Document:

ASSET SALE AGREEMENT

                                  BETWEEN

                              NUI CORPORATION

                                    AND

                           C&T ENTERPRISES, INC.

                        Dated as of October 4, 2000

                           ASSET SALE AGREEMENT

               This Asset Sale Agreement (the "Agreement") is made as of
     this 4th day of October, 2000 by and between NUI CORPORATION, a New
     Jersey corporation having offices at 550 Route 202-206, P.O. Box 760,
     Bedminster, New Jersey 07921-0760 (the "Seller") and C&T ENTERPRISES,
     INC., a Pennsylvania corporation having offices at 1775 Industrial
     Boulevard, P.O. Box 551, Lewisburg, Pennsylvania 17837 (the "Buyer").

                                WITNESSETH:

               WHEREAS, Seller owns certain assets described herein, which
     assets are presently used in that portion of the Seller's business
     which is operated under the name of "Valley Cities Gas Service" and
     "Waverly Gas Service" which are operating divisions of Seller
     (hereinafter referred to as the "VCW Business"); and

               WHEREAS, Seller wishes to sell the assets constituting the
     VCW Business as more fully described herein to Buyer and Buyer wishes
     to buy such assets constituting the VCW Business subject to the terms
     and conditions of this Agreement.

               NOW THEREFORE, in consideration of the mutual covenants,
     agreements, representations and warranties contained herein, and
     intending to be legally bound hereby, the parties agree as follows:

     ARTICLE 1.     SALE, TRANSFER AND ASSIGNMENT OF ASSETS.

               Subject to the terms and conditions set forth in this
     Agreement, Seller agrees to sell, convey, transfer, assign and deliver
     to Buyer, and Buyer agrees to purchase from Seller at the Closing
     described in Article 3 hereof, the assets, properties and interests
     of Seller constituting the VCW Business of every kind, character and
     description, whether tangible, intangible, real, personal or mixed,
     and wherever located except for the Excluded Assets, all of which are
     sometimes collectively referred to in this Agreement as the "Assets",
     including, but not limited to, the following:

          1.1 Owned Real Property.

               Those certain parcels of land more fully described on
     Schedule 1.1, together with all privileges and appurtenances thereto
     and all buildings, structures, fixtures and other improvements
     situated thereon and together with all easements used or useful in
     connection therewith (such land, improvements and easements together
     hereinafter collectively referred to as the "Owned Real Property").

          1.2 Real Property Leases; Easements.

               All right, title and interest of Seller in the leases of the
     real property more fully described on Schedule 1.2(a), together with
     all rights and privileges under such leases (hereinafter referred to
     as the "Real Property Leases") and to the real property subject to
     such leases (hereinafter referred to as the "Leased Real Property" and
     together with the Owned Real Property being hereinafter collectively
     referred to as the "Real Property"), and the easements, rights-of-way,
     rights of access or licenses relating to the distribution mains and
     pipelines utilized in the VCW Business described on Schedule 1.2(b)
     (hereinafter referred to as the "Easements").

          1.3 Equipment.

               All the machinery, tools, appliances, vehicles, furniture,
     equipment (including, without limitation, essential spares and
     replacement parts), gas distribution mains and pipelines, together
     with gate stations, meters and other gas distribution equipment and
     other tangible personal property of every kind and description that
     are located upon or within the Real Property, and/or are owned or held
     by Seller, and are utilized in connection with the operations of the
     VCW Business, a current list of which is attached hereto as Schedule
     1.3. (hereinafter referred to collectively as the "Equipment").

          1.4 Transportation and Storage Contracts / Supply Contracts.

               Seller's interest in the transportation and storage
     contracts and gas supply contracts relating to the operation of the
     VCW Business to be assumed by Buyer pursuant to Article 4, subject to
     Seller's continuing interest in such interstate pipeline
     deliverability and supply contracts necessary to serve Seller's New
     Jersey operations, all as fully described in Schedule 1.4 attached
     hereto (hereinafter referred to as the "Contracts").

          1.5 Accounts Receivable.

               All of Seller's accounts receivable  as of the Closing Date
     (as defined in Article 3 below) arising out of the operation of the
     VCW Business in the ordinary course and unpaid as of the Closing Date
     (hereinafter referred to as "Accounts Receivable"), but excluding any
     reserves or allowance for bad debt maintained by Seller as of the
     Closing Date.

          1.6 Intangibles.

               All intangible assets of the VCW Business listed on Schedule
     5.12 as well as any other trade names (other than names used in the
     VCW Business which include the "NUI" name), trademarks, service marks,
     copyrights, patents, intellectual property, software licenses,
     customer lists, goodwill and other intangibles used exclusively in
     the VCW Business, if any, as of the Closing Date (as defined in
     Article 3 below) including, without limitation, tort or insurance
     proceeds arising out of any damage or destruction of any of the Assets
     between the date of this Agreement and the Closing Date.

          1.7 Books and Records.

               All papers, computerized databases and records in Seller's
     care, custody or control relating to any or all of the above described
     Assets or exclusive to Seller's operation of the VCW Business,
     including, but not limited to all blueprints, plans and
     specifications, personnel and labor relations records, environmental
     compliance records, sales records, customer records, marketing
     materials, accounting and financial records, maintenance records,
     plats and surveys of the Real Property, and plans and designs of
     buildings, structures, fixtures and equipment.

          1.8 Prepaid Expenses.

               All prepaid expenses and other prepaid items relating to any
     of the Assets and the operation of the VCW Business as of the Closing
     Date subject to allocations which may be made by Seller consistent
     with the terms of this Agreement and subject to Seller's retention of
     amounts attributable to pension payments and pension expenses as
     adjusted by Seller after Seller's valuation of its pension obligations
     to the employees of the VCW Business.

          1.9 Permits, etc.

               All permits, licenses, consents or authorizations issued by,
     and all registrations and filings with, any governmental agency in
     connection with, the VCW Business whenever issued or filed, excepting
     only those which by law or by their terms are non-transferable or
     those which have expired.

          1.10 Plant Material, Merchandise, Gas and Propane.

               All plant material and operating supplies, all merchandise,
     all gas stored underground and all propane in bulk storage tank
     utilized in connection with the VCW Business existing as of the
     Closing Date.

          1.11 Excluded Assets.

               Seller shall not transfer to Buyer and Buyer shall not
     acquire Seller's cash, bank deposits or similar cash and cash
     equivalent items existing as of the Closing Date, whether or not
     arising from Seller's operation of the VCW Business (the "Excluded
     Assets") other than restricted cash held for regulatory purposes in
     connection with the VCW Business which shall be transferred to Buyer.

     ARTICLE 2.  PURCHASE PRICE.

          2.1 Payment of Purchase Price.

               In consideration for the transfer and assignment by Seller
     of the Assets, Buyer on the conditions set forth herein,

               (a) shall deliver to Seller at the Closing (as
     hereinafter defined) (i) Fifteen Million Dollars ($15,000,000)
     plus or minus any customary prorations as of the Closing Date
     relating to the transfer of the Real Property under this
     Agreement, and (ii) an amount required to reimburse Seller for
     reasonable amounts expended by Seller for the NUCOR expansion
     allocable to the VCW Business as more fully described in Section
     8.12 of this Agreement, all payable in cash as more fully
     described in Section 3.2 hereof; and

               (b) shall assume and discharge, and shall indemnify
     Seller against liabilities and obligations of Seller under the
     leases, contracts or other agreements, if any, specified on
     Schedule 4.

               (c) shall pay Three Million Dollars ($3,000,000) to Seller
     at such time as the entire amount of the rate increase, consisting of
     the sum of: (i) the rate increase of Five Hundred Seventy Thousand
     Dollars ($570,000) described in the Regulatory Relief Section of
     Seller's Information Memorandum (dated June 2000), Page 5, Part F, and
     (ii) One Hundred Thousand Dollars ($100,000) (the agreed amount
     representing any annual insurance premium and/or accrual of funds
     associated with the remediation described in Section 8.8 of this
     Agreement), receives all necessary government approvals subject to
     reasonable and customary restrictions and limitations.  If a rate
     increase of a lesser amount receives all necessary government
     approvals subject to reasonable and customary restrictions and
     limitations, then a linearly pro rated portion of the aforementioned
     $3 million payment shall be paid to Seller, provided, however, that if
     the amount of the approved rate increase does not yield additional
     annual revenue equal to at least $385,000 - the sum of (x) $285,000 and
     (y) $100,000 (the agreed amount of any annual insurance premium and/or
     accrual of funds associated with the remediation described in Section
     8.8) - then no portion of the $3 million will be paid to Seller.  As an
     illustration of the above proration, if the total rate increase
     approved is $500,000, the portion of the $3 million payable to Seller
     shall be calculated as follows: ($500,000 - ($285,000 + $100,000)) /
     $285,000 x $3,000,000 = $1,210,526.32.

               Buyer shall pursue approval of such rate increase with
     diligence and shall commence formal proceedings to obtain such
     increase by the later of: (i) eighteen (18) months after the Closing;
     or (ii) such date as the New York Public Service Commission and the
     Pennsylvania Public Utility Commission permit the Buyer to commence
     such proceedings. In the event Buyer breaches its obligation to
     diligently pursue such rate increase in accordance with the terms of
     this subparagraph, Buyer shall pay to Seller $3 million.  Buyer's
     obligation to pursue the rate increase shall survive the Closing.
     Notwithstanding the foregoing, if Buyer applies for a rate increase
     and such increase is not approved, or only partially approved, as a
     result of such proceedings, Buyer shall have no obligation to reapply
     for a rate increase and Buyer's obligation to make payment to Seller
     pursuant to Section 2.1(c) shall be fixed on the basis of such initial
     application and decision.

          2.2 Allocation of Purchase Price.

               The parties agree to make an allocation of the Purchase
     Price (defined as the sum of the amounts specified in paragraphs (a)
     and (c) of Section 2.1  above) at the Closing  and to use such
     allocation in reporting the transaction contemplated by this Agreement
     for Federal and state tax purposes.

     ARTICLE 3.  THE CLOSING.

          The closing of the purchase and sale of the Assets by Seller to
     Buyer (the "Closing") shall take place at the offices of Seller at
     10:00 a.m. local time, no later than five (5) business days after all
     conditions to the Closing contained in this Agreement have been
     satisfied or waived in writing, or at such other place and/or time as
     the parties may agree in writing (the "Closing Date").

          3.1 Seller's Obligations at the Closing

               At the Closing, the Seller shall deliver or cause to be
     delivered to Buyer:

          (a) For all the owned Real Property and interests in the Owned
     Real Property, warranty deeds with covenants against grantor's acts in
     recordable form, properly executed and acknowledged, conveying title
     to the same;

          (b) Assignments of all Real Property Leases and Easements
     properly executed by Seller, and accompanied by all consents of
     lessors required by this Agreement and the leases being assigned;

          (c) Assignment and assumption agreements for personal property
     leases, licenses and permits and all Contracts of Seller to be assumed
     by Buyer in connection herewith, in a form legally sufficient to
     accomplish the assignment of the same and assumptions of the
     liabilities thereunder, and accompanied by all third party consents
     required by this Agreement and the personal property leases and
     Contracts being assigned to Buyer; and

          (d) Other instruments of assignment and transfer (including bills
     of sale) of all of the other Assets of Seller to be transferred
     hereunder reasonably requested by Buyer to effect, evidence or
     facilitate the transactions contemplated by this Agreement, in form
     legally sufficient to properly assign or convey such title.

     Simultaneously with the consummation of the transfer of the Assets,
     Seller, through its officers, agents, and employees, shall put Buyer
     into full possession and enjoyment of all the Assets to be sold,
     conveyed, transferred, assigned and delivered under this Agreement.

          3.2  Buyer's Obligations at the Closing.

               At the Closing, Buyer shall deliver to Seller against
     delivery of the items specified in Section 3.1: (i) a certified or
     bank cashier's check, or a wire transfer of immediately available
     funds, in the amount of the balance of the Purchase Price, payable to
     Seller in accordance with Sections 2.1(a) and 2.1(b) of this
     Agreement; and (ii) appropriate instruments of assumption of the
     Assumed Obligations as defined herein in form legally sufficient to
     accomplish such assumption.

     ARTICLE 4.  ASSUMPTION OF LIABILITIES

          Buyer is assuming certain debts, liabilities or obligations of
     Seller relating to the VCW Business, including all Accounts Payable
     that have become due and payable in the ordinary course of business no
     more than forty-five (45) days prior to the Closing Date and such
     other obligations as herein specifically provided.  Buyer shall have
     the benefit of and shall perform and assume all Real Property Leases,
     Contracts (subject to Seller's retained rights thereunder), Easements,
     and other agreements and obligations relating to the VCW Business, if
     any, specifically listed on Schedule 4, in accordance with the terms
     and conditions thereof (the "Assumed Obligations").  Buyer
     specifically assumes no debts, liabilities or obligations of Seller
     other than those listed in Schedule 4.

     ARTICLE 5. REPRESENTATIONS AND  WARRANTIES OF SELLER.

          Seller does hereby represent and warrant to Buyer as follows:

          5.1 Organization.

               Seller is a corporation duly organized, validly existing and
     in good standing under the laws of the State of New Jersey and has
     full corporate power and authority to carry on its business, and in
     particular the VCW Business, and to own, lease or operate its
     properties, and in particular, the Assets utilized in the VCW
     Business.

          5.2 Authority.

               Seller has taken all necessary corporate and other action to
     authorize the execution, delivery and performance of this Agreement
     and the consummation of the transactions contemplated hereby.  The
     Agreement has been duly and validly authorized, executed and delivered
     by Seller and constitutes the valid and binding obligation of Seller
     enforceable against Seller in accordance with its terms.

          5.3 No Violation or Conflict.

               Assuming that all of the consents described in Schedule 5.4
     and Schedule 6.4 are obtained, neither the execution and delivery nor
     performance of this Agreement by Seller will, with or without the
     giving of notice or the passage of time, or both, conflict with,
     result in a default, right to accelerate or loss of rights under, or
     result in the creation of any lien, charge or encumbrance pursuant to,
     any provision of Seller's Certificate of Incorporation or Bylaws or,
     to Seller's knowledge, any material franchise, mortgage, deed of
     trust, lease, license, agreement, understanding, law, ordinance, rule
     or regulation or any order, judgment, award or decree to which Seller
     is a party or by which it is bound.

          5.4 Consents.

               Except as set forth on Schedule 5.4, no approval, consent,
     withholding of objection or other authorization is required from any
     court, administrative agency, regulatory agency, governmental
     authority or any other third party in connection with the execution
     and delivery of this Agreement by Seller or for the consummation by
     Seller of the transactions contemplated by this Agreement.

          5.5 Claims and Litigation.

               To Seller's knowledge, except as set forth on Schedule 5.5,
     there is no material claim, legal action, suit, arbitration,
     governmental investigation or other legal, regulatory or
     administrative proceeding, or any order, judgment, decree or award in
     progress, pending, threatened or in effect against or relating to the
     Assets or the VCW Business.

          5.6 Compliance with Laws and Other Requirements.

               To Seller's knowledge, Seller has not received any notice of
     material noncompliance with any laws, statutes, regulations,
     ordinances and orders, judgments, decrees and awards applicable to the
     Assets or the VCW Business, which notice remains unresolved and which
     noncompliance would have a material adverse effect on the Assets or
     the VCW Business.

          5.7 Real Property.

               Schedules 1.1 and 1.2 to this Agreement contain complete
     listings of each parcel of real property owned by or leased to Seller
     and used in the VCW Business. Schedules 1.1 and 1.2 contain a
     description of all buildings, fixtures and other improvements located
     on the Real Property and a list of the policies of title insurance
     issued, if any, to Seller for these properties. True, correct and
     complete copies of the Real Property Leases and Easements are
     available for inspection by the Buyer.  All the Real Property Leases,
     and to Seller's knowledge, all Easements, are valid and in full force,
     and there does not exist any default or event that with notice or
     lapse of time, or both, would constitute a default under any of such
     Leases or Easements.  The zoning of each parcel of real property
     described in Schedules 1.1 and 1.2 permits the presently existing
     improvements and the continuation of the VCW Business presently being
     conducted thereon.

          5.8 Tangible Personal Property

               The Equipment described in Section 1.3 and Schedule 1.3 of
     this Agreement constitutes all the items of tangible personal property
     owned by, in the possession of, or exclusively used by Seller in
     connection with the VCW Business.  The Equipment listed in Schedule
     1.3 constitutes all tangible personal property necessary for the
     conduct by Seller of the VCW Business as now conducted by Seller.
     Except as stated in Schedule 1.3, no Equipment used by Seller in
     connection with the VCW Business is held under any lease, security
     agreement, conditional sales contract, or other title retention or
     security arrangement.

          5.9 Financial Statements of the VCW Business.

               Schedule 5.9(a) to this Agreement sets forth the balance
     sheet of the VCW Business as of September 30, 1999, (the "Last Fiscal
     Year End"), and the related statement of income for the year then
     ending which balance sheet and related statement of income are
     included in the consolidated financial statements of the Seller which
     are audited annually by Arthur Andersen LLP, Seller's independent
     certified public accountants.  Schedule 5.9(b) to this Agreement sets
     forth the balance sheet of the VCW Business as of June 30, 2000, (the
     "Stub Period Date"), together with the related statement of income for
     the three month period then ending, certified by the Chief Financial
     Officer of Seller.  The financial statements in Schedules 5.9(a) and
     5.9(b) are hereinafter referred to as the "Financial Statements".  The
     Financial Statements have been prepared in accordance with generally
     accepted accounting principles ("GAAP") consistently followed by
     Seller throughout the periods indicated, are complete and correct in
     all material respects and accurately and fairly present the financial
     position of the VCW Business as of the respective dates of the balance
     sheets included in the Financial Statements, and the results of
     operations of the VCW Business for the respective periods indicated.

          5.10 Absence of Specified Changes.

          Since the Last Fiscal Year End, there has not been any:

               (a) Adverse change in the financial condition, liabilities,
     Assets, business, operating results or prospects of the VCW Business;

               (b) Destruction, damage to, or loss of any Assets of the VCW
     Business (whether or not covered by insurance) that adversely affects
     the Assets, financial condition, business, operating results or
     prospects of the VCW Business;

               (c) Labor trouble or other event or condition of any
     character adversely affecting the financial condition, business,
     Assets or prospects of the VCW Business; or

               (d) Other event or condition of any character that has or
     might reasonably have an adverse effect on the financial condition,
     business, Assets, operating results or prospects of the VCW Business.

          5.11 Accounts Receivable.

               The Accounts Receivable reflected on the balance sheet dated
     the Stub Period Date included in the Financial Statements, and the
     Accounts Receivable created after the date thereof, are valid and
     genuine and arose from bonafide transactions involving the
     distribution of natural gas to the VCW Business customers and the
     performance of other services or other transactions in the ordinary
     course of the VCW Business.

          5.12 Intangible Assets.

               Schedule 5.12 to this Agreement is a complete schedule of
     all trade names (other than names including the "NUI" name),
     trademarks, service marks, copyrights, patents, intellectual property,
     software licenses and other intangibles owned by or licensed to Seller
     and used exclusively in the VCW Business.  Seller owns or has the
     right to use all trade names, trademarks, service marks, copyrights,
     patents, intellectual property, software licenses and other
     intangibles necessary to carry on the VCW Business substantially as
     currently conducted, except the failure of which to own or have the
     right to use individually or in the aggregate would not reasonably be
     expected to have a material adverse effect on the Assets or on the VCW
     Business.

          5.13 Title to Assets.

               Seller has good and marketable title to all the Assets and
     its interests in the Assets, whether real, personal, tangible and
     intangible, which constitute all the Assets and interests in Assets
     that are exclusively used in Seller's operation of the VCW Business.
     All the Assets are free and clear of mortgages, liens, pledges,
     charges, encumbrances, equities, claims, easements, rights of way,
     covenants, conditions or restrictions, except for (i) those disclosed
     in Seller's balance sheet as of the Stub Period Date, included in the
     Financial Statements, or disclosed  in Schedule 5.13 and the other
     Schedules to this Agreement; (ii) the lien of current taxes not yet
     due and payable; and (iii) possible minor matters that, in the
     aggregate, are not substantial in amount and do not materially detract
     from or interfere with the present or intended use of any of the
     Assets, nor materially impair the business operations of the VCW
     Business.

          5.14 Employee Agreements and Benefit Plans.

          (a) Schedule 5.14(a) contains a complete list of all employment
     contracts with respect to the employees of the VCW Business to which
     Seller is a party or by which Seller is bound (all the foregoing being
     herein called "Employee Agreements").  At the present time there are
     no Employee Agreements in effect, and to Seller's knowledge neither
     Seller nor any other party is in default under any Employee Agreement
     previously in effect.  There have been no claims of default and, to
     the knowledge of the Seller, there are no facts or conditions which,
     if continued, or with the passage of time or compliance with any
     applicable notice requirements or both, will result in a default under
     the Employee Agreements.

          At the present time Seller is not a party to any collective
     bargaining agreement other than its collective bargaining agreement
     with the International Brotherhood of Teamsters, Chauffeurs,
     Warehousemen and Helpers (the "Union"), which agreement has expired.
     Seller is currently compensating bargaining unit employees of the VCW
     Business in accordance with the terms of the expired agreement.  There
     is no pending or, to the knowledge of the Seller, threatened labor
     dispute, strike or work stoppage by the VCW Employees or any
     representative of the VCW employees.  Seller made its last and best
     offer to Union in August, 2000 and Seller believes it is likely that a
     new collective bargaining agreement will be reached.  A copy of the
     Seller's last and best offer has been provided to Buyer.

          (b) Schedule 5.14(b) contains a complete list of all pension
     plans, practices, policies or arrangements, profit sharing plans,
     bonus, deferred compensation, supplemental executive retirement plans,
     excess benefit plans, stock options, stock appreciation or other forms
     of incentive or other compensation plans or arrangements (including,
     "employee pension benefit plans" as defined in Section 3(2) of the
     Employee Retirement Income Security Act of 1974, as amended,
     ("ERISA")), and all welfare, severance, vacation, and other employee
     fringe benefit plans (including "employee welfare benefit plans" as
     defined in Section 3(1) of ERISA) maintained, or contributed to, by
     Seller for the benefit of the employees of the VCW Business or  former
     employees of the VCW Business (all the foregoing being herein called
     "Benefit Plans").

          (c) With respect to the NUI Corporation Savings and Investment
     Plan (the "Seller's Savings Plan") and the Pennsylvania & Southern Gas
     Company Employees Pension Plan (the "Seller's Pension Plan"), Seller
     has made available to Buyer copies of each of the following: (i) plan
     document; (ii) summary plan description; (iii) trust agreement; (iv)
     most recent annual report on IRS Form 5500 and (v) most recent
     Internal Revenue Service determination letter.  To the knowledge of
     the Seller, the Seller's Savings Plan and the Seller's Pension Plan
     are "qualified" within the meaning of Section 401(a) of the Code.

          (d) Except as disclosed on Schedule 5.14(d), the Seller's Savings
     Plan and Seller's Pension Plan have been maintained in substantial
     compliance with their  terms and within the requirements prescribed by
     any and all statutes, orders, rules and regulations, including but not
     limited to ERISA and the Internal Revenue Code of 1986, as amended
     (the "Code").  No "prohibited transaction" (as defined in Section 4975
     of the Code or Section 406 of ERISA) has occurred which could subject
     the Buyer to the tax or penalty on prohibited transactions imposed by
     Section 4975 of the Code or the sanctions imposed under Title I of
     ERISA.

          5.15 Personnel Identification and Compensation

               Schedule 5.15 contains a list of the names of all permanent,
     full time employees of the VCW Business stating the rates of
     compensation payable to each of them.  All of the persons named in
     Schedule 5.15 have been employees of the VCW Business for at least One
     Hundred Twenty (120) days prior to the date of this Agreement and no
     other individuals have been employed by the VCW Business on a
     permanent basis during this period.

          5.16 Contracts.

               Prior to the date hereof, Seller has provided Buyer with
     access to true and correct copies of all of the Contracts set forth in
     Schedule 1.4.  Seller has performed and, to the knowledge of Seller,
     every other party has performed, each material term, covenant and
     condition of each of the Contracts that is to be performed by any of
     them at or before the date hereof.  No event has occurred that would,
     with the passage of time or compliance with any applicable notice
     requirements or both, constitute a default by Seller or, to the
     knowledge of Seller, any other party under any of the Contracts and,
     to the knowledge of Seller, no party to any of the Contracts intends
     to cancel, terminate or exercise any option under any of such
     Contracts.

          5.17 Environmental Conditions.

          (a) When used in this Section 5.17 and elsewhere in this
     Agreement:

               (i) "Environmental Laws" shall mean any and all
     federal, state, local or municipal laws, rules, orders,
     regulations, statutes, ordinances, codes, decrees or requirements
     of any Governmental Authority regulating, relating to or imposing
     liability or standards of conduct concerning any Hazardous
     Materials or environmental protection as now or at any time
     hereafter in effect, together with any amendment or re-
     authorization thereto or thereof,

               (ii) "Governmental Authority" shall mean any federal,
     state, municipal or other governmental department, commission,
     board, bureau, agency or instrumentality, or any court.

               (iii) "Hazardous Materials" shall mean any hazardous
     material, hazardous waste, infectious medical waste, Petroleum
     and Natural Gas Products, hazardous or toxic substance defined or
     regulated as such in or under any Environmental Law, including,
     without limitation, materials exhibiting the characteristics of
     ignitability, corrosivity, reactivity or extraction procedure
     toxicity, as such terms are now or hereafter defined in
     connection with hazardous materials or hazardous wastes or
     hazardous or toxic substances in any Environmental Law; and

               (iv) "Petroleum and Natural Gas Products" shall mean
     crude oil, petroleum or fractions thereof, gasoline, diesel fuel,
     motor oil, waste or used oil, heating oil, kerosene and any other
     petroleum products and natural gas, natural gas liquids,
     liquefied natural gas or synthetic gas useable for fuel.

          (b) Except for past operations conducted at the Athens,
     Pennsylvania manufactured gas plant (the "Athens MGP") and as
     otherwise disclosed in Schedule 5.17(b) attached hereto, and except
     for such violations that in the aggregate would not have a material
     adverse effect on the Assets or the VCW Business, (i) to Seller's
     knowledge, Seller has not used, stored, treated, transported,
     manufactured, refined, handled, produced, disposed of, managed,
     spilled or released any Hazardous Materials on, under, at from or in
     any way affecting any Real Estate or other Assets or otherwise, in any
     manner which at the time of the action in question violated, or at the
     time of this Agreement violate, any Environmental Law governing the
     use, storage, treatment, transportation, manufacture, refinement,
     handling, production, disposal, management, spill or release of
     Hazardous Materials; and (ii) to Seller's knowledge, no prior owner of
     such Real Property or Assets or any tenant, subtenant, prior tenant or
     prior subtenant thereof has used Hazardous Materials on, from or in
     any way affecting any such Real Property or Asset, or otherwise, in
     any manner which at the time of the action in question violated, or at
     the time of this Agreement violate,  any Environmental Law governing
     the use, storage, treatment, transportation, manufacture, refinement,
     handling, production, disposal, management, spill or release of
     Hazardous Materials.

          (c) Except as set forth in Schedule 5.17(c), and except for such
     permits or noncompliance that in the aggregate would not have a
     material adverse effect on the Assets or the VCW Business, to Seller's
     knowledge (i)  Seller has received all permits as may be required
     under applicable Environmental Laws to conduct the VCW businesses,
     (ii) Seller is in compliance in all material respects with the terms
     and conditions of any such permits, and (iii)  Seller has not received
     any notices or claims, nor is there a factual basis for such a claim,
     that it is a responsible party in connection with any claim or notice
     asserted pursuant to 42 U.S.C. Section 9601 et seq., or any state
     superfund law with respect to any Real Property or the Assets.

          5.18 Fees and Expenses of Brokers and Others

          Seller has not had any dealings, negotiations or communications
     with any broker or other intermediary in connection with the
     transactions contemplated by this Agreement, is not committed to any
     liability for any brokers' or finders' fees or any similar fees in
     connection with the transactions contemplated by this Agreement, and
     has not retained any broker or other intermediary to act on its behalf
     in connection with the transactions contemplated by this Agreement,
     except that Seller has engaged Berenson, Minella & Company to
     represent it in connection with such transactions, and Seller shall
     pay all of Berenson Minella's fees and expenses in connection with
     such engagement.

          5.19 Taxes.

          To Seller's knowledge, Seller has not received any notice of
     material noncompliance with any federal, state or municipal tax law
     and Seller is current in its payment of all taxes including without
     limitation all income, gross receipts, property, sales, excise and
     franchise taxes, assessments or duties and no such tax is a lien or
     encumbrance upon any Asset which is a subject of this Agreement,
     except for the lien of current taxes not yet due and payable.

          5.20 Gas Operations.

          To Seller's knowledge:

          (a) there have been no changes in the VCW gas transmission and
     distribution system between January 1, 2000 and the date of this
     Agreement other than changes made in the ordinary course of the VCW
     Business;

          (b) VCW's propane air peaking plants are capable of normal and
     safe operations; and

          (c) None of VCW's largest customers listed in Exhibit 8 of the
     June 2000 Information Memorandum have "bypassed" in the period between
     January 1, 2000 and the date of this Agreement, and Seller has no
     knowledge of any such customer who plans to "bypass."

          5.21 Definition of Seller's Knowledge.

          As set forth in this Agreement, certain representations and
     warranties of Seller are being made to "Seller's knowledge" or
     terminology similar to such phrase.  In determining Seller's knowledge
     and whether Seller has knowledge, Seller shall be deemed to have
     knowledge only of information actually known or which ought to be
     reasonably known by Seller's management team who are listed on
     Schedule 5.19.  Each such member, in turn, shall be deemed to have
     knowledge of information of which that person has actual knowledge or
     which that person ought to reasonably know as of the Closing Date and
     information which that person personally possesses or reasonably ought
     to possess (including information in that person's respective files),
     but that person shall not be deemed to have knowledge of any
     information otherwise in the files of Seller or possessed by any other
     employee, officer or agent of Seller.  The knowledge of each of such
     named persons shall not be imputed to any of the other named persons.

     Article 6.  REPRESENTATIONS AND WARRANTIES OF BUYER.

          Buyer does hereby represent and warrant to Seller as follows:

          6.1 Organization.

               Buyer is a corporation duly organized, validly existing and
     in good standing under the laws of the State of Pennsylvania and has
     full corporate power and authority to carry on its business as now
     being conducted and to own, lease and operate its properties, as and
     in the places where such business is now conducted and such properties
     are now owned, leased or operated.

          6.2 Authorization.

          Buyer has taken all necessary corporate and other action to
     authorize the execution, delivery and performance of this Agreement
     and the consummation of the transactions contemplated hereby.  The
     Agreement has been duly and validly authorized, executed and delivered
     by Buyer and constitutes the valid and binding obligation of Buyer
     enforceable against Buyer in accordance with its terms.

          6.3 No Violation or Conflict.

          Assuming that all of the consents described in Schedules 5.4 and
     Schedule 6.4 are obtained, neither the execution and delivery nor
     performance of this Agreement by Buyer will, with or without the
     giving of notice or the passage of time, or both, conflict with,
     result in a default, right to accelerate or loss of rights under, or
     result in the creation of any lien, charge or encumbrance pursuant to,
     any provision of Buyer's Certificate of Incorporation or Bylaws or, to
     Buyer's knowledge, any material franchise, mortgage, deed of trust,
     lease, license, agreement, understanding, law, ordinance, rule or
     regulation or any order, judgment, award or decree to which Buyer is a
     party or by which it is bound.

          6.4 Consents.

          Except as set forth in Schedule 6.4, no approval, consent,
     withholding of objection or other authorization is required from any
     court, administrative agency, regulatory agency, governmental
     authority or any other third party in connection with the execution
     and delivery of this Agreement by Buyer or for the consummation by
     Buyer of the transactions contemplated by this Agreement.

          6.5 Financial Ability to Perform.

          Buyer has the financial ability and has access to funding sources
     to obtain the funds  necessary to consummate the transactions
     contemplated to occur at the Closing.  As of the date of this
     Agreement, Buyer knows of no reason that the funding sources Buyer has
     access to will not be able to provide Buyer such funding.

          6.6 Fees and Expenses of Brokers and Others.

          Buyer has not had any dealings, negotiations or communications
     with any broker or other intermediary in connection with the
     transactions contemplated by this Agreement, is not committed to any
     liability for any brokers' or finders' fees or any similar fees in
     connection with the transactions contemplated by this Agreement, and
     has not retained any broker or other intermediary to act on its behalf
     in connection with the transactions contemplated by this Agreement,
     except that Buyer has engaged Management Consulting Services, Inc.
     ("MCS") to assist it in connection with such transactions, and Buyer
     shall pay all of the fees and expenses of MCS in connection with such
     engagement.

          6.7 Acknowledgment by Buyer.

          Buyer has conducted, to its satisfaction, an independent
     investigation of the financial condition, Assets, liabilities to be
     assumed by Buyer and projected operations of the VCW Business in
     making its determination to proceed with the transactions contemplated
     by this Agreement, and Buyer has relied on the results of its own
     independent investigation, as well as the representations and
     warranties of Seller expressly and specifically set forth herein.

          6.8 Definition of Buyer's Knowledge.

          As set forth in this Agreement, certain representations and
     warranties of Buyer are being made to "Buyer's knowledge" or
     terminology similar to such phrases.  In determining Buyer's knowledge
     and whether Buyer has knowledge, Buyer shall be deemed to have
     knowledge only of information actually known or which ought to be
     reasonably known by Buyer's management team who are listed on Schedule
     6.8.  Each such member, in turn, shall be deemed to have knowledge of
     information of which that person has actual knowledge or which that
     person ought to reasonably know as of the Closing Date and information
     which that person personally possesses or reasonably ought to possess
     (including information in that person's respective files), but that
     person shall not be deemed to have knowledge of any information
     otherwise in the files of Buyer or possessed by any other employee,
     officer or agent of Buyer.  The knowledge of each such named persons
     shall not be imputed to any of the other named persons.

     ARTICLE 7.  SELLER'S

          Seller covenants and agrees that, except as otherwise agreed in
     writing by Buyer, from the date of this Agreement until the Closing
     Date:

          7.1 Conduct of Business in the Ordinary Course.

          Seller shall continue to conduct the VCW Business in the ordinary
     course and consistent with past practice.  Seller will use all
     commercially reasonable efforts to preserve the VCW Business, maintain
     all real and personal property, keep available the services of the
     present employees of the VCW Business and maintain the goodwill of the
     customers, suppliers and others having a business relationship with
     the VCW Business.  Notwithstanding the foregoing, Seller shall not
     extend the term of any expiring interstate pipeline transportation
     and/or storage contracts without the consent of Buyer, nor will Seller
     enter into a gas "customer choice" program that has a material adverse
     effect on VCW's distribution margin, or volume delivered to customers
     on a weather normalized basis, except as otherwise required by the
     Pennsylvania Public Utility Commission and/or the Public Service
     Commission of the State of New York or any other entity having
     jurisdiction over such matters.

          7.2 Maintenance of Insurance.

          Seller shall continue to carry its existing insurance covering
     the Assets and the VCW Business subject to variations in amounts
     required by the ordinary operations of the VCW
     Business.

          7.3 Employees and Compensation.

          Seller shall not do, or agree to do, any of the following:

          (a) grant any increase in salaries payable or to become payable
     to any employee of the VCW Business other than such increases which
     are made in the ordinary course of business to employees and other
     than such increase which may be required under a collective bargaining
     agreement or other understanding with the representative of the
     employees who are members of a bargaining unit;

          (b) increase benefits payable to any employee of the VCW Business
     under any bonus or pension plan or other contract or commitment other
     than with respect to changes to any such plans, contracts or
     commitments made by Seller which affect its employees generally.
     Seller shall permit Buyer to contact Seller's employees at all
     reasonable times for the purpose of discussing with such employees
     prospective employment by Buyer on or after the Closing Date, and
     Seller shall take reasonable steps to assist Buyer's efforts to
     encourage employees of Seller to accept any employment offered by
     Buyer;

          (c) hire any new employee for, or transfer any existing employee
     to, the VCW Business, or terminate (other than for cause) or transfer
     any existing employee of the VCW Business without the consent of
     Buyer.

