by the Real Estate Settlement Procedures Act, and the Company agrees
to timely cooperate with Buyer in sending such notices.  If the Company fails
to pay any amount required by this Section 5.6 and as a result Buyer pays such
amount, the Company shall be liable to the Buyer for the amount paid and such
amount may be deducted from any amount payable by Buyer pursuant to Section
2.7.  Buyer will work diligently and cooperate with the Company to obtain
necessary approvals and the most favorable costs, rates and prices for the
items referred to herein if the provider of the service is satisfactory to
Buyer in the exercise of its reasonable judgment.  If the Company chooses to
contract with any Person to provide any of the services described in this
Section 5.6(a) or in Section 5.9, Buyer shall have the right to consent to the
Company's use of such Person, which consent may not be unreasonably withheld or
delayed.





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<PAGE>   97
                 (b)       Nothing contained in this Section 5.6 shall
constitute a waiver by any party hereto of the right to recover damages,
including recovery of costs and expenses covered by this Section 5.6, from the
other party in the event of a breach by such other party of the terms and
provisions of this Agreement.

                 5.7       Additional Contracts

                 From the date hereof until the Closing Date, prior to entering
into any additional contract or group of related contracts in connection with
any of the Assets or the Assumed Liabilities (other than a Mortgage Servicing
Agreement which was entered into in the ordinary course of business), which
contract or group of related contracts would call for payments of more than
$250,000 in any year and would not be terminable through notice of 30 days or
less without cost or penalty, the Company shall notify Buyer in writing of any
intent to enter into such contract and shall afford Buyer reasonable access to
the documents relating thereto.  Buyer shall relate to the Company by 12:00
p.m. on the next business day after being so notified, its decision whether or
not to accept such additional contract.  The failure by Buyer to respond prior
to 12:00 p.m. on such next business day shall be deemed an acceptance of such
additional contract.  Any





                                       92
<PAGE>   98
additional contracts accepted or deemed accepted by Buyer under this Section
5.7, and any contract entered into by the Company subsequent to the date hereof
for which the Company shall not be required to notify Buyer pursuant to the
terms of this Section 5.7, shall be added to the applicable Schedule hereto and
thereby become part of the Contracts to be assumed by Buyer.

                 5.8       Submission for Court Approval.

                 (a)       The Company shall submit this Agreement for the 
approval of the Bankruptcy Court, including approval of the provisions set
forth in Section 5.17 and assumption and assignment of the Contracts as set
forth in Section 6.2(c) and 6.3(c) hereof, as promptly as practicable after the
date hereof, but in no event later than five business days after the filing of
the Petition.  Buyer shall cooperate with the Company in obtaining such
Bankruptcy Court approval, including providing evidence, if requested, of
Buyer's ability to perform the obligations of the Company and its Subsidiaries
under the Contracts listed on Schedules II, IV and V hereto.  In connection
with its application for the First Order, the Company shall seek approval of
and support the over-bid procedure set forth in Section 5.17 hereof and the
Termination Payment set forth in Section 8.4 hereof.





                                       93
<PAGE>   99
                 (b)       The Company will promptly deliver to Buyer copies 
of all pleadings, motions, notices, statements, schedules, applications,
reports and other papers to be filed in the Company's Chapter 11 case relating
to the Company or its Subsidiaries.

                 5.9       Assignment of Mortgages
                           and Endorsements of Notes

                 Beginning immediately following the Closing Date, to the
extent required by applicable law or the applicable Investor or Insurer, the
Company shall prepare, execute and (i) record with the appropriate state or
local recording offices assignments to Buyer of the Mortgages securing the
Mortgage Loans, including, without limitation, blanket assignments wherever
possible and permitted by the Regulations and (ii) provide Buyer with an
endorsement of each of the Notes.  The Company shall arrange for each
assignment to be forwarded to Buyer, after recordation, in numerical order, by
pool number.  The Company shall cooperate with Buyer with respect to Buyer's
obligation to assign Mortgages to Investors, including providing Buyer with the
identity of any contractors preparing assignments of Mortgages to Buyer on
behalf of the Company.  For purposes of obtaining information in order to
prepare assignments and endorse Notes,





                                       94
<PAGE>   100
after the Closing, Buyer shall give the Company access to any of the Loan
Documents transferred by the Company to Buyer, including access to any Loan
Documents held by a custodian, and allow the Company to utilize space at the
offices of Buyer (or the offices of any of its Affiliates at which the Loan
Documents to which the Company requires access are located) for purposes of
preparing the assignments and endorsements.  The Company shall use its best
efforts to, or use its best efforts to cause its contractor to, prepare and
record on an expedited priority basis all assignments and any other documents
necessary or appropriate to record releases or make such releases effective in
connection with the foreclosure and payoff of any Mortgage Loan.

                 5.10       Final Certification and
                            Re-Certification

                 (a)        Closing Date Deadline.  The Company shall use its 
best efforts to obtain the final certification or recertification, as
applicable, of any Pool with respect to which the deadline for final
certification or recertification is a date that occurs on or before the Closing
Date.  If it appears that a Pool required to be finally certified or
recertified on or before the Closing Date will not be so certified or
recertified, then, subject to





                                       95
<PAGE>   101
any necessary approval of the Investor, Buyer may request that the Company
repurchase any Mortgage Loan that is preventing the Pool from being finally
certified or recertified in time to permit the Pool to be so certified or
recertified by the Closing Date.  Buyer may require, as a condition to the
transfer of the Servicing Rights to a Pool that is required to be, but is not,
finally certified or recertified on the Closing Date, that the Company post, or
pay the cost of posting, any letter of credit or performance bond required by
the applicable Investor with respect to the Pool to the extent of the
proportion which its delinquent uncertified or unrecertified pools bears to all
delinquent uncertified or unrecertified pools under Buyer's issuer number, and
reimburse Buyer for any proportionate Losses resulting from, arising out of or
relating to the Pool not being finally certified or recertified by the
deadline.

                 (b)       Post Closing Date Deadline.  The Company shall obtain
such documents and shall take such steps as are necessary to enable Buyer,
through the exercise of reasonable efforts after the Closing Date, to obtain by
the appropriate deadline the final certification or recerti-





                                       96
<PAGE>   102
fication, as applicable, of any Pool with respect to which the deadline for
final certification or recertification is after the Closing Date, including the
recertification of Pools in connection with the transfer of Servicing Rights to
Buyer hereunder.  If the Company does not take such actions and, as a result,
Buyer cannot obtain by the appropriate deadline, through the exercise of
reasonable efforts after the Closing Date, the final certification or
recertification of any Pool with respect to which the deadline for final
certification or recertification is after the Closing Date, then upon the
request of Buyer, the Company shall (i) post, or pay the cost of posting, any
letter of credit or performance bond required by the applicable Investor to the
extent of the proportion which its delinquent uncertified or unrecertified
pools bears to all delinquent uncertified or unrecertified pools under Buyer's
issuer number, and reimburse Buyer for any proportionate Losses resulting from,
arising out of or relating to the failure to obtain final certification or
recertification by the deadline, and (ii) if permitted by the applicable
Investor, repurchase, or pay all Losses related to Buyer's repurchase of, any
Mortgage Loan that is preventing such a Pool from being finally certified or
recertified.

                 (c)      On and after the Closing Date, all documents necessary
for the final certification or recertifi-





                                       97
<PAGE>   103
cation of a Pool shall be delivered by the Company to Buyer.  If Buyer's
document custodian returns a document to Buyer for correction or missing
information, Buyer shall forward the document to the Company, and the Company
shall promptly correct the document or insert the appropriate information and
return the document to Buyer.

                 5.11       Employees

                 Prior to the Closing, Buyer shall offer employment to those
employees of the Company set forth on Schedule VIII hereto (the "Employees"),
which schedule shall be delivered on or prior to the Closing Date, effective as
of the Closing Date, on such terms as Buyer, in its sole discretion, shall
determine (which terms, including compensation terms, may be different from
those now received from the Company).  Buyer shall not be obligated to employ
any Employee, but shall offer to such Employees employment, and shall hire such
Employees that accept employment, effective immediately following the Closing.
In the event the Acquisition is not consummated, Buyer's offer of employment to
the Employees shall be deemed to be withdrawn.