          7.4 Access by Buyer.

          Seller shall give to Buyer and its authorized representatives
     access, during normal business hours and upon reasonable advance
     notice, in such a manner as not to disrupt the normal business
     activities of Seller's business, to the Assets and books of account
     and records of the VCW Business reasonably relevant to an evaluation
     of the Assets and the VCW Business.  Seller will also cause its
     officers to furnish to Buyer any and all material financial, technical
     and operating data, and other information pertaining to the VCW
     Business operations of Seller and the Assets, as Buyer shall from time
     to time reasonably request for such purpose.

          7.5 Covenant Not to Compete.

          Seller covenants and agrees that, for a period of five (5) years
     after the Closing Date (the "Restrictive Period") Seller shall not, in
     any capacity, directly or indirectly, distribute natural gas to any
     customers in the areas of Pennsylvania or New York (as applicable)
     served by the VCW Business.  In addition, except as otherwise set
     forth in this Section 7.5, Seller covenants and agrees that during the
     Restrictive Period Seller shall not, in any capacity, directly or
     indirectly, sell natural gas to (i) any residential customer, or (ii)
     any other customer that would not be eligible for transportation
     service under tariffs in effect for the VCW Business as of the Closing
     Date.  During the Restrictive Period, Seller shall not solicit non-
     transportation customers of the VCW Business to become transportation
     customers and it shall not solicit any customers of the VCW Business
     to "bypass." The foregoing notwithstanding, Seller shall be permitted
     to make bulk sales of natural gas to retail customers who were
     transportation customers of the VCW Business on or before the Closing
     Date.  In the event that Buyer establishes a retail "choice" program
     in Pennsylvania and/or New York, permitting retail customers to
     purchase supply from a third-party, Buyer agrees to permit Seller to
     participate in any such "choice" program as a third-party marketer.

          If any court determines that this covenant not to compete, or any
     part thereof, is unenforceable because of the duration or geographic
     scope of such provision, such court shall have the power to reduce the
     duration or scope of such provision, as the case may be, and, in its
     reduced form, such provision shall then be enforceable.  For purposes
     of this section, the term Seller shall include any parent, subsidiary
     or affiliated corporation of Seller or any entity, organization, or
     enterprise which Seller, directly or indirectly controls or in which
     Seller directly or indirectly possesses an ownership interest equal to
     or greater than fifty percent (50%)

     ARTICLE 8.  ADDITIONAL AGREEMENTS.

          8.1 Regulatory Matters.

          (a) The parties shall cooperate with each other and use all
     commercially reasonable efforts promptly to prepare and file all
     necessary documentation, to effect all applications, notices,
     petitions and filings, and to obtain as promptly as practicable all
     permits, consents, approvals and authorizations of all governmental
     entities and third parties which are necessary to consummate the
     transactions contemplated by this Agreement as set forth in Schedule
     5.4 and Schedule 6.4.  The Seller and Buyer 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 the
     Seller, the VCW Business or the Buyer, as the case may be, which
     appear in any application, notice, petition and filing made with or
     written materials submitted to, any governmental entity or third party
     in connection with the transactions contemplated by this Agreement.
     In exercising the foregoing right, each of the parties hereto shall
     act reasonably and as promptly as practicable.  The parties agree that
     they will consult with each other with respect to the obtaining of all
     permits, consents, approvals and authorizations of all governmental
     entities and third parties necessary or advisable to consummate the
     transactions contemplated by this Agreement as set forth in Schedule
     5.4 and Schedule 6.4, and each party will keep the other apprised of
     the status of matters relating to completion of the transactions
     contemplated herein.

          (b) Seller and Buyer shall promptly furnish each other with
     copies of written communications received by Seller and Buyer, as the
     case may be, from, or delivered by any of the foregoing to, any
     governmental entity in respect of the transactions contemplated
     hereby.

          8.2 Legal Conditions to the Transaction.

          Each of Seller and Buyer shall use all reasonable efforts 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 party with respect to the consummation of the transactions
     contemplated by this Agreement and to obtain (and to cooperate with
     the other party to obtain) any consent, authorization, order or
     approval of or any exemption by, any governmental entity and any other
     third party which is required to be obtained by Seller or Buyer in
     connection with the transactions contemplated by this Agreement.

          8.3 Additional Agreements.

          If at any time after the Closing Date any further action is
     necessary or desirable to carry out the purpose of this Agreement or
     to vest Buyer with full title to the Assets and the VCW Business, the
     proper officers of each party to this Agreement shall take all such
     necessary actions as may be reasonably requested by the Buyer (without
     additional cost to it).

          8.4 Disclosure Supplements.

          Prior to the Closing Date, each party will supplement or amend
     the Schedules hereto delivered 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.  No supplement or amendment to such Schedules
     shall have any effect for the purposes of determining satisfaction of
     the conditions set forth in Sections 9.2(a), 9.2(b), 9.3(a) and 9.3(b)
     hereof.

          8.5 No Inconsistent Actions.

          Prior to the Closing Date, except as otherwise permitted by this
     Agreement, no party will enter into any transaction or make any
     agreement or commitment and will use reasonable efforts not to permit
     any event to occur, which could reasonably be anticipated to result in
      a denial of the regulatory or governmental approvals referred to in
     Schedules 5.4 and 6.4, the imposition of any condition or requirement
     that would materially adversely affect the economic or business
     benefits to the Buyer of the transactions contemplated by this
     Agreement.

          8.6 Confidentiality.

          The parties agree to continue to comply with the terms of the
     Confidentiality Agreement dated May 31, 2000 between Seller and Buyer
     the terms of which are incorporated herein by reference.

          8.7 Employment Matters.

          (a)  Buyer will offer to each employee of the VCW Business (the
     "VCW Employees") employment in a position of comparable seniority and
     at least the same pay as that received by each such VCW Employee
     immediately prior to the Closing Date.  Each VCW Employee who is
     tendered and accepts Buyer's offer of employment will be referred to
     as a "Transferred Employee."  Buyer agrees not to terminate any
     Transferred Employee during the three (3) month period following the
     Closing Date except for cause.  Buyer will provide the Transferred
     Employees with the same benefits it provides to its other employees in
     similar positions, subject to any changes that Buyer may negotiate
     with any union, which may be the collective bargaining representative
     of any of the Transferred Employees.  Furthermore, for a one year
     period commencing on the Closing Date, Buyer will agree to pay
     severance to any Transferred Employee terminated by Buyer (other than
     a Transferred Employee terminated for cause) during such one year
     period in an amount equal to two weeks' pay for each year of service
     to Seller and Buyer up to a maximum of the Transferred Employee's
     annual salary, but in no event less than three month's pay or such
     amount required to be paid under a collective bargaining agreement, if
     applicable.  Any severance payment provided for herein shall be
     payable in a lump sum and shall be based on the salary payable to the
     Transferred Employee at the time of the termination of employment.
     Seller shall reimburse Buyer for all severance costs for the first
     five (5) Transferred Employees that are terminated without cause
     between the Closing Date and one year after the Closing Date.  Seller
     agrees to indemnify, defend and hold harmless Buyer with respect to
     any and all compensation, severance and/or employee benefits claims by
     any current or former employee (or any spouse, former spouse,
     dependent or former dependents of any such current or former employee)
     of Seller accruing prior to the Closing Date.

          (b) Subject to Seller's obligations to comply with applicable
     labor laws, rules and regulations, Seller agrees that it will not
     make, or agree to, any material changes to its last and best offer in
     connection with the collective bargaining agreement submitted to the
     Union in August, 2000 without consulting Buyer.  In the event that
     after the Closing Date, Buyer terminates the employment of any
     Transferred Employee who is represented by a collective bargaining
     representative, Buyer shall pay severance benefits in accordance with
     any collective bargaining agreement, if applicable, in lieu of the
     severance payments provided in subsection (a) above.

          (c)  Effective immediately after the Closing Date, all
     Transferred Employees shall be eligible to participate in Buyer's
     employee benefit plans, including, but not limited to, the defined
     benefit pension (the "Buyer's Pension Plan") and 401(k) savings plan
     (the "Buyer's Savings Plan") maintained by Buyer, in accordance with
     the terms of such plans unless and until different benefit plans are
     negotiated with an applicable collective bargaining representative.
     Buyer agrees to amend its employee benefit plans to provide that
     service completed by Transferred Employees while employed by the
     Seller or its predecessor or its affiliates shall be recognized under
     Buyer's employee benefit plans for purposes of determining eligibility
     for participation and vesting of benefits.

          (d) Effective immediately after the Closing Date, all Transferred
     Employees shall be eligible to participate in the Buyer's Savings
     Plan, unless and until different benefit plans are negotiated with any
     applicable collective bargaining representative.  Effective as of the
     Closing Date, Seller shall amend Seller's Savings Plan to provide that
     all Transferred Employees shall be fully vested in their account
     balances thereunder. Seller shall cause the trustees of the Seller's
     Savings Plan to transfer to the trustees of the Buyer's Savings Plan
     the aforementioned fully vested account balances of the Transferred
     Employees to the Buyer's Savings Plan as soon as practicable following
     the Closing Date but in no event more than 150 days following the
     Closing Date ("Transfer Date") and Buyer shall cause the trustees of
     the Buyer's Savings Plan to accept such transfer of the account
     balances.  In no event shall the amount transferred be less than the
     amount required to be transferred to satisfy Sections 401(a)(12) and
     414(1) of the Code.  The transfer of the Transferred Employees account
     balances shall be in cash, except that the account balances or
     portions thereof invested in notes representing participant loans
     shall be transferred in-kind to the Buyer's Savings Plan (except for
     mortgage loans, which shall not be transferred to the Buyer's Savings
     Plan).  Buyer agrees to provide Seller with evidence that the Buyer's
     Savings Plan is qualified under Section 401(a) of the Code and Seller
     agrees to provide Buyer with evidence that Seller's Savings Plan is
     qualified under Section 401(a) of the Code.

          (e) Effective as of the Closing Date, all Transferred Employees
     shall cease benefit accruals in the Seller's Pension Plan and Seller
     shall amend Seller's Pension Plan to provide that all Transferred
     Employees shall be fully vested in their accrued benefits as of the
     Closing Date.  Effective immediately after the Closing Date, all
     Transferred Employees shall be eligible to participate in the Buyer's
     Pension Plan, unless and until different benefit plans are negotiated
     with any applicable collective bargaining representative.  Seller
     shall cause the trustees of the Seller's Pension Plan to transfer to
     the trustees of the Buyer's Pension Plan the assets and liabilities
     attributable to the Transferred Employees (as described below) as soon
     as practicable following the Closing Date but in no event more than
     150 days following the Closing Date (the "Transfer Date") and Buyer
     shall cause the trustees of the Buyer's Pension Plan to accept such
     transfer of assets and liabilities.  The amount transferred to the
     Buyer's Pension Plan shall equal the Accumulated Benefit Obligation as
     defined below for the Transferred Employees as of the Closing Date,
     increased by 7 3/4% interest from the Closing Date to the date of
     transfer, and decreased by the amount of any benefit payments to the
     Transferred Employees after the Closing Date but prior to the date of
     transfer.  The Accumulated Benefit Obligation for the Transferred
     Employees shall be determined by using the accumulated benefits
     obligation methodology of Statement of Financial Accounting Standards
     No. 87, on the basis of (i) each participant's age, years of vesting
     service and years of benefit accrual service on the Closing Date, and
     (ii) the actuarial assumptions and methods used for determining the
     accumulated benefits obligation as of the January 1, 2000 actuarial
     report for the Seller's Pension Plan including the lump sum
     distribution assumption of 50%; provided, however, that the discount
     rate shall instead be a rate midway between the GATT annual interest
     rate for the month prior to the month during which the Closing Date
     occurs and 7 3/4%.  In no event shall the amount transferred be less
     than the amount required to be transferred to satisfy Sections
     401(a)(12) and 414(1) of the Code.  The calculation of the above
     described present value of accrued benefits shall be made by an
     actuary designated by the Seller and shall be reviewed and approved by
     an actuary designated by the Buyer (which approval shall not be
     unreasonably withheld).  The Seller shall cooperate fully in the
     gathering of any necessary data to be used by the respective actuaries
     and shall certify or cause the certification of the accuracy of such
     data to the actuaries.  The costs and expenses of any third party
     engaged to perform services with regard to this section shall be paid
     by the party engaging such third party.  Seller shall cause the plan
     administrator of the Seller's Pension Plan and Buyer shall cause the
     plan administrator of the Buyer's Pension Plan to make such timely
     filings as may be required by the Internal Revenue Service with
     respect to the transfer of assets and liabilities, including Forms
     5310-A.  Buyer agrees to provide Seller with evidence that Buyer's
     Pension Plan is qualified under Section 401(a) of the Code and Seller
     agrees to provide evidence to Buyer that Seller's Pension Plan is
     similarly qualified under Section 401(a) of the Code.  Buyer's Pension
     Plan will provide that each Transferred Employee will be entitled to a
     benefit at least equal to his accrued benefit under the Seller's
     Pension Plan as of the Closing Date.

          (f) With respect to any medical, dental, prescription drug,
     vacation, death, accidental death and dismemberment, short-term
     disability and long-term disability benefit plans maintained by Buyer
     for its employees, immediately after the Closing Date, the Transferred
     Employees shall participate in such plans (i) without any waiting
     periods , exclusions due to pre-existing conditions and without any
     evidence of insurability; and (ii) Buyer shall take into account
     claims arising during the calendar year in which occurs the Closing
     Date for purposes of satisfying deductibles, out-of-pocket maximums
     and all other similar limitations.  Notwithstanding the foregoing,
     Seller will assume responsibility for any and all outstanding employee
     benefits claims, including, but not limited to, any and all heath
     insurance claims, relating to claims and/or expenses incurred on or
     prior to the Closing Date.

          (g) Buyer shall be responsible for any legally-mandated
     continuation of health care coverage for all Transferred Employees
     and/or their covered dependents who have a loss of health coverage due
     to a "qualifying event" (as defined in Section 4980B of the Code) that
     occurs on or after the Closing Date.

          (h) After the Closing Date, the Buyer will have sole
     responsibility for any obligations or liabilities to Transferred
     Employees under the Worker Adjustment and Retraining Notification Act
     or any similar applicable law of any jurisdiction relating to any
     plant closing or mass layoff or as otherwise required by any
     applicable law.

          8.8 Environmental Condition of the Athens MGP.

          Buyer shall, at its sole cost and expense, in accordance with all
     applicable Environmental Laws, assume responsibility for the
     environmental condition associated with the former operations of the
     Athens MGP, including, but not limited to, conducting such
     investigations and remediation activities with respect to any
     Hazardous Materials that may exist in, on, under or about the Athens
     MGP and any contiguous property used in connection with the former
     operations of the Athens MGP as may be required by any Governmental
     Authority.  Notwithstanding anything contained in this Agreement to
     the contrary, it is understood and agreed that Buyer shall assume all
     risk relating to the past, present and future environmental condition
     of the Athens MGP and any contiguous property used in connection with
     the former operations of the Athens MGP.

          Buyer intends to seek insurance and/or to accrue funds to address
     the potential liability stemming from its ownership of the Athens MGP
     and its assumption of responsibility for the environmental conditions
     described herein.  Buyer will seek a rate increase from the
     Pennsylvania Public Utility Commission and the New York Public Service
     Commission for the amount of the insurance premiums and/or the accrual
     of funds for the eventual remediation of the Athens MGP.

          8.9 Bulk Sales Law.

          No action is required by either party with respect to any bulk
     sales or bulk transfer laws.  In the event that any such law is deemed
     to apply to the sale of the Assets and the VCW Business by Seller, by
     execution of this Agreement Seller agrees that it shall be solely
     liable and Seller hereby waives any and all obligations and
     requirements imposed upon Buyer under such laws.

          8.10 Existing Arrangements between NUI and VCW.

          Buyer will have the right, as its sole option, to assume under
     existing terms and conditions, renegotiate, or immediately terminate
     any arrangements that existed between Seller and the VCW Business as
     of January 1, 2000 or at any time thereafter, up to and including the
     Closing Date; provided, however that Buyer shall not have the right to
     renegotiate or terminate any arrangement with Seller's New Jersey
     division relating to interstate pipeline capacity or deliverability
     and gas supply.  Buyer intends to continue the current contract
     between the VCW Business and Utility Business Services, Inc., a
     wholly-owned subsidiary of Seller ("UBS"), for billing services at
     least until August 31, 2001 or until the Closing Date whichever is
     later.  In the event that Buyer terminates such contract after such
     period, Seller agrees to cause UBS to waive any termination fee,
     penalty or any other termination payment which may be provided for
     under the terms of such contract.

          8.11 Post-Closing Servicing Agreements.

          The parties agree to use commercially reasonable efforts to
     negotiate certain post-Closing servicing agreements on mutually
     acceptable terms relating to the provision of on-going services by
     Seller to Buyer in connection with the operation of the VCW Business
     relating to gas supply procurement, billing, information systems and
     other administrative functions.  It is understood and agreed by the
     parties that the Closing of the transactions contemplated by this
     Agreement is not subject to or in any way conditioned upon the
     successful negotiation and execution of any such post-Closing
     servicing agreements.

          8.12 The NUCOR Expansion.

          The parties agree that Seller shall use commercially reasonable
     efforts to obtain the franchise, permits and approvals to secure grant
     monies from the State of New York and to expend the funds reasonably
     necessary to secure the same and for the construction required for the
     NUCOR expansion.  Seller has provided Buyer with cost estimates for
     the NUCOR expansion.  It being understood that such expansion will
     benefit the future of the VCW Business, Buyer agrees to reimburse
     Seller at Closing for Seller's reasonable NUCOR expansion expenses
     properly allocable to the VCW Business in excess of the grant monies
     awarded to Seller.

     ARTICLE 9.  CONDITIONS TO CLOSING

          9.1 Conditions to Each Party's Obligation to Effect the Sale.

          The respective obligation of each party to effect the
     transactions contemplated by this Agreement shall be subject to the
     satisfaction at or prior to the Closing of the following conditions:

          (a) Regulatory Approvals.  All necessary approvals,
     authorizations and consents of all governmental entities required to
     consummate the transactions contemplated hereby shall have been
     obtained and shall remain in full force and effect and all statutory
     waiting periods in respect thereof shall have expired or have been
     terminated.

          (b) No Injunctions or Restraints; Illegality.  No order,
     injunction or decree issued by any court or agency of competent
     jurisdiction or other legal restraint or prohibition (an "Injunction")
     preventing the consummation of the transactions contemplated by this
     Agreement shall be in effect and no proceeding initiated by any
     governmental entity seeking an injunction shall be pending.  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
     transactions contemplated by this Agreement.

          9.2 Conditions to Obligations of Buyer.

          The obligation of the Buyer to effect the transactions
     contemplated in this Agreement is also subject to the satisfaction or
     waiver by Buyer, at or prior to the time set for performance of the
     following conditions:

          (a) Representations and Warranties.  The representations and
     warranties of the Seller set forth in this Agreement shall be true and
     correct as of the date of this Agreement and (except to the extent
     such representations and warranties speak as of an earlier date) as of
     the Closing Date as though made on and as of the Closing Date.  Buyer
     shall have received a certificate signed on behalf of the Seller by
     its Chief Financial Officer to the foregoing effect.

          (b) Performance of Obligations of Seller.  The Seller shall have
     performed in all material respects all obligations required to be
     performed by it under this Agreement at or prior to the Closing Date,
     and the Buyer shall have received a Certificate signed on behalf of
     the Seller by its Chief Financial Officer.

          (c) Third Party Consents.  The consent, approval, or waiver of
     each person (other than the governmental entities) whose consent or
     approval shall be required in order to permit the sale, transfer or
     assignment of the Assets (including, but not limited to, all gas
     supply contracts identified on Schedule 1.4) shall have been obtained.

          9.3 Conditions to Obligations of the Seller.

          The obligations of the Seller to effect the transactions
     contemplated in this Agreement are also subject to the satisfaction,
     or waiver by the Seller, at or prior to the Closing of the following
     conditions:

          (a) Representations and Warranties.  The representations and
     warranties of the Buyer set forth in this Agreement shall be true and
     correct as of the date of this Agreement and (except to the extent
     such representations and warranties speak as of a earlier date) as of
     the Closing Date as though made on and as of the Closing Date.  The
     Seller shall have received a certificate signed on behalf of the Buyer
     by its Chief Financial Officer to the foregoing effect.

          (b) Performance of Obligations of Buyer.  The Buyer shall have
     performed in all material respects all obligations required to be
     performed by the Buyer under this Agreement at or prior to the Closing
     Date, and the Seller shall have received a Certificate signed on
     behalf of Buyer by its Chief Financial Officer to such effect.

     ARTICLE 10.  TERMINATION AND AMENDMENT

          10.1 Termination.

          This Agreement may be terminated and the transactions
     contemplated herein abandoned at any time prior to the Closing Date:

          (a) by mutual consent of the Seller and the Buyer in a written
     instrument, if the Board of Directors of each so determines by a vote
     of a majority of the members of its entire Board;

          (b) by either the Seller or the Buyer upon written notice to the
     other party (i) at least thirty (30) days after the date on which any
     request or application for an approval of a governmental entity
     required to consummate the transactions contemplated by this Agreement
     shall have been denied or withdrawn at the request or recommendation
     of the governmental entity which must grant such requisite approval;
     provided however, that no party shall have the right to terminate this
     Agreement pursuant to this Section 10.1(b)(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 having jurisdiction over the transactions
     contemplated by this Agreement shall have issued a final nonappealable
     order enjoining or otherwise prohibiting the consummation of any of
     the transactions contemplated in this Agreement;

          (c) by either the Seller or the Buyer if the purchase and sale of
     the Assets shall not have been consummated on or before the first
     anniversary date of the execution of this Agreement by the parties;
     provided, however, that if all of the conditions provided in Article 9
     hereof, other than the receipt of Regulatory Approvals described in
     Article 9.1(a) have been satisfied or waived, and diligent efforts are
     being undertaken to satisfy the conditions in Article 9.1(a), then the
     references to the first anniversary date in this Article 9.1(c) shall
     be deemed to be the second anniversary of the  date of this Agreement.

          (d) by either the Seller or the Buyer (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, (i) which breach (if susceptible to cure) is not
     cured within twenty (20) business days following receipt by the
     breaching party of written notice of such breach by the other party
     hereto, or (ii) which breach, by its nature, cannot be cured; or

          (e) by either the Seller or the Buyer (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 party of
     the other party, (i) which breach (if susceptible to cure)  is not
     cured within twenty (20) business days following receipt by the
     breaching party of written notice of such breach from the other party
     hereto, or (ii) which breach, by its nature, cannot be cured.

          10.2 Effect of Termination.

          In the  event of  termination of  this  Agreement by  either  the
     Seller or the Buyer as provided in Section 10.1, this Agreement  shall
     forthwith become void and have no effect, except that Sections 8.6 and
     10.3 shall survive any termination of this Agreement, and there  shall
     be no further obligation on the part of the Buyer, the Seller or their
     respective officers or directors except for the obligations under such
     provisions.   Notwithstanding anything  to the  contrary contained  in
     this Agreement,  no  party shall  be  relieved or  released  from  any
     liabilities or damages arising  out of its  intentional breach of  any
     provision of this Agreement; provided, however, that no claim for  any
     intentional breach shall survive the Closing.

          10.3 Expenses; Break-Up Fee

          (a) All  costs  and expenses  incurred  in connection  with  this
     Agreement and the  transactions contemplated hereby  shall be paid  by
     the party incurring such expense.

          (b) In order to induce Seller to enter into this Agreement and to
     deal exclusively with Buyer, and to reimburse the Seller for incurring
     the costs and expenses related to entering into this Agreement and
     consummating the transactions contemplated by this Agreement, in the
     event that the transactions contemplated by this Agreement are not
     consummated as a result of any failure to satisfy the conditions set
     forth in Section 9.3(b) of this Agreement, Seller shall be entitled to
     receive from Buyer the payment of Five Hundred Thousand Dollars
     ($500,000)  as liquidated damages in full satisfaction of Seller's
     claims under this Agreement.  Notwithstanding the foregoing, Buyer
     shall have no obligation to make such payment to Seller  if the
     transactions contemplated by this Agreement are not consummated as a
     result of any failure to satisfy the conditions set forth in Sections
     9.1, 9.2(a) or 9.2(b) of this Agreement or if any material consents
     under Section 9.2(c) are not obtained, provided the failure to obtain
     such material consents is not due to the financial condition of Buyer,
     whether or not the conditions set forth Section 9.3(b) have been
     satisfied.

          (c) In order to induce Buyer to enter into this Agreement and to
     deal exclusively with Seller, and to reimburse the Buyer for incurring
     the costs and expenses related to entering into this Agreement and
     consummating the transactions contemplated by this Agreement, in the
     event that (i) the transactions contemplated by this Agreement are not
     consummated as a result of any failure to satisfy the conditions set
     forth in Section 9.2(b) of this Agreement or (ii) Seller terminates
     this Agreement without cause hereunder and, at the time of termination
     Seller has received, or thereafter receives, an alternative offer to
     purchase the VCW Business which offer is accepted by Seller within six
     (6) months after such termination, Seller shall pay to Buyer an amount
     equal to Five Hundred Thousand Dollars ($500,000.00) as liquidated
     damages in full satisfaction of Buyer's claims under this Agreement.
     Notwithstanding the foregoing, Seller shall  not be obligated to make
     such payment to Buyer if the transactions contemplated by this
     Agreement are not consummated as a result of any failure to satisfy
     the conditions set forth in Sections 9.1, 9.3(a) or 9.3(b) of this
     Agreement, whether or not the conditions set forth in Section 9.2(b)
     have been satisfied.

          10.4 Amendment.

          Subject to compliance with applicable law, this Agreement may be
     amended by the parties hereto, by action taken or authorized by their
     respective Boards of Directors, at any time.  This Agreement may not
     be amended except by an instrument in writing signed on behalf of each
     of the parties hereto.

          10.5 Extension; Waiver

          The parties hereto, by action taken or authorized by their
     respective Boards of Directors, may, to the extent legally allowed,
     extend the time for the performance of any of the obligations or other
     acts of the parties hereto, waive any inaccuracies in the
     representations and warranties contained herein or in any document
     delivered pursuant hereto  and waive compliance with any of the
     agreements or conditions contained herein.  Any agreement on the part
     of a party hereto to any such extension or waiver shall be valid only
     if set forth in a written instrument signed on behalf of such party,
     but such extension or waiver shall not operate as a waiver of, or
     estoppel with respect to, any subsequent or other failure.

     ARTICLE 11.  POST-CLOSING INDEMNIFICATION OBLIGATIONS

          11.1 Indemnification.

          (a) Seller shall indemnify and hold Buyer harmless against and in
     respect of all claims, costs, losses, expenses, liabilities, suits,
     actions or damages, including reasonable attorneys' and accountants'
     fees and disbursements (hereinafter "Damages") arising out of Seller's
     breach of its representations and warranties contained in this
     Agreement or asserted against Buyer relating to or directly arising
     from Seller's ownership of the Assets or the conduct of the VCW
     Business prior to the Closing Date other than Assumed Obligations;

          (b) Buyer shall indemnify and hold Seller harmless against and in
     respect of all Damages arising out of Buyer's breach of its
     representations and warranties contained in this Agreement or asserted
     against Seller relating to or directly arising from Buyer's ownership
     of the Assets or conduct of the VCW Business or Buyer's failure to
     satisfy the Assumed Obligations or Buyer's Obligations under Section
     8.7 of this Agreement as of and subsequent to the Closing Date;

          (c) Buyer shall indemnify and hold Seller harmless against and in
     respect of all Damages asserted against Seller relating to the
     environmental condition associated with the former operations of the
     Athens MGP or Buyer's failure to satisfy its obligations contained in
     Section 8.8 concerning the environmental condition of the Athens MGP
     and any contiguous property used in connection with the former
     operations of the Athens MGP.

          (d) In the event of a claim for indemnification under this
     Section 11.1, the party seeking indemnification shall promptly notify
     the indemnifying party in writing of the nature of the claim for which
     indemnification is sought within a reasonable time after the assertion
     of the claim.  The indemnifying party shall be entitled to participate
     at its own expense in the defense, or if it so elects, within a
     reasonable time after receipt of such notice, to assume the defense of
     any suit brought to enforce any such claim.  If the indemnifying party
     so elects to assume the defense, such defense shall be conducted by
     counsel chosen by the indemnifying party and reasonably satisfactory
     to the party seeking indemnification.  In the event that the
     indemnifying party elects to assume the defense of any such suit and
     retain its own counsel, the party seeking indemnification shall (i)
     bear the fees and expenses of any additional counsel thereafter
     retained by it, and (ii) not settle such suit without the prior
     written consent of the indemnifying party, which consent shall not be
     unreasonably withheld.

          In the event the party seeking indemnification fails to promptly
     notify the indemnifying party, the indemnifying party shall be
     relieved of liability for such claim to the extent such delay
     materially adversely affects the indemnifying party's ability to
     defend the claim.

          (e) Notwithstanding anything to the contrary contained herein:
     (i) all claims by either party arising out of or relating to this
     Agreement shall be brought under this Section 11.1; (ii) all claims
     arising under subparagraphs (a) and (b) of this Section 11.1 must be
     made within eighteen (18) months from the Closing Date; and (iii)
     neither Buyer nor Seller shall be liable for any claim arising under
     subparagraphs (a) and (b) of this Section 11.1 until the aggregate
     amount of all such claims made against such party exceeds $100,000.00,
     it being understood that, once the aggregate amount of claims exceeds
     $100,000.00, the indemnifying party shall be fully liable for any
     claims made by the other party (including the first $100,000.00 of any
     such claims) up to an aggregate amount equal to the Purchase Price.
     The limitations on the indemnification obligation of the parties
     contained in this subparagraph shall not limit in any way Buyer's
     indemnification obligation contained in subparagraph (c) of this
     Section 11.1.

     ARTICLE 12. GENERAL PROVISIONS

          12.1 Survival of Representations and Warranties.

          Notwithstanding any term or provision of this Agreement to the
     contrary and regardless of any investigation made by any party, the
     representations and warranties contained in this Agreement or
     otherwise made or delivered pursuant to, or in connection with, this
     Agreement, the transaction contemplated hereunder or any related
     transactions shall survive the Closing for a period of twenty-four
     (24) months from the Closing Date.

          12.2 Notices.

          All notices and other communications hereunder shall be in
     writing and shall be deemed given when personally delivered or
     telecopied (with confirmation from recipient), three (3) days after
     mailed by registered or certified mail (return receipt requested) or
     on the day delivered by any express courier (with confirmation from
     recipient) to the parties at the following addresses (or at such other
     address for a party as shall be specified by like notice):

          (a) if to the Buyer, to:

               C&T Enterprises, Inc.
               1775 Industrial Boulevard
               P.O. Box 551
               Lewisburg, PA 17837
               Attn:  General Counsel

               With copies to:
               Management Consulting Services, Inc.
               1667 K Street, N.W., 210
               Washington, D.C. 20006

               and

               Facer & Stamoulas, P.C.
               1025 Connecticut Avenue, N.W., #610
               Washington, D.C. 20036

          (b) if to the Seller, to:

               NUI Corporation
               550 Route 202-206
               P.O. Box 760
               Bedminister, New Jersey 07921-0760
               Attn: General Counsel

               with a copy to:

               Bourne, Noll & Kenyon
               382 Springfield Avenue
               P.O. Box 690
               Summit, New Jersey 07902-0690
               Attention: Roger Mehner, Esq
               Facsimile No.: (908) 277-6808

          12.3 Interpretation.

          When a reference is made to this Agreement to Sections, or
     Schedules, such reference shall be to a Section of or Schedule to this
     Agreement unless otherwise indicated.  The table of contents and
     headings contained in this Agreement are for reference purposes only
     and shall not affect in any way the meaning or interpretation of this
     Agreement.  Whenever the words "include," "includes" or "including"
     are used in this Agreement, they shall be deemed to be followed by the
     words "without limitation." The phrases "the date of this Agreement,"
     "the date hereof" and terms of similar import, unless the context
     otherwise requires, shall be deemed to be October 4, 2000.

          12.4 Counterparts.

          This Agreement may be executed in counterparts, all of which
     shall be considered one and the same agreement and shall become
     effective when counterparts have been signed by each of the parties
     and delivered to the other parties, it being understood that all
     parties need not sign the same counterpart.

          12.5 Entire Agreement.

          This Agreement (including the documents and instruments referred
     to herein), constitute the entire agreement and supersede all prior
     agreements and understandings, both written and oral, among the
     parties with respect to the subject matter hereof.

          12.6 Governing Law.

          This Agreement shall be governed and construed in accordance
     with the laws of the Commonwealth of Pennsylvania, without regard to
     any applicable conflicts of law, and the Seller consents to
     jurisdiction in a Court of Common Pleas in Pennsylvania with respect
     to any claims arising out of this Agreement.

          12.7 Severability.

          Any term or provision of this Agreement which is invalid or
     unenforceable in any jurisdiction shall, as to that jurisdiction, be
     ineffective to the extent of such invalidity or unenforceability
     without rendering invalid or unenforceable the remaining terms and
     provision of this Agreement or affecting the validity or
     enforceability of any of the terms or provisions of this Agreement in
     any other jurisdiction. If any provision of this Agreement is deemed
     to be so broad as to be unenforceable, the provisions shall be
     interpreted to be only so broad as is enforceable.

          12.8 Publicity.

          Except as otherwise required by law, neither the Seller nor the
     Buyer nor either of their subsidiaries shall be permitted to issue or
     cause the publication or any press release or other public
     announcement with respect to, or otherwise make any public statement
     concerning, the transactions contemplated by this Agreement without
     the consent of the other party, which consent shall not by
     unreasonably withheld.

          12.9 Assignment.

          Neither this Agreement nor any of the rights, interest or
     obligations hereunder shall be assigned by any of the parties hereto
     (whether by operation of law or otherwise) without the prior written
     consent of the other parties except that Buyer and Seller shall each
     have the right to assign its right, interest or obligations hereunder
     to a wholly-owned subsidiary of Buyer so long as Buyer remains liable
     for all terms, conditions, obligations and agreements contained in
     this Agreement.  Subject to the preceding sentence, this Agreement
     will be binding upon, inure to the benefit of and be enforceable by
     the parties and their respective successors and assigns.  Except as
     otherwise expressly provided herein, this Agreement (including the
     documents and instruments referred to herein) is not intended to
     confer upon any person other than the parties any rights or remedies
     hereunder.

          IN WITNESS WHEREOF, Buyer and  Seller have caused this  Agreement
     to be executed by their respective officers thereunto duly  authorized
     as of the date first above written.