                 5.12       Insurance Solicitation.  For a period of three
years following the Closing Date, the Company's insurance agency subsidiaries
shall have the non-exclu-





                                       98
<PAGE>   104
sive right to solicit the borrowers under all of the Mortgage Loans as of the
Closing Date for the purpose of selling property and casualty insurance, but
not force placed property and casualty insurance.  Buyer agrees, if requested
by the Company, to assist in the solicitation of such borrowers by providing
such services (principally clerical and processing services) as it may legally
perform in consideration of the payment of reasonable costs therefor by the
Company to Buyer, such fees to be negotiated in good faith between the parties
prior to any such solicitation by Buyer on the Company's behalf.  Nothing
contained in this Section 5.12 shall be construed to require either the Company
or Buyer to take any action prohibited by applicable law or regulation.  Buyer
is currently unaware that performing such clerical and processing services is
contrary to applicable law or regulation.

                 5.13      Non-Solicitation.  From and after the date hereof,
neither the Company nor any of its Affiliates shall, during the remaining term
of any of the Mortgage Loans (i) take any action, by telephone, by mail or
otherwise, to solicit the prepayment of the Mortgage Loans by the Mortgagors,
in whole or in part, (ii) take any action intended to facilitate or encourage
the corre-





                                       99
<PAGE>   105
spondents of the Company or any of its Affiliates that originated the Mortgage
Loans to solicit the prepayment of the Mortgage Loans by the mortgagors, in
whole or in part, (iii) solicit borrowers of Mortgage Loans who are delinquent
with respect to late fees or other charges by offering to forgive such
delinquent obligations in exchange for a partial payment or other incentives
which result in payment of less than all of such outstanding delinquent
obligations, or (iv) disseminate to any third party, for compensation or
otherwise, any complete or partial list of the mortgagors on the Mortgage Loans
for the purpose of soliciting the prepayment of Mortgage Loans; provided, that
this provision shall not prohibit the Company or any of its Affiliates from
providing such lists in any judicial proceedings or in response to a request by
a Government Entity, Agency or Investor.

                 5.14      Remittances.  Unless otherwise agreed to by the 
parties or required by the applicable Agency or Investor, the Company shall
make the first payment of principal and interest due immediately following the
Closing Date to Investors, and shall pay all related guaranty fees for the
applicable month, from the payments received by the Company with respect to
such Mortgage Loans pursuant to the Subservicing and Transition Servic-





                                      100
<PAGE>   106
es Agreement.  In the event the payments so received by the Company are
insufficient to pay these amounts, Buyer agrees to provide to the Company the
additional funds necessary to pay these amounts by wiring immediately available
funds to the Company no later than twenty-four (24) hours prior to the required
remittance date.

                 5.15      Bills.  All bills (including, without limitation, tax
and insurance bills) pertaining to the Mortgage Loans with respect to which the
earlier of the payment deadline to take advantage of a discount or the payment
deadline to avoid a penalty is before, on or within thirty (30) days after the
Closing Date shall be paid by the Company, and the Company shall pay such bills
in accordance with the Regulations.  All penalties and interest due on any
Mortgage Loan resulting from the Company's failure to pay a bill in accordance
with this Section 5.14 shall be borne by the Company.

                 5.16      Interest Rate Adjustments.  For any Mortgage Loan 
that is an adjustable rate mortgage loan, or fixed rate loan that is being
converted to an adjustable rate loan, in connection with which the interest
rate and payment amount must be adjusted, and the mortgagor notified of the
adjustments, in accordance with the Regulations before, on or within sixty (60)
days after





                                      101
<PAGE>   107
the Closing Date, the Company shall calculate the appropriate rate and payment
adjustments and notify the related mortgagor in accordance with all
Regulations.

                 5.17       Acquisition Proposals; Overbid Provisions.

                            (a)  From the date of this Agreement through the
Closing Date, the Company will not, directly or indirectly, through any
Affiliate, officer, director, employee, representative (including, but not
limited to, any investment banker, financial advisor, attorney or accountant)
or agent of the Company or any of its Subsidiaries (i) solicit, initiate or
encourage any inquiries or proposals from a Third Party that constitute, or
would reasonably be expected to lead to, a proposal or offer for a merger,
consolidation, business combination, sale of substantial assets, sale of a
substantial percentage of shares of capital stock (including, without
limitation, by way of a tender offer) or similar transaction involving the
Company or any of the Company's Subsidiaries owning any of the Assets (an
"Acquisition Proposal") and any Third Party (it being understood that any
notices approved by the Bankruptcy Court in connection with the First Order
shall not constitute a breach of this provision), or (ii) engage in
negotiations or dis-





                                      102
<PAGE>   108
cussions concerning, or enter into any understandings or agreements with any
Third Party with respect to, any Acquisition Proposal.  Notwithstanding the
foregoing, to the extent required by the fiduciary obligations of the Board of
Directors of the Company based on the advice of counsel, (i) the Company may
furnish non-public information with respect to the Company and its Subsidiaries
to any Qualified Third Party pursuant to an agreement which explicitly
acknowledges the existence of this Agreement and the Overbid and Termination
Fee procedures contained herein and requires such Third Party to adhere to them
and may participate in discussions and negotiations with such Qualified Third
Party, provided that the Company has notified Buyer not later than one (1)
business day after the receipt of the corresponding offer, proposal or inquiry,
and has indicated in such notice the identity of the offeror and all of the
material terms thereof, and (ii) upon receipt by the Company of an Acquisition
Proposal from a Qualified Third Party which the Board of Directors of the
Company has in good faith reasonably determined constitutes an Overbid
Transaction, the Company shall deliver a written notice to Buyer (an "Overbid
Notice") advising it of the foregoing determination by its Board of Directors
(which notice shall be accompanied





                                      103
<PAGE>   109
by copies of the form of definitive agreement or other documentation proposed
to be entered into in connection with such Acquisition Proposal).

                            (b)  Upon delivery by the Company to Buyer of an
Overbid Notice in accordance with the provisions of subsection (a) hereof,
Buyer shall have the right (a "Topping Right") to deliver to the Company,
within five calendar days following the receipt by Buyer of such Overbid
Notice, a written offer (a "Topping Offer") to amend the terms of this
Agreement in order to provide for a base purchase price having a value at least
$1.5 million higher than the base purchase price provided for under the
Acquisition Proposal to which such Overbid Notice relates.  In the event that
Buyer exercises such Topping Right (i) the Company may disclose such Topping
Offer to such Qualified Third Party and (ii) within five calendar days
following receipt by the Company of Buyer's notice of Topping Offer, Buyer and
the Company shall enter into an amendment to this Agreement to reflect the
Company's acceptance of Buyer's Topping Offer (unless the Company has received
an additional Acquisition Proposal constituting an Overbid Transaction).  If
within the time period specified Buyer has failed to make a Topping Offer or
has notified the Company in writing that it does not





                                      104
<PAGE>   110
intend to make a Topping Offer, the Company shall deliver to Buyer the
Termination Fee described in Section 8.4 and thereafter may enter into the
definitive agreement with the Qualified Third Party described in the Overbid
Notice.

                            (c)  Following the execution of any amendment to
this Agreement pursuant to subsection (b) above, the provisions of this Section
5.17 shall remain in effect and the receipt by the Company of any other offers,
proposals or inquiries relating to any Acquisition Proposal shall be subject to
the provisions of this Section 5.17.

                 5.18       Forwarding of Payments and Other Items.  With 
respect to any checks, other funds or documents in respect of any Mortgage Loan
which are received by the Company or made payable to the Company and provided
to the Company within thirty (30) calendar days after the Conversion Date, and
which relate to any payments due under the Mortgage Loans and collectible by
the servicer under the terms of the Mortgage Servicing Agreements, the Company
shall, after identification, promptly endorse such checks or transfer such
other funds to Buyer without recourse and send the same to Buyer via overnight
mail.  Any checks or other funds in respect of any Mortgage Loan





                                      105
<PAGE>   111
which are received by the Company after such thirty (30) day period shall be
endorsed without recourse by the Company to Buyer and sent by first class mail
to Buyer within five (5) business days of receipt, without identification.
Except as otherwise provided herein, the Company shall promptly forward by
first class mail to Buyer all borrower correspondence, insurance notices, tax
bills or any other correspondence or documentation related to the Mortgage
Loans which are received by the Company after the Conversion Date.  The Company
shall have no obligation with respect to forwarding post-Conversion Date items
to Buyer after one-hundred and twenty (120) calendar days following the
Conversion Date.  All penalties and interest due in connection with a Mortgage
Loan resulting from the Company's failure to forward bills or related
information to Buyer as provided above shall be borne by the Company.  The
Company shall cooperate with Buyer to obtain tax bills with respect to which
the earlier of the payment deadline to take advantage of a discount or the
payment deadline to avoid a penalty is between the thirty first (31st) and
sixtieth (60th) day after the Conversion Date.

                 5.19       Assignment of Certain Contracts.  The Company shall
assign to Buyer, effective as of the Clos-





                                      106
<PAGE>   112
ing Date, fully paid, life of the loan tax service contracts issued by First
American Real Estate Tax Services, Inc.  related to all Mortgage Loans.  The
Company also shall assign to Buyer, effective as of the Closing Date, such
fully paid, life of the loan flood zone certification contracts issued by a
company acceptable to Buyer related to all Mortgage Loans as have been obtained
by the Company by the Closing Date.  The Company shall obtain, at its expense,
the required consents, if any, to assign such tax service contracts (subject to
the limitations set forth in Section 5.6(a)(iii)) and flood zone certification
contracts to Buyer.

                 5.20       Custodial Fund Interest and Reporting.  The Company
shall pay interest on Escrow Funds accrued through the Closing Date to the
extent interest with respect to Escrow Funds is required to be paid under the
Regulations for the benefit of mortgagors under the Mortgage Loans.  The
Company shall credit such interest to the related Custodial Account before the
Escrow Funds are transferred to Buyer.

                 5.21       IRS Reporting.  Subject to Section 5.22, the Company
shall, at its sole cost and expense, prepare and timely file, or cause to be
prepared and timely filed with the Internal Revenue Service all reports, forms,





                                      107
<PAGE>   113
notices and filings required by the Code and rules, regulations and
interpretations thereunder in connection with the Servicing Rights and Mortgage
Loans with respect to events that occurred prior to the Closing Date, including
without limitation, the reporting of all interest paid by the Company for the
account of mortgagors under the Mortgage Loans.

                 5.22       Information Reporting. The Buyer shall, at its sole
cost and expense, assume the Company's obligation to (i) file IRS Forms
1099-INT ("Statement for Recipients of Interest Income") with respect to
interest payments made by the Company in respect of the Escrow Funds for the
1996 taxable year, (ii) file IRS Forms 1098 ("Mortgage Interest Statement")
with respect to interest received by the Company in respect of the Mortgage
Loans during the 1996 taxable year, (iii) prepare and issue Schedule K-1's
required to be issued by the Company for the taxable period beginning January
1, 1996 in respect of those Mortgage Loans that are part of a Pool and (iv)
prepare, file and issue any other similar Tax Returns, IRS Forms or statements,
as the Company may reasonably request, required to be prepared, filed or issued
for the taxable period beginning January 1, 1996.  In connection therewith, the
Company and Buyer agree to prepare, file





                                      108
<PAGE>   114
and execute any and all documentation required by applicable law to be
prepared, filed and executed in order to authorize the Buyer to assume the
reporting obligations set forth in the preceding sentence.

                 5.23       Reconciliation of Suspense Accounts.  As soon as
practicable following the Closing Date, the Company shall effect a
reconciliation of all funds held in suspense (both loan level and other).
Buyer shall have the opportunity to review and approve the results of such
reconciliation.  Any disputes relating to Buyer's review and approval of the
results of such reconciliation shall be subject to the dispute resolution
mechanism set forth in Section 2.4.  Following final approval of the suspense
account reconciliation, Buyer shall promptly remit to the Company the aggregate
amount of any excess funds held in such suspense accounts as set forth in the
results of such reconciliation.

                 5.24       ARM Loan Review.   Buyer may, at its option and
at its sole cost and expense, conduct a review of all adjustable rate Mortgage
Loans to confirm that the Company (i) provided all appropriate disclosures to
the mortgagors, (ii) made all appropriate adjustments in accordance with
applicable Regulations, (iii) provided the mortgagor with all appropriate
notices, (iv) appro-





                                      109
<PAGE>   115
priately adjusted the interest rate and payment, and (v) otherwise complied
with all applicable Regulations.

                 5.25       Further Assurances

                 Subject to the terms and conditions of this Agreement, the
Company and Buyer shall do all things reasonably necessary or desirable and
within their control to effect the consummation of the transactions
contemplated hereby.  At any time and from time to time after the Closing Date,
the Company and Buyer shall, each upon the request of the other, do or cause to
be done, execute, acknowledge and deliver all such further acts,  assignments,
transfers, conveyances, powers of attorney and assurances as may be reasonably
necessary or desirable to sell, assign, convey and transfer to and vest in
Buyer all of the Company's right, title and interest in and to the Assets and
to evidence the assumption by Buyer of the Assumed Liabilities.

                 5.26       Trade Names License

                 Effective as of the Closing Date, Buyer shall enter into a
licensing agreement with the Company pursuant to which Buyer shall grant the
Company a royalty-free license with respect to the Trade Names, including the
right to use the Trade Name Lomas in connection with the





                                      110
<PAGE>   116
insurance subsidiaries.  Such license shall be in form and substance reasonably
acceptable to the parties.

                 5.27       Subservicing and Transition
                            Services Agreement

                 Prior to or simultaneously with the Closing, Buyer and the
Company shall enter into the Subservicing and Transition Services Agreement
substantially in the form of Exhibit 5.27 (the "Subservicing and Transition
Services Agreement") and providing for the provision by the Company of the
services set forth therein relating to the Mortgage Loans transferred to Buyer
hereunder and the transition of the servicing of the Mortgage Loans to Buyer's
operations systems.

                 5.28       Establishment of Escrow Account
                            under RIS Agreement

                 On or prior to the Closing Date and subject to the approval of
the Bankruptcy Court, the Company shall establish a cash escrow account for the
benefit of Residential Information Services Limited Partnership pursuant to
Section III.C.(ii) of the RIS Agreement, unless the Bankruptcy Court shall
otherwise direct.





                                      111
<PAGE>   117
                                   ARTICLE VI
                                   CONDITIONS

                 6.1        Conditions to Each Party's
                            Obligations Under This Agreement

                 The respective obligations of each party to consummate the
Acquisition shall be subject to the satisfaction on or prior to the Closing
Date of the following conditions:

                 (a)        All approvals of Governmental Entities required to
be obtained in connection with the transactions contemplated by this Agreement
shall have been obtained, all notices required to be filed with any
Governmental Entity in connection with and prior to the consummation of the
transactions contemplated by this Agreement shall have been filed, all such
regulatory approvals shall be in full force and effect, and all notice periods
and waiting periods required by law or regulation in respect thereof or
otherwise applicable to the transactions contemplated by this Agreement shall
have expired or been terminated (all such approvals and the expiration of all
such waiting periods being referred to herein as the "Requisite Regulatory
Approvals").

                 (b)        No order, injunction or decree issued by any court
or agency of competent jurisdiction or other





                                      112
<PAGE>   118
legal restraint or prohibition (an "Injunction") preventing the consummation of
the Acquisition or any of the other transactions contemplated by this Agreement
shall be in effect.  No statute, rule, regulation, order, injunction or decree
shall have been enacted, entered, promulgated or enforced by any Governmental
Entity which prohibits, restricts or makes illegal consummation of the
Acquisition.