                                   NUI CORPORATION (SELLER)

                                   By: /s/John Kean, Jr.
                                          President and
                                          Chief Executive Officer

                                   C & T ENTERPRISES, INC. (BUYER)

                                   By: /s/ Robert O. Toombs
                                   President and Chief Executive OfficerEXHIBIT

<PAGE>

                   STRUCTURED ASSET MORTGAGE INVESTMENTS INC.,

                                     SELLER,

                          CENDANT MORTGAGE CORPORATION,

                                MASTER SERVICER,

                                       and

                              THE BANK OF NEW YORK,

                                     TRUSTEE

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

                         POOLING AND SERVICING AGREEMENT

                           Dated as of October 1, 2000
                        --------------------------------

                                CDMC Trust 2000-8

                 CDMC Mortgage-Backed Pass-Through Certificates,
                                  Series 2000-8

                                     <PAGE>

<TABLE>
<CAPTION>
                                                 TABLE OF CONTENTS

                                                                                                               PAGE
<S>                                                                                                            <C>
                                                     ARTICLE I

                                                    Definitions

                                                    ARTICLE II

                                           Conveyance of Mortgage Loans;

Original Issuance of Certificates
         Section 2.01.  CONVEYANCE OF MORTGAGE LOANS TO TRUSTEE..................................................30
         Section 2.02.  ACCEPTANCE OF MORTGAGE LOANS BY TRUSTEE..................................................31
         Section 2.03.  REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE MASTER SERVICER.........................33
         Section 2.04.  ASSIGNMENT OF INTEREST IN THE MORTGAGE LOAN PURCHASE AGREEMENT...........................34
         Section 2.05.  SUBSTITUTION OF MORTGAGE LOANS...........................................................35
         Section 2.06.  REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE............................................36
         Section 2.07.  ISSUANCE OF CERTIFICATES.................................................................37
         Section 2.08.  REPRESENTATIONS AND WARRANTIES CONCERNING THE SELLER.....................................37
         Section 2.09.  NEGATIVE COVENANTS OF THE TRUST FUND.....................................................39

                                                    ARTICLE III

                                  Administration and Servicing of Mortgage Loans

         Section 3.01.  MASTER SERVICER TO ASSURE SERVICING......................................................40
         Section 3.02.  SUB-SERVICING AGREEMENTS BETWEEN THE MASTER SERVICER AND SUB-SERVICERS...................41
         Section 3.03.  SUCCESSOR SUB-SERVICERS..................................................................41
         Section 3.04.  LIABILITY OF THE MASTER SERVICER.........................................................42
         Section 3.05.  ASSUMPTION OF SUB-SERVICING AGREEMENTS BY TRUSTEE........................................42
         Section 3.06.  COLLECTION OF MORTGAGE LOAN PAYMENTS.....................................................43
         Section 3.07.  COLLECTION OF TAXES, ASSESSMENTS AND SIMILAR ITEMS; SERVICING ACCOUNTS...................43
         Section 3.08.  ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING THE MORTGAGE LOANS.............44

<PAGE>

         Section 3.09.  MAINTENANCE OF PRIMARY MORTGAGE INSURANCE POLICIES; COLLECTION THEREUNDER................44
         Section 3.10.  MAINTENANCE OF HAZARD INSURANCE AND FIDELITY COVERAGE....................................45
         Section 3.11.  DUE-ON-SALE CLAUSES; ASSUMPTION AGREEMENTS...............................................47
         Section 3.12.  REALIZATION UPON DEFAULTED MORTGAGE LOANS................................................47
         Section 3.13.  TRUSTEE TO COOPERATE; RELEASE OF MORTGAGE FILES..........................................48
         Section 3.14.  SERVICING AND MASTER SERVICING COMPENSATION..............................................50
         Section 3.15.  ANNUAL STATEMENT OF COMPLIANCE...........................................................50
         Section 3.16.  ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING REPORT..................................51
         Section 3.17.  REMIC-RELATED COVENANTS..................................................................51
         Section 3.18.  ADDITIONAL INFORMATION...................................................................51
         Section 3.19.  PERIODIC FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION.............................52

                                                    ARTICLE IV

                                                     Accounts

         Section 4.01.  PROTECTED ACCOUNTS.......................................................................53
         Section 4.02.  CERTIFICATE ACCOUNT......................................................................54
         Section 4.03.  PERMITTED WITHDRAWALS AND TRANSFERS FROM THE CERTIFICATE ACCOUNT.........................56

                                                     ARTICLE V

                                                   Certificates

         Section 5.01.  CERTIFICATES.............................................................................59
         Section 5.02.  REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES....................................62
         Section 5.03.  MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES........................................66
         Section 5.04.  PERSONS DEEMED OWNERS....................................................................67
         Section 5.05.  TRANSFER RESTRICTIONS ON RESIDUAL CERTIFICATES...........................................67
         Section 5.06.  RESTRICTIONS ON TRANSFERABILITY OF PRIVATE CERTIFICATES..................................68
         Section 5.07.  ERISA RESTRICTIONS.......................................................................68
         Section 5.08.  RULE 144A INFORMATION....................................................................70

                                                    ARTICLE VI

                                          Payments to Certificateholders

         Section 6.01.  DISTRIBUTIONS ON THE CERTIFICATES........................................................71
         Section 6.02.  ALLOCATION OF LOSSES.....................................................................74
         Section 6.03.  PAYMENTS.................................................................................76
         Section 6.04.  STATEMENTS TO CERTIFICATEHOLDERS.........................................................77
         Section 6.05.  REPORTS TO THE TRUSTEE AND THE MASTER SERVICER...........................................79

                                       ii

<PAGE>

         Section 6.06.  MONTHLY ADVANCES.........................................................................81
         Section 6.07.  COMPENSATING INTEREST PAYMENTS...........................................................81
         Section 6.08.  REPORTS OF FORECLOSURES AND ABANDONMENT OF MORTGAGED PROPERTY............................81

                                                    ARTICLE VII

         Section 7.01.  LIABILITIES OF THE MASTER SERVICER.......................................................82
         Section 7.02.  MERGER OR CONSOLIDATION OF THE MASTER SERVICER...........................................82
         Section 7.03.  INDEMNIFICATION OF THE TRUSTEE...........................................................82
         Section 7.04.  LIMITATION ON LIABILITY OF THE MASTER SERVICER AND OTHERS................................82
         Section 7.05.  MASTER SERVICER NOT TO RESIGN............................................................83
         Section 7.06.  SUCCESSOR MASTER SERVICER................................................................84
         Section 7.07.  SALE AND ASSIGNMENT OF MASTER SERVICING..................................................84

                                                   ARTICLE VIII

                                                      Default

         Section 8.01.  EVENTS OF DEFAULT........................................................................85
         Section 8.02.  TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR.................................................86
         Section 8.03.  NOTIFICATION TO CERTIFICATEHOLDERS.......................................................87
         Section 8.04.  WAIVER OF DEFAULTS.......................................................................87
         Section 8.05.  LIST OF CERTIFICATEHOLDERS...............................................................88

                                                    ARTICLE IX

                                              Concerning the Trustee

         Section 9.01.  DUTIES OF TRUSTEE........................................................................89
         Section 9.02.  CERTAIN MATTERS AFFECTING THE TRUSTEE....................................................90
         Section 9.03.  TRUSTEE NOT LIABLE FOR CERTIFICATES OR MORTGAGE LOANS....................................92
         Section 9.04.  TRUSTEE MAY OWN CERTIFICATES.............................................................92
         Section 9.05.  FEES AND EXPENSES........................................................................92
         Section 9.06.  ELIGIBILITY REQUIREMENTS FOR TRUSTEE.....................................................93
         Section 9.07.  INSURANCE................................................................................93
         Section 9.08.  RESIGNATION AND REMOVAL OF THE TRUSTEE...................................................94
         Section 9.09.  SUCCESSOR TRUSTEE........................................................................94
         Section 9.10.  MERGER OR CONSOLIDATION OF TRUSTEE.......................................................95
         Section 9.11.  APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE............................................95
         Section 9.12.  MASTER SERVICER SHALL PROVIDE INFORMATION AS REASONABLY REQUIRED.........................96
         Section 9.13.  FEDERAL INFORMATION RETURNS AND REPORTS TO CERTIFICATEHOLDERS............................96
         Section 9.14.  LIMITATION ON DUTY OF TRUSTEE IN RESPECT OF FILINGS......................................98

                                       iii

<PAGE>

                                                     ARTICLE X

                                                    Termination

         Section 10.01.  TERMINATION REQUIREMENTS................................................................99
         Section 10.02.  ADDITIONAL TERMINATION REQUIREMENTS....................................................101

                                                    ARTICLE XI

                                             Miscellaneous Provisions

         Section 11.01.  INTENT OF PARTIES......................................................................103
         Section 11.02.  AMENDMENT..............................................................................103
         Section 11.03.  RECORDATION OF AGREEMENT...............................................................104
         Section 11.04.  LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS.............................................104
         Section 11.05.  ACTS OF CERTIFICATEHOLDERS.............................................................105
         Section 11.06.  GOVERNING LAW..........................................................................106
         Section 11.07.  NOTICES................................................................................106
         Section 11.08.  SEVERABILITY OF PROVISIONS.............................................................107
         Section 11.09.  SUCCESSORS AND ASSIGNS.................................................................107
         Section 11.10.  ARTICLE AND SECTION HEADINGS...........................................................107
         Section 11.11.  COUNTERPARTS...........................................................................107
         Section 11.12.  NOTICE TO RATING AGENCIES..............................................................107
         Section 11.13.  WAIVER OF JURY TRIAL...................................................................108
         Section 11.14.  NO PETITION............................................................................108
</TABLE>

                                       iv

<PAGE>

EXHIBITS

Exhibit A-1 - Form of Senior Certificates
Exhibit A-2 - Form of Class X Certificates
Exhibit A-3 - Form of Class B Certificates
Exhibit A-4 - Form of Class R Certificates
Exhibit B-1 - Mortgage Loan Schedule for Cendant Mortgage Loans
Exhibit B-2 - Mortgage Loan Schedule for Bishop's Gate Mortgage Loans
Exhibit C   - Representations and Warranties of the Mortgage Loan Sellers
              Concerning the Mortgage Loans
Exhibit D   - Request for Release of Documents
Exhibit E   - Form of Affidavit pursuant to Section 860E(e)(4)
Exhibit F-1 - Form of Investment Letter
Exhibit F-2 - Form of Rule 144A and Related Matters Certificate
Exhibit G   - Form of Initial Certification
Exhibit H   - Form of Final Certification
Exhibit I   - List of Mortgage Loans for which Mortgage Notes are Lost
Exhibit J   - Electronic Data File Information
Exhibit K   - Schedule of Mortgage Loans with a Primary Mortgage Insurance
              Policy

                                        v

<PAGE>

                         POOLING AND SERVICING AGREEMENT
                         -------------------------------

         Pooling and Servicing Agreement dated as of October 1, 2000, among
Structured Asset Mortgage Investments Inc., a Delaware corporation, as the
seller (the "Seller"), Cendant Mortgage Corporation, as Master Servicer (in such
capacity the "Master Servicer") and The Bank of New York, not in its individual
capacity but solely as trustee (the "Trustee").

                              PRELIMINARY STATEMENT

         On or prior to the Closing Date, the Seller has acquired the Mortgage
Loans from Cendant Mortgage Corporation ("Cendant") and Bishop's Gate
Residential Mortgage Trust ("Bishop's Gate"; and together with Cendant, the
"Mortgage Loan Sellers"). On the Closing Date, the Seller will sell the Mortgage
Loans and certain other property to the Trust Fund and receive in consideration
therefor Certificates evidencing the entire beneficial ownership interest in
CDMC Trust 2000-8, the Trust created hereby.

         The Trustee on behalf of the Trust shall make an election for the
assets constituting the Trust Fund to be treated for federal income tax purposes
as a REMIC. On the Startup Day, all the Classes of Certificates (other than the
Class R Certificates) will be designated "regular interests" in the REMIC and
the Class R Certificates will be designated the "residual interest" in the
REMIC.

         The Mortgage Loans will have an Outstanding Principal Balance as of the
Cut-off Date, after deducting all Scheduled Principal due on or before the
Cut-off Date, of approximately $225,371,952.

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

                                    ARTICLE I
                                   Definitions

         Whenever used in this Agreement, the following words and phrases,
unless otherwise expressly provided or unless the context otherwise requires,
shall have the meanings specified in this Article.

         ACCOUNT: The Certificate Account, the Protected Accounts, or the
Servicing Accounts as the context may require.

         ACCRUAL CERTIFICATES:  The Class A-2 Certificates.

         ACCRUAL DISTRIBUTION AMOUNT:  As defined in Section 6.01(d).

         ACCRUAL TERMINATION DATE: The Distribution Date which is the earlier of
(i) the Cross-Over Date and (ii) the Distribution Date following the
Distribution Date on which the Current Principal Amount of the Class A-1
Certificates has been reduced to zero.

<PAGE>

         ACCRUED CERTIFICATE INTEREST: For any Certificate for any Distribution
Date, the interest accrued during the related Interest Accrual Period at the
applicable Pass-Through Rate on the Current Principal Amount (or in the case of
the Class X Certificates, the Notional Amount) of such Certificate immediately
prior to such Distribution Date. In each case, Accrued Certificate Interest on
any Class of Certificates will be reduced by (i) in the case of an interest
bearing Senior Certificate, such Certificate's share of any Net Interest
Shortfall and (ii) in the case of a Subordinate Certificate, such Certificate's
share of any Net Interest Shortfall and the interest portion of any Realized
Losses allocated thereto pursuant to Section 6.02(b) or (c). With respect to the
Accrual Certificates on each Distribution Date, interest shortfalls allocable to
such Certificates on such Distribution Date will be so allocated by reducing the
amount that is added to the Current Principal Balances thereof, as applicable,
in respect of Accrued Certificate Interest pursuant to Section 6.01(d). Accrued
Certificate Interest for each Class of the Certificates shall be calculated on
the basis of a 360-day year consisting of twelve 30-day months.

         ADJUSTMENT AMOUNT: For each anniversary of the Cut-off Date, the
"Adjustment Amount" shall be equal to the amount, if any, by which the Special
Hazard Loss Amount (without giving effect to the deduction of the Adjustment
Amount for such anniversary) exceeds the lesser of (A) an amount calculated by
the Seller and approved by each Rating Agency, which amount shall not be less
than $500,000, and (B) the greater of (x) 1.0% (or if greater than 1.0%, the
highest percentage of Mortgage Loans by principal balance secured by Mortgaged
Properties in any California zip code) of the outstanding principal balance of
all the Mortgage Loans on the Distribution Date immediately preceding such
anniversary and (y) twice the outstanding principal balance of the Mortgage Loan
which has the largest outstanding principal balance on the Distribution Date
immediately preceding such anniversary.

         ADVANCING DATE: The Business Day preceding the related Distribution
Date.

         AFFILIATE: As to any Person, any other Person controlling, controlled
by or under common control with such Person. "Control" means the power to direct
the management and policies of a Person, directly or indirectly, whether through
ownership of voting securities, by contract or otherwise. "Controlled" and
"Controlling" have meanings correlative to the foregoing. The Trustee may
conclusively presume that a Person is not an Affiliate of another Person unless
a Responsible Officer of the Trustee has actual knowledge to the contrary.

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

         ALLOCABLE SHARE: With respect to each Class of Subordinate
Certificates:

                  (a) as to any Distribution Date and amounts distributable
         pursuant to clauses (i) and (iii) of the applicable Subordinate Optimal
         Principal Amount, the fraction, expressed as a percentage, the
         numerator of which is the Current Principal Amount of such Class and
         the

                                        2

<PAGE>

         denominator of which is the aggregate Current Principal Amount of all
         Classes of the Subordinate Certificates; and

                  (b) as to any Distribution Date and amounts distributable
         pursuant to clauses (ii), (iv) and (v) of the applicable Subordinate
         Optimal Principal Amount, and as to each Class of Subordinate
         Certificates (other than the Class of Subordinate Certificates having
         the lowest numerical designation as to which the Class Prepayment
         Distribution Trigger shall not be applicable) for which (x) the related
         Class Prepayment Distribution Trigger has been satisfied on such
         Distribution Date, the fraction, expressed as a percentage, the
         numerator of which is the Current Principal Amount of such Class and
         the denominator of which is the aggregate Current Principal Amount of
         all Classes of Subordinate Certificates and (y) the related Class
         Prepayment Distribution Trigger has not been satisfied on such
         Distribution Date, 0%; provided that if on a Distribution Date, the
         Current Principal Amount of any Class of Subordinate Certificates for
         which the related Class Prepayment Distribution Trigger was satisfied
         on such Distribution Date is reduced to zero, any amounts distributed
         pursuant to this clause (b), to the extent of such Class's remaining
         Allocable Share, shall be distributed to the remaining Classes of
         Subordinate Certificates which satisfy the related Class Prepayment
         Distribution Trigger and to the Subordinate Certificates having the
         lowest numerical designation in reduction of their respective Current
         Principal Amounts in the order of their numerical Class designations.

         APPLICABLE CREDIT RATING: A credit rating of Aaa, in the case of
Moody's or a credit rating of AAA, in the case of Fitch, for any long-term
deposit or security, or a rating of P-1, in the case of Moody's or F-1+, in the
case of Fitch, for any short-term deposit or security.

         APPLICABLE STATE LAW: For purposes of Section 9.13(d), the Applicable
State Law shall be (a) the law of the State of New York, and (b) such other
state law whose applicability shall have been brought to the attention of the
Trustee by either (i) an Opinion of Counsel delivered to it, or (ii) written
notice from the appropriate taxing authority as to the applicability of such
state law.

         APPRAISED VALUE: For any Mortgaged Property, the amount set forth as
the appraised value of such Mortgaged Property in an appraisal made for the
mortgage originator in connection with its origination of the related Mortgage
Loan.

         ASSUMED FINAL DISTRIBUTION DATE: With respect to each Class of
Certificates, November 25, 2030.

         AVAILABLE FUNDS: With respect to any Distribution Date, an amount equal
to the aggregate of the following amounts with respect to the Mortgage Loans:
(a) all previously undistributed payments on account of principal (including the
principal portion of Scheduled Payments, Principal Prepayments and the principal
portion of Net Liquidation Proceeds) and all previously undistributed payments
on account of interest received after the Cut-off Date and on or prior to the
related Determination Date, and (b) any Monthly Advances and Compensating
Interest Payments by the

                                        3

<PAGE>

Master Servicer or a Sub-Servicer with respect to such Distribution Date,
except, without duplication:

                  (i) all payments that were due on or before the Cut-off Date;

                  (ii) all Principal Prepayments and Liquidation Proceeds
         received after the applicable Prepayment Period;

                  (iii) all payments, other than Principal Prepayments, that
         represent early receipt of Scheduled Payments due on a date or dates
         subsequent to the related Due Date;

                  (iv) amounts received on particular Mortgage Loans as late
         payments of principal or interest and respecting which, and to the
         extent that, there are any unreimbursed Monthly Advances;

                  (v) amounts of Monthly Advances determined to be
         Nonrecoverable Advances; and

                  (vi) amounts permitted to be withdrawn from the Certificate
         Account pursuant to Subsection 4.03(a).

         BANKRUPTCY CODE: The United States Bankruptcy Code, as amended as
codified in 11 U.S.C. ss.ss.101-1330.

         BANKRUPTCY COVERAGE TERMINATION DATE: The Distribution Date upon which
the Bankruptcy Loss Amount has been reduced to zero or a negative number.

         BANKRUPTCY LOSS: With respect to any Mortgage Loan, a Deficient
Valuation or Debt Service Reduction, as reported by the Master Servicer.

         BANKRUPTCY LOSS AMOUNT: As of any Determination Date, the Bankruptcy
Loss Amount shall equal $108420.00, as reduced by the aggregate amount of
Bankruptcy Losses since the Cut-off Date.

         BISHOP'S GATE: Bishop's Gate Residential Mortgage Trust, or its
successor in interest.

         BISHOP'S GATE MORTGAGE LOANS: Those Mortgage Loans sold by Bishop's
Gate to the Seller pursuant to the Mortgage Loan Purchase Agreement, as listed
in Exhibit B-2.

         BOOK-ENTRY CERTIFICATES: Initially, all Classes of Certificates other
than the Class P, Class X, Residual Certificates and the Private Certificates.

         BUSINESS DAY: Any day other than (i) a Saturday or a Sunday, or (ii) a
day on which the New York Stock Exchange is closed or on which banking
institutions in New York City or New Jersey

                                        4

<PAGE>

or in the jurisdiction in which the Trustee or the Master Servicer is authorized
or obligated by law or executive order to be closed.

         CENDANT:  Cendant Mortgage Corporation, or its successor in interest.

         CENDANT MORTGAGE LOANS: Those Mortgage Loans sold by Cendant to the
Seller pursuant to the Mortgage Loan Purchase Agreement, as listed in Exhibit
B-1.

         CERTIFICATE: Any mortgage-backed pass-through certificate evidencing a
beneficial ownership interest in the Trust Fund signed and countersigned by the
Trustee in substantially the forms annexed hereto as Exhibit A-1, A-2, A-3 and
A-4, with the blanks therein appropriately completed.

         CERTIFICATE ACCOUNT: The trust account or accounts created and
maintained pursuant to Section 4.02, which shall be denominated "The Bank of New
York, as Trustee f/b/o holders of CDMC Mortgage-Backed Pass-Through
Certificates, Series 2000-8--Certificate Account".

         CERTIFICATE OWNER: Any Person who is the beneficial owner of a
Certificate registered in the name of the Depository or its nominee.

         CERTIFICATE REGISTER: The register maintained pursuant to Section 5.02.

         CERTIFICATEHOLDER:  A Holder of a Certificate.

         CERTIFICATES: The Senior Certificates and the Subordinate Certificates.

         CLASS: With respect to the Certificates, A-1, A-2, A-3, A-4, A-5, P, X,
B-1, B-2, B-3, B-4, B-5, B-6 and R.

         CLASS P CERTIFICATE CASH SHORTFALL: As defined in Section 6.01(c).

         CLASS P CERTIFICATE DEFERRED AMOUNT: With respect to each Distribution
Date, the aggregate of all amounts allocable on such Distribution Date to the
Class P Certificates in respect of the principal portion of applicable Realized
Losses on Discount Mortgage Loans and Class P Certificate Cash Shortfall, and
all amounts previously allocated in respect of such losses and such shortfall to
the Class P Certificates and not distributed on prior Distribution Dates. No
interest shall accrue on any Class P Certificate Deferred Amount.

         CLASS P CERTIFICATE DEFERRED PAYMENT WRITEDOWN AMOUNT: With respect to
any Distribution Date, the amount if any, distributed on such date in respect of
the Class P Certificate Deferred Amount pursuant to Sections 6.01(a)(F).

         CLASS P CERTIFICATE PRINCIPAL DISTRIBUTION AMOUNT: With respect to the
Class P Certificate on each Distribution Date, an amount, without duplication,
equal to the sum of:

                                        5

<PAGE>

                  (i) the applicable PO Percentage of the Scheduled Principal
         due on each Discount Mortgage Loan on the related Due Date as specified
         in the amortization schedule at the time applicable thereto (after
         adjustments for previous principal prepayments, but before any
         adjustment to such amortization schedule by reason of any bankruptcy or
         similar proceeding or any moratorium or similar waiver or grace
         period);

                  (ii) the applicable PO Percentage of the Scheduled Principal
         Balance of each Discount Mortgage Loan which was the subject of a
         Voluntary Principal Prepayment in full received by the Master Servicer
         during the applicable Prepayment Period;

                  (iii) the applicable PO Percentage of all Voluntary Principal
         Prepayments in part for each Discount Mortgage Loan received during the
         applicable Prepayment Period;

                  (iv) the lesser of (a) the applicable PO Percentage of the sum
         of (A) all Net Liquidation Proceeds allocable to principal on each
         Discount Mortgage Loan which became a Liquidated Mortgage Loan during
         the related Prepayment Period (other than a Discount Mortgage Loan
         described in the immediately following clause (B)) and (B) the
         Scheduled Principal Balance of each such Discount Mortgage Loan
         purchased by an Insurer from the Trustee during the related Prepayment
         Period pursuant to the related Primary Mortgage Insurance Policy, if
         any, or otherwise; and (b) the applicable PO Percentage of the sum of
         (A) the Scheduled Principal Balance of each Discount Mortgage Loan
         which became a Liquidated Mortgage Loan during the related Prepayment
         Period (other than a Discount Mortgage Loan described in the
         immediately following clause (B)) and (B) the Scheduled Principal
         Balance of each such Mortgage Loan that was purchased by an Insurer
         from the Trustee during the related Prepayment Period pursuant to the
         related Primary Mortgage Insurance Policy, if any, or otherwise, less
         (C) in the case of clause (b), the applicable PO Percentage of the
         principal portion of Excess Losses (other than Debt Service Reductions)
         on each Discount Mortgage Loan incurred during the related Prepayment
         Period; and

                  (v) the applicable PO Percentage of the sum of (a) the
         Scheduled Principal Balance of each Discount Mortgage Loan or REO
         Property which was repurchased by a Mortgage Loan Seller or the Master
         Servicer on such Distribution Date pursuant to Section 2.02 or 2.04(b)
         and (b) the excess, if any, of the Scheduled Principal Balance of a
         Discount Mortgage Loan that has been replaced by a Mortgage Loan Seller
         with a Substitute Mortgage Loan pursuant to Section 2.06 on such
         Distribution Date over the Scheduled Principal Balance of such
         Substitute Mortgage Loan.

         CLASS PREPAYMENT DISTRIBUTION TRIGGER: For a Class of Subordinate
Certificates for any Distribution Date, the Class Prepayment Distribution
Trigger is satisfied if the fraction (expressed as a percentage), the numerator
of which is the aggregate Current Principal Amount of such Class and each Class
of Subordinate Certificates subordinate thereto, if any, and the denominator of
which is the Scheduled Principal Balance of all of the Mortgage Loans as of the
related Due Date, equals or exceeds such percentage calculated as of the Closing
Date.

                                        6

<PAGE>

         CLOSING DATE: October 30, 2000.

         CODE:  The Internal Revenue Code of 1986.

         COMPENSATING INTEREST PAYMENTS:  As defined in Section 6.07.

         CORPORATE TRUST OFFICE: The office of the Trustee at which at any
particular time its corporate trust business is administered, which office, at
the date of the execution of this Agreement, is located at 101 Barclay Street,
12E, New York, New York 10286, ref: CDMC Mortgage-Backed Pass- Through
Certificates, Series 2000-8.

         CROSS-OVER DATE: The first Distribution Date on which the Senior
Percentage is equal to 100%.

         CURRENT PRINCIPAL AMOUNT: With respect to any Certificate (other than
an Interest Only Certificate) as of any Distribution Date, the initial principal
amount of such Certificate, as reduced by (i) all amounts distributed on
previous Distribution Dates on such Certificate with respect to principal, plus
(ii) in the case of the Accrual Certificates, an amount equal to the aggregate
Accrued Certificate Interest added to the Current Principal Balance of the
Accrual Certificates on each Distribution Date pursuant to Section 6.01(d), less
(iii) the principal portion of all Realized Losses allocated prior to such
Distribution Date to such Certificate, taking account of the applicable Loss
Allocation Limitation applicable to such Certificate and (iv) in the case of a
Subordinate Certificate, such Certificate's pro rata share, if any, of the
Subordinate Certificate Writedown Amount and the Class P Certificate Deferred
Payment Writedown Amount, if applicable, in each case for previous Distribution
Dates.

         CUT-OFF DATE:  October 1, 2000.

         CUT-OFF DATE BALANCE:  $225,971,952.

         DEBT SERVICE REDUCTION: Any reduction of the Scheduled Payments which a
Mortgagor is obligated to pay with respect to a Mortgage Loan as a result of any
proceeding under the Bankruptcy Code or any other similar state law or other
proceeding.

         DEBTOR RELIEF LAWS: Any applicable liquidation, conservatorship,
receivership, bankruptcy, insolvency, rearrangement, moratorium, reorganization,
or similar debtor relief laws affecting the rights of creditors generally from
time to time in effect.

         DEFAULTED MORTGAGE LOAN: Any Mortgage Loan as to which the Mortgagor
has failed to make unexcused payment in full of three or more consecutive
Scheduled Payments.

         DEFICIENT VALUATION: With respect to any Mortgage Loan, a valuation of
the Mortgaged Property by a court of competent jurisdiction in an amount less
than the then outstanding

                                        7

<PAGE>

indebtedness under the Mortgage Loan, which valuation results from a proceeding
initiated under the Bankruptcy Code or any other similar state law or other
proceeding.

         DEPOSITORY: The Depository Trust Company, the nominee of which is Cede
& Co., or any successor thereto.

         DEPOSITORY AGREEMENT: The meaning specified in Subsection 5.01(a)
hereof.

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

         DESIGNATED DEPOSITORY INSTITUTION: A depository institution (commercial
bank, federal savings bank, mutual savings bank or savings and loan association)
or trust company (which may include the Trustee), the deposits of which are
insured by the FDIC to the maximum extent provided by law.

         DETERMINATION DATE: With respect to the Mortgage Loans, the 18th day of
the month of the Distribution Date, or if such day is not a Business Day, the
following Business Day (but in no event less than two Business Days prior to the
related Distribution Date).

         DISCOUNT MORTGAGE LOAN: Any Mortgage Loan with a Net Rate less than
7.50% per annum.

         DISQUALIFIED ORGANIZATION: Any of the following: (i) the United States,
any State or political subdivision thereof, any possession of the United States,
or any agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject to
tax and, except for the Federal Home Loan Mortgage Corporation or any successor
thereto, a majority of its board of directors is not selected by such
governmental unit), (ii) any foreign government, any international organization,
or any agency or instrumentality of any of the foregoing, (iii) any organization
(other than certain farmers' cooperatives described in Section 521 of the Code)
which is exempt from the tax imposed by Chapter 1 of the Code (including the tax
imposed by Section 511 of the Code on unrelated business taxable income), (iv)
rural electric and telephone cooperatives described in Section 1381(a)(2)(C) of
the Code or (v) any other Person so designated by the Trustee based upon an
Opinion of Counsel that the holding of an ownership interest in a Certificate by
such Person may cause the Trust or any Person having an ownership interest in
the Certificate (other than such Person) to incur a liability for any federal
tax imposed under the Code that would not otherwise be imposed but for the
transfer of an ownership interest in a Certificate to such Person. The terms
"United States," "State" and "international organization" shall have the
meanings set forth in Section 7701 of the Code or successor provisions.

         DISTRIBUTION DATE: The 25th day of any month, beginning in the month
immediately following the month of the Closing Date, or, if such 25th day is not
a Business Day, the Business Day immediately following.

                                        8

<PAGE>

         DTC CUSTODIAN: The Bank of New York, or its successors in interest as
custodian for the Depository.

         DUE DATE: With respect to each Mortgage Loan, the first day of the
month.

         DUE PERIOD: With respect to any Distribution Date, the period
commencing on the second day of the month preceding the month in which the
Distribution Date occurs and ending at the close of business on the first day of
the month in which the Distribution Date occurs.

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

         EVENT OF DEFAULT:  An event described in Section 8.01.

         EXCESS BANKRUPTCY LOSS: Any Bankruptcy Loss, or portion thereof with
respect to the Mortgage Loans, (i) occurring after the Bankruptcy Coverage
Termination Date or (ii) if on such date, in excess of the then-applicable
Bankruptcy Loss Amount.

         EXCESS FRAUD LOSSES: Any Fraud Loss or portion thereof with respect to
the Mortgage Loans (i) occurring after the Fraud Coverage Termination Date with
respect thereto or (ii) if on such date, in excess of the then-applicable Fraud
Loss Amount.

         EXCESS LIQUIDATION PROCEEDS: To the extent that such amount is not
required by law to be paid to the related Mortgagor, the amount, if any, by
which Liquidation Proceeds with respect to a Liquidated Mortgage Loan exceed the
sum of (i) the Outstanding Principal Balance of such Mortgage Loan and accrued
but unpaid interest at the related Mortgage Interest Rate through the last day
of the month in which the related Liquidation Date occurs, plus (ii) related
Liquidation Expenses.

         EXCESS LOSSES: Means, collectively, Excess Bankruptcy Losses, Excess
Fraud Losses and Excess Special Hazard Losses.

         EXCESS SPECIAL HAZARD LOSSES: Any Special Hazard Loss or portion
thereof with respect to the Mortgage Loans (i) occurring after the Special
Hazard Termination Date with respect thereto or (ii) if on such date, in excess
of the then-applicable Special Hazard Loss Amount.

         FANNIE MAE: Fannie Mae (formerly the Federal National Mortgage
Association) or any successor thereto.

         FDIC:  Federal Deposit Insurance Corporation or any successor thereto.

         FITCH:  Fitch, Inc. or any successor thereto.

                                       9

<PAGE>

         FRACTIONAL UNDIVIDED INTEREST: With respect to any Class of
Certificates (other than the Class X Certificates), the fractional undivided
interest evidenced by any Certificate of such Class the numerator of which is
the Current Principal Amount of such Certificate and the denominator of which is
the Current Principal Amount of such Class. With respect to the Class X
Certificates, the fractional undivided interest evidenced by such Certificate,
the numerator of which is the Notional Amount of such Certificate and the
denominator of which is the Notional Amount of such Class. With respect to the
Certificates in the aggregate, the fractional undivided interest evidenced by
(i) the Class X Certificates will be deemed to equal 1% multiplied by a
fraction, the numerator of which is the Notional Amount of such Certificate and
the denominator of which is the Notional Amount of all of the Certificates of
the same Class, in each case, less the aggregate Scheduled Principal Balance of
the Discount Mortgage Loans, (ii) a Class R Certificate will be deemed to equal
1% multiplied by the Percentage Interest of such Certificate of such respective
Class, as stated on the face thereof and (iii) a Certificate of any other Class
will be deemed to equal 98% (plus an additional 1% if and when the aggregate
Scheduled Principal Balance of the Non-Discount Mortgage Loans has been reduced
to zero) multiplied by a fraction, the numerator of which is the Current
Principal Amount of such Certificate and the denominator of which is the Current
Principal Amount of all the Certificates.

         FRAUD COVERAGE TERMINATION DATE: The Distribution Date upon which the
Fraud Loss Amount has been reduced to zero or a negative number.

         FRAUD LOSS: Any Realized Loss attributable to fraud in the origination
of the related Mortgage Loan, as reported by the applicable Sub-Servicer to the
Master Servicer.

         FRAUD LOSS AMOUNT: Upon the initial issuance of the Certificates, 2.0%
of the aggregate Scheduled Principal Balances of the Mortgage Loans as of the
Cut-off Date. As of any Distribution Date prior to the first anniversary of the
Cut-off Date, the Fraud Loss Amount will equal the initial Fraud Loss Amount,
minus the aggregate amount of Fraud Losses that would have been allocated to the
Subordinate Certificates in the absence of the applicable Loss Allocation
Limitation since the Cut-off Date.

         As of any Distribution Date (x) from the first through the second
anniversaries of the Cut-off Date, the Fraud Loss Amount will equal (1) the
lesser of (a) the Fraud Loss Amount as of the most recent anniversary of the
Cut-off Date and (b) 2.0% of the aggregate outstanding principal balance of all
of the Mortgage Loans as of the most recent anniversary of the Cut-off Date
minus (2) the Fraud Losses that would have been allocated to the Subordinate
Certificates in the absence of the applicable Loss Allocation Limitation since
the most recent anniversary of the Cut-off Date; (y) after the second and
through the fourth anniversary of the Cut-off Date, the Fraud Loss Amount will
equal (i) the lesser of (a) the Fraud Loss Amount as of the most recent
anniversary of the Cut-off Date and (b) 1.00% of the aggregate outstanding
principal balance of all Mortgage Loans as of the most recent anniversary of the
Cut-off Date minus (2) the Fraud Losses that would have been allocated to the
Subordinate Certificates in the absence of the applicable Loss Allocation
Limitation since the most recent anniversary of the Cut-off Date; and (z) after
the fourth and through the fifth anniversary of

                                       10

<PAGE>

the Cut-off Date, the Fraud Loss Amount will equal (i) the lesser of (a) the
Fraud Loss Amount as of the most recent anniversary of the Cut-off Date and (b)
0.50% of the aggregate outstanding principal balance of all Mortgage Loans as of
the most recent anniversary of the Cut-off Date minus (2) the Fraud Losses that
would have been allocated to the Subordinate Certificates in the absence of the
applicable Loss Allocation Limitation since the most recent anniversary of the
Cut-off Date.

         After the fifth anniversary of the Cut-off Date, the Fraud Loss Amount
shall be zero.