                 6.2        Additional Conditions to the
                            Obligations of the Company
                            Under This Agreement

                 The obligations of the Company to consummate the Acquisition
shall be subject to the satisfaction on or prior to the Closing Date of each of
the following additional conditions unless waived by the Company pursuant to
Section 8.3 hereof:

                 (a)        The obligations of Buyer required to be performed
by the Buyer at or prior to the Closing Date pursuant to the terms of this
Agreement shall have been duly performed and complied with in all material
respects and the representations and warranties of Buyer set forth in this
Agreement shall be true and correct in all material respects as of the date of
this Agreement and as of the Closing Date as though made on and as of the
Closing Date (except for any representation or warranty which





                                      113
<PAGE>   119
speaks as of an earlier date), and the Company shall have received a
certificate of an executive officer of Buyer to such effect, provided, however,
that nothing contained in this Section 6.2(a) shall be deemed to preclude, or
otherwise limit, the right of the Company to be indemnified for any breach of a
representation or warranty by Buyer in accordance with the provisions of
Article VII hereof; and

                 (b)        No proceeding initiated by any Governmental Entity
seeking an Injunction shall be pending; and

                 (c)        The Bankruptcy Court shall have entered the First
Order and the Second Order.  The Second Order shall have authorized the Company
and its Subsidiaries to convey to Buyer all of its right, title and interest in
and to the Assets free and clear of all Encumbrances of any nature whatsoever.
Simultaneous with entry of the Second Order, all Contracts (other than those
Mortgage Servicing Agreements with respect to which the Investor shall have
successfully objected to the assumption thereof by Buyer) shall have been
assumed and the Bankruptcy Court shall have approved such assumption and the
assignment thereof by the Company pursuant to Section 365 of the Bankruptcy
Code by an order in form reasonably acceptable to Buyer and the Company (the
"365 Order").  The





                                      114
<PAGE>   120
365 Order shall provide that the Contracts will be transferred to, and remain
in full force and effect for the benefit of, Buyer notwithstanding any
provision in such Contracts (including those described in sections 365(b)(2)
and (f) of the Bankruptcy Code) that prohibits such assignment or transfer; and

                 (d)        None of the Requisite Regulatory Approvals shall
contain a condition or requirement relating to the Company or any of the
Company's Affiliates which would or would reasonably be expected to so
materially adversely impact the economic or business benefits of the
transaction contemplated hereby so as to render inadvisable, in the reasonable
good faith judgment of the Board of Directors of the Company, the consummation
of such transactions (such a condition or requirement, whether relating to the
Company or Buyer, is referred to herein as a "Burdensome Condition").

                 6.3        Additional Conditions to Buyer's
                            Obligations Under This Agreement

                 The obligations of Buyer to consummate the Acquisition shall
be subject to the satisfaction on or prior to the Closing Date of each of the
following conditions unless waived by Buyer pursuant to Section 8.3 hereof:





                                      115
<PAGE>   121
                 (a)        (i) The obligations of the Company required to be
performed on or prior to the Closing Date pursuant to the terms of this
Agreement shall have been duly performed and complied with in all material
respects, (ii) the representations and warranties of the Company set forth in
this Agreement shall be true and correct in all material respects as of the
date of this Agreement and as of the Closing Date as though made on and as of
the Closing Date (except for any representation or warranty which speaks as of
an earlier date), provided, however, that for purposes of determining the
satisfaction of the condition contained in this clause (ii), no effect shall be
given to any exception in such representations and warranties relating to
materiality or a "Material Adverse Effect," and provided further, however, that
the condition contained in this clause (ii) shall be deemed to be satisfied
even if all of such representations and warranties are not true and correct
unless the failure of any of the representations or warranties to be so true
and correct, individually or in the aggregate, would have or would reasonably
be expected to have a Material Adverse Effect, and provided further, however,
that nothing contained in this Section 6.3(a) shall be deemed to preclude, or
otherwise limit, the





                                      116
<PAGE>   122
right of Buyer to be indemnified for any breach of a representation or warranty
by the Company in accordance with the provisions of Article VII hereof, and
(iii) Buyer shall have received a certificate of an executive officer of the
Company in form and substance satisfactory to Buyer; and

                 (b)        No proceeding initiated by any Governmental Entity
seeking an Injunction shall be pending; and

                 (c)        The Bankruptcy Court shall have entered the First
Order and the Second Order, each of which shall be Final Orders.  The Second
Order shall have authorized the Company and its Subsidiaries to convey to Buyer
all of its right, title and interest in and to the Assets free and clear of all
Encumbrances of any nature whatsoever.  Simultaneous with entry of the Second
Order, all Contracts (other than those Mortgage Servicing Agreements with
respect to which the Investor shall have successfully objected to the
assumption thereof by Buyer) shall have been assumed and the Bankruptcy Court
shall have approved such assumption and the assignment thereof by the Company
pursuant to the 365 Order, and such 365 Order shall have been entered and shall
have become a Final Order.  The 365 Order shall provide that the Contracts will
be transferred to, and remain in full force and





                                      117
<PAGE>   123
effect for the benefit of, Buyer notwithstanding any provision in such
Contracts (including those described in sections 365(b)(2) and (f) of the
Bankruptcy Code) that prohibits such assignment or transfer.  Nothing in this
Section 6.3(c), or any other section of this Agreement, shall preclude the
Company or Buyer from consummating the transactions contemplated herein if
Buyer, in its sole discretion, waives the requirement that the Second Order,
365 Order or any other orders be Final Orders.  No notice of such waiver of
this or any other condition to Closing need be given except to the Company or
Buyer, as explicitly required in this Agreement, it being the intention of the
parties hereto that Buyer shall be entitled to, and is not waiving, the
protection of Section 363(m) of the Bankruptcy Code, the mootness doctrine and
any similar statute or body of law if the Closing occurs in the absence of a
Final Order; and

                 (d)        The Company shall have received from all Investors
or Insurers which are government agencies or are government-sponsored agencies
or corporations, (including, without limitation, VA, FHA, FNMA and FHLMC), all
consents required as a result of the consummation of the Acquisition, and shall
have properly filed all notic-





                                      118
<PAGE>   124
es with such agencies and corporations which are required as a result of the
consummation of the Acquisition; and

                 (e)        The consent, approval or waiver of each Person
identified in Section 3.6 of the Company Schedule (other than the Governmental
Entities referred to in Section 6.1(a) or 6.3(d)) whose consent or approval
shall be required in connection with the consummation of the Acquisition shall
have been obtained in writing in a form reasonably acceptable to Buyer, except
where the failure to obtain such consent, approval or waiver, individually or
in the aggregate, would not have a Material Adverse Effect; and

                 (f)        Buyer shall have received evidence reasonably
satisfactory to it of the termination and release of all Encumbrances on the
Assets except for (i) liens for Taxes not yet due and payable and (ii) the
Assumed Liabilities; and

                 (g)        Subsequent to January 4, 1996, and (subject to the
validity of Buyer's representations in Section 4.7) subsequent to July 31,
1995, no event shall have occurred or failed to occur which has caused or could
reasonably be expected to cause a Material Adverse Effect; and





                                      119
<PAGE>   125
                 (h)        None of the Requisite Regulatory Approvals shall
contain any Burdensome Condition relating to Buyer or any of Buyer's
Affiliates, the Assets or the Assumed Liabilities; and

                 (i)        The Company shall have taken all action required to
have been taken and made all payments required to have been made to permit
assumption and assignment to Buyer under Section 365(b) and (f) of the
Bankruptcy Code of the Contracts listed on Schedules II, IV and V hereto; and

                 (j)        The Company and Buyer shall have entered into the
Subservicing and Transition Services Agreement.

                                  ARTICLE VII
                                INDEMNIFICATION

                 7.1        Indemnification

                 (a)        From and after the Closing Date, subject to the
terms and conditions of this Agreement, the Company shall indemnify and hold
harmless Buyer and each of its Affiliates (without duplication) from and
against any and all Losses which any of them actually suffer, incur or sustain
arising out of or attributable to (whether or not arising out of third party
claims) (i) any inaccuracy in or breach of any representation or warranty made
by the Company in this Agreement or any of the documents,





                                      120
<PAGE>   126
agreements or instruments executed pursuant to this Agreement, provided,
however, that with respect to claims for breaches of representations and
warranties relating to the servicing and/or origination of any Mortgage Loan
(other than as specifically set forth elsewhere in this Section 7.1(a)) the
indemnification shall be limited to (X) Losses actually incurred at the time
such claim is asserted, (Y) Third Party Claims (as hereinafter defined) and (Z)
claims relating to breaches discovered by Buyer in the normal course of
business, which claim, if submitted, could reasonably be expected to entitle an
Investor to demand repurchase of the Mortgage Loan in question or entitle an
Insurer to demand indemnification, cancel any mortgage insurance, or reduce any
mortgage insurance or guarantee benefits with respect to the Mortgage Loan in
question, (ii) any breach or nonperformance of any covenant to be performed by
the Company pursuant to this Agreement or any of the documents, agreements or
instruments executed pursuant to this Agreement, (iii) the Excluded Assets or
the Excluded Liabilities (whether arising before, on or after the Closing
Date), (iv) the failure by the Company to obtain all of the waivers, consents,
estoppels and approvals of any Governmental Entity or other third party
required in order to consummate the





                                      121
<PAGE>   127
Acquisition and the other transactions contemplated by this Agreement or to
prevent any violation, conflict, default, breach, loss of rights, modification,
acceleration, termination, right of termination or Encumbrance as a result of
such consummation, (v) VA No-Bids, and Buydowns resulting from or made to avoid
a VA No-Bid, in connection with any VA Loan for which Foreclosure proceedings
have been initiated prior to the one-year anniversary of the Closing Date, (vi)
any Non-Amortizing Loans, (vii) any of the Company's (a) escrow practices, (b)
practices with regard to the adjustment of interest rates and payment amounts
on Mortgage Loans and the general administration of Mortgage Loans that provide
for the adjustment of the interest rate and payment amount, and (c) practices
with regard to insurance, including without limitation forced placement
insurance, earthquake insurance and the retention and remittance of proceeds,
in each case prior to the Closing Date, (viii) the uncollectability of any of
the Accounts Receivable (provided, that for purposes of this clause (viii) the
term "Loss" shall be deemed to be the amount of a reserve, to be accrued on the
books and records of Buyer in accordance with GAAP on the first anniversary of
the Closing Date, with respect to the aggregate dollar amount of the





                                      122
<PAGE>   128
Accounts Receivable which remain uncollected as of the first anniversary of the
Closing Date, as reduced in accordance with Section 7.1(l)), (ix) any
Repurchases for which Buyer has received notice prior to the one-year
anniversary of the Closing Date (provided, that for purposes of this clause
(ix) the term "Loss" shall include, with respect to each Mortgage Loan which is
the subject of a Repurchase, an amount equal to 0.95% (other than Mortgage
Loans funded and entered on the Company's system after July 31, 1995, for which
a multiple of 1.50% shall be used) multiplied by the outstanding principal
balance of such Mortgage Loan as of the Closing Date, less the servicing fees,
if any, actually received by Buyer with respect to such Mortgage Loan), (x)
those Mortgage Loans serviced by the Company on behalf of FNMA, the Servicing
Rights relating to which were transferred to the Company by First Federal
Savings Bank of Boston, First Eastern Funding Corporation and First Eastern
Mortgage Corporation (collectively, the "First Eastern Entities") pursuant to
the Mortgage Servicing Purchase and Sale Agreement, dated as of September 30,
1991, by and among the Company, the First Eastern Entities and First Eastern
Bankshares Corporation (the "First Eastern Portfolio") (the Losses
indemnifiable by the Company pursuant to this





                                      123
<PAGE>   129
Section 7.1(a)(x) shall include an amount equal to the aggregate amount of all
unrealized losses on the First Eastern Portfolio which have been accrued or
reserved against on the books and records of Buyer in accordance with GAAP as
of the first anniversary of the Closing Date), and (xi) the commercially
reasonable sale of any of the Turkey Pile Loans, provided, however, that in
each case where the sale of any such loan results in a gain, the amount of such
gain shall be deducted from the aggregate amount of Losses indemnifiable by the
Company pursuant to Section 7.1(a).  For purposes of establishing whether any
matter is indemnifiable pursuant to Section 7.1(a)(i) hereof, the accuracy of
the representations and warranties made by the Company in this Agreement shall
be determined without giving effect to the qualifications to such
representations and warranties concerning "knowledge," "materiality" or
"Material Adverse Effect" and without giving effect to the disclosure of any
exceptions to such representations and warranties on any Schedule, Exhibit or
other written or oral notice (other than any exceptions set forth in Sections
3.13 and 3.23 of the Company Schedule).

                 (b)        From and after the Closing Date, subject to the
terms and conditions of this Agreement, Buyer





                                      124
<PAGE>   130
shall indemnify and hold harmless the Company and each of its Affiliates
(without duplication) from and against any and all Losses which any of them
actually suffer, incur or sustain arising out of or attributable to (whether or
not arising out of third party claims) (i) any inaccuracy in or breach of any
representation or warranty made by Buyer in this Agreement or any of the
documents, agreements or instruments executed pursuant to this Agreement, (ii)
any breach or non-performance of any covenant to be performed by Buyer pursuant
to this Agreement or any of the documents, agreements or instruments executed
pursuant to this Agreement, and (iii) any action taken or omitted to be taken
by Buyer or any of its Affiliates subsequent to the Closing and resulting from
or arising in connection with Buyer's and its Affiliates' conduct of the
business relating to the Assets and the Assumed Liabilities subsequent to the
Closing to the extent such Losses are not otherwise indemnifiable by the
Company pursuant to the terms of this Agreement.

                 (c)        The indemnified party shall promptly notify the
indemnifying party of the discovery by it of, or the assertion against it of,
any claim or potential liability for which indemnification is provided herein
or the commencement of any action or proceeding in respect





                                      125
<PAGE>   131
of which indemnity may be sought hereunder, which notification shall state in
reasonable detail the basis of such claim or potential liability, including the
specific date of such claim, the third parties affected thereby, and the
specific facts relating to the incident which gave rise to such claim or
potential liability, provided, however, that the indemnified party shall not be
foreclosed from seeking indemnification pursuant to this Article VII by any
failure to provide timely notice of the existence of a third party claim to the
indemnifying party except and only to the extent that the indemnifying party
actually incurs an out-of-pocket expense or otherwise has been damaged or
prejudiced as a result of such delay.

                 (d)        With respect to a claim for indemnification arising
out of or involving an assertion by a third party of liability of an
indemnified party (a "Third Party Claim"), upon receipt by the indemnifying
party of the notice of claim for indemnity required to be given by the
indemnified party pursuant to subsection (c) hereof, the indemnifying party
shall have the right at any time thereafter to assume the defense thereof and
be represented, at its own expense, by legal counsel and/or accountants of its
own choosing, in and with respect to





                                      126
<PAGE>   132
any (i) settlement negotiations and (ii) action, suit or other proceeding,
whether legal, administrative or arbitrative, including any appeal proceeding,
in each instance with respect to the matter giving rise to said Third Party
Claim.  If the indemnifying party chooses to defend any such Third Party Claim,
the indemnified party shall make available to the indemnifying party any
personnel or any books, records or other documents within its control that are
reasonably necessary or appropriate for such defense.  The indemnifying party
shall have the right, in its sole discretion and at its expense, to control the
defense of such Third Party Claim, including without limitation, the right to
designate counsel and to control all negotiations, litigation, arbitration,
settlements, compromises and appeals of any such claim or potential claim;
provided, however, that prior to entering into a final settlement or compromise
with respect to such Third Party Claim, the indemnifying party shall obtain the
indemnified party's consent (which consent shall not be unreasonably withheld
or delayed) to such settlement or compromise if such settlement or compromise
would materially and adversely affect the business, financial condition or
results of operations of the indemnified party.  Notwithstanding the foregoing,
if an





                                      127
<PAGE>   133
offer of settlement or compromise is received by or communicated to the
indemnifying party with respect to a Third Party Claim and the indemnifying
party notifies the indemnified party in writing of the indemnifying party's
willingness to settle or compromise such Third Party Claim on the basis set
forth in such notice and the indemnified party declines to accept such
settlement or compromise, the indemnified party may continue to contest such
Third Party Claim, free of any participation by the indemnifying party, at the
indemnified party's sole expense.  The obligation of the indemnifying party to
the indemnified party with respect to such Third Party Claim shall be equal to
the lesser of (i) the amount of the offer of settlement or compromise which the
indemnified party declined to accept plus the costs and expenses of the
indemnified party prior to the date the indemnifying party notifies the
indemnified party of the indemnifying party's willingness to settle or
compromise such Third Party Claim or (ii) the amount the indemnified party is
obligated to pay as a result of the indemnified party's continuing to contest
such Third Party Claim including costs and expenses with respect thereto; and
the indemnifying party shall be entitled to recover (by set off or otherwise)
from the indemnified party any additional





                                      128
<PAGE>   134
expenses incurred by the indemnifying party as a result of the indemnified
party's decision to continue to contest such Third Party Claim.