         FREDDIE MAC: Freddie Mac (formerly the Federal Home Loan Mortgage
Corporation) or any successor thereto.

         FUNDS TRANSFER DATE: In the case of the Master Servicer, the 24th day
in each month or if such day is not a Business Day, the preceding Business Day.

         GLOBAL CERTIFICATE: Any Private Certificate registered in the name of
the Depository or its nominee, beneficial interests in which are reflected on
the books of the Depository or on the books of a Person maintaining an account
with such Depository (directly or as an indirect participant in accordance with
the rules of such depository). As of the Closing Date, there will be no Global
Certificate.

         HOLDER: The Person in whose name a Certificate is registered in the
Certificate Register, except that, subject to Subsections 11.02(b) and 11.05(e),
solely for the purpose of giving any consent pursuant to this Agreement, any
Certificate registered in the name of the Seller, the Master Servicer, a
Sub-Servicer, if any, or the Trustee or any Affiliate thereof shall be deemed
not to be outstanding and the Fractional Undivided Interest evidenced thereby
shall not be taken into account in determining whether the requisite percentage
of Fractional Undivided Interests necessary to effect any such consent has been
obtained.

         INDEMNIFIED PERSONS: The Trustee, its officers, directors, agents and
employees and any separate co-trustee and its officers, directors, agents and
employees.

         INDEPENDENT: When used with respect to any specified Person, this term
means that such Person (a) is in fact independent of the Seller or the Master
Servicer and of any Affiliate of the Seller or the Master Servicer, (b) does not
have any direct financial interest or any material indirect financial interest
in the Seller or the Master Servicer, or any Affiliate of the Seller or the
Master Servicer, and (c) is not connected with the Seller or the Master
Servicer, or any Affiliate as an officer, employee, promoter, underwriter,
trustee, partner, director or person performing similar functions.

         INDIVIDUAL CERTIFICATE: Any Private Certificate registered in the name
of the Holder other than the Depository or its nominee.

                                       11

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         INSTITUTIONAL ACCREDITED INVESTOR: Any Person meeting the requirements
of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act or
any entity all of the equity holders in which come within such paragraphs.

         INSURANCE POLICY: With respect to any Mortgage Loan, any Primary
Mortgage Insurance Policy, standard hazard insurance policy, flood insurance
policy or title insurance policy.

         INSURANCE PROCEEDS: Amounts paid by the insurer under any Insurance
Policy covering any Mortgage Loan or Mortgaged Property other than amounts
required to be paid over to the Mortgagor pursuant to law or the related
Mortgage Note or Security Instrument and other than amounts used to repair or
restore the Mortgaged Property or to reimburse Insured Expenses.

         INSURED EXPENSES:  Expenses covered by any Insurance Policy.

         INSURER:  Any issuer of an Insurance Policy.

         INTEREST ACCRUAL PERIOD: With respect to each Distribution Date and
each Class of interest bearing Certificates, the calendar month preceding the
month in which the Distribution Date occurs, commencing in October 2000.

         INTEREST SHORTFALL: With respect to any Distribution Date and each
Mortgage Loan that during the related Prepayment Period was the subject of a
Voluntary Principal Prepayment, or constitutes a Relief Act Mortgage Loan, an
amount determined as follows:

                  (a) partial principal prepayments: The difference between (i)
         one month's interest at the applicable Net Rate on the amount of such
         prepayment and (ii) the amount of interest for the calendar month of
         such prepayment (adjusted to the applicable Net Rate) received at the
         time of such prepayment;

                  (b) principal prepayments in full received during the relevant
         Prepayment Period: The difference between (i) one month's interest at
         the applicable Net Rate on the Scheduled Principal Balance of such
         Mortgage Loan immediately prior to such prepayment and (ii) the amount
         of interest for the calendar month of such prepayment (adjusted to the
         applicable Net Rate) received at the time of such prepayment;

                  (c) Relief Act Mortgage Loans: As to any Relief Act Mortgage
         Loan, the excess of (i) 30 days' interest (or, in the case of a
         principal prepayment in full, interest to the date of prepayment) on
         the Scheduled Principal Balance thereof (or, in the case of a principal
         prepayment in part, on the amount so prepaid) at the related Net Rate
         over (ii) 30 days' interest (or, in the case of a principal prepayment
         in full, interest to the date of prepayment) on such Scheduled
         Principal Balance (or, in the case of a Principal Prepayment in part,
         on the amount so prepaid) at the Net Rate required to be paid by the
         Mortgagor as limited by application of the Relief Act.

                                       12

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         INVESTMENT LETTER: The letter to be furnished by each Institutional
Accredited Investor which purchases any Class of Private Certificates in
connection with such purchase, substantially in the form set forth as Exhibit
F-1 hereto.

         LIQUIDATED MORTGAGE LOAN: Any defaulted Mortgage Loan as to which the
Master Servicer has determined that all amounts it expects to recover from or on
account of such Mortgage Loan have been recovered.

         LIQUIDATION DATE: With respect to any Liquidated Mortgage Loan, the
date on which the Master Servicer has certified that such Mortgage Loan has
become a Liquidated Mortgage Loan.

         LIQUIDATION EXPENSES: With respect to a Mortgage Loan in liquidation,
unreimbursed expenses paid or incurred by or for the account of the Master
Servicer and not recovered by the Master Servicer under any Insurance Policy for
reasons other than the Master Servicer's failure to ensure the maintenance of or
compliance with a Insurance Policy, such expenses including (a) property
protection expenses, (b) property sales expenses, (c) foreclosure and sale
costs, including court costs and reasonable attorneys' fees, and (d) similar
expenses reasonably paid or incurred in connection with liquidation.

         LIQUIDATION PROCEEDS: Cash received in connection with the liquidation
of a defaulted Mortgage Loan, whether through trustee's sale, foreclosure sale,
Insurance Proceeds, condemnation proceeds or otherwise.

         LOAN SUMMARY AND REMITTANCE REPORT: The report to be submitted by the
Master Servicer to the Trustee pursuant to Subsection 6.05(c).

         LOAN-TO-VALUE RATIO: The fraction, expressed as a percentage, the
numerator of which is the original principal balance of the related Mortgage
Loan and the denominator of which is the Original Value of the related Mortgaged
Property.

         LOCKOUT DISTRIBUTION PERCENTAGE: For any Distribution Date occurring
prior to the Distribution Date in November 2005, the Lockout Distribution
Percentage will be 0%. For any Distribution Date occurring after the first five
years following the Closing Date, the Lockout Distribution Percentage will be as
follows: for any Distribution Date during the sixth year after the Closing Date,
30%; for any Distribution Date during the seventh year after the Closing Date,
40%; for any Distribution Date during the eighth year after the Closing Date;
60% for any Distribution Date during the ninth year after the Closing Date, 80%,
and for any Distribution Date thereafter, 100%

         LOSS ALLOCATION LIMITATION: The meaning specified in Section 6.02(d)
hereof.

         LOST NOTES: The original Mortgage Notes that have been lost, as
indicated on Exhibit I hereto.

                                       13

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         MASTER SERVICER: Cendant Mortgage Corporation, or its successors in
interest, and any successor master servicer with respect to the Mortgage Loans
appointed as herein provided.

         MASTER SERVICING FEE: With respect to the Mortgage Loans and each
Distribution Date, a fee equal to the product of (i) Master Servicing Fee Rate
divided by 12 and (ii) the aggregate Outstanding Principal Balance of the
Mortgage Loans as of the first day of the related Due Period, payable from full
payments of accrued interest on each such Mortgage Loans as compensation for its
activities under this Agreement.

         MASTER SERVICING FEE RATE:  A rate equal to 0.20% per annum.

         MONTHLY ADVANCE: The advance required to be made by the Master Servicer
on the related Advancing Date pursuant to Section 6.06.

         MOODY'S: Moody's Investors Service, Inc., or its successors in
interest.

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

         MORTGAGE INTEREST RATE: The annual rate at which interest accrues from
time to time on any Mortgage Loan pursuant to the related Mortgage Note, which
rate is equal to the "Mortgage Interest Rate" set forth with respect thereto on
the related Mortgage Loan Schedule.

         MORTGAGE LOAN: A mortgage loan transferred and assigned to the Trustee
pursuant to Section 2.01 or Section 2.05 and held as a part of the Trust Fund,
as identified in the Mortgage Loan Schedules, including a mortgage loan the
property securing which has become an REO Property.

         MORTGAGE LOANS: The Mortgage Loans identified in the Mortgage Loan
Schedules attached hereto as Exhibit B-1 and Exhibit B-2.

         MORTGAGE LOAN PURCHASE AGREEMENT: The Mortgage Loan Purchase Agreement
dated as of October 26, 2000, among Cendant and Bishop's Gate, as mortgage loan
sellers, and SAMI, as purchaser, and all amendments thereof and supplements
thereto.

         MORTGAGE LOAN SCHEDULES: The schedules attached hereto as Exhibit B-1
and Exhibit B-2 with respect to the Cendant Mortgage Loans and Bishop's Gate
Mortgage Loans, respectively, and as amended from time to time to reflect the
repurchase or substitution of Mortgage Loans pursuant to this Agreement.

         MORTGAGE LOAN SELLERS: Cendant and Bishop's Gate, as mortgage loan
sellers under the Mortgage Loan Purchase Agreement.

                                       14

<PAGE>

         MORTGAGE NOTE: The originally executed note or other evidence of the
indebtedness of a Mortgagor under the related Mortgage Loan.

         MORTGAGED PROPERTY: Land and improvements securing the indebtedness of
a Mortgagor nder the related Mortgage Loan or, in the case of REO Property, such
REO Property.

         MORTGAGOR:  The obligor on a Mortgage Note.

         NET INTEREST SHORTFALL: With respect to any Distribution Date, the
Interest Shortfall, if any, for such Distribution Date net of Compensating
Interest Payments made with respect to such Distribution Date.

         NET LIQUIDATION PROCEEDS: As to any Liquidated Mortgage Loan,
Liquidation Proceeds net of (i) Liquidation Expenses which are payable therefrom
to the Master Servicer in accordance with this Agreement and (ii) unreimbursed
advances by the Master Servicer and Monthly Advances.

         NET RATE: With respect to Mortgage Loan, the Mortgage Interest Rate
borne by such Mortgage Loan less the Master Servicing Fee Rate and the Trustee's
Fee Rate.

         NON-DISCOUNT MORTGAGE LOAN: Any Mortgage Loan with a Net Rate equal to
or greater than 7.50% per annum.

         NON-PO PERCENTAGE: With respect to any Discount Mortgage Loan, the Net
Rate thereof divided by 7.50%. With respect to any Non-Discount Mortgage Loan,
100%.

         NONRECOVERABLE ADVANCE: Any advance (i) which was previously made or is
proposed to be made by the Master Servicer and (ii) which, in the good faith
judgment of the Master Servicer, as evidenced by an Officer's Certificate, will
not or, in the case of a proposed advance, would not, be ultimately recoverable
by the Master Servicer from Liquidation Proceeds, Insurance Proceeds or future
payments on the Mortgage Loan for which such advance was made.

         NOTIONAL AMOUNT: On any Distribution Date, with respect to the Class X
Certificates, an amount equal to the aggregate Scheduled Principal Balance of
the Mortgage Loans.

         NOTIONAL AMOUNT CERTIFICATES:  The Class X Certificates.

         OFFERED CERTIFICATE: Any of the Senior Certificates and the Class B-1,
Class B-2 and Class B-3 Certificates.

         OFFERED SUBORDINATE CERTIFICATES: The Class B-1, Class B-2 and Class
B-3 Certificates.

                                       15

<PAGE>

         OFFICER'S CERTIFICATE: A certificate signed by the Chairman of the
Board, the Vice Chairman of the Board, the President or a Vice President or
Assistant Vice President or other authorized officer of the Master Servicer and
delivered to the Trustee, as required by this Agreement.

         OPINION OF COUNSEL: A written opinion of counsel who is or are
acceptable to the Trustee and who, unless required to be Independent (an
"Opinion of Independent Counsel"), may be internal counsel for the Master
Servicer.

         ORIGINAL SUBORDINATE PRINCIPAL BALANCE: The sum of the aggregate
Current Principal Amounts of each Class of Subordinate Certificates as of the
Cut-off Date.

         ORIGINAL VALUE: The lesser of (i) the Appraised Value or (ii) sales
price of a Mortgaged Property at the time of origination of a Mortgage Loan,
except that in instances where either (i) or (ii) is unavailable, the other may
be used to determine Original Value, or if both (i) and (ii) are unavailable,
Original Value may be determined from other sources reasonably acceptable to the
Trustee.

         OUTSTANDING MORTGAGE LOAN: With respect to any Due Date, a Mortgage
Loan which, prior to such Due Date, was not the subject of a Principal
Prepayment in full, did not become a Liquidated Mortgage Loan and was not
purchased pursuant to Sections 2.02 or 2.04 or replaced pursuant to Section
2.05.

         OUTSTANDING PRINCIPAL BALANCE: As of the time of any determination, the
principal balance of a Mortgage Loan remaining to be paid by the Mortgagor, or,
in the case of an REO Property, the principal balance of the related Mortgage
Loan remaining to be paid by the Mortgagor at the time such property was
acquired by the Trust Fund less any Net Insurance Proceeds with respect thereto
to the extent applied to principal.

         PASS-THROUGH RATE: As to each Class of Certificates, other than the
Class X Certificates, the rate of interest set forth, or determined as provided
with respect thereto, in Section 5.01(c). With respect to the Class X
Certificates and the initial Interest Accrual Period, approximately 0.569101%
per annum, and as to any Interest Accrual Period thereafter, a per annum rate
equal to the weighted average of the Pool Strip Rates on the Mortgage Loans,
weighted on the Scheduled Principal Balances thereof. Any monthly calculation of
interest at a stated rate shall be based upon annual interest at such rate
divided by twelve.

         PERMITTED INVESTMENTS: Any one or more of the following obligations or
securities held in the name of the Trustee for the benefit of the
Certificateholders:

                  (i) direct obligations of, and obligations the timely payment
         of which are fully guaranteed by the United States of America or any
         agency or instrumentality of the United States of America the
         obligations of which are backed by the full faith and credit of the
         United States of America;

                                       16

<PAGE>

                  (ii) (a) demand or time deposits, federal funds or bankers'
         acceptances issued by any depository institution or trust company
         incorporated under the laws of the United States of America or any
         state thereof (including the Trustee acting in its commercial banking
         capacity) and subject to supervision and examination by federal and/or
         state banking authorities, provided that the commercial paper and/or
         the short-term debt rating and/or the long-term unsecured debt
         obligations of such depository institution or trust company at the time
         of such investment or contractual commitment providing for such
         investment have the Applicable Credit Rating or better from each Rating
         Agency and (b) any other demand or time deposit or certificate of
         deposit that is fully insured by the Federal Deposit Insurance
         Corporation;

                  (iii) repurchase obligations with respect to (a) any security
         described in clause (i) above or (b) any other security issued or
         guaranteed by an agency or instrumentality of the United States of
         America, the obligations of which are backed by the full faith and
         credit of the United States of America, in either case entered into
         with a depository institution or trust company (acting as principal)
         described in clause (ii)(a) above where the Trustee holds the security
         therefor;

                  (iv) securities bearing interest or sold at a discount issued
         by any corporation (including the Trustee) incorporated under the laws
         of the United States of America or any state thereof that have the
         Applicable Credit Rating or better from each Rating Agency at the time
         of such investment or contractual commitment providing for such
         investment; PROVIDED, HOWEVER, that securities issued by any particular
         corporation will not be Permitted Investments to the extent that
         investments therein will cause the then outstanding principal amount of
         securities issued by such corporation and held as part of the Trust to
         exceed 10% of the aggregate Outstanding Principal Balances and amounts
         of all the Mortgage Loans and Permitted Investments held as part of the
         Trust;

                  (v) commercial paper (including both non-interest-bearing
         discount obligations and interest-bearing obligations payable on demand
         or on a specified date not more than one year after the date of
         issuance thereof) having the Applicable Credit Rating or better from
         each Rating Agency at the time of such investment;

                  (vi) a Reinvestment Agreement issued by any bank, insurance
         company or other corporation or entity;

                  (vii) any other demand, money market or time deposit,
         obligation, security or investment as may be acceptable to each Rating
         Agency as evidenced in writing by each Rating Agency to the Trustee;
         and

                  (viii) any money market or common trust fund having the
         Applicable Credit Rating or better from each Rating Agency, including
         any such fund for which the Trustee, the

                                       17

<PAGE>

         Master Servicer or any affiliate of the Trustee or the Master Servicer
         acts as a manager or an advisor;

PROVIDED, HOWEVER, that no instrument or security shall be a Permitted
Investment if such instrument or security evidences a right to receive only
interest payments with respect to the obligations underlying such instrument or
if such security provides for payment of both principal and interest with a
yield to maturity in excess of 120% of the yield to maturity at par or if such
instrument or security is purchased at a price greater than par.

         PERMITTED TRANSFEREE: Any Person other than a Disqualified
Organization, an "electing large partnership" (as defined by Section 775 of the
Code) or a non-United States Person.

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

         PHYSICAL CERTIFICATES: Initially, the Residual Certificates and the
Private Certificates.

         PO PERCENTAGE: With respect to any Discount Mortgage Loan, the
fraction, expressed as a percentage, equal to 7.50% minus the Net Rate thereof
divided by 7.50%; and with respect to any Non-Discount Mortgage Loan, 0.00%.

         POOL STRIP RATE: With respect to (i) each Non-Discount Mortgage Loan,
the excess, if any, of the Net Rate over 7.50% per annum, and (ii) each Discount
Mortgage Loan, a rate equal to 0.00%.

         PREPAYMENT PERIOD: With respect to any Mortgage Loan and any
Distribution Date, the calendar month preceding the month of such Distribution
Date.

         PRIMARY MORTGAGE INSURANCE POLICY: Any primary mortgage insurance
policy issued in connection with a Mortgage Loan which provides compensation to
a Mortgage Note holder in the event of default by the obligor under such
Mortgage Note or the related Security Instrument, or any replacement policy
therefor.

         PRINCIPAL PREPAYMENT: Any payment (whether partial or full) or other
recovery of principal on a Mortgage Loan which is received in advance of its
scheduled Due Date to the extent that it is not accompanied by an amount as to
interest representing scheduled interest due on any date or dates in any month
or months subsequent to the month of prepayment, including Insurance Proceeds
and the purchase price in connection with any purchase of a Mortgage Loan, any
cash deposit in connection with the substitution of a Mortgage Loan, and the
principal portion of Net Liquidation Proceeds.

         PRIVATE CERTIFICATES: Any Class B-4, Class B-5 or Class B-6
Certificate.

                                       18

<PAGE>

         PROTECTED ACCOUNTS: An account established and maintained in the name
of the Trustee for the benefit of Certificateholders by the Master Servicer or
any Sub-Servicer with respect to the Mortgage Loans and with respect to REO
Property in a Designated Depository Institution for receipt of principal and
interest and other amounts as described in Section 4.01.

         QIB: A Qualified Institutional Buyer as defined in Rule 144A
promulgated under the Securities Act.

         QUALIFIED INSURER: Any insurance company duly qualified as such under
the laws of the state or states in which the related Mortgaged Property or
Mortgaged Properties is or are located, duly authorized and licensed in such
state or states to transact the type of insurance business in which it is
engaged and approved as an insurer by the Master Servicer, so long as the claims
paying ability of which is acceptable to the Rating Agencies for pass-through
certificates having the same rating as the Certificates rated by the Rating
Agencies as of the Closing Date.

         RATING AGENCIES: With respect to the Senior Certificates (other than
the Class R Certificates), Moody's and Fitch. With respect to the Class R
Certificates and the Subordinate Certificates (other than the Class B-6
Certificates), Fitch.

         RATING AGENCY ELIGIBLE ACCOUNT: An account, including one maintained
with the Trustee, which either (i) is a trust account maintained with the
corporate trust department of a depository institution or trust company
(including, without limitation, the Trustee) organized under the laws of the
United States of America or any one of the states thereof or the District of
Columbia which is not affiliated with the Master Servicer, any Sub-Servicer or
any other master servicer other than the Trustee, (ii) is maintained with an
entity which is an institution whose deposits are insured by the FDIC, the
unsecured and uncollateralized long-term debt obligations of which shall be
rated "A2" or higher by Moody's and "A" or higher by Fitch, or one of the two
highest short-term ratings by each Rating Agency, and which is either (a) a
federal savings association duly organized, validly existing and in good
standing under the federal banking laws, (b) an institution duly organized,
validly existing and in good standing under the applicable banking laws of any
state, (c) a national banking association under the federal banking laws, or (d)
a principal subsidiary of a bank holding company, or (iii) otherwise meets the
requirements of each Rating Agency for the maintenance of the ratings on the
Certificates.

         REALIZED LOSS: Any (i) Deficient Valuation or (ii) as to any Liquidated
Mortgage Loan, (x) the Outstanding Principal Balance of such Liquidated Mortgage
Loan plus accrued and unpaid interest thereon at the Mortgage Interest Rate
through the last day of the month of such liquidation LESS (y) the related Net
Liquidation Proceeds with respect to such Mortgage Loan.

         RECORD DATE: With respect to any Distribution Date, the close of
business on the last Business Day of the month immediately preceding the month
of such Distribution Date.

                                       19

<PAGE>

         REINVESTMENT AGREEMENTS: One or more reinvestment agreements,
acceptable to the Rating Agencies, from a bank, insurance company or other
corporation or entity (including the Trustee).

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

         RELIEF ACT MORTGAGE LOAN: Any Mortgage Loan as to which the Scheduled
Payment thereof has been reduced due to the application of the Relief Act.

         REMIC: A "real estate mortgage investment conduit" as defined in
Section 860D of the Code.

         REMIC OPINION: An Opinion of Independent Counsel, to the effect that
the proposed action described therein would not, under the REMIC Provisions, (i)
cause the Trust Fund to fail to qualify as a REMIC while any regular interest in
the REMIC is outstanding, (ii) result in a tax on prohibited transactions with
respect to the REMIC or (iii) constitute a taxable contribution to the REMIC
after the Startup Day.

         REMIC PROVISIONS: The provisions of the federal income tax law relating
to REMICs, which appear at Sections 860A through 860G of the Code, and related
provisions and regulations promulgated thereunder, as the foregoing may be in
effect from time to time.

         REO PROPERTY: A Mortgaged Property acquired in the name of the Trustee,
for the benefit of Certificateholders, by foreclosure or deed-in-lieu of
foreclosure in connection with a defaulted Mortgage Loan.

         REPURCHASE PRICE: With respect to any Mortgage Loan (or any property
acquired with respect thereto) required to be repurchased pursuant to Section
2.02 or 2.04 an amount equal to the sum of (i) 100% of the Outstanding Principal
Balance of such Mortgage Loan as of the date of repurchase (or if the related
Mortgaged Property was acquired with respect thereto, 100% of the Outstanding
Principal Balance at the date of the acquisition) plus (ii) accrued but unpaid
interest on the Outstanding Principal Balance at the related Mortgage Interest
Rate, through and including the last day of the month of repurchase reduced by
(ii) any portion of the related Master Servicing Fee or advances payable to the
purchaser of the Mortgage Loan.

         REQUEST FOR RELEASE: A request for release in the form attached hereto
as Exhibit D.

         REQUIRED INSURANCE POLICY: With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to time under this
Agreement with respect to such Mortgage Loan.

         RESIDUAL CERTIFICATES:  The Class R Certificates.

                                       20

<PAGE>

         RESPONSIBLE OFFICER: Any officer assigned to the Corporate Trust
Division (or any successor thereto), including any Vice President, Assistant
Vice President, any Assistant Treasurer, any trust officer or any other officer
of the Trustee customarily performing functions similar to those performed by
any of the above designated officers and having direct responsibility for the
administration of this Agreement or any other officer of the Trustee to whom
matters under this Agreement may be referred.

         RULE 144A CERTIFICATE: The certificate to be furnished by each
purchaser of a Private Certificate (which is also a Physical Certificate) which
is a Qualified Institutional Buyer as defined under Rule 144A promulgated under
the Securities Act, substantially in the form set forth as Exhibit F-2 hereto.

         SAMI:  Structured Asset Mortgage Investments Inc.

         SCHEDULED PAYMENT: With respect to any Mortgage Loan and any month, the
scheduled payment or payments of principal and interest due during such month on
such Mortgage Loan which either is payable by a Mortgagor in such month under
the related Mortgage Note or, in the case of REO Property, would otherwise have
been payable under the related Mortgage Note.

         SCHEDULED PRINCIPAL:  The principal portion of any Scheduled Payment.

         SCHEDULED PRINCIPAL BALANCE: With respect to any Mortgage Loan on any
Distribution Date, (i) the unpaid principal balance of such Mortgage Loan as of
the close of business on the related Due Date (i.e., taking account of the
principal payment to be made on such Due Date and irrespective of any
delinquency in its payment), as specified in the amortization schedule at the
time relating thereto (before any adjustment to such amortization schedule by
reason of any bankruptcy or similar proceeding occurring after the Cut-off Date
(other than a Deficient Valuation) or any moratorium or similar waiver or grace
period) less (ii) any Principal Prepayments (including the principal portion of
Net Liquidation Proceeds) received during or prior to the related Prepayment
Period; provided that the Scheduled Principal Balance of a Liquidated Mortgage
Loan is zero.

         SECURITIES ACT:  The Securities Act of 1933, as amended.

         SECURITIES LEGEND: "THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A "QIB"), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER

                                       21

<PAGE>

HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER
IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (3)
IN CERTIFICATED FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE
MEANING THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT
OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS
PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO
(A) THE RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN
THE AGREEMENT AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE
ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY
OTHER APPLICABLE JURISDICTION. THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR
INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, AND/OR SECTION 4975 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED, UNLESS THE PROPOSED TRANSFER AND/OR HOLDING OF A
CERTIFICATE AND THE SERVICING, MANAGEMENT AND/OR OPERATION OF THE TRUST AND ITS
ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED TRANSACTION WHICH IS NOT COVERED
UNDER AN INDIVIDUAL OR CLASS PROHIBITED TRANSACTION EXEMPTION, INCLUDING, BUT
NOT LIMITED TO, PROHIBITED TRANSACTION EXEMPTION ("PTE") 84-14, PTE 91-38, PTE
90-1, PTE 95-60 OR PTE 96-23 AND (II) WILL NOT GIVE RISE TO ANY ADDITIONAL
FIDUCIARY DUTIES ON THE PART OF A MASTER SERVICER OR THE TRUSTEE, WHICH WILL BE
DEEMED REPRESENTED BY AN OWNER OF A BOOK-ENTRY CERTIFICATE OR A GLOBAL
CERTIFICATE AND WILL BE EVIDENCED BY A REPRESENTATION TO SUCH EFFECT BY OR ON
BEHALF OF A HOLDER OF A PRIVATE CERTIFICATE."

         SECURITY INSTRUMENT: A written instrument creating a valid first lien
on a Mortgaged Property securing a Mortgage Note, which may be any applicable
form of mortgage, deed of trust, deed to secure debt or security deed, including
any riders or addenda thereto.

         SELLER: Structured Asset Mortgage Investments Inc., a Delaware
corporation, or its successors in interest.

         SENIOR CERTIFICATES: The Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5, Class X, Class P and Class R Certificates.

         SENIOR P&I CERTIFICATES: The Senior Certificates (other than the Class
X Certificates and Class P Certificates).

                                       22

<PAGE>

         SENIOR PERCENTAGE: Initially, approximately 96.00%. On any Distribution
Date, the lesser of (i) 100% and (ii) the percentage (carried to six places
rounded up) obtained by dividing the aggregate Current Principal Amounts of all
the Senior P&I Certificates immediately preceding such Distribution Date by the
aggregate Scheduled Principal Balance of the Mortgage Loans (other than the PO
Percentage thereof) as of the beginning of the related Due Period.

         SENIOR PREPAYMENT PERCENTAGE: On any Distribution Date occurring during
the periods set forth below, as follows:

<TABLE>
<CAPTION>
               Period (dates inclusive)                  Senior Prepayment Percentage
-------------------------------------------------------  ------------------------------------------------------------
<S>                                                      <C>
November 25, 2000 - October 25, 2005                     100%

November 25, 2005 - October 25, 2006                     Senior Percentage plus 70% of the Subordinate
                                                         Percentage

November 25, 2006 - October 25, 2007                     Senior Percentage plus 60% of the Subordinate
                                                         Percentage

November 25, 2007 - October 25, 2008                     Senior Percentage plus 40% of the Subordinate
                                                         Percentage

November 25, 2008 - October 25, 2009                     Senior Percentage plus 20% of the Subordinate
                                                         Percentage

November 25, 2009 and thereafter                         Senior Percentage.
</TABLE>

Notwithstanding the foregoing, if on any Distribution Date, the percentage, the
numerator of which is the aggregate Current Principal Amount of the Senior P&I
Certificates immediately preceding such Distribution Date, and the denominator
of which is the sum of the Scheduled Principal Balances of the Mortgage Loans
(other than the PO Percentage thereof, with respect to the Discount Mortgage
Loans) as of the beginning of the related Due Period, exceeds such percentage as
of the Cut-off Date, the Senior Prepayment Percentage with respect to the
Certificates for such Distribution Date will equal 100%. On the Distribution
Date on which the Current Principal Amounts of the Senior Certificates are
reduced to zero, the Senior Prepayment Percentage shall be the minimum
percentage sufficient to effect such reduction and thereafter shall be zero.

In addition, no reduction of the Senior Prepayment Percentage shall occur on any
Distribution Date unless, as of the last day of the month preceding such
Distribution Date, either (A) (i) (x) the aggregate Scheduled Principal Balance
of the Mortgage Loans delinquent 60 days or more (including for this purpose any
such Mortgage Loans in foreclosure and Mortgage Loans with respect to which the
related Mortgaged Property has been acquired by the Trust), averaged over the
last six months, as a percentage of the sum of the aggregate Current Principal
Amount of the Subordinate Certificates does not exceed 50%, or (y) the aggregate
Scheduled Principal Balance of Mortgage Loans

                                       23

<PAGE>

delinquent 60 days or more (including for this purpose any such Mortgage Loans
in foreclosure and such Mortgage Loans with respect to which the related
Mortgaged Property has been acquired by the Trust), averaged over the last six
months, as a percentage of the aggregate Scheduled Principal Balances of the
Mortgage Loans averaged over the last six months, does not exceed 2.0%; and (ii)
cumulative Realized Losses on such Mortgage Loans do not exceed (a) 30% of the
Original Subordinate Principal Balance if such Distribution Date occurs between
and including November 2005 and October 2006, (b) 35% of the Original
Subordinate Principal Balance if such Distribution Date occurs between and
including November 2006 and October 2007, (c) 40% of the Original Subordinate
Principal Balance if such Distribution Date occurs between and including
November 2007 and October 2008, (d) 45% of the Original Subordinate Principal
Balance if such Distribution Date occurs between and including November 2008 and
October 2009, and (e) 50% of the Original Subordinate Principal Balance if such
Distribution Date occurs during or after November 2009; or (B) (i) the aggregate
Scheduled Principal Balance of Mortgage Loans delinquent 60 days or more
(including for this purpose any such Mortgage Loans in foreclosure and such
Mortgage Loans with respect to which the related Mortgaged Property has been
acquired by the Trust), averaged over the last six months, does not exceed 4.0%
of the then-current aggregate Scheduled Principal Balance of such Mortgage
Loans; and (ii) cumulative Realized Losses on such Mortgage Loans do not exceed
(a) 10% of the aggregate Current Principal Amounts of the Original Subordinate
Principal Balance if such Distribution Date occurs between and including
November 2005 and October 2006, (b) 15% of the Original Subordinate Principal
Balance if such Distribution Date occurs between and including November 2006 and
October 2007, (c) 20% of the Original Subordinate Principal Balance if such
Distribution Date occurs between and including November 2007 and October 2008,
(d) 25% of the Original Subordinate Principal Balance if such Distribution Date
occurs between and including November 2008 and October 2009, and (e) 30% of the
Original Subordinate Principal Balance if such Distribution Date occurs during
or after November 2009.

         SENIOR P&I OPTIMAL PRINCIPAL AMOUNT: As to any Distribution Date, an
amount equal to the sum of the following (but in no event greater than the
aggregate Current Principal Amounts of the Senior Certificates immediately prior
to such Distribution Date):

                  (i) the applicable Senior Percentage of the applicable Non-PO
         Percentage of the Scheduled Principal due on each Mortgage Loan on the
         related Due Date as specified in the amortization schedule at the time
         applicable thereto (after adjustments for previous Principal
         Prepayments but before any adjustment to such amortization schedule by
         reason of any bankruptcy or similar proceeding or any moratorium or
         similar waiver or grace period);

                  (ii) the applicable Senior Prepayment Percentage of the
         applicable Non-PO Percentage of all Voluntary Principal Prepayments in
         part received during the related Prepayment Period with respect to each
         Mortgage Loan, together with the applicable Senior Prepayment
         Percentage of the applicable Non-PO Percentage of the Scheduled
         Principal Balance of each Mortgage Loan which was the subject of a
         Voluntary Principal Prepayment in full during the related Prepayment
         Period;

                                       24

<PAGE>

                  (iii) the lesser of (a) the applicable Senior Prepayment
         Percentage of the applicable Non-PO Percentage of the sum of (A) all
         Net Liquidation Proceeds allocable to principal received in respect of
         each Mortgage Loan which became a Liquidated Mortgage Loan during the
         related Prepayment Period (other than Mortgage Loans described in the
         immediately following clause (B)) and (B) the Scheduled Principal
         Balance of each Mortgage Loan purchased by an Insurer from the Trustee
         during the related Prepayment Period, pursuant to the related Primary
         Mortgage Insurance Policy, if any, or otherwise; and (b) the applicable
         Senior Percentage of the applicable Non-PO Percentage of the sum of (A)
         the Scheduled Principal Balance of each Mortgage Loan which became a
         Liquidated Mortgage Loan during the related Prepayment Period (other
         than the Mortgage Loans described in the immediately following clause
         (B)) and (B) the Scheduled Principal Balance of each Mortgage Loan that
         was purchased by an Insurer from the Trustee during the related
         Prepayment Period pursuant to the related Primary Mortgage Insurance
         Policy, if any, or otherwise, less (C) in the case of clause (b), the
         applicable Senior Percentage of the Non-PO Percentage of the principal
         portion of Excess Losses (other than Debt Service Reductions) on each
         Mortgage Loan incurred during the related Prepayment Period;

                  (iv) the applicable Senior Prepayment Percentage of the
         applicable Non-PO Percentage of the Scheduled Principal Balance of each
         Mortgage Loan or REO Property which was purchased by a Mortgage Loan
         Seller or the Master Servicer on such Distribution Date pursuant to
         Section 2.02 or 2.04(b); and

                  (v) the applicable Senior Prepayment Percentage of the
         applicable Non-PO Percentage of the excess, if any, of the Scheduled
         Principal Balance of a Mortgage Loan that has been replaced by a
         Mortgage Loan Seller or the Master Servicer with a Substitute Mortgage
         Loan pursuant to Section 2.05 on such Distribution Date over the
         Scheduled Principal Balance of such Substitute Mortgage Loan.