                 (e)        Notwithstanding anything to the contrary contained
herein, if the indemnifying party has not assumed control of the defense of any
Third Party Claim within sixty (60) days after its receipt of a notice of claim
for indemnity from the indemnified party, or if the indemnifying party has
abandoned control of any Third Party Claim, the indemnified party shall have
the right to assume the defense thereof, and subject to the provisions of this
Article VII, the costs and expenses incurred by the indemnified party in
connection therewith shall be borne by the indemnifying party.  In addition, in
connection with any Third Party Claim in which the indemnified party shall
reasonably conclude, based upon an opinion of its counsel, that (i) there is a
conflict of interest between the indemnifying party and the indemnified party
in the conduct of the defense of such Third Party Claim or (ii) there are
specific defenses available to the indemnified party which are different from
or additional to those available to the indemnifying party and which could be
materially adverse to the indemnifying party, then the indemnified party shall
have the right to





                                      129
<PAGE>   135
assume and direct the defense of such Third Party Claim.  In such an event, the
indemnifying party shall pay the fees and disbursements of counsel to each of
the indemnifying party and the indemnified party.  In all other cases, the
indemnifying party and the indemnified party shall each pay the costs and
disbursements of their respective counsel, and, prior to entering into a final
settlement or compromise, the indemnified party shall follow the procedures
required of the indemnifying party in paragraph (d) of this Section 7.1.

                 (f)        Notwithstanding anything to the contrary contained
in paragraphs (d) or (e) of this Section 7.1, in the event prompt action is
required with respect to the defense of a Third Party Claim, the indemnified
party shall, subject to the terms and conditions of this Article VII, have the
right to assume the defense of such Third Party Claim; provided, however, that
in the event that the indemnifying party subsequently elects to assume the
defense of such Third Party Claim, then the provisions set forth in paragraphs
(d) and (e) of this Section 7.1 shall be applicable and the indemnifying party
shall, subject to the terms and conditions of this Article VII, reimburse the
indemnified party for any costs and expenses incurred by the indemnified party
prior to the date





                                      130
<PAGE>   136
the indemnifying party assumes control of such Third Party Claim.

                 (g)        The right of an indemnified party under this
Section 7.1 shall be subject to the condition that notice of any claim for
indemnification under Section 7.1(a)(i) or Section 7.1(b)(i) shall have been
given prior to the expiration of the survival period of the representation or
warranty to which the claim relates as set forth in Section 9.1 hereof.

                 (h)        In no event shall the Company's indemnity
obligation under Section 7.1(a) exceed an amount (the "Indemnification Cap")
equal to the sum of (i) $20,510,000 plus (ii) the greater of $16,000,000 or the
12% Holdback.

                 (i)        Buyer shall use reasonable efforts at all times to
minimize the claims and losses for which the Company may be liable under this
Agreement.  Without limiting the foregoing, in carrying out its duty to
mitigate claims and losses for which the Company may be liable, Buyer shall use
prudent mortgage banking practices and, in any case, not less than that degree
of care that Buyer exercises with respect to the conduct of its existing
mortgage banking business.





                                      131
<PAGE>   137
                 (j)        Promptly upon receipt of a claim for 
indemnification, the party receiving such claim shall either acknowledge in
writing the validity of the claim (an "Undisputed Claim") or within 20 days
from the receipt of such notice dispute the claim for indemnification by
written notice setting forth to the extent practicable the reasons for such
dispute (a "Disputed Claim").  If the party receiving a notice of claim does
not give notice that it disputes the claim within such twenty day period, the
claim shall be deemed to be an Undisputed Claim.  The parties shall promptly
commence good faith negotiations with a view to resolving all Disputed Claims. 
Any Disputed Claim which is finally resolved shall thereafter be an Undisputed
Claim in an amount equal to the amount of the claim as so finally resolved.

                 (k)        On the first anniversary of the Closing Date,
provided that the aggregate amount of Undisputed Claims does not equal or
exceed the Indemnification Cap, Buyer shall establish reserve accounts
(collectively, the "Reserve") for estimated Losses relating to the following
items indemnifiable by the Company pursuant to Section 7.1(a):  (A) a reserve
established in accordance with GAAP for uncollectible Accounts Receivable
outstanding as





                                      132
<PAGE>   138
of such date, (B) the reserve contemplated by Section 7.1(a)(x) with respect to
indemnifiable Losses relating to the First Eastern Portfolio, (C) a reserve
established in accordance with GAAP sufficient to cover breaches or alleged
breaches of the Origination and Servicing Representations determined in
accordance with clause (Z) of Section 7.1(a)(i), and (D) a reserve sufficient
to cover all other unresolved, disputed or theretofore unasserted claims
indemnifiable by the Company pursuant to Section 7.1(a) (including all other
existing Disputed Claims).  If the Company disputes any portion of the amounts
included by Buyer in the Reserve pursuant to clause (A) above then such dispute
or disputes shall be referred promptly to the Independent Accounting Firm whose
determination of the appropriate amount relating to such items to be included
in the Reserve shall be binding on all parties.  If the Company disputes the
amount included in the Reserve with respect to clause (B), such dispute shall
be referred promptly to the Independent Accounting Firm whose determination of
the appropriate amount of the Loss to be charged to the Reserve shall have the
status of an Undisputed Claim.  Such determination shall be final and binding
on all parties.  If on the second anniversary of the Closing Date there
continue to be Disputed





                                      133
<PAGE>   139
Claims with respect to Origination and Servicing Representations, such claims
shall be submitted to the Qualified Institution who shall determine the amount
of the Loss which shall then be an Undisputed Claim to be charged to the
Reserve.  The determination of the Qualified Institution shall be final and
binding on all parties.  If the Company disputes any portion of the amounts
included by Buyer in the Reserve pursuant to clause (D) above, then on the
second anniversary of the Closing Date (or such earlier date as the Buyer may
determine), the parties shall cause the dispute to be referred promptly to the
Qualified Institution whose determination of the appropriate amount relating to
such items to be included in the Reserve shall be final and binding on all
parties.

                 (l)        On each successive anniversary of the Closing Date
following the first anniversary, Buyer shall review the amount of the Reserve
attributable to uncollected Accounts Receivable in order to determine an
appropriate reserve in accordance with GAAP for uncollectible Accounts
Receivable outstanding as of such date.  The parties promptly shall refer any
dispute arising out of any such annual review to the Independent Accounting
Firm whose determination of the appropriate amount to be included in the
Reserve shall be binding on all parties.





                                      134
<PAGE>   140
The parties shall maintain this annual review process until all Accounts
Receivable have been collected by Buyer in full or have been finally determined
to be uncollectible.

                 (m)        On each successive anniversary of the Closing Date
following the second anniversary, Buyer shall review the amount of the Reserve
to determine the amount necessary to cover Disputed Claims which have not yet
been resolved.  If the Company disputes any portion of the amounts included by
Buyer in the Reserve in connection with such annual review, the parties
promptly shall refer any such dispute to the Qualified Institution whose
determination of the appropriate amount to be included in the Reserve shall be
binding on all parties.  The parties shall maintain this annual review process
until all Disputed Claims have been finally resolved.

                 (n)        The Reserve established in accordance with Section
7.1(k) shall be adjusted in accordance with the annual reviews described in the
two preceding paragraphs and as each Disputed Claim is resolved.  As promptly
as practicable following the second anniversary of the Closing, Buyer shall pay
to the Company the amount, if any, by which (A) the amount withheld at the
Final Settlement Date as a result of the calculation of the Re-





                                      135
<PAGE>   141
serve pursuant to Section 2.7(a) less the amount of any Disputed Claims which
become Undisputed Claims after such date, exceeds (B) the remaining amount of
the Reserve.  Thereafter, not less frequently than annually, Buyer shall
recompute the amount resulting from the calculation set forth in the previous
sentence as of such date and shall pay to the Company the amount computed
thereby less the aggregate of all amounts previously paid by Buyer pursuant to
this Section 7.1(n).

                 (o)        In the case of any referral of a dispute to either
the Independent Accounting Firm or the Qualified Institution, Buyer and the
Company shall use their respective best efforts to cause such firm to render
its determination as soon as practicable following such referral, and each
party shall cooperate with such firm and shall provide such firm with
reasonable access to its books, records, personnel and representatives and such
other information as such firm may require in order to render its
determination.  All of the fees and expenses of the Independent Accounting Firm
or the Qualified Institution, as the case may be, shall be paid one-half by
Buyer and one-half by the Company.





                                      136
<PAGE>   142
                                  ARTICLE VIII
                       TERMINATION, WAIVER AND AMENDMENT

                 8.1        Termination

                 This Agreement may be terminated on or at any time prior to 
the Closing Date:

                 (a)        by the mutual written consent of the parties hereto;

                 (b)        by either Buyer or the Company upon written notice
to the other party (i) thirty (30) days after the date on which any request or
application for a Requisite Regulatory Approval shall have been denied or
withdrawn at the request or recommendation of the Governmental Entity which
must grant such Requisite Regulatory Approval, unless within the 30-day period
following such denial or withdrawal a petition for rehearing or an amended
application has been filed with the applicable Governmental Entity, provided,
however, that no party shall have the right to terminate this Agreement
pursuant to this clause (i) if such denial or request or recommendation for
withdrawal shall be due to the failure of the party seeking to terminate this
Agreement to perform or observe the covenants and agreements of such party set
forth herein or (ii) if any Governmental Entity of competent jurisdiction shall
have issued a final nonappeal-





                                      137
<PAGE>   143
able order enjoining or otherwise prohibiting the consummation of any of the
transactions contemplated by this Agreement;

                 (c)        by either Buyer or the Company (provided that the
terminating party is not then in material breach of any representation,
warranty, covenant or other agreement contained herein) if there shall have
been a material breach of any of the representations or warranties set forth in
this Agreement on the part of the other party, which breach is not cured within
thirty (30) days following written notice to the party committing such breach,
or which breach, by its nature, cannot be cured prior to the Closing, and which
breach, individually or together with all other such breaches, would have a
Material Adverse Effect, in the case of breaches by the Company, or a material
adverse effect on Buyer's ability to consummate the transactions contemplated
hereby, in the case of breaches by Buyer;

                 (d)        by either Buyer or the Company (provided that the
terminating party is not then in material breach of any representation,
warranty, covenant or other agreement contained herein) if there shall have
been a material breach of any of the covenants or agreements set forth in this
Agreement on the part of the other party, which





                                      138
<PAGE>   144
breach shall not have been cured within thirty (30) days following receipt by
the breaching party of written notice of such breach from the other party
hereto;

                 (e)        by Buyer or the Company, if the Closing Date shall
not have occurred on or prior to January 31, 1996, unless the failure of such
occurrence shall be due to the failure of the party seeking to terminate this
Agreement to perform or observe its agreements as set forth in this Agreement
required to be performed or observed by such party on or before the Closing
Date;

                 (f)        by Buyer or the Company, if five calendar days
shall have elapsed after the delivery by the Company of an Overbid Notice to
Buyer and Buyer has not delivered a Topping Offer to the Company;

                 (g)        by Buyer, if the Bankruptcy Court has not entered
the First Order within ten days following the date of the filing with the
Bankruptcy Court of the motion seeking the First Order; or

                 (h)        by Buyer, if the Bankruptcy Court has not entered
the Second Order by January 15, 1996.

                 8.2        Effect of Termination

                 In the event of a termination of this Agreement pursuant to
Section 8.1 hereof, this Agreement shall become void and have no effect, except
that the provi-





                                      139
<PAGE>   145
sions relating to confidentiality and expenses set forth in Sections 5.3 and
9.2 hereof, respectively, this Section 8.2, and, to the extent applicable,
Section 8.4, shall survive any such termination, provided, however, that except
as provided in this Section 8.2, no such termination shall relieve any party
from liability for any willful breach of this Agreement.

                 8.3  Amendment, Extension and Waiver

                 Subject to applicable law, the parties hereto may (i) amend
this Agreement, (ii) extend the time for the performance of any of the
obligations or other acts of any other party hereto, (iii) waive any
inaccuracies in the representations and warranties contained herein or in any
document delivered pursuant hereto, or (iv) waive compliance with any of the
agreements or conditions contained in Articles V and VI hereof.  This Agreement
may not be amended except by an instrument in writing signed on behalf of each
of the parties hereto.  Any agreement on the part of a party hereto to any
extension or waiver shall be valid only if set forth in an instrument in
writing signed on behalf of such party, but such waiver or failure to insist on
strict compliance with such obligation, covenant, agreement or condition shall





                                      140
<PAGE>   146
not operate as a waiver of, or estoppel with respect to, any subsequent or
other failure.

                 8.4  Termination Payment.

                 In the event that (a) this Agreement is terminated pursuant to
Section 8.1(f), (b) the Board of Directors of the Company shall have withdrawn
its support for the Acquisition or modified its support for the Acquisition in
a manner adverse to Buyer, or (c) the Company shall have entered into a
definitive agreement with a Qualified Third Party with respect to an
Acquisition Proposal as contemplated by Section 5.17(b), then the Company shall
pay to Buyer promptly, but in no event more than two business days following
the date of the applicable event described in clauses (a), (b) and (c) above,
by wire transfer of immediately available funds, to such account as Buyer shall
designate, an amount (the "Termination Payment") equal to the greater of (X) $3
million or (Y) 50% of the amount by which the consideration paid pursuant to
any alternative Acquisition Proposal exceeds the Base Purchase Price set forth
in this Agreement, provided, that in no event shall the amount paid by the
Company to Buyer pursuant to this Section 8.4 exceed $5 million.  If within one
year from the date of any termination of this Agreement pursuant to Article
VIII hereof





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(other than pursuant to Section 8.1(f)), the Company consummates an Acquisition
Proposal (excluding any restructuring of capital of the Company solely with
their existing creditors in exchange for their outstanding debt),
simultaneously with the consummation of such Acquisition Proposal and provided
that this Agreement has not been terminated because of a material breach of
Buyer's obligations, representations or warranties hereunder, the Company will
pay to Buyer the Termination Payment.

                                   ARTICLE IX
                                 MISCELLANEOUS

                 9.1        Survival; Buyer's Rights
                            Following Closing

                 (a)        The representations and warranties set forth in 
Articles III and IV hereof, other than those contained in Section 3.6 hereof,
shall survive for a period of one year following the Closing Date, and the
representations and warranties contained in Section 3.6 hereof shall survive
the Closing Date indefinitely.

                 (b)        The covenants and agreements set forth in this 
Agreement shall not survive the Closing, except for





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those covenants and agreements which by their terms apply in whole or in part
after such date.