         SERVICING ADVANCES: All reasonable and customary "out of pocket" costs
and expenses (including reasonable attorneys' fees and disbursements) incurred
in the performance by the Master Servicer or any Sub-Servicer of its servicing
obligations, including, but not limited to the following, without duplication,
the cost of (i) the preservation, restoration and protection of the Mortgaged
Property, (ii) any enforcement, administrative or judicial proceedings, or any
legal work or advice specifically related to servicing the Mortgage Loans,
including but not limited to, foreclosures, bankruptcies, condemnations, drug
seizures, elections, foreclosures by subordinate or superior lienholders, and
other legal actions incidental to the servicing of the Mortgage Loans (provided
that such expenses are reasonable and that the Master Servicer specifies the
Mortgage Loan(s) to which such expenses relate), (iii) the management and
liquidation of the Mortgaged Property if the Mortgaged Property is acquired in
full or partial satisfaction of the Mortgage, including reasonable fees paid to
any independent contractor in connection therewith, (iv) taxes, assessments,
water rates, sewer rates and other charges which are or may become a lien upon
the Mortgaged Property, and Primary Mortgage Insurance Policy premiums and fire
and hazard insurance coverage, (v) compliance with the obligations under Section
3.07 or 3.10, and (vi) in connection with the

                                       25

<PAGE>

liquidation of a Mortgage Loan, expenditures relating to the purchase or
maintenance of the first lien on the Mortgaged Property pursuant to Section
3.12, all of which reasonable and customary out-of- pocket costs and expenses
are reimbursable to the Master Servicer or such Sub-Servicer to the extent
provided in Sections 4.02(b) and 4.03(b).

         SERVICING OFFICER: Any officer of the Master Servicer or of an agent or
independent contractor through which all or part of the Master Servicer's
servicing responsibilities are carried out, involved in, or responsible for, the
administration and servicing of the Mortgage Loans whose name and specimen
signature appear on a list of servicing officers furnished to the Trustee by the
Master Servicer as such list may from time to time be amended in accordance with
the foregoing.

         SPECIAL HAZARD LOSS: (i) A Realized Loss suffered by a Mortgaged
Property on account of direct physical loss, exclusive of (a) any loss covered
by a hazard insurance policy or a flood insurance policy required to be
maintained in respect of such Mortgaged Property under Section 3.10 and (b) any
loss caused by or resulting from:

                  (1)      normal wear and tear;

                  (2)      conversion or other dishonest act on the part of the
                           Trustee, a Master Servicer or any of their agents or
                           employees; or

                  (3)      errors in design, faulty workmanship or faulty
                           materials, unless the collapse of the property or a
                           part thereof ensues;

or (ii) any Realized Loss suffered by the Trust Fund arising from or related to
the presence or suspected presence of hazardous wastes or hazardous substances
on a Mortgage Property as reported by a Master Servicer unless such loss to a
Mortgaged Property is covered by a hazard insurance policy or a flood insurance
policy required to be maintained in respect of such Mortgage Property under
Section 3.10.

         SPECIAL HAZARD LOSS AMOUNT: Upon the initial issuance of the
Certificates, the "Special Hazard Loss Amount" for the Mortgage Loans will equal
$2,253,720. As of any Distribution Date, the Special Hazard Loss Amount will
equal the initial Special Hazard Loss Amount, minus the sum of (i) the aggregate
amount of Special Hazard Losses that would have been previously allocated to the
Subordinate Certificates in the absence of the Loss Allocation Limitation and
(ii) the Adjustment Amount.

         SPECIAL HAZARD TERMINATION DATE: The Distribution Date upon which the
Special Hazard Loss Amount has been reduced to zero or a negative number.

         STARTUP DAY:  October 30, 2000.

                                       26

<PAGE>

         SUBORDINATE CERTIFICATES: The Class B-1, Class B-2, Class B-3, Class
B-4, Class B-5 and Class B-6 Certificates.

         SUBORDINATE OPTIMAL PRINCIPAL AMOUNT: As to any Distribution Date, an
amount equal to the sum, without duplication, of the following (but in no event
greater than the aggregate Current Principal Amounts of the Subordinate
Certificates immediately prior to such Distribution Date):

                  (i) the applicable Subordinate Percentage of the applicable
         Non-PO Percentage of the Scheduled Principal due on each Mortgage Loan
         on the related Due Date, as specified in the amortization schedule at
         the time applicable thereto (after adjustment for previous Principal
         Prepayments but before any adjustment to such amortization schedule by
         reason of any bankruptcy or similar proceeding or any moratorium or
         similar waiver or grace period);

                  (ii) the applicable Subordinate Prepayment Percentage of the
         applicable Non-PO Percentage of each Voluntary Principal Payment in
         part during the related Prepayment Period with respect to each Mortgage
         Loan and the applicable Subordinate Prepayment Percentage of the
         applicable Non-PO Percentage of the Scheduled Principal Balance of each
         Mortgage Loan that was the subject of a Voluntary Principal Prepayment
         in full during the related Prepayment Period;

                  (iii) the excess, if any, of the applicable Non-PO Percentage
         of (A) all Net Liquidation Proceeds allocable to principal received
         during the related Prepayment Period over (B) the sum of the amounts
         distributable pursuant to clause (iii) of the definition of Senior P&I
         Optimal Principal Amount and clause (iv) of the definition of the
         applicable Class P Certificate Distribution Amount, on such
         Distribution Date;

                  (iv) the applicable Subordinate Prepayment Percentage of the
         applicable Non-PO Percentage of the sum of (a) the Scheduled Principal
         Balance of each Mortgage Loan which was purchased by a Mortgage Loan
         Seller or the Master Servicer on such Distribution Date pursuant to
         Section 2.02 or 2.04(b) and (b) the difference, if any, between the
         Scheduled Principal Balance of a Mortgage Loan that has been replaced
         by a Mortgage Loan Seller or the Master Servicer with a substitute
         Mortgage Loan pursuant to Section 2.05 on such Distribution Date over
         the Scheduled Principal Balance of such substitute Mortgage Loan; and

                  (v) on the Distribution Date on which the Current Principal
         Amounts of the Senior P&I Certificates have all been reduced to zero,
         100% of any Senior P&I Optimal Principal Amount.

After the aggregate current Principal Amounts of the Subordinate Certificates
have been reduced to zero, the Subordinate Optimal Principal Amount shall be
zero.

                                       27

<PAGE>

         SUBORDINATE CERTIFICATE WRITEDOWN AMOUNT: As to any Distribution Date,
the amount by which (a) the sum of the Current Principal Amounts of all of the
Certificates (after giving effect to the distribution of principal and the
allocation of applicable Realized Losses and any applicable Class P Certificate
Deferred Payment Writedown Amount with respect to the Class P Certificates in
reduction of the Current Principal Amounts of such Certificates on such
Distribution Date) exceeds (b) the aggregate Scheduled Principal Balances of the
Mortgage Loans on the Due Date related to such Distribution Date.

         SUBORDINATE PERCENTAGE: On any Distribution Date, 100% minus the Senior
Percentage.

         SUBORDINATE PREPAYMENT PERCENTAGE: On any Distribution Date, 100% minus
the Senior Prepayment Percentage, except that on any Distribution Date after the
Current Principal Amounts of the Senior Certificates have each been reduced to
zero, the Subordinate Prepayment Percentage will equal 100%.

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

         SUB-SERVICING AGREEMENT: Any agreement entered into between the Master
Servicer and a Sub-Servicer pursuant to Section 3.02

         SUBSTITUTE MORTGAGE LOAN: A mortgage loan tendered to the Trustee
pursuant to Section 2.05, in each case, (i) which has an Outstanding Principal
Balance not materially greater nor materially less than the Mortgage Loan for
which it is to be substituted; (ii) which has a fixed Mortgage Interest Rate and
Net Rate not less than, and not materially greater than, such Mortgage Loan;
(iii) which has a maturity date not materially earlier or later than such
Mortgage Loan and not later than the latest maturity date of any Mortgage Loan;
(iv) which is of the same property type and occupancy type as such Mortgage
Loan; (v) which has a Loan-to-Value Ratio not greater than the Loan-to-Value
Ratio of such Mortgage Loan; (vi) which is current in payment of principal and
interest as of the date of substitution; and (vii) as to which the payment terms
do not vary in any material respect from the payment terms of the Mortgage Loan
for which it is to be substituted.

         TAX ADMINISTRATION AND TAX MATTERS PERSON: The Trustee or any successor
thereto or assignee thereof shall serve as tax administrator hereunder and as
agent for each Tax Matters Person. The Holder of the Residual Certificates shall
be the Tax Matters Person for the REMIC, as more particularly set forth in
Section 9.13 hereof.

         TRUST FUND OR TRUST: The corpus of the trust created by this Agreement,
consisting of the Mortgage Loans and the other assets described in Section
2.01(a).

         TRUSTEE:  The Bank of New York, and its successors in interest.

                                       28

<PAGE>

         TRUSTEE'S FEES: With respect to the Mortgage Loans and each
Distribution Date, a fee equal to the product of (i) Trustee Fee Rate divided by
12 and (ii) the aggregate Outstanding Principal Balance of the Mortgage Loans as
of the first day of the related Due Period, payable from full payments of
accrued interest on each such Mortgage Loans as compensation for its activities
under this Agreement.

         TRUSTEE FEE RATE:  A rate equal to 0.0125% per annum.

         UNITED STATES PERSON: A citizen or resident of the United States, a
corporation or partnership (including an entity treated as a corporation or
partnership for federal income tax purposes) created or organized in, or under
the laws of, the United States or any state thereof or the District of Columbia
(except, in the case of a partnership, to the extent provided in regulations);
provided that, for purposes solely of the restrictions on the transfer of the
Class R Certificates, no partnership or other entity treated as a partnership
for United States federal income tax purposes shall be treated as a United
States Person unless all persons that own an interest in such partnership either
directly or through any entity that is not a corporation for United States
federal income tax purposes are required by the applicable operative agreement
to be United States Persons, or an estate whose income is subject to United
States federal income tax regardless of its source, or a trust if a court within
the United States is able to exercise primary supervision over the
administration of the trust and one or more such United States Persons have the
authority to control all substantial decisions of the trust. To the extent
prescribed in regulations by the Secretary of the Treasury, which have not yet
been issued, a trust which was in existence on August 20, 1996 (other than a
trust treated as owned by the grantor under subpart E of part I of subchapter J
of chapter 1 of the Code), and which was treated as a United States person on
August 20, 1996 may elect to continue to be treated as a United States person
notwithstanding the previous sentence.

         UNINSURED CAUSE: Any cause of damage to a Mortgaged Property or REO
Property such that the complete restoration of such Mortgaged Property or REO
Property is not fully reimbursable by the hazard insurance policies required to
be maintained pursuant to Section 3.10, without regard to whether or not such
policy is maintained.

         VOLUNTARY PRINCIPAL PREPAYMENT: With respect to any Distribution Date,
any Principal Prepayment received from the related Mortgagor on a Mortgage Loan.

                                       29

<PAGE>

                                   ARTICLE II

                          Conveyance of Mortgage Loans;
                        Original Issuance of Certificates

         Section 2.01. CONVEYANCE OF MORTGAGE LOANS TO TRUSTEE. (a) The Seller
concurrently with the execution and delivery of this Agreement, sells, transfers
and assigns to the Trust without recourse all its right, title and interest in
and to (i) the Mortgage Loans identified in the Mortgage Loan Schedules,
including all interest and principal due with respect to the Mortgage Loans
after the Cut-off Date, but excluding any payments of principal and interest due
on or prior to the Cut-off Date; (ii) such assets as shall from time to time be
credited or are required by the terms of this Agreement to be credited to the
Certificate Account (subject to the right of the Master Servicer to retain all
income from Permitted Investments under Section 4.02(c)), (iii) such assets
relating to the Mortgage Loans as from time to time may be held by the Master
Servicer or a Sub-Servicer in Protected Accounts (excluding any income to the
Master Servicer or any Sub-Servicer from Permitted Investments under Subsection
4.01(a)), (iv) any Servicing Accounts (to the extent the mortgagee has a claim
thereto and excluding any income to the Master Servicer or Sub-Servicer or
interest payable to Mortgagors pursuant to applicable law), (v) any REO
Property, (vi) the Required Insurance Policies and any amounts paid or payable
by the insurer under any Insurance Policy (to the extent the mortgagee has a
claim thereto), (vii) the Mortgage Loan Purchase Agreement to the extent
provided in Subsection 2.04(a), and (viii) any proceeds of the foregoing.
Although it is the intent of the parties to this Agreement that the conveyance
of the Seller's right, title and interest in and to the Mortgage Loans and other
assets in the Trust Fund pursuant to this Agreement shall constitute a purchase
and sale and not a loan, in the event that such conveyance is deemed to be a
loan, it is the intent of the parties to this Agreement that the Seller shall be
deemed to have granted to the Trustee a first priority perfected security
interest in all of the Seller's right, title and interest in, to and under the
Mortgage Loans and other assets in the Trust Fund, and that this Agreement shall
constitute a security agreement under applicable law.

         (b) In connection with the above transfer and assignment, the Seller
hereby deposits with the Trustee, with respect to each Mortgage Loan, (i) the
original Mortgage Note, endorsed without recourse to the order of the Trustee
and showing an unbroken chain of endorsements from the original payee thereof to
the Person endorsing it to the Trustee, (ii) the original Security Instrument,
which shall have been recorded, with evidence of such recording indicated
thereon, (iii) the assignment (which may be in the form of a blanket assignment
if permitted in the jurisdiction in which the Mortgaged Property is located) to
the Trustee of the Security Instrument, with evidence of recording with respect
to each Mortgage Loan in the name of the Trustee thereon (or if clause (x) in
the proviso below applies, shall be in recordable form), (iv) all intervening
assignments of the Security Instrument, if applicable, to the Seller with
evidence of recording thereon, (v) a schedule prepared by the Master Servicer
attached hereto as Exhibit K identifying each Mortgage Loan by Mortgage Loan
number that has a Primary Mortgage Insurance Policy and identifying its
corresponding Primary Mortgage Insurance Policy number, (vi) the original policy
of title insurance

                                       30

<PAGE>

or mortgagee's certificate of title insurance or commitment or binder for title
insurance and (vii) originals of all modification agreements, if applicable.

PROVIDED, HOWEVER, that in lieu of the foregoing, the Seller may deliver the
following documents, under the circumstances set forth below: (x) in lieu of the
original Security Instrument, assignments to the Trustee or intervening
assignments thereof which have been delivered, are being delivered or will, upon
receipt of recording information relating to the Security Instrument required to
be included thereon, be delivered to recording offices for recording and have
not been returned to the Seller in time to permit their delivery as specified
above, the Seller may deliver a true copy thereof with a certification by a
Mortgage Loan Seller, on the face of such copy, substantially as follows:
"Certified to be a true and correct copy of the original, which has been
transmitted for recording"; but in no event shall any such delivery be made
later than 90 days following the Closing Date (unless such document has not been
returned from the relevant recording office at such time, in which case the
Servicer shall make such delivery within 180 days of the Closing Date); (y) in
lieu of the Security Instrument, assignment to the Trustee or intervening
assignments thereof, if the applicable jurisdiction retains the originals of
such documents (as evidenced by a certification from a Mortgage Loan Seller to
such effect) the Seller may deliver photocopies of such documents containing an
original certification by the judicial or other governmental authority of the
jurisdiction where such documents were recorded; and (z) in lieu of the Mortgage
Notes relating to 1 Mortgage Loan, with an aggregate Scheduled Principal Balance
as of the Cut-off Date of $319,795.95, as identified in the list delivered by
the Seller to the Trustee on the Closing Date and set forth in Exhibit I hereto,
the Seller may deliver a lost note affidavit and, if available, a copy of the
original Mortgage Note; and PROVIDED, FURTHER, HOWEVER, that in the case of
Mortgage Loans which have been prepaid in full after the Cut-off Date and prior
to the Closing Date, the Seller, in lieu of delivering the above documents, may
deliver to the Trustee a certification of a Servicing Officer to such effect and
shall deposit all amounts paid in respect of such Mortgage Loans in the
Certificate Account on the Closing Date. The Seller shall deliver such original
documents (including any original documents as to which certified copies had
previously been delivered) to the Trustee promptly after they are received. The
Master Servicer shall deliver the original recorded Security Instrument (or
certified copy) and intervening assignments, if any, and the assignment of the
Security Instrument to the Trustee to be recorded not later than 180 days after
the Closing Date.

         Section 2.02. ACCEPTANCE OF MORTGAGE LOANS BY TRUSTEE. (a) The Trustee
acknowledges receipt of, subject to further review and the exceptions which may
be noted pursuant to the procedures described below, the documents (or certified
copies thereof) delivered to it pursuant to Section 2.01 and declares that it
holds and will continue to hold those documents and any amendments, replacements
or supplements thereto and all other assets of the Trust Fund delivered to it as
Trustee in trust for the use and benefit of all present and future Holders of
the Certificates. On the Closing Date (or, with respect to any Substitute
Mortgage Loan, within 5 Business Days after the receipt by the Trustee thereof),
the Trustee agrees, for the benefit of the Certificateholders, to review each
Mortgage File delivered to it to verify that such Mortgage File includes a
Mortgage Note and to execute and deliver, or cause to be executed and delivered,
to the Seller and the Master Servicer an Initial Certification substantially in
the form annexed hereto as Exhibit G. In conducting

                                       31

<PAGE>

such review, the Trustee will ascertain whether all required documents have been
executed and received and whether those documents relate, determined on the
basis of the Mortgagor name, original principal balance and loan number, to the
Mortgage Loans it has received, as identified in Exhibit B to this Agreement, as
supplemented (PROVIDED, HOWEVER, that with respect to those documents described
in subclauses (b)(iv) and (b)(vi) of Section 2.01, the Trustee's obligations
shall extend only to documents actually delivered pursuant to such subsections).
In performing any such review, the Trustee may conclusively rely on the
purported due execution and genuineness of any such document and on the
purported genuineness of any signature thereon. If the Trustee finds any
document constituting part of the Mortgage File not to have been executed or
received, or to be unrelated to the Mortgage Loans identified in Exhibit B or to
appear to be defective on its face, the Trustee shall promptly notify Cendant.
Cendant shall correct or cure any such defect within 90 days from the date of
notice from the Trustee of the defect and if Cendant fails to correct or cure
the defect within such period, and such defect materially and adversely affects
the interests of the Certificateholders in the related Mortgage Loan, Cendant
will, subject to Section 2.05, within 90 days from the Trustee's notification
purchase such Mortgage Loan at the Repurchase Price; PROVIDED, HOWEVER, that if
such defect relates solely to the inability of the related Mortgage Loan Seller
to deliver the original Security Instrument or intervening assignments thereof,
or a certified copy because the originals of such documents, or a certified copy
have not been returned by the applicable jurisdiction, Cendant shall not be
required to purchase such Mortgage Loan if such Mortgage Loan Seller delivers
such original documents or certified copy promptly upon receipt, but in no event
later than 360 days after the Closing Date. The foregoing repurchase obligation
shall not apply in the event that the related Mortgage Loan Seller cannot
deliver such original or copy of any document submitted for recording to the
appropriate recording office in the applicable jurisdiction because such
document has not been returned by such office; provided that the related
Mortgage Loan Seller shall instead deliver a recording receipt of such recording
office or, if such receipt is not available, a certificate of a Servicing
Officer confirming that such documents have been accepted for recording, and
delivery to the Trustee shall be effected by the related Mortgage Loan Seller
within thirty days of its receipt of the original recorded document.

         (b) No later than 180 days after the Closing Date, the Trustee will
review, for the benefit of the Certificateholders, the Mortgage Files delivered
to it and will execute and deliver or cause to be executed and delivered to the
Seller and the Master Servicer, a Final Certification substantially in the form
annexed hereto as Exhibit H. In conducting such review, the Trustee will
ascertain whether an original of each document required to be recorded has been
returned from the recording office with evidence of recording thereon or a
certified copy has been obtained from the recording office. If the Trustee finds
any document constituting part of the Mortgage File has not been received, or to
be unrelated, determined on the basis of the Mortgagor name, original principal
balance and loan number, to the Mortgage Loans identified in Exhibit B-1 and
Exhibit B-2 or to appear defective on its face, the Trustee shall promptly
notify the related Mortgage Loan Seller (PROVIDED, HOWEVER, that with respect to
those documents described in subsection (b)(iv) and (b)(vi) of Section 2.01, the
Trustee's obligations shall extend only to the documents actually delivered
pursuant to such subsections). The related Mortgage Loan Seller shall correct or
cure any such defect or shall deliver to the Trustee an Opinion of Counsel to
the effect that such defect does not

                                       32

<PAGE>

materially or adversely affect the interests of Certificateholders in such
Mortgage Loan within 90 days from the date of notice from the Trustee of the
defect and if the related Mortgage Loan Seller is unable to cure such defect
within such period, and if such defect materially and adversely affects the
interests of the Certificateholders in the related Mortgage Loan, the related
Mortgage Loan Seller shall, subject to Section 2.05, within 90 days from the
Trustee's notification purchase such Mortgage Loan at the Repurchase Price;
PROVIDED, HOWEVER, that if such defect relates solely to the inability of the
related Mortgage Loan Seller to deliver the original Security Instrument or
intervening assignments thereof, or a certified copy, because the originals of
such documents, or a certified copy, have not been returned by the applicable
jurisdiction, the related Mortgage Loan Seller shall not be required to purchase
such Mortgage Loan, if such Mortgage Loan Seller delivers such original
documents or certified copy promptly upon receipt, but in no event later than
360 days after the Closing Date, unless an Officer's Certificate of the related
Mortgage Loan Seller is provided stating such delay is as a result of a delay by
the applicable recording office.

         (c) In the event that a Mortgage Loan is purchased by Cendant in
accordance with Subsections 2.02(a) or (b) above, Cendant shall provide the
Repurchase Price to the Trustee for deposit in the Certificate Account and shall
provide to the Trustee written notification detailing the components of the
Repurchase Price. Upon deposit of the Repurchase Price in the Certificate
Account, the Trustee shall release to the related Mortgage Loan Seller the
related Mortgage File and shall execute and deliver all instruments of transfer
or assignment, without recourse, furnished to it by the related Mortgage Loan
Seller as are necessary to vest in such Mortgage Loan Seller title to and rights
under the Mortgage Loan. Such purchase shall be deemed to have occurred on the
date on which the Repurchase Price in available funds is received by the
Trustee. The Trustee shall amend the related Mortgage Loan Schedule, which were
previously delivered to it by Seller in a form agreed to between the Seller and
the Trustee, to reflect such repurchase and shall promptly notify the Master
Servicer and the Rating Agencies of such amendment. The obligation of Cendant to
repurchase any Mortgage Loan as to which such a defect in a constituent document
exists shall be the sole remedy respecting such defect available to the
Certificateholders or to the Trustee on their behalf.

         Section 2.03. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE MASTER
SERVICER. The Master Servicer hereby represents and warrants to the Trustee and
the Seller that:

                  (i) It is a corporation duly organized, validly existing and
         in good standing under the laws of the state of its incorporation and
         is in good standing as a foreign corporation in each jurisdiction where
         such qualification is necessary or is exempt from such qualification or
         not required by applicable law to effect such qualification and, for so
         long as it is the Master Servicer under this Agreement, will remain a
         corporation duly organized, validly existing and in good standing under
         the laws of the state of its incorporation, any state of
         reincorporation or the laws of the United States of America and in good
         standing as a foreign corporation in each jurisdiction where such
         qualification is necessary (except, in the case of foreign corporation
         qualification both on the date hereof and in the future, where the
         failure so to qualify would not reasonably be expected to have a
         material adverse effect on the Master

                                       33

<PAGE>

         Servicer's ability to enter into this Agreement or to perform its
         obligations hereunder), and has the corporate power and authority to
         perform its obligations under this Agreement;

                  (ii) The execution and delivery of this Agreement have been
         duly authorized by all requisite corporate action;

                  (iii) This Agreement, assuming due authorization, execution,
         and delivery by the other parties hereto, will constitute its legal,
         valid and binding obligation, enforceable in accordance with its terms,
         except only as such enforcement may be limited by applicable Debtor
         Relief Laws and that certain equitable remedies may not be available
         regardless of whether enforcement is sought in equity or at law;

                  (iv) Its execution and delivery of this Agreement and its
         performance and compliance with the terms of this Agreement will not
         (A) violate its certificate of incorporation or bylaws (B) to its
         knowledge, violate any law or regulation, or any administrative or
         judicial decree or order to which it is subject or (C) constitute a
         default (or an event which, with notice or lapse of time, or both,
         would constitute a default) under, or result in the breach of, any
         material contract, agreement or other instrument to which it is a party
         or which may be applicable to it or any of its assets;

                  (v) To its best knowledge, after reasonable investigation, it
         is not in default with respect to any order or decree of any court or
         any order, regulation or demand of any federal, state, municipal or
         governmental agency, which default would reasonably be expected to have
         consequences that would materially and adversely affect its financial
         condition or operations or its performance hereunder;

                  (vi) The consummation of the transactions contemplated by this
         Agreement are in the ordinary course of its business; and

                  (vii) No litigation is pending or, to its best knowledge,
         threatened against it, which could be reasonably expected to materially
         and adversely affect its entering into this Agreement or performing its
         obligations under this Agreement or which would have a material adverse
         effect on its financial condition.

         Section 2.04. ASSIGNMENT OF INTEREST IN THE MORTGAGE LOAN PURCHASE
AGREEMENT. (a) The Seller hereby assigns to the Trustee all of its right, title
and interest in the Mortgage Loan Purchase Agreement (but none of its
obligations) insofar as such contract relates to the representations and
warranties set forth in Exhibit C hereto regarding the Mortgage Loans (including
the substitution and repurchase obligations of the Mortgage Loan Sellers);
provided that the obligations of the Mortgage Loan Sellers to substitute or
repurchase a Mortgage Loan shall be the Trustee's and the Certificateholders'
sole remedy for any breach thereof. At the request of the Trustee, the Seller
shall take such actions as may be necessary to enforce the above right, title
and interest on behalf of the

                                       34

<PAGE>

Trustee and the Certificateholders or shall execute such further documents as
the Trustee may reasonably require in order to enable the Trustee to carry out
such enforcement.

         (b) If the Seller, either Mortgage Loan Seller or the Trustee discovers
a breach of any of the representations and warranties set forth in Exhibit C or
Section 4 of the Mortgage Loan Purchase Agreement and such breach existed on the
date the representation and warranty was made, which breach materially and
adversely affects the value of the interests of Certificateholders or the
Trustee in the related Mortgage Loan, the party discovering the breach shall
give prompt written notice of the breach to the other parties. The related
Mortgage Loan Seller within 90 days of its discovery or receipt of notice that
such breach has occurred (whichever occurs earlier), shall cure the breach in
all material respects or, subject to Section 2.05, Cendant shall purchase the
Mortgage Loan or any property acquired with respect thereto from the Trustee at
the Repurchase Price; PROVIDED, HOWEVER, that if there is a breach of any
representation set forth in Exhibit C and the Mortgage Loan or the related
property acquired with respect thereto has been sold, then Cendant shall pay, in
lieu of the Repurchase Price, any excess of the Repurchase Price over the Net
Liquidation Proceeds received upon such sale. (If the Net Liquidation Proceeds
exceed the Repurchase Price, any excess shall be paid to the Master Servicer to
the extent not required by law to be paid to the borrower.) Any such purchase by
Cendant shall be made by providing an amount equal to the Repurchase Price to
the Trustee for deposit in the Certificate Account and the Trustee, upon deposit
of the Repurchase Price in the Certificate Account and of written notification
detailing the components of such Repurchase Price, shall release to the related
Mortgage Loan Seller the related Mortgage File and shall execute and deliver all
instruments of transfer or assignment furnished to it by such Mortgage Loan
Seller, without recourse, as are necessary to vest in such Mortgage Loan Seller
title to and rights under the Mortgage Loan or any property acquired with
respect thereto. Such purchase shall be deemed to have occurred on the date on
which the Repurchase Price in available funds is received by the Trustee. The
Trustee shall amend the related Mortgage Loan Schedule to reflect such
repurchase and shall promptly notify the Master Servicer, and the Rating
Agencies of such amendment. Enforcement of the obligation of a Mortgage Loan
Seller to purchase (or substitute a Substitute Mortgage Loan for) any Mortgage
Loan or any property acquired with respect thereto (or pay the Repurchase Price
as set forth in the above proviso) as to which a breach has occurred and is
continuing shall constitute the sole remedy respecting such breach available to
the Certificateholders or the Trustee on their behalf.

         Section 2.05. SUBSTITUTION OF MORTGAGE LOANS. Notwithstanding anything
to the contrary in this Agreement, in lieu of purchasing a Mortgage Loan
pursuant to Sections 2.02 or 2.04, a Mortgage Loan Seller may, no later than the
date by which such purchase by such Mortgage Loan Seller would otherwise be
required, tender to the Trustee a Substitute Mortgage Loan accompanied by an
Officer's Certificate of such Mortgage Loan Seller that such Substitute Mortgage
Loan conforms to the requirements set forth in the definition of "Substitute
Mortgage Loan"; PROVIDED, HOWEVER, that substitution pursuant to this Section
2.05 in lieu of purchase shall not be permitted after the termination of the
two-year period beginning on the Startup Day. The Trustee shall examine the
Mortgage File for any Substitute Mortgage Loan in the manner set forth in
Section 2.02(a) and shall notify the Master Servicer in writing, within five
Business Days after receipt, whether or not the

                                       35

<PAGE>

documents relating to the Substitute Mortgage Loan satisfy the requirements of
the third sentence of Subsection 2.02(a). Within two Business Days after such
notification, the related Mortgage Loan Seller shall provide to the Trustee for
deposit in the Certificate Account the amount, if any, by which the Outstanding
Principal Balance as of the next preceding Due Date of the Mortgage Loan for
which substitution is being made, after giving effect to Scheduled Principal due
on such date, exceeds the Outstanding Principal Balance as of such date of the
Substitute Mortgage Loan, after giving effect to Scheduled Principal due on such
date, which amount shall be treated for the purposes of this Agreement as if it
were the payment by such Mortgage Loan Seller of the Repurchase Price for the
purchase of a Mortgage Loan by such Mortgage Loan Seller. After such
notification to the related Mortgage Loan Seller and, if any such excess exists,
upon receipt of such deposit, the Trustee shall accept such Substitute Mortgage
Loan, which shall thereafter be deemed to be a Mortgage Loan hereunder. In the
event of such a substitution, accrued interest on the Substitute Mortgage Loan
for the month in which the substitution occurs and any Principal Prepayments
made thereon during such month shall be the property of the Trust Fund and
accrued interest for such month on the Mortgage Loan for which the substitution
is made and any Principal Prepayments made thereon during such month shall be
the property of the related Mortgage Loan Seller. The Scheduled Principal on a
Substitute Mortgage Loan due on the Due Date in the month of substitution shall
be the property of the related Mortgage Loan Seller and the Scheduled Principal
on the Mortgage Loan for which the substitution is made due on such Due Date
shall be the property of the Trust Fund. Upon acceptance of the Substitute
Mortgage Loan, the Trustee shall release to the related Mortgage Loan Seller the
related Mortgage File related to any Mortgage Loan released pursuant to this
Section 2.05 and shall execute and deliver all instruments of transfer or
assignment, without recourse, in form as provided to it as are necessary to vest
in such Mortgage Loan Seller title to and rights under any Mortgage Loan
released pursuant to this Section 2.05. Such Mortgage Loan Seller shall deliver
the documents related to the Substitute Mortgage Loan in accordance with the
provisions of Subsections 2.01(b) and 2.02(b), with the date of acceptance of
the Substitute Mortgage Loan deemed to be the Closing Date for purposes of the
time periods set forth in those Subsections. The representations and warranties
set forth in Exhibit C shall be deemed to have been made by the related Mortgage
Loan Seller with respect to each Substitute Mortgage Loan as of the date of
acceptance of such Mortgage Loan by the Trustee. The Trustee shall amend the
related Mortgage Loan Schedule to reflect such substitution and shall provide a
copy of such amended Mortgage Loan Schedule to the Master Servicer, and the
Rating Agencies.

         Section 2.06. REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE. The
Trustee hereby represents and warrants to the Seller and each Mortgage Loan
Seller as of the Closing Date (and in the case of paragraphs (iv) and (v) below
throughout the term of the Agreement), that:

                  (i) The Trustee is a banking corporation, duly organized,
         validly existing and in good standing under the laws of the State of
         New York with a principal place of business in New York, New York.

                  (ii) Subject to the right of the Trustee to appoint a
         co-trustee or separate trustee under Section 9.11 hereof in order to
         meet the legal requirements of a particular jurisdiction, the

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<PAGE>

         Trustee has full power, authority and legal right to execute and
         deliver this Agreement and to perform its obligations under this
         Agreement and has taken all necessary action to authorize the
         execution, delivery and performance by it of this Agreement and the
         Certificates;

                  (iii) To the best of the Trustee's knowledge, after reasonable
         investigation, the execution and delivery by the Trustee of this
         Agreement and the Certificates and the performance by the Trustee of
         its obligations under this Agreement and the Certificates will not
         violate any provision of the Trustee's Organization Certificate or
         By-Laws or any New York or federal law or regulation governing the
         Trustee or any order, writ, judgment or decree of any court, arbitrator
         or governmental authority or agency applicable to the Trustee or any of
         its assets. To the best of the Trustee's knowledge, after reasonable
         investigation, such execution, delivery and performance will not
         require the authorization, consent or approval of, the giving of notice
         to, the filing or registration with, or the taking of any other action
         with respect to, any governmental authority or agency regulating the
         fiduciary activities of a New York bank. To the best of the Trustee's
         knowledge, after reasonable investigation, such execution, delivery and
         performance will not conflict with, or result in a breach or violation
         of, any material indenture, mortgage, deed of trust, lease or other
         agreement or instrument to which the Trustee is a party or by which it
         or its properties is bound;

                  (iv) This Agreement has been duly executed and delivered by
         the Trustee. This Agreement, when executed and delivered by the other
         parties hereto, will constitute the valid, legal and binding obligation
         of the Trustee, enforceable against the Trustee in accordance with its
         terms, except as the enforcement thereof may be limited by applicable
         Debtor Relief Laws and that certain equitable remedies may not be
         available regardless of whether enforcement is sought in equity or at
         law; and

                  (v) All funds received by the Trustee and required to be
         deposited in the Certificate Account pursuant to this Agreement will be
         promptly so deposited.

         Section 2.07. ISSUANCE OF CERTIFICATES. The Trustee acknowledges the
assignment to it of the Mortgage Loans and the other assets comprising the Trust
Fund and, concurrently therewith, has signed, and countersigned and delivered to
the Seller, in exchange therefor, Certificates in such authorized denominations
representing such Fractional Undivided Interests as the Seller has requested.
The Trustee agrees that it will hold the Mortgage Loans and such other assets as
may from time to time be delivered to it segregated on the books of the Trustee
in trust for the benefit of the Certificateholders.