                 9.2        Expenses

                 Except as otherwise specified in this Agreement, each party
hereto shall bear and pay all costs and expenses incurred by it in connection
with the transactions contemplated hereby, including fees and expenses of its
own financial consultants, accountants and counsel, provided, however, that
nothing contained in this Section 9.2 shall limit a party's rights to recover
damages for willful breach of this Agreement as specified in, and subject to
the provisions of, Section 8.2 hereof.

                 9.3        Release and Settlement.  On the Closing Date, the
Company shall be deemed to have released, compromised and settled any and all
claims, rights, and causes of action that the Company may have against Buyer or
its Affiliates pursuant to sections 544 through 550 of the Bankruptcy Code,
inclusive, arising out of the prepetition transfer of assets from the Company
to Buyer consummated on October 2, 1995, including, but not limited to, any
fraudulent transfer or conveyance claims that might have been assertable by a
creditor prior to the Company's Chapter 11 case.





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                 9.4        Entire Agreement

                 This Agreement, together with the documents, schedules and
other writings referred to herein or delivered pursuant hereto, and the
Confidentiality Agreement, the First Order and the Second Order contain the
entire agreement and understanding of the parties with respect to the subject
matter contained herein or therein.  This Agreement supersedes all prior
arrangements and understandings between the parties, both written or oral, with
respect to its subject matter (other than the Confidentiality Agreement).

                 9.5        Parties in Interest

                 The Agreement shall be binding upon and shall inure to the
benefit of and be binding upon the parties hereto and their respective
successors and assigns, provided, however, that nothing in this Agreement,
expressed or implied, is intended to confer upon any other Person any rights,
remedies, obligations or liabilities of any nature whatsoever under or by
reason of this Agreement.

                 9.6        Assignment

                 No party hereto may assign any of its rights or obligations
hereunder to any other Person, without the prior written consent of the other
party provided, howev-





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er, that Buyer may assign to an Affiliate of Buyer all of its rights hereunder
to assume the rights and obligations of the Company under those Contracts
pursuant to which the Company services, subservices or master services
multi-family Mortgage Loans (as set forth on Section 3.23 of the Company
Schedule).

                 9.7        Notices

                 All notices or other communications hereunder shall be in
writing and shall be deemed given if delivered personally or mailed by prepaid
registered or certified mail (return receipt requested), or by overnight
courier, cable, telegram or telex addressed as follows:

                 (a)        If to the Company, to:

                            Lomas Mortgage USA, Inc.
                            1600 Viceroy Drive
                            Dallas, Texas  75235
                            Attention:     Louis Gregory, Esq.
                                           (214) 879-7075 (facsimile)

                            Copies to:

                            Davis Polk & Wardwell
                            450 Lexington Avenue
                            New York, New York  10017
                            Attention:     Robert J. Levine, Esq.
                                           (212) 450-4800 (facsimile)

                            Jaffe, Raitt, Heuer & Weiss
                            Suite 2400
                            One Woodward Avenue
                            Detroit, Michigan 48226
                            Attention:     Mark K. Rabidoux, Esq.
                                           (313) 961-8358 (facsimile)





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                 (b)        If to Buyer, to:

                            First Nationwide Bank,
                              A Federal Savings Bank
                            200 Crescent Court, Suite 1350
                            Dallas, Texas  75201
                            Attention:     Christie S. Flanagan, Esq.
                                           (214) 871-5199 (facsimile)

                            Copies to:

                            Skadden, Arps, Slate, Meagher & Flom
                            919 Third Avenue
                            New York, New York  10022
                            Attention:   J. Gregory Milmoe, Esq.
                                         (212) 735-2000 (facsimile)

                 and

                            Weiner, Brodsky, Sidman & Kider
                            1350 New York Avenue, N.W.
                            Suite 800
                            Washington, D.C.  20005
                            Attention:     Harvey E. Weiner, Esq.
                                           (202) 628-2011 (facsimile)

                 (c)        If to counsel for creditors' committee, to:

                            Weil, Gotshal & Manges LLP
                            767 Fifth Avenue
                            New York, New York 10153
                            Attention:     Martin J. Bienenstock, Esq.
                                           (212) 310-8007 (facsimile)

                 9.8        Captions

                 The table of contents and captions contained in this Agreement
are for reference purposes only and are not part of this Agreement.

                 9.9        Counterparts





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

                 9.10       Governing Law

                 This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without giving effect to the
principles of conflict of laws thereof.

                 9.11        Exclusive Jurisdiction.  The parties hereby agree
that, without limitation of any party's right to appeal any order of the
Bankruptcy Court, (a) the Bankruptcy Court shall retain exclusive jurisdiction
to enforce the terms of this Agreement and to decide any claims or disputes
which may arise or result from, or be connected with this Agreement, any breach
or default hereunder, or the transactions contemplated herein, and (b) any and
all claims, actions, causes of action, suits and proceedings relating to the
foregoing shall be filed and maintained only in the Bankruptcy Court, and the
parties hereby consent and submit to the jurisdiction of the Bankruptcy Court.





                                      147
<PAGE>   153
                 IN WITNESS WHEREOF, each of the undersigned has executed this
Agreement as of the day and year first above written.


                                           FIRST NATIONWIDE MORTGAGE
                                            CORPORATION

                                           By: /s/ LAWRENCE P. WASHINGTON
                                               --------------------------------
                                               Name: Lawrence P. Washington
                                               Title: Executive Vice President


                                           LOMAS MORTGAGE USA, INC.

                                           By: /s/ ERIC D. BOOTH
                                               --------------------------------
                                               Name: Eric D. Booth
                                               Title: Chief Executive Officer





<PAGE>   154
The Exhibits and Schedules to the Section 363 Asset Sale Agreement amended and
restated as of January 4, 1996 by and between First Nationwide Mortgage
Corporation, as Buyer, and Lomas Mortgage USA, Inc., as the Company (the "Asset
Sale Agreement"), have not been filed herewith pursuant to Item 601(b)(2) of
Regulation S-K.  Pursuant to this Regulation, set forth below is a list briefly
identifying the contents of all omitted Exhibits and Schedules to the Asset
Sale Agreement.  In addition, pursuant to such Regulation, the registrant
hereby agrees to furnish supplementally a copy of any such omitted Exhibits and
Schedules to the Securities and Exchange Commission upon request.


                                    EXHIBITS

Exhibit 2.2               Base Purchase Price
Exhibit 2.3(b)(i)         Bill of Sale and Assignment
Exhibit 2.3(b)(ii)        Lease Assignment and Assumption Agreement
Exhibit 2.3(c)            Assumption Agreement
Exhibit 2.6(e)            Terms and Provisions with respect to the Mortgage
                          Loans serviced by the Company pursuant to the
                          Citicorp Agreement
Exhibit 5.27              Subservicing and Transition Services Agreement

                                 BUYER SCHEDULE

Buyer Schedule - Section 4.3      Consents and Approvals

                                   SCHEDULES

Schedule I            Accounts Receivable
Schedule II           Assumed Contracts (other than Mortgage Servicing
                      Agreements and Leases)
Schedule III          Investments Related to Servicing Business
Schedule IV           Leases
Schedule V            Mortgage Servicing Agreements
Schedule VI           Other Assets Related to Servicing Business
Schedule VII          Scheduled Liabilities
Schedule VIII         Employees
Schedule IX           Trade Names
Schedule X            Furniture, Fixtures and Equipment

                                COMPANY SCHEDULE

Section 3.2(b)        Authority; No Violation
Section 3.3           Consents and Approvals





<PAGE>   155
Section 3.5(b)        Leases
Section 3.6           Title to Assets
Section 3.8           Legal Proceedings
Section 3.10          Mortgage Loans
Section 3.13          No Recourse
Section 3.14          Mortgage Servicing Agreement Defaults
Section 3.15(c)       Compliance with Mortgage Banking Regulations
Section 3.17          Inquiries
Section 3.18          Advances; Accounts Receivable
Section 3.19          Physical Damage
Section 3.20          Pool Certification
Section 3.23          Single Family Loans
Section 3.25          Taxes
Section 3.29(b)       Trade Names
Section 5.1           Conduct Prior to Closing