         Section 2.08. REPRESENTATIONS AND WARRANTIES CONCERNING THE SELLER. The
Seller hereby represents and warrants to the Trustee and each Mortgage Loan
Seller as follows:

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<PAGE>

                  (i) the Seller (a) is a corporation duly organized, validly
         existing and in good standing under the laws of the State of Delaware
         and (b) is qualified and in good standing as a foreign corporation to
         do business in each jurisdiction where such qualification is necessary,
         except where the failure so to qualify would not reasonably be expected
         to have a material adverse effect on the Seller's business as presently
         conducted or on the Purchaser's ability to enter into this Agreement
         and to consummate the transactions contemplated hereby;

                  (ii) the Seller has full corporate power to own its property,
         to carry on its business as presently conducted and to enter into and
         perform its obligations under this Agreement;

                  (iii) the execution and delivery by the Seller of this
         Agreement have been duly authorized by all necessary corporate action
         on the part of the Seller; and neither the execution and delivery of
         this Agreement, nor the consummation of the transactions herein
         contemplated, nor compliance with the provisions hereof, will conflict
         with or result in a breach of, or constitute a default under, any of
         the provisions of any law, governmental rule, regulation, judgment,
         decree or order binding on the Seller or its properties or the articles
         of incorporation or by-laws of the Seller, except those conflicts,
         breaches or defaults which would not reasonably be expected to have a
         material adverse effect on the Seller's ability to enter into this
         Agreement and to consummate the transactions contemplated hereby;

                  (iv) the execution, delivery and performance by the Seller of
         this Agreement and the consummation of the transactions contemplated
         hereby do not require the consent or approval of, the giving of notice
         to, the registration with, or the taking of any other action in respect
         of, any state, federal or other governmental authority or agency,
         except those consents, approvals, notices, registrations or other
         actions as have already been obtained, given or made;

                  (v) this Agreement has been duly executed and delivered by the
         Seller and, assuming due authorization, execution and delivery by the
         other parties hereto, constitutes a valid and binding obligation of the
         Seller enforceable against it in accordance with its terms (subject to
         applicable bankruptcy and insolvency laws and other similar laws
         affecting the enforcement of the rights of creditors generally);

                  (vi) there are no actions, suits or proceedings pending or, to
         the knowledge of the Seller, threatened against the Seller, before or
         by any court, administrative agency, arbitrator or governmental body
         (i) with respect to any of the transactions contemplated by this
         Agreement or (ii) with respect to any other matter which in the
         judgment of the Seller will be determined adversely to the Seller and
         will if determined adversely to the Seller materially and adversely
         affect the Seller's ability to enter into this Agreement or perform its
         obligations under this Agreement; and the Seller is not in default with
         respect to any order of any court, administrative agency, arbitrator or
         governmental body so as to materially and adversely affect the
         transactions contemplated by this Agreement; and

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<PAGE>

                  (vii) immediately prior to the transfer and assignment to the
         Trustee, each Mortgage Note and each Mortgage were not subject to an
         assignment or pledge, and the Seller had good and marketable title to
         and was the sole owner thereof and had full right to transfer and sell
         such Mortgage Loan to the Trustee free and clear of any encumbrance,
         equity, lien, pledge, charge, claim or security interest.

         Section 2.09.  NEGATIVE COVENANTS OF THE TRUST FUND.

         Except as otherwise expressly permitted by this Agreement, the Trust
Fund shall not:

         (a) sell, transfer, exchange or otherwise dispose of any of the assets
of the Trust Fund;

         (b) dissolve or liquidate in whole or in part;

         (c) engage, directly or indirectly, in any business other than that
arising out of the issue of the Certificates, and the actions contemplated or
required to be performed under this Agreement;

         (d) incur, create or assume any indebtedness for borrowed money;

         (e) voluntarily file a petition for bankruptcy, reorganization,
assignment for the benefit of creditors or similar proceeding; or

         (f) merge, convert or consolidate with any other Person.

                                       39

<PAGE>

                                   ARTICLE III

                 Administration and Servicing of Mortgage Loans

         Section 3.01. MASTER SERVICER TO ASSURE SERVICING. (a) The Master
Servicer shall supervise, or take such actions as are necessary to ensure, the
servicing and administration of the Mortgage Loans and any related REO Property
in accordance with this Agreement and its normal servicing practices (including
making any Servicing Advances), which generally conform to the standards of an
institution prudently servicing mortgage loans for its own account and shall
have full authority to do anything it reasonably deems appropriate or desirable
in connection with such servicing and administration. The Master Servicer may
perform its responsibilities relating to servicing through other agents or
independent contractors, but shall not thereby be released from any of its
responsibilities as hereinafter set forth. The authority of the Master Servicer,
in its capacity as master servicer, shall include, without limitation, the power
to (i) consult with and advise any Sub- Servicer regarding administration of a
Mortgage Loan, (ii) approve any recommendation by a Sub- Servicer to foreclose
on a Mortgage Loan, (iii) supervise the filing and collection of insurance
claims and take or cause to be taken such actions on behalf of the insured
person thereunder as shall be reasonably necessary to prevent the denial of
coverage thereunder, and (iv) effectuate foreclosure or other conversion of the
ownership of the Mortgaged Property securing a Mortgage Loan, including the
employment of attorneys, the institution of legal proceedings, the collection of
deficiency judgments, the acceptance of compromise proposals, the filing of
claims under any Required Insurance Policy and any other matter pertaining to a
delinquent Mortgage Loan. The authority of the Master Servicer shall include, in
addition, the power on behalf of the Certificateholders, the Trustee or any of
them to (i) execute and deliver customary consents or waivers and other
instruments and documents, (ii) consent to transfers of any related Mortgaged
Property and assumptions of the related Mortgage Notes and Security Instruments
(in the manner provided in this Agreement) and (iii) collect any Insurance
Proceeds and Liquidation Proceeds. Without limiting the generality of the
foregoing, the Master Servicer may, and is hereby authorized, and empowered by
the Trustee to, execute and deliver, on behalf of itself, the
Certificateholders, the Trustee, or any of them, any instruments of
satisfaction, cancellation, partial or full release, discharge and all other
comparable instruments, with respect to the Mortgage Loans, the Insurance
Policies and the accounts related thereto, and the Mortgaged Properties. The
Master Servicer may exercise this power in its own name or in the name of a
Sub-Servicer.

         (b) Notwithstanding the provisions of Subsection 3.01(a), the Master
Servicer shall not take any action inconsistent with generally accepted good
servicing procedures and practices and with the interest of the Trustee or the
Certificateholders in the Mortgage Loans or with the rights and interests of the
Trustee or the Certificateholders under this Agreement.

         (c) The Trustee shall furnish the Master Servicer with any powers of
attorney and other documents in form as provided to it necessary or appropriate
to enable the Master Servicer to service and administer the related Mortgage
Loans and REO Property.

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<PAGE>

         Section 3.02. SUB-SERVICING AGREEMENTS BETWEEN THE MASTER SERVICER AND
SUB-SERVICERS. (a) The Master Servicer may enter into Sub-Servicing Agreements
with Sub-Servicers for the servicing and administration of the Mortgage Loans
and for the performance of any and all other activities of the Master Servicer
hereunder. Each Sub-Servicer shall be either (i) an institution the accounts of
which are insured by the FDIC or (ii) another entity that engages in the
business of originating or servicing mortgage loans, and in either case shall be
authorized to transact business in the state or states in which the related
Mortgaged Properties it is to service are situated, if and to the extent
required by applicable law to enable the Sub-Servicer to perform its obligations
hereunder and under the Sub-Servicing Agreement, and in either case shall be a
Freddie Mac or Fannie Mae approved mortgage servicer. Any Sub-Servicing
Agreement entered into by the Master Servicer shall include the provision that
such Agreement may be immediately terminated (x) with cause and without any
termination fee by the Master Servicer hereunder or (y) without cause in which
case the Master Servicer shall be responsible for any termination fee or penalty
resulting therefrom. In addition, any Sub-Servicing Agreement shall provide for
servicing of the related Mortgage Loans consistent with the terms of this
Agreement. With the consent of the Trustee, which consent shall not be
unreasonably withheld, the Master Servicer and the Sub-Servicers may enter into
Sub- Servicing Agreements and make amendments to the Sub-Servicing Agreements or
enter into different forms of Sub-Servicing Agreements; provided, however, that
any such amendments or different forms shall be consistent with and not violate
the provisions of this Agreement, and that no such amendment or different form
shall be made or entered into which could be reasonably expected to be
materially adverse to the interests of the Certificateholders, without the
consent of the Holders of Certificates entitled to at least 51% of the
Fractional Undivided Interests of all the Certificates in the aggregate.

         (b) As part of its servicing activities hereunder, the Master Servicer,
for the benefit of the Trustee and the Certificateholders, shall use its best
reasonable efforts to enforce the obligations of each Sub-Servicer under the
related Sub-Servicing Agreement. Such enforcement, including, without
limitation, the legal prosecution of claims, termination of Sub-Servicing
Agreements and the pursuit of other appropriate remedies, shall be in such form
and carried out to such an extent and at such time as the Master Servicer, in
its good faith business judgment, would require were it the owner of the related
Mortgage Loans. The Master Servicer shall pay the costs of such enforcement at
its own expense, but shall be reimbursed therefor only (i) from a general
recovery resulting from such enforcement only to the extent, if any, that such
recovery exceeds all amounts due in respect of the related Mortgage Loans or
(ii) from a specific recovery of costs, expenses or attorneys' fees against the
party against whom such enforcement is directed.

         Section 3.03. SUCCESSOR SUB-SERVICERS. The Master Servicer shall be
entitled to terminate any Sub-Servicing Agreement that may exist in accordance
with the terms and conditions of such Sub-Servicing Agreement and without any
limitation by virtue of this Agreement; PROVIDED, HOWEVER, that upon
termination, the Master Servicer shall either act as servicer of the related
Mortgage Loan or enter into an appropriate contract with a successor
Sub-Servicer pursuant to which such successor Sub-Servicer will be bound by all
relevant terms of the related Sub-Servicing Agreement pertaining to the
servicing of such Mortgage Loan.

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<PAGE>

         Section 3.04. LIABILITY OF THE MASTER SERVICER. (a) Notwithstanding any
Sub-Servicing Agreement, any of the provisions of this Agreement relating to
agreements or arrangements between the Master Servicer and a Sub-Servicer or
reference to actions taken through a Sub-Servicer or otherwise, the Master
Servicer shall under all circumstances remain obligated and primarily liable to
the Trustee and the Certificateholders for the servicing and administering of
the Mortgage Loans and any related REO Property in accordance with this
Agreement. The obligations and liability of the Master Servicer shall not be
diminished by virtue of Sub-Servicing Agreements or by virtue of indemnification
of the Master Servicer by any Sub-Servicer, or any other Person. The obligations
and liability of the Master Servicer shall remain of the same nature and under
the same terms and conditions as if the Master Servicer alone were servicing and
administering the related Mortgage Loans. The Master Servicer shall, however, be
entitled to enter into indemnification agreements with any Sub-Servicer or other
Person and nothing in this Agreement shall be deemed to limit or modify such
indemnification. For the purposes of this Agreement, the Master Servicer shall
be deemed to have received any payment on a Mortgage Loan on the date the
Sub-Servicer received such payment.

         (b) Any Sub-Servicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a Sub-Servicer
in its capacity as such and not as an originator shall be deemed to be between
the Sub-Servicer and the Master Servicer alone, and the Trustee and
Certificateholders shall not be deemed parties thereto and shall have no claims,
rights, obligations, duties or liabilities with respect to the Sub-Servicer
except as set forth in Section 3.05.

         Section 3.05. ASSUMPTION OF SUB-SERVICING AGREEMENTS BY TRUSTEE. (a) If
the Trustee or its designee shall assume the master servicing obligations of the
Master Servicer in accordance with Section 8.02, the Trustee, to the extent
necessary to permit the Trustee to carry out the provisions of Section 8.02 with
respect to the Mortgage Loans, shall succeed to all of the rights and
obligations of the Master Servicer under each of the Sub-Servicing Agreements.
In such event, the Trustee or its designee as the successor master servicer
shall be deemed to have assumed all of the Master Servicer's rights and
obligations therein and to have replaced the Master Servicer as a party to such
Sub-Servicing Agreements to the same extent as if such Sub-Servicing Agreements
had been assigned to the Trustee or its designee as a successor master servicer,
except that the Trustee or its designee as a successor master servicer shall not
be deemed to have assumed any obligations or liabilities of the Master Servicer
arising prior to such assumption and the Master Servicer shall not thereby be
relieved of any liability or obligations under such Sub-Servicing Agreements.

         (b) In the event that the Trustee or its designee as successor master
servicer for the Trustee assumes the servicing obligations of the Master
Servicer under Section 8.02, upon the reasonable request of the Trustee or such
designee as successor master servicer, the Master Servicer shall at its own
expense deliver to the Trustee, or at its written request to such designee,
photocopies of all documents and records, electronic or otherwise, relating to
the Sub-Servicing Agreements and the related Mortgage Loans or REO Property then
being serviced and an accounting of amounts collected and held by it, if any,
and will otherwise cooperate and use its reasonable best efforts to

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<PAGE>

effect the orderly and efficient transfer of the Sub-Servicing Agreements, or
responsibilities hereunder to the Trustee, or at its written request to such
designee as successor master servicer.

         Section 3.06. COLLECTION OF MORTGAGE LOAN PAYMENTS. (a) The Master
Servicer will make remittances itself or will coordinate and monitor remittances
by Sub-Servicers to the Trustee with respect to the related Mortgage Loans in
accordance with this Agreement.

         (b) The Master Servicer shall make its reasonable best efforts to
collect or cause to be collected all payments required under the terms and
provisions of the Mortgage Loans and shall follow, and use its best efforts to
cause Sub-Servicers to follow, collection procedures comparable to the
collection procedures of prudent mortgage lenders servicing mortgage loans for
their own account to the extent such procedures shall be consistent with this
Agreement. Consistent with the foregoing, the Master Servicer may in its
discretion (i) waive or permit to be waived any late payment charge, prepayment
charge, assumption fee, or any penalty interest in connection with the
prepayment of a Mortgage Loan and (ii) suspend or temporarily reduce or permit
to be suspended or temporarily reduced regular monthly payments for a period of
up to six months, or arrange or permit an arrangement with a Mortgagor for a
scheduled liquidation of delinquencies. In the event the Master Servicer shall
consent to the deferment of the due dates for payments due on a related Mortgage
Note, the Master Servicer shall nonetheless make a Monthly Advance or shall
cause the related Sub-Servicer to make an advance to the same extent as if such
installment were due, owing and delinquent and had not been deferred through
liquidation of the Mortgaged Property; PROVIDED, HOWEVER, that the obligation of
the Master Servicer to make a Monthly Advance shall apply only to the extent
that the Master Servicer believes, in good faith, that such advances are not
Nonrecoverable Advances.

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

         Section 3.07. COLLECTION OF TAXES, ASSESSMENTS AND SIMILAR ITEMS;
SERVICING ACCOUNTS. (a) The Master Servicer shall establish and maintain or
cause the Sub-Servicers to establish and maintain, in addition to the Protected
Accounts, one or more Servicing Accounts. The Master Servicer or a Sub-Servicer
will deposit and retain therein all otherwise unapplied collections from the
Mortgagors, including amounts collected for the payment of taxes, assessments,
insurance premiums, or comparable items as agent of the Mortgagors.

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         (b) The deposits in the Servicing Accounts shall be held in a
Designated Depository Institution in an account held in trust by the Master
Servicer or a Sub-Servicer as trustee for borrowers and for the Master Servicer
(and its successors and assigns) acting on its own behalf and for the Master
Servicer as agent for holders of various pass-through securities and other
interests in mortgage loans sold by it; and agent for various mortgagors, as
their interests may appear or under such other designation as may be permitted
by a Sub-Servicing Agreement. The amount at any time credited to a Servicing
Account must be fully insured by the FDIC, or, to the extent that such deposits
exceed the limits of such insurance, such excess must be (i) transferred to
another fully insured account in another Designated Depository Institution or
(ii) if permitted by applicable law, invested in Permitted Investments held in
trust by the Master Servicer or a Sub-Servicer as described above and maturing,
or be subject to redemption or withdrawal, no later than the date on which such
funds are required to be withdrawn, and in no event later than 45 days after the
date of investment. The Master Servicer may, or may permit a Sub-Servicer to,
establish Servicing Accounts not conforming to the foregoing requirements to the
extent that such Servicing Accounts are Rating Agency Eligible Accounts.
Withdrawals of amounts from the Servicing Accounts may be made only to effect
timely payment of taxes, assessments, insurance premiums, or comparable items,
to transfer previously unapplied collections to a Protected Account, to
reimburse the Master Servicer or a Sub- Servicer for any advances made with
respect to such items, to refund to any Mortgagors any sums as may be determined
to be overages, to pay interest, if required, to Mortgagors on balances in the
Servicing Accounts, to remove any amounts deposited in error, or to clear and
terminate the Servicing Accounts at or any time after the termination of this
Agreement in accordance with Section 10.01.

         Section 3.08. ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING
THE MORTGAGE LOANS. The Master Servicer shall provide, and shall cause any
Sub-Servicer to provide, to the Trustee and the Seller access to the records and
documentation regarding the Mortgage Loans and REO Property and the servicing
thereof and to the FDIC, and the supervisory agents and examiners of the FDIC
(to which the Trustee shall also provide) access to the documentation regarding
the Mortgage Loans required by applicable regulations, such access being
afforded without charge but only upon reasonable prior written request and
during normal business hours at the offices of the Master Servicer, the
Sub-Servicers or the Trustee that are designated by these entities; PROVIDED,
HOWEVER, that, unless otherwise required by law, the Trustee, the Master
Servicer or the Sub-Servicer shall not be required to provide access to such
records and documentation if the provision thereof would violate the legal right
to privacy of any Mortgagor PROVIDED, FURTHER, HOWEVER, that the Trustee and the
Seller shall coordinate their requests for such access so as not to impose an
unreasonable burden on, or cause an interruption of, the business of the Master
Servicer or any Sub-Servicer. The Master Servicer, the Sub-Servicers and the
Trustee shall allow representatives of the above entities to photocopy any of
the records and documentation and shall provide equipment for that purpose at a
charge that covers their own actual out-of-pocket costs.

         Section 3.09. MAINTENANCE OF PRIMARY MORTGAGE INSURANCE POLICIES;
COLLECTION THEREUNDER. The Master Servicer shall, or shall cause the related
Sub-Servicer to, in accordance with applicable law (including the Federal
Homeowner's Protection Act of 1998), exercise its best reasonable efforts

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<PAGE>

to maintain and keep in full force and effect each Primary Mortgage Insurance
Policy by a Qualified Insurer, or other insurer satisfactory to the Rating
Agencies, with respect to each related conventional Mortgage Loan as to which as
of the Cut-off Date such a Primary Mortgage Insurance Policy was in effect (or,
in the case of a Substitute Mortgage Loan, the date of substitution) and the
original principal amount of the related Mortgage Note exceeded 80% of the
Original Value in an amount at least equal to the excess of such original
principal amount over 75% of such Original Value until the principal amount of
any such Mortgage Loan is reduced below 80% of the Original Value or, based upon
a new appraisal, the principal amount of such Mortgage Loan represents less than
80% of the new appraised value. The Master Servicer shall, or shall cause the
related Sub-Servicer to, effect the timely payment of the premium on each
Primary Mortgage Insurance Policy. The Master Servicer and the related
Sub-Servicer shall have the power to substitute for any Primary Mortgage
Insurance Policy another substantially equivalent policy issued by another
Qualified Insurer; PROVIDED THAT such substitution is subject to the condition,
to be evidenced by a writing from each Rating Agency, that it would not cause
the ratings on the Certificates to be downgraded or withdrawn.

         Section 3.10. MAINTENANCE OF HAZARD INSURANCE AND FIDELITY COVERAGE.
(a) The Master Servicer shall maintain and keep, or cause each Sub-Servicer to
maintain and keep, with respect to each Mortgage Loan and each REO Property, in
full force and effect hazard insurance (fire insurance with extended coverage)
equal to at least the lesser of the Outstanding Principal Balance of the
Mortgage Loan or the current replacement cost of the Mortgaged Property, and
containing a standard mortgagee clause; PROVIDED, HOWEVER, that the amount of
hazard insurance may not be less than the amount necessary to prevent loss due
to the application of any co-insurance provision of the related policy. Unless
applicable state law requires a higher deductible, the deductible on such hazard
insurance policy may be no more than $1000 or 1% of the applicable amount of
coverage, whichever is less. In the case of a condominium unit or a unit in a
planned unit development, the required hazard insurance shall take the form of a
multiperil policy covering the entire condominium project or planned unit
development, in an amount equal to at least 100% of the insurable value based on
replacement cost.

         (b) Any amounts collected by the Master Servicer or a Sub-Servicer
under any such hazard insurance policy (other than amounts to be applied to the
restoration or repair of the Mortgaged Property or amounts released to the
Mortgagor in accordance with the Master Servicer's or Sub-Servicer's normal
servicing procedures, the terms of the Mortgage Note, the Security Instrument or
applicable law) shall be deposited initially in a Protected Account, for
transmittal to the Certificate Account, subject to withdrawal pursuant to
Section 4.03.

         (c) Any cost incurred by the Master Servicer or a Sub-Servicer in
maintaining any such hazard insurance policy shall not be added to the amount
owing under the related Mortgage Loan for the purpose of calculating monthly
distributions to Certificateholders, notwithstanding that the terms of such
Mortgage Loan so permit. Such costs shall be recoverable by the Master Servicer
or Sub-Servicer out of related late payments by the Mortgagor or out of
Insurance Proceeds or

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<PAGE>

Liquidation Proceeds or by the Master Servicer from the Repurchase Price, to the
extent permitted by Section 4.03.

         (d) No earthquake or other additional insurance is to be required of
any Mortgagor or maintained on property acquired with respect to a Security
Instrument other than pursuant to such applicable laws and regulations as shall
at any time be in force and shall require such additional insurance. The Master
Servicer shall cause an ongoing review to be performed of the related Mortgage
Loans to determine which, if any, of the Mortgaged Properties are located in a
federally designated special flood hazard area, and for each Mortgaged Property
found to be located in a federally designated special flood hazard area, the
Master Servicer shall use its best reasonable efforts to cause with respect to
the related Mortgage Loans and each REO Property, flood insurance (to the extent
available and in accordance with mortgage servicing industry practice) to be
maintained. Such flood insurance shall cover the related Mortgaged Property,
including all items taken into account in arriving at the Appraised Value on
which the Mortgage Loan was based, and shall be in an amount meeting the current
requirements of Fannie Mae or Freddie Mac, but not more than the maximum amount
of such insurance available for the related Mortgaged Property under either the
regular or emergency programs of the National Flood Insurance Program (assuming
that the area in which such Mortgaged Property is located is participating in
such program). Unless applicable state law requires a higher deductible, the
deductible on such flood insurance may not exceed $1,000 or 1% of the applicable
amount of coverage, whichever is less.

         (e) If insurance has not been maintained complying with Subsections
3.10(a) and (d) and there shall have been a loss which would have been covered
by such insurance had it been maintained, the Master Servicer shall pay, or
cause the related Sub-Servicer to pay, for any necessary repairs.

         (f) The Master Servicer shall present, or cause the related
Sub-Servicer to present, if it is a permitted claimant, claims under the related
hazard insurance or flood insurance policy.

         (g) The Master Servicer shall obtain and maintain at its own expense
and for the duration of this Agreement a blanket fidelity bond and an errors and
omissions insurance policy and shall cause each Sub-Servicer to obtain and
maintain an errors and omissions insurance policy covering such Sub-Servicer's
officers, employees and other persons acting on its behalf in connection with
its activities under this Agreement. The amount of coverage shall be at least
equal to the coverage maintained by the Master Servicer acceptable to Fannie Mae
or Freddie Mac to service loans for it or otherwise in an amount as is
commercially available at a cost that is generally not regarded as excessive by
industry standards. The Master Servicer shall promptly notify the Trustee of any
material change in the terms of such bond or policy. The Master Servicer shall
provide annually to the Trustee a certificate of insurance that such bond and
policy are in effect. If any such bond or policy ceases to be in effect, the
Master Servicer shall, to the extent possible, give the Trustee ten days' notice
prior to any such cessation and shall use its best efforts to obtain a
comparable replacement bond or policy, as the case may be. Any amounts relating
to the Mortgage Loans

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<PAGE>

collected under such bond or policy shall be remitted to the Certificate Account
to the extent that such amounts have not previously been paid to such account.

         Section 3.11. DUE-ON-SALE CLAUSES; ASSUMPTION AGREEMENTS. (a) In any
case in which the Master Servicer is notified by any Mortgagor or Sub-Servicer
that a Mortgaged Property relating to a Mortgage Loan has been or is about to be
conveyed by the Mortgagor, the Master Servicer shall enforce, or shall instruct
such Sub-Servicer to enforce, any due-on-sale clause contained in the related
Security Instrument to the extent permitted under the terms of the related
Mortgage Note and by applicable law unless the Master Servicer reasonably
believes such enforcement is likely to result in legal action by the Mortgagor.
If the Master Servicer reasonably believes that such due-on-sale clause cannot
be enforced under applicable law or if the related Mortgage Loan does not
contain a due-on-sale clause, the Master Servicer is authorized, and may
authorize any Sub-Servicer, to consent to a conveyance subject to the lien of
the Mortgage, and to take or enter into an assumption agreement from or with the
Person to whom such property has been or is about to be conveyed, pursuant to
which such Person becomes liable under the related Mortgage Note and unless
prohibited by applicable state law, such Mortgagor remains liable thereon, on
condition, however, that the related Mortgage Loan shall continue to be covered
(if so covered before the Master Servicer or the related Sub-Servicer enters
into such agreement) by any Primary Mortgage Insurance Policy. The Master
Servicer shall notify the Trustee, whenever possible, before the completion of
such assumption agreement, and shall forward to the Trustee the original copy of
such assumption agreement, which copy shall be added by the Trustee to the
related Mortgage File and which shall, for all purposes, be considered a part of
such Mortgage File to the same extent as all other documents and instruments
constituting a part thereof. In connection with any such assumption agreement,
the interest rate on the related Mortgage Loan shall not be changed and no other
material alterations in the Mortgage Loan shall be made. Any fee or additional
interest collected by the Master Servicer or Sub-Servicer for consenting to any
such conveyance or entering into any such assumption agreement may be retained
by the Master Servicer or the related Sub-Servicer as additional servicing
compensation.

         (b) Notwithstanding the foregoing paragraph or any other provision of
this Agreement, the Master Servicer shall not be deemed to be in default, breach
or any other violation of its obligations hereunder by reason of any assumption
of a Mortgage Loan by operation of law or any conveyance by the Mortgagor of the
related Mortgaged Property or assumption of a Mortgage Loan which the Master
Servicer reasonably believes, based on prudent servicing standards, it may be
restricted by law from preventing, for any reason whatsoever or if the exercise
of such right would impair or threaten to impair any recovery under any
applicable Insurance Policy, or, in the Master Servicer's judgment, be
reasonably, likely to result in legal action by the Mortgagor or would otherwise
adversely affect the Certificateholders.

         Section 3.12. REALIZATION UPON DEFAULTED MORTGAGE LOANS. (a) The Master
Servicer shall, or shall direct the related Sub-Servicer to, foreclose upon or
otherwise comparably convert the ownership of properties securing any related
Mortgage Loans that come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments

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<PAGE>

pursuant to Section 3.06 except that the Master Servicer shall not, and shall
not direct the related Sub-Servicer, if any, to, foreclose upon or otherwise
comparably convert a Mortgaged Property if there is evidence of environmental
hazards or toxic waste thereon and the Master Servicer determines it would be
imprudent to do so or not in accordance with appropriate servicing standards.
The Master Servicer can conclusively rely on results of third party inspections
from parties it reasonably believes are qualified to conduct such inspections.
In connection with such foreclosure or other conversion, the Master Servicer in
conjunction with the related Sub-Servicer, if any, shall use its best reasonable
efforts to preserve REO Property and to realize upon related defaulted Mortgage
Loans in such manner as to maximize the receipt of principal and interest by the
Certificateholders, taking into account, among other things, the timing of
foreclosure and the considerations set forth in Subsection 3.12(b). The
foregoing is subject to the proviso that the Master Servicer shall not be
required to expend its own funds in connection with any foreclosure or towards
the restoration of any property unless it determines in good faith (i) that such
restoration or foreclosure will increase the proceeds of liquidation of the
related Mortgage Loan to Certificateholders after reimbursement to itself for
such expenses and (ii) that such expenses will be recoverable to it either
through Liquidation Proceeds (respecting which it shall have priority for
purposes of reimbursements from the Certificate Account pursuant to Section
4.03) or through Insurance Proceeds (respecting which it shall have similar
priority). The Master Servicer shall be responsible for all other costs and
expenses incurred by it in any such proceedings; PROVIDED, HOWEVER, that it
shall be entitled to reimbursement thereof (as well as its normal servicing
compensation), and in respect of the Master Servicer only, to receive Excess
Liquidation Proceeds as additional servicing compensation to the extent that
transfers or withdrawals from the Certificate Account with respect thereto are
permitted under Section 4.03. Any income from or other funds (net of any income
taxes) generated by REO Property shall be deemed for purposes of this Agreement
to be Insurance Proceeds.

         (b) The Trust Fund shall not acquire any real property (or any personal
property incident to such real property) except in connection with a default or
reasonably foreseeable default of a Mortgage Loan. In the event that the Trust
Fund acquires any real property (or personal property incident to such real
property) in connection with a default or reasonably foreseeable default of a
Mortgage Loan, such property shall be disposed of by the Trust Fund before the
close of the third taxable year following the taxable year in which the Trust
Fund acquired such property (the "grace period") unless the Trustee shall have
received a REMIC Opinion with respect to such longer retention or the Master
Servicer applies for and receives an extension of the grace period under Section
856(e)(3) of the Code, in which case such grace period described above will be
extended by the period set forth in such REMIC Opinion or approved application,
as the case may be. The Trustee shall have no obligation to monitor compliance
with this Section 3.12 or to pay for such REMIC Opinion.

         Section 3.13. TRUSTEE TO COOPERATE; RELEASE OF MORTGAGE FILES. (a) Upon
payment in full of any Mortgage Loan or the receipt by the Master Servicer of a
notification that payment in full will be escrowed in a manner customary for
such purposes, the Master Servicer will immediately notify the Trustee by
delivering two copies (one of which will be returned to the Master Servicer with
the

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<PAGE>

Mortgage File) of a certification signed by a Servicing Officer in the form of
Exhibit D, or in a mutually agreeable electronic format which will, in lieu of a
signature on its face, originate from a Servicing Officer (which certification
shall include a statement to the effect that all amounts received or to be
received in connection with such payment which are required to be deposited in
the Certificate Account have been or will be so deposited), and shall request
delivery to the Master Servicer or a Sub-Servicer, as the case may be, of the
Mortgage File. Upon receipt of such certification and request, the Trustee shall
promptly, but in no event later than five Business Days, release the related
Mortgage File to the Master Servicer or a Sub-Servicer and execute and deliver
to the Master Servicer, without recourse, the request for reconveyance, deed of
reconveyance or release or satisfaction of mortgage or such instrument releasing
the lien of the Security Instrument (furnished by the Master Servicer), together
with the Mortgage Note with written evidence of cancellation thereon. No
expenses incurred in connection with any instrument of satisfaction or deed of
reconveyance shall be chargeable to the Certificate Account.

         (b) From time to time as is appropriate for the servicing or
foreclosure of any Mortgage Loan or collection under a Required Insurance
Policy, the Master Servicer shall deliver to the Trustee two copies (one of
which will be returned to the Master Servicer with the Mortgage File) of a
Request for Release signed by a Servicing Officer on behalf of the Master
Servicer in substantially the form attached as Exhibit D hereto, or in a
mutually agreeable electronic format which will, in lieu of a signature on its
face, originate from a Servicing Officer. Upon receipt of the Request for
Release, the Trustee shall deliver the Mortgage File or any document therein to
the Master Servicer or Sub-Servicer, as the case may be.

         (c) The Master Servicer shall cause each Mortgage File or any document
therein released pursuant to Subsection 3.13(b) to be returned to the Trustee
when the need therefor no longer exists, unless the related Mortgage Loan has
become a Liquidated Mortgage Loan and the Liquidation Proceeds relating to the
Mortgage Loan have been deposited in the Certificate Account or such Mortgage
File is being used to pursue foreclosure or other legal proceedings. Prior to
return of a Mortgage File or any document to the Trustee, the Master Servicer,
the related Insurer or Sub- Servicer to whom such file or document was delivered
shall retain such file or document in its respective control unless the Mortgage
File or such document has been delivered to an attorney, or to a public trustee
or other public official as required by law, to initiate or pursue legal action
or other proceedings for the foreclosure of the Mortgaged Property either
judicially or non-judicially, and the Master Servicer has delivered to the
Trustee a certificate of a Servicing Officer certifying as to the name and
address of the Person to which such Mortgage File or such document was delivered
and the purpose or purposes of such delivery. If a related Mortgage Loan becomes
a Liquidated Mortgage Loan, the Master Servicer shall deliver the Request for
Release with respect thereto to the Trustee upon deposit of the related
Liquidation Proceeds in the Certificate Account.

         (d) The Trustee shall execute and deliver to the Master Servicer any
court pleadings, requests for trustee's sale or other documents necessary or
desirable to (i) the foreclosure or trustee's sale with respect to a Mortgaged
Property; (ii) any legal action brought to obtain judgment against any Mortgagor
on the Mortgage Note or Security Instrument; (iii) obtain a deficiency judgment

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<PAGE>

against the Mortgagor; or (iv) enforce any other rights or remedies provided by
the Mortgage Note or Security Instrument or otherwise available at law or
equity. Together with such documents or pleadings the Master Servicer shall
deliver to the Trustee a certificate of a Servicing Officer in which it requests
the Trustee to execute the pleadings or documents. The certificate shall certify
and explain the reasons for which the pleadings or documents are required. It
shall further certify that the Trustee's execution and delivery of the pleadings
or documents will not invalidate any insurance coverage under the Required
Insurance Policies or invalidate or otherwise affect the lien of the Security
Instrument, except for the termination of such a lien upon completion of the
foreclosure or trustee's sale.

         Section 3.14. SERVICING AND MASTER SERVICING COMPENSATION. (a) As
compensation for its activities hereunder, the Master Servicer shall be entitled
to receive the Master Servicing Fee from full payments of accrued interest on
each Mortgage Loan, subject to the Master Servicer's obligation to pay
Compensating Interest Payments pursuant to Section 6.07.

         (b) The Master Servicer may retain additional servicing compensation in
the form of assumption fees, tax service fees, fees for statement of account or
payoff, late payment charges, modification fees, interest on amounts deposited
in any Accounts or Permitted Investments of such amounts, or otherwise. The
Master Servicer is also entitled to receive Excess Liquidation Proceeds as
additional servicing compensation. The Master Servicer shall be required to pay
all expenses it incurs in connection with servicing activities under this
Agreement, including fees and expenses to Sub-Servicers, and shall not be
entitled to reimbursement except as provided in this Agreement. Expenses to be
paid by the Master Servicer under this Subsection 3.14(b) shall include payment
of the expenses of the accountants retained pursuant to Section 3.16.

         Section 3.15. ANNUAL STATEMENT OF COMPLIANCE. Within 120 days after
December 31st of each year, commencing December 2000, the Master Servicer at its
own expense, shall deliver to the Trustee, with a copy to the Rating Agencies,
an Officer's Certificate stating, as to the signer thereof, that (i) a review of
the activities of the Master Servicer during the preceding fiscal year or
applicable portion thereof and of performance under this Agreement has been made
under such officer's supervision, (ii) to the best of such officer's knowledge,
based on such review, the Master Servicer has fulfilled all its obligations
under this Agreement for such year, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to such
officer and the nature and status thereof including the steps being taken by the
Master Servicer to remedy such default; (iii) a review of the activities of each
Sub-Servicer, if any, during the Sub-Servicer's most recently ended fiscal year
on or prior to such December 31st and its performance under its Sub- Servicing
Agreement has been made under such Officer's supervision; and (iv) to the best
of the Servicing Officer's knowledge, based on his review and the certification
of an officer of the Sub- Servicer (unless the Servicing Officer has reason to
believe that reliance on such certification is not justified), either each
Sub-Servicer has performed and fulfilled its duties, responsibilities and
obligations under this Agreement and its Sub-Servicing Agreement in all material
respects throughout the year, or, if there has been a default in performance or
fulfillment of any such duties, responsibilities or obligations, specifying the
nature and status of each such default known to the

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<PAGE>

Servicing Officer. Copies of such statements shall be provided by the Master
Servicer to the Certificateholders upon request or by the Trustee at the expense
of the Master Servicer should the Master Servicer fail to provide such copies.

         Section 3.16. ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING REPORT.
(a) Within 120 days after December 31st of each year, commencing December 2000,
the Master Servicer, at its expense, shall cause a firm of Independent public
accountants who are members of the American Institute of Certified Public
Accountants to furnish a statement to the Master Servicer, which will be
provided to the Trustee and the Rating Agencies to the effect that, in
connection with the firm's examination of the Master Servicer's overall
servicing activities for such fiscal year conducted in accordance with the
requirements of the Uniform Single Attestation Program for Mortgage Bankers,
nothing came to their attention that indicated that the Master Servicer was not
in compliance with Sections 3.07, 3.15, 4.01, 4.02 and 4.03 except for (i) such
exceptions as such firm believes to be immaterial and (ii) such other exceptions
as are set forth in such statement. In connection with the engagement to deliver
any such report (or other accountants' report or certificate hereunder) the
Trustee is authorized and directed to enter into such agreed-upon-procedures or
engagement letter as such accountants may request and shall be indemnified by
the Trust hereunder in so doing.

         (b) Within 120 days after the last day of the fiscal year, commencing
in 2000, of each Sub-Servicer or the Master Servicer (other than Cendant
Mortgage Corporation or the Trustee), the Master Servicer, at its expense, shall
furnish to the Trustee the most recently available letter or letters from one or
more firms of Independent certified public accountants who are members of the
American Institute of Certified Public Accountants reporting the results of such
firm's examination of the servicing procedures of any Sub-Servicer and the
Master Servicer (other than Cendant Mortgage Corporation or the Trustee) in
accordance with the requirements of the Uniform Single Attestation Program for
Mortgage Bankers, or such other program as may be certified as being comparable
by such accountant.

         Section 3.17. REMIC-RELATED COVENANTS. For as long as the Trust Fund
shall exist, the Master Servicer and the Trustee shall act in accordance
herewith to assure continuing treatment of the Trust Fund as a REMIC, and the
Trustee shall comply with any directions of the Master Servicer to assure such
continuing treatment. In particular, the Trustee shall not (a) sell or permit
the sale of all or any portion of the Mortgage Loans or of any Permitted
Investment unless such sale is as a result of a repurchase of the Mortgage Loans
pursuant to this Agreement or the Trustee has received a REMIC Opinion prepared
at the expense of the Trust Fund; and (b) other than with respect to a
substitution pursuant to Section 2.05, accept any contribution to the Trust Fund
after the Startup Day without receipt of a REMIC Opinion.

         Section 3.18. ADDITIONAL INFORMATION. The Master Servicer agrees to
furnish the Seller, at no expense to the Master Servicer, from time to time upon
reasonable request, such further information, reports and financial statements
as the Seller deems appropriate to prepare and file all necessary reports with
the Securities and Exchange Commission.

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<PAGE>

         Section 3.19. PERIODIC FILINGS WITH THE SECURITIES AND EXCHANGE
COMMISSION. The Trustee agrees to cooperate with the Seller in connection with
the Seller's satisfying the reporting requirements of the Trust Fund with the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934, as amended (the "Exchange Act"). The Seller shall prepare, execute and
file with respect to the Trust Fund any Forms 8-K and 10-K customary for similar
securities as required by the Exchange Act and the Rules and Regulations of the
Securities and Exchange Commission thereunder.

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<PAGE>

                                   ARTICLE IV

                                    Accounts

         Section 4.01. PROTECTED ACCOUNTS. (a) The Master Servicer shall
establish and maintain if it is servicing the Mortgage Loans and shall require
each Sub-Servicer to establish and maintain a Protected Account complying with
the requirements set forth in this Section 4.01, with records to be kept with
respect thereto on a Mortgage Loan by Mortgage Loan basis, into which accounts
shall be deposited within 48 hours of receipt all collections of principal and
interest on any Mortgage Loan and with respect to any REO Property received by
the Master Servicer, or a Sub-Servicer, including Principal Prepayments,
Insurance Proceeds, Liquidation Proceeds, and advances made from the Sub-
Servicer's own funds (less servicing compensation as permitted by Subsection
3.14(a)) and all other amounts to be deposited in the Protected Accounts. The
Master Servicer is hereby authorized to make withdrawals from and deposits to
the related Protected Accounts for purposes required or permitted by this
Agreement. All Protected Accounts shall be held in a Designated Depository
Institution and segregated on the books of such institution. The amount at any
time credited to a Protected Account shall be fully insured by the FDIC or, to
the extent that such balance exceeds the lesser of $100,000 or the limits of
such insurance, such excess either (i) must be invested in Permitted Investments
or (ii) may be deposited in a Rating Agency Eligible Account in the name of the
Trustee for the benefit of Certificateholders and not commingled with any other
funds. The Master Servicer may, and the Master Servicer may permit a
Sub-Servicer to, transfer funds to other accounts (which shall for purposes
hereof be deemed to be Protected Accounts), commingle accounts, or to establish
Protected Accounts not conforming to the foregoing requirements, to the extent
that such other accounts or Protected Accounts are Rating Agency Eligible
Accounts.

         Amounts on deposit in a Protected Account may be invested in Permitted
Investments in the name of the Trustee for the benefit of Certificateholders
and, except as provided in the preceding paragraph, not commingled with any
other funds, such Permitted Investments to mature, or to be subject to
redemption or withdrawal, no later than the date on which such funds are
required to be withdrawn for deposit in the Certificate Account, and shall be
held until required for such deposit. The income earned from Permitted
Investments made pursuant to this Section 4.01 shall be paid to the Master
Servicer or the related Sub-Servicer as additional compensation for its
obligations under this Agreement, and the risk of loss of moneys required to be
distributed to the Certificateholders resulting from such investments shall be
borne by and be the risk of the Master Servicer or the related Sub-Servicer. The
Master Servicer shall itself, or shall cause the related Sub-Servicer to,
deposit the amount of any such loss in the related Protected Account within two
Business Days of receipt of notification of such loss but not later than the
second Business Day prior to the Distribution Date on which the moneys so
invested are required to be distributed to the Certificateholders.

         (b) On or before each Funds Transfer Date, the Master Servicer shall
withdraw or shall cause to be withdrawn from the Protected Accounts and shall
immediately deposit or cause to be deposited in the Certificate Account amounts
representing the following collections and payments

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<PAGE>

(other than with respect to principal of or interest on the Mortgage Loans due
on or before the Cut- off Date):

                  (i) Scheduled Payments on the Mortgage Loans received or any
         related portion thereof advanced by the Master Servicer or
         Sub-Servicers which were due on or before the related Due Date, net of
         the amount thereof comprising the applicable Master Servicing Fee due
         the Master Servicer;

                  (ii) Full Principal Prepayments and any Liquidation Proceeds
         received by the Master Servicer or related Sub-Servicers with respect
         to such Mortgage Loans in the related Prepayment Period, with interest
         to the date of prepayment or liquidation, net of the amount thereof
         comprising the applicable Master Servicing Fee due the Master Servicer;
         and

                  (iii) Partial prepayments of principal received by the Master
         Servicer or related Sub- Servicers for such Mortgage Loans in the
         related Prepayment Period.

         (c) Withdrawals may be made from a Protected Account only to make
remittances as provided in Subsections 4.01(b) or 4.03(c); to reimburse the
Master Servicer or a Sub-Servicer for advances of principal and interest which
have been recovered by subsequent collection from the related Mortgagor; to
remove amounts deposited in error; to remove fees, charges or other such amounts
deposited on a temporary basis; or to clear and terminate the account at the
termination of this Agreement in accordance with Section 10.01. As provided in
Section 4.02(b) certain amounts otherwise due to the Master Servicer may be
retained by it and need not be deposited in the Certificate Account.

         (d) The Master Servicer shall promptly deliver to the Trustee, upon
request, a statement from the institution at which each Protected Account is
maintained showing deposits and withdrawals during the prior month.

         Section 4.02. CERTIFICATE ACCOUNT. (a) The Trustee shall establish and
maintain in the name of the Trustee, for the benefit of the Certificateholders,
the Certificate Account as a segregated non- interest bearing trust account or
accounts. The Trustee will deposit in the Certificate Account as received the
following amounts:

                  (i) Any amounts withdrawn from a Protected Account pursuant to
         Subsection 4.01(b);

                  (ii) Any Monthly Advance and any Compensating Interest
         Payments;

                  (iii) Any Insurance Proceeds or Liquidation Proceeds received
         by the Master Servicer which were not deposited in a Protected Account;

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<PAGE>

                  (iv) The Repurchase Price with respect to any Mortgage Loans
         purchased by a Mortgage Loan Seller pursuant to Sections 2.02 or 2.03,
         any amounts which are to be treated pursuant to Section 2.05 as the
         payment of such a Repurchase Price, and all proceeds of any Mortgage
         Loans or property acquired with respect thereto repurchased by the
         Seller or its designee or the Master Servicer or its designee pursuant
         to Section 10.01; and

                  (v) Any other amounts received by the Master Servicer or the
         Trustee and required to be deposited in the Certificate Account
         pursuant to this Agreement.

         (b) All amounts deposited to the Certificate Account shall be held by
the Trustee in the name of the Trustee in trust for the benefit of the
Certificateholders in accordance with the terms and provisions of this
Agreement, subject to the right of the Master Servicer to require the Trustee to
make withdrawals therefrom as provided herein. The foregoing requirements for
crediting the Certificate Account shall be exclusive, it being understood and
agreed that, without limiting the generality of the foregoing, payments in the
nature of (i) prepayment or late payment charges or assumption, tax service,
statement account or payoff, substitution, satisfaction, release and other like
fees and charges and (ii) the items enumerated in Subsections 4.03(a)(i), (ii),
(iii), (iv), (vi), (vii), (ix) and (xi) need not be credited by the Master
Servicer or the related Sub-Servicer to the Certificate Account and may be
retained by the Master Servicer or the related Sub-Servicer as servicing
compensation. In the event that the Master Servicer shall deposit or cause to be
deposited to the Certificate Account any amount not required to be credited
thereto, the Trustee, upon receipt of a written request therefor signed by a
Servicing Officer of the Master Servicer, shall promptly transfer such amount to
the Master Servicer, any provision herein to the contrary notwithstanding.

         (c) The Certificate Account shall constitute a trust account of the
Trust Fund segregated on the books of the Trustee and held by the Trustee in
trust in its Corporate Trust Office and the Certificate Account and the funds
deposited therein shall not be subject to, and shall be protected from, all
claims, liens, and encumbrances of any creditors or depositors of the Trustee or
the Master Servicer (whether made directly, or indirectly through a liquidator
or receiver of the Trustee or the Master Servicer). The amount at any time
credited to the Certificate Account shall be (i) fully insured by the FDIC to
the maximum coverage provided thereby, (ii) invested, at the written direction
of the Master Servicer, in the name of the Trustee, or its nominee, for the
benefit of the Certificateholders, in Permitted Investments described in clause
(viii) of the definition of Permitted Investments, to be held by the Trustee as
directed by the Master Servicer, or (iii) from the maturity of any Permitted
Investment on the Business Day prior to a Distribution Date through the
distribution of such funds on such Distribution Date, held by the Trustee
uninvested in such Certificate Account. All Permitted Investments shall mature
or be subject to redemption or withdrawal on or before, and shall be held until,
the next succeeding Distribution Date if the obligor for such Permitted
Investment is the Trustee or, if such obligor is any other Person, the Business
Day preceding such Distribution Date. The Master Servicer shall be entitled to
all investment earnings on amounts in the Certificate Account. If the Master
Servicer does not provide written instruction to the Trustee to invest amounts
in the Certificate Account, such amounts shall be held uninvested. With respect
to the Certificate Account and the funds deposited therein, the Trustee shall
take such action as may be necessary to

                                       55

<PAGE>

ensure that the Certificateholders shall be entitled to the priorities afforded
to such a trust account (in addition to a claim against the estate of the
Trustee) as provided by 12 U.S.C. ss. 92a(e), if applicable, or any applicable
comparable state statute applicable to state chartered banking corporations.

         Section 4.03. PERMITTED WITHDRAWALS AND TRANSFERS FROM THE CERTIFICATE
ACCOUNT. (a) The Trustee will, from time to time on receipt of written
instructions from the Master Servicer, make or cause to be made such withdrawals
or transfers from the Certificate Account as the Master Servicer has designated
for such transfer or withdrawal as specified in a certificate signed by a
Servicing Officer (upon which the Trustee may conclusively rely) for the
following purposes (limited in the case of amounts due the Master Servicer to
those not withdrawn from the Protected Account in accordance with the terms of
this Agreement):

                  (i) to reimburse the Master Servicer or any Sub-Servicer for
         any Monthly Advance of its own funds or any advance of such
         Sub-Servicer's own funds, the right of the Master Servicer or a
         Sub-Servicer to reimbursement pursuant to this subclause (i) being
         limited to amounts received on a particular related Mortgage Loan
         (including, for this purpose, the Repurchase Price therefor, Insurance
         Proceeds and Liquidation Proceeds) which represent late payments or
         recoveries of the principal of or interest on such Mortgage Loan
         respecting which such Monthly Advance or advance was made;

                  (ii) to reimburse the Master Servicer or any Sub-Servicer from
         Insurance Proceeds or Liquidation Proceeds relating to a particular
         related Mortgage Loan for amounts expended by the Master Servicer or
         such Sub-Servicer pursuant to Section 3.12 in good faith in connection
         with the restoration of the related Mortgaged Property which was
         damaged by an Uninsured Cause or in connection with the liquidation of
         such Mortgage Loan;

                  (iii) to reimburse the Master Servicer or any Sub-Servicer
         from Insurance Proceeds relating to a particular related Mortgage Loan
         for Insured Expenses incurred with respect to such Mortgage Loan and to
         reimburse the Master Servicer or such Sub-Servicer from Liquidation
         Proceeds from a particular related Mortgage Loan for Liquidation
         Expenses incurred with respect to such Mortgage Loan; PROVIDED THAT the
         Master Servicer shall not be entitled to reimbursement for Liquidation
         Expenses with respect to a Mortgage Loan to the extent that (i) any
         amounts with respect to such Mortgage Loan were paid as Excess
         Liquidation Proceeds pursuant to clause (xi) of this Subsection 4.03(a)
         to the Master Servicer; and (ii) such Liquidation Expenses were not
         included in the computation of such Excess Liquidation Proceeds;

                  (iv) to pay the Master Servicer or any Sub-Servicer (payment
         to any Sub-Servicer to be subject to prior payment to the Master
         Servicer of an amount equal to the applicable Master Servicing Fee), as
         appropriate, from Liquidation Proceeds or Insurance Proceeds received
         in connection with the liquidation of any Mortgage Loan, the amount
         which it or such Sub-Servicer would have been entitled to receive under
         subclause (ix) of this

                                       56

<PAGE>

         Subsection 4.03(a) as servicing compensation on account of each
         defaulted scheduled payment on such Mortgage Loan if paid in a timely
         manner by the related Mortgagor, but only to the extent that the
         aggregate of Liquidation Proceeds and Insurance Proceeds with respect
         to such Mortgage Loan, after any reimbursement to the Master Servicer
         or any Sub- Servicer, pursuant to subclauses (i), (ii), (iii) and (vi)
         of this Subsection 4.03(a), exceeds the Outstanding Principal Balance
         of such Mortgage Loan plus accrued and unpaid interest thereon at the
         related Mortgage Interest Rate less the applicable Master Servicing Fee
         Rate to but not including the date of payment;

                  (v) to pay the Master Servicer or any Sub-Servicer (payment to
         any Sub-Servicer to be subject to prior payment to the Master Servicer
         of the portion of the applicable Master Servicing Fee which the Master
         Servicer is entitled to retain as evidenced in writing to the Trustee
         by the Master Servicer), as appropriate, from the Repurchase Price for
         any related Mortgage Loan, the amount which it or such Sub-Servicer
         would have been entitled to receive under subclause (ix) of this
         Subsection 4.03(a) as servicing compensation, but only to the extent
         that the Repurchase Price with respect to such Mortgage Loan after any
         reimbursement to the Master Servicer and Sub-Servicer pursuant to
         subclauses (i) and (vi) of this Subsection 4.03(a) exceeds the
         Outstanding Principal Balance of such Mortgage Loan plus accrued and
         unpaid interest thereon at the related Mortgage Interest Rate less the
         applicable Master Servicing Fee Rate through the last day of the month
         of repurchase;

                  (vi) to reimburse the Master Servicer or any Sub-Servicer for
         advances of funds pursuant to Sections 3.07, 3.09 and 3.10, the right
         to reimbursement pursuant to this subclause being limited to amounts
         received on the related Mortgage Loan (including, for this purpose, the
         Repurchase Price therefor, Insurance Proceeds and Liquidation Proceeds)
         which represent late recoveries of the payments for which such advances
         were made;

                  (vii) to pay the Master Servicer or any Sub-Servicer, as the
         case may be, with respect to each related Mortgage Loan that has been
         purchased pursuant to Section 2.02, 2.04, 2.05 or 10.01, all amounts
         received thereon, representing recoveries of principal that reduce the
         Outstanding Principal Balance of such Mortgage Loan below the
         Outstanding Principal Balance used in calculating the Repurchase Price
         or representing interest included in the calculation of the Repurchase
         Price or accrued after the end of the month during which such
         repurchase occurs;

                  (viii) to reimburse the Master Servicer or any Sub-Servicer
         for any Monthly Advance or advance, after a Realized Loss has been
         allocated with respect to the related Mortgage Loan if the Monthly
         Advance or advance has not been reimbursed pursuant to clauses (i) and
         (vi);

                  (ix) to pay the Master Servicer and any Sub-Servicer servicing
         compensation as set forth in Section 3.14;

                                       57

<PAGE>

                  (x) to reimburse the Master Servicer for expenses, costs and
         liabilities incurred by and reimbursable to it pursuant to Subsection
         7.04(d);

                  (xi) to pay to the Master Servicer, as additional servicing
         compensation, any Excess Liquidation Proceeds;

                  (xii) to reimburse the Trustee's expenses to the extent not
         paid by the Master Servicer in accordance with Section 9.05;

                  (xiii) to clear and terminate the Certificate Account pursuant
         to Section 10.01; and

                  (xiv) to remove amounts deposited in error.

         The Master Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of accounting for any
reimbursement from the Certificate Account pursuant to subclauses (i) through
(vi), inclusive, and (viii) or with respect to any such amounts which would have
been covered by such subclauses had the amounts not been retained by the Master
Servicer without being deposited in the Certificate Account under Section
4.02(b).

         (b) On each Distribution Date, the Trustee shall make the following
payments in the priority set forth from the funds in the Certificate Account:

                  (i) First, the Trustee's Fees shall be paid to the Trustee;
         and

                  (ii) Second, the amount distributable to the Holders of the
         Certificates shall be payable in accordance with Section 6.01.

         (c) Notwithstanding the provisions of this Section 4.03, the Master
Servicer may, but is not required to, allow the Sub-Servicers to deduct from
amounts received by them or from the related Protected Account, prior to deposit
in the Certificate Account, any portion to which such Sub- Servicers are
entitled as servicing compensation (including income on Permitted Investments)
or reimbursement of any reimbursable advances made by such Sub-Servicers.

                                       58

<PAGE>

                                   ARTICLE V

                                  Certificates

         Section 5.01. CERTIFICATES. (a) The Depository, the Seller and the
Trustee have entered into a Depository Agreement dated as of October 29, 2000
(the "Depository Agreement"). Except for the Class P, Class X, Residual and
Individual Certificates and as provided in Subsection 5.01(b), the Certificates
shall at all times remain registered in the name of the Depository or its
nominee and at all times: (i) registration of such Certificates may not be
transferred by the Trustee except to a successor to the Depository; (ii)
ownership and transfers of registration of such Certificates on the books of the
Depository shall be governed by applicable rules established by the Depository;
(iii) the Depository may collect its usual and customary fees, charges and
expenses from its Depository Participants; (iv) the Trustee shall deal with the
Depository as representative of such Certificate Owners of the respective Class
of Certificates for purposes of exercising the rights of Certificateholders
under this Agreement, and requests and directions for and votes of such
representative shall not be deemed to be inconsistent if they are made with
respect to different Certificate Owners; and (v) the Trustee may rely and shall
be fully protected in relying upon information furnished by the Depository with
respect to its Depository Participants.

         The Class P, Class X, Residual and Private Certificates are initially
Physical Certificates. If at any time the Holders of all of the Certificates of
one or more such Classes request that the Trustee cause such Class to become
Global Certificates, the Trustee and the Seller will take such action as may be
reasonably required to cause the Depository to accept such Class or Classes for
trading if it may legally be so traded.

         All transfers by Certificate Owners of such respective Classes of
Book-Entry Certificates and any Global Certificates shall be made in accordance
with the procedures established by the Depository Participant or brokerage firm
representing such Certificate Owners. Each Depository Participant shall only
transfer Book-Entry Certificates of Certificate Owners it represents or of
brokerage firms for which it acts as agent in accordance with the Depository's
normal procedures.

         (b) If (i)(A) the Seller advises the Trustee in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository and (B) the Trustee or the Seller is unable to
locate a qualified successor within 30 days or (ii) the Seller at its option
advises the Trustee in writing that it elects to terminate the book-entry system
through the Depository, the Trustee shall request that the Depository notify all
Certificate Owners of the occurrence of any such event and of the availability
of definitive, fully registered Certificates to Certificate Owners requesting
the same. Upon surrender to the Trustee of the Certificates by the Depository,
accompanied by registration instructions from the Depository for registration,
the Trustee shall issue the definitive Certificates. Neither the Seller, the
Master Servicer nor the Trustee shall be liable for any delay in delivery of
such instructions and may conclusively rely on, and shall be protected in
relying on, such instructions.

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<PAGE>

         (c) (i) The Classes of the Certificates shall have the following
designations, initial principal amounts and Pass-Through Rates:

<TABLE>
<CAPTION>
             Designation                Initial Principal or Notional Amount             Pass-through Rate
             -----------                ------------------------------------             -----------------
<S>                                     <C>                                              <C>
     Class A-1 Certificates                                 $154,290,797.00                      7.50%
     Class A-2 Certificates                                   $7,000,000.00                      7.50%
     Class A-3 Certificates                                  $10,000,000.00                      7.50%
     Class A-4 Certificates                                  $22,500,000.00                      7.50%
     Class A-5 Certificates                                  $22,500,000.00                      7.50%
     Class X Certificates                                   $225,371,952.00(1)                    (2)
     Class P Certificates                                        $66,176.00                      0.00%(3)
     Class B-1 Certificates                                   $4,732,800.00                      7.50%
     Class B-2 Certificates                                   $1,690,300.00                      7.50%
     Class B-3 Certificates                                   $1,014,100.00                      7.50%
     Class B-4 Certificates                                     $676,100.00                      7.50%
     Class B-5 Certificates                                     $450,800.00                      7.50%
     Class B-6 Certificates                                     $450,779.40                      7.50%
     Class R Certificates                                           $100.00                      7.50%
</TABLE>

         ------------
*        Notional Amount.

(1)      The Class X Certificates will have a Notional Amount equal to the
         aggregate Scheduled Principal Balances of the Mortgage Loans and will
         bear interest on their Notional Amount at a variable Pass-Through Rate
         equal to the weighted average of the Pool Strip Rates on each Mortgage
         Loan.

(2)      See the definition of Pass-Through Rate. For the Class X Certificates,
         the Pass-Through Rate for the initial Interest Accrual Period is
         approximately 0.569101% per annum.

(3)      The Class P Certificates are principal only certificates and will not
         bear interest. The Current Principal Amount of the Class P Certificates
         initially will be the amount shown above and is composed of a strip of
         principal from the Discount Mortgage Loans.

                  (d) With respect to each Distribution Date, each Class of
Certificates (other than the Class P Certificates) shall accrue interest during
the related Interest Accrual Period. With respect to each Distribution Date and
each such Class of Certificates, interest shall be calculated, on the basis of a
360-day year comprised of twelve 30-day months, based upon the respective
Pass-Through Rate set forth, or determined as provided, above and the Current
Principal Amount or Notional Amount of such Class applicable to such
Distribution Date. Interest will accrue on the Accrual Certificates but will not
be paid as interest to such Class so long as it is outstanding prior to the
Accrual Termination Date. The Accrual Distribution Amount will be distributed as
principal as provided in Section 6.01(a)(C).

                  (e) The Certificates shall be substantially in the forms set
forth in Exhibit A-1, A-2, A-3 and A-4. On original issuance, the Trustee shall
sign, countersign and shall deliver them at the direction of the Seller. Pending
the preparation of definitive Certificates of any Class, the Trustee may sign
and countersign temporary Certificates that are printed, lithographed or
typewritten, in authorized denominations for Certificates of such Class,
substantially of the tenor of the definitive

                                       60

<PAGE>

Certificates in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers or
authorized signatories executing such Certificates may determine, as evidenced
by their execution of such Certificates. If temporary Certificates are issued,
the Seller will cause definitive Certificates to be prepared without
unreasonable delay. After the preparation of definitive Certificates, the
temporary Certificates shall be exchangeable for definitive Certificates upon
surrender of the temporary Certificates at the office of the Trustee, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Certificates, the Trustee shall sign and countersign and deliver in
exchange therefor a like aggregate principal amount, in authorized denominations
for such Class, of definitive Certificates of the same Class. Until so
exchanged, such temporary Certificates shall in all respects be entitled to the
same benefits as definitive Certificates.

         (f) Each Class of Book-Entry Certificates will be registered as a
single Certificate of such Class held by a nominee of the Depository or the DTC
Custodian, and beneficial interests will be held by investors through the
book-entry facilities of the Depository in minimum denominations of (i) in the
case of the Senior Certificates which are Book-Entry Certificates, $1,000 and in
each case increments of $1.00 in excess thereof, and (ii) in the case of the
Offered Subordinate Certificates, $25,000 and increments of $1.00 in excess
thereof, except that one Certificate of each such Class may be issued in a
different amount so that the sum of the denominations of all outstanding
Certificates of such Class shall equal the Current Principal Amount or Notional
Amount of such Class on the Closing Date. On the Closing Date, the Trustee shall
execute and countersign Physical Certificates all in an aggregate principal
amount that shall equal the Current Principal Amount of such Class on the
Closing Date. The Class P and Class X Certificates will be issued in
certificated fully-registered form in minimum denominations of $1,000 and
increments of $1.00 in excess thereof, except that one Certificate of each such
Class may be issued in a different amount so that the sum of the denominations
of all outstanding Certificates of such Class shall equal the Current Principal
Amount of such Class on the Closing Date. The Private Certificates will be
issued in certificated fully-registered form in minimum denominations of $50,000
and increments of $1.00 in excess thereof, except that one Certificate of each
such Class may be issued in a different amount so that the sum of the
denominations of all outstanding Certificates of such Class shall equal the
Current Principal Amount of such Class on the Closing Date. The Residual
Certificates shall be issued in certificated fully-registered form in the
denomination of $50 each. Each Class of Global Certificates, if any, shall be
issued in fully registered form in minimum dollar denominations of $50,000 and
integral multiples of $1.00 in excess thereof, except that one Certificate of
each Class may be in a different denomination so that the sum of the
denominations of all outstanding Certificates of such Class shall equal the
Current Principal Amount of such Class on the Closing Date. On the Closing Date,
the Trustee shall execute and countersign (i) in the case of each Class of
Offered Certificates, the Certificate in the entire Current Principal Amount or
Notional Amount of the respective Class and (ii) in the case of each Class of
Private Certificates, all in an aggregate principal amount that shall equal the
Current Principal Amount of each such respective Class on the Closing Date. The
Certificates referred to in clause (i) and if at any time there are to be Global
Certificates, the Global Certificates shall be delivered by the Seller to the
Depository or pursuant to the Depository's instructions, shall be delivered by
the Seller on behalf of the Depository to and

                                       61

<PAGE>

deposited with the DTC Custodian. The Trustee shall sign the Certificates by
facsimile or manual signature and countersign them by manual signature on behalf
of the Trustee by one or more authorized signatories, each of whom shall be a
Responsible Officer of the Trustee or its agent. A Certificate bearing the
manual and facsimile signatures of individuals who were the authorized
signatories of the Trustee or its agent at the time of issuance shall bind the
Trustee, notwithstanding that such individuals or any of them have ceased to
hold such positions prior to the delivery of such Certificate.

         (g) No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless there appears on such Certificate
the manually executed countersignature of the Trustee or its agent, and such
countersignature upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly executed and delivered hereunder.
All Certificates issued on the Closing Date shall be dated the Closing Date. All
Certificates issued thereafter shall be dated the date of their
countersignature.

         (h) The Closing Date is hereby designated as the "startup" day of the
REMIC within the meaning of Section 860G(a)(9) of the Code.

         (i) For federal income tax purposes, the REMIC shall have a tax year
that is a calendar year and shall report income on an accrual basis.

         (j) The Trustee on behalf of the Trust shall cause the Trust Fund to
elect to be treated as a REMIC under Section 860D of the Code. Any
inconsistencies or ambiguities in this Agreement or in the administration of any
Trust established hereby shall be resolved in a manner that preserves the
validity of such elections.

         (k) The Assumed Final Distribution Date for distributions on the
Certificates is November 25, 2030; the latest possible maturity date of the
"regular interests" of the REMIC is November 25, 2030.

         Section 5.02. REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.
(a) The Trustee shall maintain at its Corporate Trust Office a Certificate
Register in which, subject to such reasonable regulations as it may prescribe,
the Trustee shall provide for the registration of Certificates and of transfers
and exchanges of Certificates as herein provided.

         (b) Subject to Subsection 5.01(a) and, in the case of any Global
Certificate or Physical Certificate upon the satisfaction of the conditions set
forth below, upon surrender for registration of transfer of any Certificate at
any office or agency of the Trustee maintained for such purpose, the Trustee
shall sign, countersign and shall deliver, in the name of the designated
transferee or transferees, a new Certificate of a like Class and aggregate
Fractional Undivided Interest, but bearing a different number.

                                       62

<PAGE>

         (c) By acceptance of an Individual Certificate, whether upon original
issuance or subsequent transfer, each holder of such a Certificate acknowledges
the restrictions on the transfer of such Certificate set forth in the Securities
Legend and agrees that it will transfer such a Certificate only as provided
herein. In addition to the provisions of Subsection 5.02(h), the following
restrictions shall apply with respect to the transfer and registration of
transfer of an Individual Certificate to a transferee that takes delivery in the
form of an Individual Certificate:

                  (i) The Trustee shall register the transfer of an Individual
         Certificate if the requested transfer is being made to a transferee who
         has provided the Trustee with a Rule 144A Certificate or comparable
         evidence as to its QIB status.

                  (ii) The Trustee shall register the transfer of any Individual
         Certificate if (x) the transferor has advised the Trustee in writing
         that the Certificate is being transferred to an Institutional
         Accredited Investor; and (y) prior to the transfer the transferee
         furnishes to the Trustee an Investment Letter (and the Trustee shall be
         fully protected in so doing), provided that, if based upon an Opinion
         of Counsel to the effect that the delivery of (x) and (y) above are not
         sufficient to confirm that the proposed transfer is being made pursuant
         to an exemption from, or in a transaction not subject to, the
         registration requirements of the Securities Act and other applicable
         laws, the Trustee shall as a condition of the registration of any such
         transfer require the transferor to furnish such other certifications,
         legal opinions or other information prior to registering the transfer
         of an Individual Certificate as shall be set forth in such Opinion of
         Counsel.

         (d) Subject to Subsection 5.02(h), so long as a Global Certificate of
such Class is outstanding and is held by or on behalf of the Depository,
transfers of beneficial interests in such Global Certificate, or transfers by
holders of Individual Certificates of such Class to transferees that take
delivery in the form of beneficial interests in the Global Certificate, may be
made only in accordance with this Subsection 5.02(d) and in accordance with the
rules of the Depository:

                  (i) In the case of a beneficial interest in the Global
         Certificate being transferred to an Institutional Accredited Investor,
         such transferee shall be required to take delivery in the form of an
         Individual Certificate or Certificates and the Trustee shall register
         such transfer only upon compliance with the provisions of Subsection
         5.02(c)(ii).

                  (ii) In the case of a beneficial interest in a Class of Global
         Certificates being transferred to a transferee that takes delivery in
         the form of an Individual Certificate or Certificates of such Class,
         except as set forth in clause (i) above, the Trustee shall register
         such transfer only upon compliance with the provisions of Subsection
         5.02(c)(i).

                  (iii) In the case of an Individual Certificate of a Class
         being transferred to a transferee that takes delivery in the form of a
         beneficial interest in a Global Certificate of such Class, the Trustee
         shall register such transfer if the transferee has provided the Trustee
         with a Rule 144A Certificate or comparable evidence as to its QIB
         status.

                                       63

<PAGE>

                  (iv) No restrictions shall apply with respect to the transfer
         or registration of transfer of a beneficial interest in the Global
         Certificate of a Class to a transferee that takes delivery in the form
         of a beneficial interest in the Global Certificate of such Class;
         provided that each such transferee shall be deemed to have made such
         representations and warranties contained in the Rule 144A Certificate
         as are sufficient to establish that it is a QIB.

         (e) Subject to Subsection 5.02(h), an exchange of a beneficial interest
in a Global Certificate of a Class for an Individual Certificate or Certificates
of such Class, an exchange of an Individual Certificate or Certificates of a
Class for a beneficial interest in the Global Certificate of such Class and an
exchange of an Individual Certificate or Certificates of a Class for another
Individual Certificate or Certificates of such Class (in each case, whether or
not such exchange is made in anticipation of subsequent transfer, and, in the
case of the Global Certificate of such Class, so long as such Certificate is
outstanding and is held by or on behalf of the Depository) may be made only in
accordance with this Subsection 5.02(e) and in accordance with the rules of the
Depository:

                  (i) A holder of a beneficial interest in a Global Certificate
         of a Class may at any time exchange such beneficial interest for an
         Individual Certificate or Certificates of such Class.

                  (ii) A holder of an Individual Certificate or Certificates of
         a Class may exchange such Certificate or Certificates for a beneficial
         interest in the Global Certificate of such Class if such holder
         furnishes to the Trustee a Rule 144A Certificate or comparable evidence
         as to its QIB status.

                  (iii) A holder of an Individual Certificate of a Class may
         exchange such Certificate for an equal aggregate principal amount of
         Individual Certificates of such Class in different authorized
         denominations without any certification.

         (f) (i) Upon acceptance for exchange or transfer of an Individual
Certificate of a Class for a beneficial interest in a Global Certificate of such
Class as provided herein, the Trustee shall cancel such Individual Certificate
and shall (or shall request the Depository to) endorse on the schedule affixed
to the applicable Global Certificate (or on a continuation of such schedule
affixed to the Global Certificate and made a part thereof) or otherwise make in
its books and records an appropriate notation evidencing the date of such
exchange or transfer and an increase in the certificate balance of the Global
Certificate equal to the certificate balance of such Individual Certificate
exchanged or transferred therefor.

                  (ii) Upon acceptance for exchange or transfer of a beneficial
                  interest in a Global Certificate of a Class for an Individual
                  Certificate of such Class as provided herein, the Trustee
                  shall (or shall request the Depository to) endorse on the
                  schedule affixed to such Global Certificate (or on a
                  continuation of such schedule affixed to such Global
                  Certificate and made a part thereof) or otherwise make in its
                  books and records an appropriate notation evidencing the date
                  of such exchange or transfer and

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<PAGE>

                  a decrease in the certificate balance of such Global
                  Certificate equal to the certificate balance of such
                  Individual Certificate issued in exchange therefor or upon
                  transfer thereof.

         (g) The Securities Legend shall be placed on any Individual Certificate
issued in exchange for or upon transfer of another Individual Certificate or of
a beneficial interest in a Global Certificate.

         (h) Subject to the restrictions on transfer and exchange set forth in
this Section 5.02, the holder of any Individual Certificate may transfer or
exchange the same in whole or in part (in an initial certificate balance equal
to the minimum authorized denomination set forth in Section 5.01(f) above or any
integral multiple of $1.00 in excess thereof) by surrendering such Certificate
at the Corporate Trust Office, or at the office of any transfer agent, together
with an executed instrument of assignment and transfer satisfactory in form and
substance to the Trustee in the case of transfer and a written request for
exchange in the case of exchange. The holder of a beneficial interest in a
Global Certificate may, subject to the rules and procedures of the Depository,
cause the Depository (or its nominee) to notify the Trustee in writing of a
request for transfer or exchange of such beneficial interest for an Individual
Certificate or Certificates. Following a proper request for transfer or
exchange, the Trustee shall, within five Business Days of such request made at
such Corporate Trust Office, sign, countersign and deliver at such Corporate
Trust Office, to the transferee (in the case of transfer) or holder (in the case
of exchange) or send by first class mail at the risk of the transferee (in the
case of transfer) or holder (in the case of exchange) to such address as the
transferee or holder, as applicable, may request, an Individual Certificate or
Certificates, as the case may require, for a like aggregate Fractional Undivided
Interest and in such authorized denomination or denominations as may be
requested. The presentation for transfer or exchange of any Individual
Certificate shall not be valid unless made at the Corporate Trust Office by the
registered holder in person, or by a duly authorized attorney-in-fact.

         (i) At the option of the Certificateholders, Certificates may be
exchanged for other Certificates of authorized denominations of a like Class and
aggregate Fractional Undivided Interest, upon surrender of the Certificates to
be exchanged at any such office or agency; PROVIDED, HOWEVER, that no
Certificate may be exchanged for new Certificates unless the original Fractional
Undivided Interest represented by each such new Certificate (i) is at least
equal to the minimum authorized denomination or (ii) is acceptable to the Seller
as indicated to the Trustee in writing. Whenever any Certificates are so
surrendered for exchange, the Trustee shall sign and countersign and the Trustee
shall deliver the Certificates which the Certificateholder making the exchange
is entitled to receive.

         (j) If the Trustee so requires, every Certificate presented or
surrendered for transfer or exchange shall be duly endorsed by, or be
accompanied by a written instrument of transfer, with a signature guarantee, in
form satisfactory to the Trustee, duly executed by the holder thereof or his or
her attorney duly authorized in writing.

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         (k) No service charge shall be made for any transfer or exchange of
Certificates, but the Trustee may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
transfer or exchange of Certificates.

         (l) The Trustee shall cancel all Certificates surrendered for transfer
or exchange but shall retain such Certificates in accordance with its standard
retention policy or for such further time as is required by the record retention
requirements of the Securities Exchange Act of 1934, as amended, and thereafter
may destroy such Certificates.

         (m) The following legend shall be placed on each Class of Subordinate
Certificates, whether upon original issuance or upon issuance of any other
Certificate of any such Class in exchange therefor or upon transfer thereof:

         THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
         BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT
         WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY
         ACT OF 1974, AS AMENDED, AND/OR SECTION 4975 OF THE INTERNAL REVENUE
         CODE OF 1986, AS AMENDED, UNLESS THE PROPOSED TRANSFER AND/OR HOLDING
         OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND/OR OPERATION OF THE
         TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED TRANSACTION
         WHICH IS NOT COVERED UNDER AN INDIVIDUAL OR CLASS PROHIBITED
         TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED TO, PROHIBITED
         TRANSACTION EXEMPTION ("PTE") 84-14, PTE 91-38, PTE 90-1, PTE 95-60 OR
         PTE 96-23 AND (II) WILL NOT GIVE RISE TO ANY ADDITIONAL FIDUCIARY
         DUTIES ON THE PART OF THE MASTER SERVICER OR THE TRUSTEE, WHICH WILL BE
         DEEMED REPRESENTED BY AN OWNER OF A BOOK-ENTRY CERTIFICATE OR A GLOBAL
         CERTIFICATE AND WILL BE EVIDENCED BY A REPRESENTATION TO SUCH EFFECT BY
         OR ON BEHALF OF A HOLDER OF A PRIVATE CERTIFICATE.

         Section 5.03. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. (a) If
(i) any mutilated Certificate is surrendered to the Trustee, or the Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and (ii) there is delivered to the Trustee such security or
indemnity as it may require to save it harmless, and (iii) the Trustee has not
received notice that such Certificate has been acquired by a third Person, the
Trustee shall sign, countersign and deliver, in exchange for or in lieu of any
such mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
tenor and Fractional Undivided Interest but in each case bearing a different
number. The mutilated, destroyed, lost or stolen Certificate shall thereupon be
canceled of record by the Trustee and shall be of no further effect and evidence
no rights.

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         (b) Upon the issuance of any new Certificate under this Section 5.03,
the Trustee may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Any duplicate Certificate issued pursuant to this Section 5.03 shall constitute
complete and indefeasible evidence of ownership in the Trust Fund, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.

         Section 5.04. PERSONS DEEMED OWNERS. Prior to due presentation of a
Certificate for registration of transfer, the Seller, the Master Servicer, the
Trustee and any agent of the Seller, the Master Servicer or the Trustee may
treat the Person in whose name any Certificate is registered as the owner of
such Certificate for the purpose of receiving distributions pursuant to Section
6.01 and for all other purposes whatsoever. Neither the Seller, the Master
Servicer, the Trustee nor any agent of the Seller, the Master Servicer or the
Trustee shall be affected by notice to the contrary. No Certificate shall be
deemed duly presented for a transfer effective on any Record Date unless the
Certificate to be transferred is presented no later than the close of business
on the third Business Day preceding such Record Date.

         Section 5.05. TRANSFER RESTRICTIONS ON RESIDUAL CERTIFICATES. (a)
Residual Certificates, or interests therein, may not be transferred without the
prior express written consent of the Tax Matters Person and the Seller. As a
prerequisite to such consent, the proposed transferee must provide the Tax
Matters Person, the Seller and the Trustee with an affidavit that the proposed
transferee is a Permitted Transferee.

         (b) No transfer, sale or other disposition of a Residual Certificate
(including a beneficial interest therein) may be made unless, prior to the
transfer, sale or other disposition of a Residual Certificate, the proposed
transferee (including the initial purchasers thereof) delivers to the Tax
Matters Person, the Trustee and the Seller an affidavit in the form attached
hereto as Exhibit E stating, among other things, that as of the date of such
transfer (i) such transferee is a Permitted Transferee and that (ii) such
transferee is not acquiring such Residual Certificate for the account of any
person who is not a Permitted Transferee. The Tax Matters Person shall not
consent to a transfer of a Residual Certificate if it has actual knowledge that
any statement made in the affidavit issued pursuant to the preceding sentence is
not true. Notwithstanding any transfer, sale or other disposition of a Residual
Certificate to any Person who is not a Permitted Transferee, such transfer, sale
or other disposition shall be deemed to be of no legal force or effect
whatsoever and such Person shall not be deemed to be a Holder of a Residual
Certificate for any purpose hereunder, including, but not limited to, the
receipt of distributions thereon. If any purported transfer shall be in
violation of the provisions of this Subsection 5.05(b), then the prior Holder
thereof shall, upon discovery that the transfer of such Residual Certificate was
not in fact permitted by this Subsection 5.05(b), be restored to all rights as a
Holder thereof retroactive to the date of the purported transfer. None of the
Trustee, the Tax Matters Person or the Seller shall be under any liability to
any Person for any registration or transfer of a Residual Certificate that is
not permitted by this Subsection 5.05(b) or for making payments due on such
Residual Certificate to the purported Holder thereof or taking any other action
with respect to such purported Holder under the provisions of this Agreement so
long as the written

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<PAGE>

affidavit referred to above was received with respect to such transfer, and the
Tax Matters Person, the Trustee and the Seller, as applicable, had no knowledge
that it was untrue. The prior Holder shall be entitled to recover from any
purported Holder of a Residual Certificate that was in fact not a permitted
transferee under this Subsection 5.05(b) at the time it became a Holder all
payments made on such Residual Certificate. Each Holder of a Residual
Certificate, by acceptance thereof, shall be deemed for all purposes to have
consented to the provisions of this Subsection 5.05(b) and to any amendment of
this Agreement deemed necessary (whether as a result of new legislation or
otherwise) by counsel of the Tax Matters Person or the Seller to ensure that the
Residual Certificates are not transferred to any Person who is not a Permitted
Transferee and that any transfer of such Residual Certificates will not cause
the imposition of a tax upon the Trust or cause the Trust Fund to fail to
qualify as a REMIC.

         (c) Unless the Tax Matters Person shall have consented in writing
(which consent may be withheld in the Tax Matters Person's sole discretion), the
Residual Certificates (including a beneficial interest therein) may not be
purchased by or transferred to any person who is not a United States Person.

         (d) By accepting a Residual Certificate, the purchaser thereof agrees
to be a Tax Matters Person, and appoints the Trustee to act as its agent with
respect to all matters concerning the tax obligations of the Trust, other than
those matters regarding transfer restrictions contained in this Section 5.05 and
the adoption of a plan of complete liquidation set forth in Section 10.02(a)(i).

         Section 5.06. RESTRICTIONS ON TRANSFERABILITY OF PRIVATE CERTIFICATES.
(a) No offer, sale, transfer or other disposition (including pledge) of a
Private Certificate shall be made by any Holder thereof unless registered under
the Securities Act, or an exemption from the registration requirements of the
Securities Act and any applicable state securities or "Blue Sky" laws is
available and the prospective transferee (other than the Seller) of such
Certificate signs and delivers to the Trustee an Investment Letter, if the
transferee is an Institutional Accredited Investor, in the form set forth as
Exhibit F-1 hereto, or a Rule 144A Certificate, if the transferee is a QIB, in
the form set forth as Exhibit F-2 hereto. Notwithstanding the provisions of the
immediately preceding sentence, no restrictions shall apply with respect to the
transfer or registration of transfer of a beneficial interest in a Physical
Certificate that is a Global Certificate of a Class to a transferee that takes
delivery in the form of a beneficial interest in the Global Certificate of such
Class provided that each such transferee shall be deemed to have made such
representations and warranties contained in the Rule 144A Certificate as are
sufficient to establish that it is a QIB. In the case of a proposed transfer of
a Private Certificate to a transferee other than a QIB, the Trustee may require
an Opinion of Counsel that such transaction is exempt from the registration
requirements of the Securities Act. The cost of such opinion shall not be an
expense of the Trustee or the Trust Fund.

         (b) Each Class of Private Certificates shall bear a Securities Legend.

         Section 5.07. ERISA RESTRICTIONS. (a) Subject to the provisions of
subsection (b), no Class of Subordinate or Residual Certificates may be acquired
directly or indirectly by, or on behalf of, an

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<PAGE>

employee benefit plan or other retirement arrangement which is subject to Title
I of ERISA and/or Section 4975 of the Code, unless the proposed transferee
provides either (i) the Trustee and the Master Servicer with an Opinion of
Counsel satisfactory to the Trustee and the Master Servicer, which opinion will
not be at the expense of the Trustee or the Master Servicer, that the purchase
of such Certificates by or on behalf of such Plan is permissible under
applicable law, will not constitute or result in a non-exempt prohibited
transaction under ERISA or Section 4975 of the Code and will not subject the
Trustee or the Master Servicer to any obligation in addition to those undertaken
in the Pooling and Servicing Agreement or (ii) a representation or certification
to the Trustee (upon which the Trustee is authorized to rely) to the effect that
the proposed transfer and/or holding of such a Certificate and the servicing,
management and operation of the Trust: (I) will not result in a prohibited
transaction under Section 406 of ERISA or Section 4975 of the Code which is not
covered under an individual or class prohibited transaction exemption including
but not limited to Department of Labor Prohibited Transaction Exemption ("PTE")
84-14 (Class Exemption for Plan Asset Transactions Determined by Independent
Qualified Professional Asset Managers); PTE 91-38 (Class Exemption for Certain
Transactions Involving Bank Collective Investment Funds); PTE 90-1 (Class
Exemption for Certain Transactions Involving Insurance Company Pooled Separate
Accounts), PTE 95-60 (Class Exemption for Certain Transactions Involving
Insurance Company General Accounts), and PTCE 96-23 (Class Exemption for Plan
Asset Transactions Determined by In-House Asset Managers and (II) will not give
rise to any additional fiduciary duties under ERISA on the part of the Master
Servicer or the Trustee.

         (b) Any Person acquiring an interest in a Book-Entry Certificate or a
Global Certificate which is a Subordinate Certificate, by acquisition of such
Certificate, shall be deemed to have represented to the Trustee that it is
either: (i) not acquiring an interest in such Certificate directly or indirectly
by, or on behalf of, an employee benefit plan or other retirement arrangement
which is subject to Title I of ERISA and/or Section 4975 of the Code, or (ii)
such Person provides a representation or certification to the Trustee to the
effect that the transfer and/or holding of an interest in such Certificate and
the servicing, management and/or operation of the Trust and its assets: (I) will
not result in any prohibited transaction which is not covered under an
individual or class prohibited transaction exemption, including, but not limited
to, PTE 84-14, PTE 91-38, PTE 90-1, PTE 95-60 or PTE 96-23 and (II) will not
give rise to any additional fiduciary duties on the part of the Master Servicer
or the Trustee.

         (c) Any attempted or purported transfer of any Certificate in violation
of the provisions of Subsections (a) or (b) above shall be void AB INITIO and
such Certificate shall be considered to have been held continuously by the prior
permitted Certificateholder. Any transferor of any Certificate in violation of
such provisions, shall indemnify and hold harmless the Trustee from and against
any and all liabilities, claims, costs or expenses incurred by the Trustee as a
result of such attempted or purported transfer.

         (d) The provisions contained in Section 5.07(a) and (b) shall no longer
apply to the Offered Subordinate Certificates if the Seller delivers to the
Trustee an Officers' Certificate stating that amendments proposed by the United
States Department of Labor (the "DOL") to be made to

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<PAGE>

Prohibited Transaction Exemption 90-30, 55 FR 21461 (May 24, 1990), as amended
by PTE 97-34, 62 Fed. Reg. 39021 (July 21, 1997) and similar exemptions have
been published in final form substantially as proposed in the DOL Exemption
Application No. D-10809, 65 Fed. Reg. 51454 (August 23, 2000). If such Officers'
Certificate is delivered to the Trustee, the Trustee, the Seller and the Master
Servicer are authorized to take any action reasonably necessary to give effect
thereto, including but not limited to removing the restrictive legend from
applicable Certificates and amending the letter of representation submitted to
the Depository in connection with the registration of the Offered Subordinate
Certificates.

         Section 5.08. RULE 144A INFORMATION. For so long as any Private
Certificates are outstanding and are "restricted securities" within the meaning
of Rule 144(a)(3) of the Securities Act, (1) the Seller will provide or cause to
be provided to any holder of such Certificates and any prospective purchaser
thereof designated by such a holder, upon the request of such holder or
prospective purchaser, the information required to be provided to such holder or
prospective purchaser by Rule 144A(d)(4) under the Securities Act; and (2) the
Seller shall update such information from time to time in order to prevent such
information from becoming false and misleading and will take such other actions
as are necessary to ensure that the safe harbor exemption from the registration
requirements of the Securities Act under Rule 144A is and will be available for
resales of such Certificates conducted in accordance with Rule 144A. The Master
Servicer shall cooperate with the Seller and furnish the Seller such information
in the Master Servicer's possession as the Seller may reasonably request.

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                                   ARTICLE VI

                         Payments to Certificateholders

         Section 6.01. DISTRIBUTIONS ON THE CERTIFICATES. (a) Interest and
principal on the Certificates will be distributed monthly on each Distribution
Date, commencing in November 2000, in an aggregate amount equal to the Available
Funds for such Distribution Date. On each Distribution Date on or prior to the
Cross-Over Date, the Available Funds will be distributed in the following order
of priority, in each case to the extent of Available Funds remaining:

                  (A) FIRST, to the Senior Certificates (other than the Class P
         Certificates), the Accrued Certificate Interest on each such Class for
         such Distribution Date; provided that Accrued Certificate Interest
         shall be paid to the Accrual Certificates only after the Accrual
         Termination Date. As described below, Accrued Certificate Interest on
         each such Class is subject to reduction in the event of certain Net
         Interest Shortfalls allocable thereto. Any Net Interest Shortfalls
         shall be allocated among such Senior Certificates as provided in
         Section 6.01(g);

                  (B) SECOND, to the Senior Certificates (other than the Class P
         Certificates), any Accrued Certificate Interest thereon remaining
         undistributed from previous Distribution Dates, to the extent of
         remaining Available Funds, any shortfall in available amounts being
         allocated among such Classes in proportion to the amount of such
         Accrued Certificate Interest remaining undistributed for each such
         Class for such Distribution Date;

                  (C) THIRD, to the Class A-1 Certificates, in reduction of the
         Current Principal Amount thereof, until reduced to zero, the Accrual
         Distribution Amount;

                  (D) FOURTH, to the Senior P&I Certificates in reduction of the
         Current Principal Amounts thereof, the Senior P&I Optimal Principal
         Amount for such Distribution Date to the extent of remaining Available
         Funds, in the following order of priority:

                           (i) FIRST, to the Class R Certificates, until the
                  Current Principal Amount of such Class has been reduced to
                  zero; and

                           (ii) SECOND, from balance of the Senior P&I Optimal
                  Principal Amount remaining after the distribution described in
                  clause FIRST above, there shall be distributed concurrently to
                  the Lockout Certificates, in reduction of the Current
                  Principal Amount thereof, the Lockout Distribution Percentage
                  of the Lockout Certificates' pro rata share (based on the
                  Current Principal Amount thereof relative to the aggregate
                  Current Principal Amount of all of the Certificates (other
                  than the Class P Certificates)) of the aggregate of the
                  collections described in the definition

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<PAGE>

                  of "Senior P&I Optimal Principal Amount" without any
                  application of the Senior Percentage or Senior Accelerated
                  Distribution Percentage; provided that, if the aggregate of
                  the amounts set forth in the definition of "Senior P&I Optimal
                  Principal Amount" is more than the balance of the Available
                  Distribution Amount remaining after the Senior Interest
                  Distribution Amount and the Accrual Distribution Amount have
                  been distributed, the amount paid to the Lockout Certificates
                  pursuant to this clause SECOND shall be reduced by an amount
                  equal to the Lockout Certificates' pro rata share (based on
                  the Current Principal Amount thereof relative to the aggregate
                  Current Principal Amount of all classes of Senior Certificates
                  (other than the Class P Certificates)) of such difference;

                           (iii) THIRD, to the Class A-1, Class A-2, Class A-3
                  and Class A-4 Certificates, in that order, in each case until
                  the Current Principal Amount of such Class has been reduced to
                  zero; and

                           (iv) FOURTH, to the Lockout Certificates, until the
                  Current Principal Amount of such Class has been reduced to
                  zero.

                  (E) FIFTH, the Class P Certificate Principal Distribution
         Amount to the Class P Certificates, until the Current Principal Amount
         of such Class has been reduced to zero;

                  (F) SIXTH, the Class P Certificate Deferred Amount for such
         Distribution Date, to the Class P Certificates, provided, that (i) on
         any Distribution Date, distributions pursuant to this priority SIXTH
         shall not exceed the excess, if any, of (x) the Available Funds
         remaining after giving effect to distributions pursuant to clauses
         FIRST through FIFTH above over (y) the sum of the amount of Accrued
         Certificate Interest for such Distribution Date and Accrued Certificate
         Interest remaining undistributed from previous Distribution Dates on
         all Classes of Subordinate Certificates then outstanding, (ii) such
         distributions shall not reduce the Current Principal Amount of the
         Class P Certificates and (iii) no distribution will be made in respect
         of the Class P Certificate Deferred Amount on or after the Cross-Over
         Date;

                  (G) SEVENTH, to the Class B-1 Certificates to the extent of
         remaining Available Funds, in the following order: (a) the Accrued
         Certificate Interest thereon for such Distribution Date, (b) any
         Accrued Certificate Interest thereon remaining undistributed from
         previous Distribution Dates and (c) such Class's Allocable Share for
         such Distribution Date, until the Current Principal Amount of such
         Class has been reduced to zero;

                  (H) EIGHTH, to the Class B-2 Certificates to the extent of
         remaining Available Funds, in the following order: (a) the Accrued
         Certificate Interest thereon for such Distribution Date, (b) any
         Accrued Certificate Interest thereon remaining undistributed from
         previous Distribution Dates and (c) such Class's Allocable Share for
         such Distribution Date, until the Current Principal Amount of such
         Class has been reduced to zero;

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                  (I) NINTH, to the Class B-3 Certificates to the extent of
         remaining Available Funds, in the following order: (a) the Accrued
         Certificate Interest thereon for such Distribution Date, (b) any
         Accrued Certificate Interest thereon remaining undistributed from
         previous Distribution Dates and (c) such Class's Allocable Share for
         such Distribution Date, until the Current Principal Amount of such
         Class has been reduced to zero;

                  (J) TENTH, to the Class B-4 Certificates to the extent of
         remaining Available Funds, in the following order: (a) the Accrued
         Certificate Interest thereon for such Distribution Date, (b) any
         Accrued Certificate Interest thereon remaining undistributed from
         previous Distribution Dates and (c) such Class's Allocable Share for
         such Distribution Date, until the Current Principal Amount of such
         Class has been reduced to zero;

                  (K) ELEVENTH, to the Class B-5 Certificates to the extent of
         remaining Available Funds, in the following order: (a) the Accrued
         Certificate Interest thereon for such Distribution Date, (b) any
         Accrued Certificate Interest thereon remaining undistributed from
         previous Distribution Dates and (c) such Class's Allocable Share for
         such Distribution Date, until the Current Principal Amount of such
         Class has been reduced to zero;

                  (L) TWELFTH, to the Class B-6 Certificates to the extent of
         remaining Available Funds, in the following order: (a) the Accrued
         Certificate Interest thereon for such Distribution Date, (b) any
         Accrued Certificate Interest thereon remaining undistributed from
         previous Distribution Dates and (c) such Class's Allocable Share for
         such Distribution Date, until the Current Principal Amount of such
         Class has been reduced to zero.

         (b) On or after the occurrence of the Credit Support Depletion Date,
all priorities relating to distributions as described above in respect of
principal among the Senior Certificates (other than the Class P Certificate)
will be disregarded and an amount equal to the Discount Fraction of the
principal portion of scheduled or unscheduled payments received or advanced in
respect of Discount Mortgage Loans will be distributed to the Class P
Certificates, and following distributions of interest pursuant to clauses (A)
and (B) of Section 6.01(a) above, the Senior P&I Optimal Principal Amount will
be distributed to the Senior P&I Certificates remaining pro rata, regardless of
the allocation, or sequential nature, of principal payments described in clauses
(C) and (D) of Section 6.01(a) above, based upon the then Current Principal
Amounts of such Certificates.

         (c) If, after distributions have been made pursuant to clause (C) under
Section 6.01(a) above on any Distribution Date, the remaining Available Funds
are less than the sum of the Senior P&I Optimal Principal Amount and the Class P
Certificate Principal Distribution Amount for such Distribution Date, such
amounts shall be proportionately reduced, and such remaining Available Funds
will be distributed on the Senior Certificates (other than Interest Only
Certificates) on the basis of such reduced amounts. Notwithstanding any
reduction in principal distributable to the Class P Certificate pursuant to this
paragraph, the principal balance of the Class P Certificates shall be reduced
not only by principal so distributed but also by the difference between (i)
principal distributable to the Class P Certificates in accordance with clause
(E) under Section 6.01(a) above

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<PAGE>

and (ii) principal actually distributed to the Class P Certificates after giving
effect to this paragraph (such difference, the "Class P Certificate Cash
Shortfall"). The Class P Certificate Cash Shortfall with respect to any
Distribution Date will be added to the Class P Certificate Deferred Amount.

         (d) The "Accrual Distribution Amount" with respect to a Distribution
Date prior to the Accrual Termination Date is equal to the Accrued Certificate
Interest that would otherwise be payable in respect of the Accrual Certificates
on such Distribution Date. On each Distribution Date prior to the Accrual
Termination Date, the Accrual Distribution Amount will be added to the Current
Principal Amount of the Accrual Certificates (such amount thereafter to accrue
interest at the Pass- Through Rate for the Accrual Certificates).

         (e) "Pro rata" distributions among Classes of Certificates will be made
in proportion to the then Current Principal Amount of such Classes.

         (f) No Accrued Certificate Interest will be payable with respect to any
Class of Certificates after the Distribution Date on which the Current Principal
Amount or Notional Amount of such Certificate has been reduced to zero.

         (g) If on any Distribution Date the Available Funds for the Senior
Certificates is less than the Accrued Certificate Interest on such Senior
Certificates for such Distribution Date prior to reduction for Net Interest
Shortfall and the interest portion of Realized Losses, the shortfall will be
allocated among the holders of each Class of interest-bearing Senior
Certificates in proportion to the respective amounts of Accrued Certificate
Interest that would have been allocated thereto in the absence of such Net
Interest Shortfall and/or Realized Losses for such Distribution Date. In
addition, the amount of any interest shortfalls on the Mortgage Loans that are
covered by subordination will constitute unpaid Accrued Certificate Interest and
will be distributable to holders of the Certificates of the related Classes
entitled to such amounts on subsequent Distribution Dates, to the extent of the
Available Funds after current interest distributions as required herein. Any
such amounts so carried forward will not bear interest. Shortfalls in interest
payments will not be offset by a reduction in the servicing compensation of the
Master Servicer or otherwise, except to the extent of applicable Compensating
Interest Payments.

         (h) The expenses and fees of the Trust shall be paid by the REMIC, to
the extent that such expenses relate to the assets of the REMIC.

         Section 6.02. ALLOCATION OF LOSSES. (a) On or prior to each
Determination Date, the Master Servicer shall determine the amount of any
Realized Loss in respect of each Mortgage Loan that occurred during the
immediately preceding calendar month. The Trustee shall then with respect to
each such Mortgage Loan allocate Realized Losses on a pro rata basis between the
PO Percentage of the Scheduled Principal Balance of a Mortgage Loan which
suffered a Realized Loss and the Non- PO Percentage of the Scheduled Principal
Balance of such Mortgage Loan.

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<PAGE>

         (b) With respect to any Distribution Date, the principal portion of
each Realized Loss (other than an Excess Loss) on a Mortgage Loan shall be
allocated as follows:

                  (i) The applicable PO Percentage of any such Realized Loss on
         a Mortgage Loan shall be allocated to the Class P Certificate; and

                  (ii) The applicable Non-PO Percentage of any such Realized
         Loss on a Mortgage Loan shall be allocated as follows:

                           first, to the Class B-6 Certificates until the
                  current Principal Amount thereof has been reduced to zero;

                           second, to the Class B-5 Certificates until the
                  Current Principal Amount thereof has been reduced to zero;

                           third, to the Class B-4 Certificates until the
                  Current Principal Amount thereof has been reduced to zero;

                           fourth, to the Class B-3 Certificates until the
                  Current Principal Amount thereof has been reduced to zero;

                           fifth, to the Class B-2 Certificates until the
                  Current Principal Amount thereof has been reduced to zero;

                           sixth, to the Class B-1 Certificates until the
                  Current Principal amount thereof has been reduced to zero; and

                           seventh, to the Senior Certificates (other than the
                  Class P Certificates), pro rata, in accordance with their
                  Current Principal Amounts.

         (c) With respect to any Distribution Date, the principal portion of
each Realized Loss (other than an Excess Loss) on a Mortgage Loan shall be
allocated as follows:

                  (i) the applicable PO Percentage of any such Excess Loss shall
         be allocated to the Class P Certificates; and

                  (ii) the applicable Non-PO Percentage of any such Excess Loss
         shall be allocated among all Classes of Certificates (other than the
         Class P Certificates), pro rata, based on the respective Current
         Principal Amounts thereof.

         (d) Notwithstanding the foregoing, no such allocation of any Realized
Loss shall be made on a Distribution Date to a Class of Certificates to the
extent that such allocation would result in the reduction of the aggregate
Current Principal Amounts of all the Certificates as of such Distribution

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Date, after giving effect to all distributions and prior allocations of Realized
Losses on such date, to an amount less than the aggregate Scheduled Principal
Balance of the Mortgage Loans as of the first day of the month of such
Distribution Date (such limitation, the "Loss Allocation Limitation").

         (e) Any Realized Losses allocated to a Class of Certificates pursuant
to Subsections 6.02(b) and (c) shall be allocated among the Certificates of such
Class in proportion to their respective Current Principal Amounts. Any
allocation of Realized Losses pursuant to Subsections 6.02(b) and (c) shall be
accomplished by reducing the Current Principal Amount of the related
Certificates on the related Distribution Date in accordance with Subsections
6.02(b) and (c).

         (f) Realized Losses allocated in accordance with this Section 6.02
shall be allocated on the Distribution Date in the month following the month in
which such loss was incurred and, in the case of the principal portion thereof,
after giving effect to distributions made on such Distribution Date, except that
the aggregate amount of Realized Losses to be allocated to the Class P
Certificates on any Distribution Date through the Cross-Over Date will be taken
into account in determining distributions in respect of the Class P Certificate
Deferred Amount for such Distribution Date.

         (g) On each Distribution Date, the Trustee shall determine the
Subordinate Certificate Writedown Amount, if any. Any such Subordinate
Certificate Writedown Amount shall effect a corresponding reduction in the
Current Principal Amount of (i) if prior to the Cross-Over Date, the Current
Principal Amounts of the Subordinate Certificates, in the reverse order of their
numerical Class designations and (ii) from and after the Cross-Over Date, the
Senior Certificates, pro rata based on their respective Current Principal
Amounts, which reduction shall occur on such Distribution Date after giving
effect to distributions made on such Distribution Date.

         (h) On each Distribution Date, on or prior to the Cross-Over Date the
Trustee shall determine the Class P Certificate Deferred Payment Writedown
Amount with respect to the Class P Certificates, if any. Any such Class P
Certificate Deferred Payment Writedown Amount with respect to the Class P
Certificates shall effect a corresponding reduction in the Current Principal
Amount of the Subordinate Certificates in the reverse order of their numerical
Class designations.

         (i) The interest portion of any Realized Losses on Mortgage Loans
occurring on or prior to the Cross-Over Date, will not be allocated among any
Certificates, but will reduce the amount of Available Funds on the related
Distribution Date. As a result of the subordination of the Subordinate
Certificates in right of distribution, such Realized Losses will be borne first
by the Subordinate Certificates (with respect to Mortgage Loans) in inverse
order of their numerical Class designations.

         Section 6.03. PAYMENTS. (a) On each Distribution Date, other than the
final Distribution Date, the Trustee shall distribute to each Certificateholder
of record on the directly preceding Record Date the Certificateholder's PRO RATA
share of its Class (based on the aggregate Fractional Undivided Interest
represented by such Holder's Certificates) of all amounts required to be
distributed on such Distribution Date to such Class. The Trustee shall calculate
the amount to be distributed to each Class and, based on such amounts, the
Trustee shall determine the amount to be distributed to each

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Certificateholder. All of the Trustee's calculations of payments shall be based
solely on information provided to the Trustee by the Master Servicer. The
Trustee shall not be required to confirm or verify any such information provided
to the Trustee by the Master Servicer and shall be entitled conclusively to rely
on such information.

         (b) Payment of the above amounts to each Certificateholder shall be
made (i) by check mailed to each Certificateholder entitled thereto at the
address appearing in the Certificate Register or (ii) upon receipt by the
Trustee on or before the fifth Business Day preceding the Record Date of written
instructions from a Certificateholder holding Certificates representing an
initial aggregate Current Principal Amount or Notional Amount of not less than
$1,000,000 by wire transfer to a United States dollar account maintained by the
payee at any United States depository institution with appropriate facilities
for receiving such a wire transfer; PROVIDED, HOWEVER, that the final payment in
respect of each Class of Certificates will be made only upon presentation and
surrender of such respective Certificates at the office or agency of the Trustee
specified in the notice to Certificateholders of such final payment.

         Section 6.04. STATEMENTS TO CERTIFICATEHOLDERS. (a) Concurrently with
each distribution to Certificateholders, the Trustee shall prepare a statement
setting forth the following information, expressed with respect to clauses (i)
through (vi) in the aggregate and as a Fractional Undivided Interest
representing an initial Current Principal Amount of $1,000, or in the case of
each Class of Notional Amount Certificates, a Notional Amount of $1,000, or in
the case of the Residual Certificates, its initial Current Principal Amount:

                  (i) the Current Principal Amount (or Notional Amount in the
         case of Notional Amount Certificates) of each Class of Certificates
         immediately prior to such Distribution Date;

                  (ii) the amount of the distribution allocable to principal on
         each applicable Class of Certificates;

                  (iii) the aggregate amount of interest accrued at the related
         Pass-Through Rate with respect to each Class of interest-bearing
         Certificates during the related Interest Accrual Period;

                  (iv) the Net Interest Shortfall and any other adjustments to
         interest at the related Pass-Through Rate necessary to account for any
         difference between interest accrued and aggregate interest distributed
         with respect to each Class of interest-bearing Certificates (other than
         the Accrual Certificates);

                  (v) the amount of the distribution allocable to interest on
         each Class of interest- bearing Certificates and the Accrual
         Distribution Amount added to the Current Principal Amount of the
         Accrual Certificates;

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                  (vi) the Pass-Through Rates for each Class of interest-bearing
         Certificates with respect to such Distribution Date;

                  (vii) the Current Principal Amount (or Notional Amount in the
         case of the Notional Amount Certificates) of each Class of Certificates
         after such Distribution Date;

                  (viii) the amount of any Monthly Advances, Compensating
         Interest Payments and outstanding unreimbursed advances by the Master
         Servicer included in such distribution;

                  (ix) the amount of any Realized Losses during the related
         Prepayment Period and cumulatively since the Cut-off Date and the
         amount and source (separately identified) of any distribution in
         respect thereof included in such distribution;

                  (x) the amount of Scheduled Principal and Principal
         Prepayments, (including but separately identifying the principal amount
         of principal prepayments, Insurance Proceeds, the purchase price in
         connection with the purchase of Mortgage Loans, cash deposits in
         connection with substitutions of Mortgage Loans and Net Liquidation
         Proceeds) and the number and principal balance of Mortgage Loans
         purchased or substituted for during the relevant period and
         cumulatively since the Cut-off Date;

                  (xi) the number of Mortgage Loans (excluding REO Property)
         remaining in the Trust Fund as of the end of the related Due Period;

                  (xii) information regarding any Mortgage Loan delinquencies as
         of the end of the related Due Period, including the aggregate number,
         aggregate Outstanding Principal Balance and aggregate Scheduled
         Principal Balance of Mortgage Loans delinquent one month, two months
         and three months or more;

                  (xiii) the number of Mortgage Loans in the foreclosure process
         as of the end of the related Due Period and the aggregate Outstanding
         Principal Balance of such Mortgage Loans;

                  (xiv) the number and aggregate Outstanding Principal Balance
         of all Mortgage Loans as to which the Mortgaged Property was REO
         Property as of the end of the related Due Period;

                  (xv) the book value (the sum of (A) the Outstanding Principal
         Balance of the Mortgage Loan, (B) accrued interest through the date of
         foreclosure and (C) foreclosure expenses) of any REO Property; PROVIDED
         THAT, in the event that such information is not available to the Master
         Servicer and the Trustee on the Distribution Date, such information
         shall be furnished promptly after it becomes available;

                  (xvi) the Special Hazard Amount, the Fraud Loss Amount and the
         Bankruptcy Loss Amount immediately prior to and following such
         Distribution Date; and

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                  (xvii) the then applicable Senior Percentage, Senior
         Prepayment Percentage, Subordinate Percentage and Subordinate
         Prepayment Percentage.

         The Trustee may make such information available each month to any
interested party via the Trustee's website. The Trustee's website will be
located at "www.mbsreporting.com". In addition, upon request, the Trustee shall
forward such information by first-class mail to any Certificateholder, the
Mortgage Loan Sellers, the Seller, the Master Servicer or the Rating Agencies.
The information set forth above shall be calculated, or reported, as the case
may be, by the Trustee based on data provided by the Master Servicer pursuant to
Section 6.05 upon which the Trustee may conclusively rely and which the Trustee
shall not be required to confirm or verify. The information furnished by the
Master Servicer shall be sufficient for the Trustee to calculate any payments or
statements it is required to make.

         (b) By April 30 of each year beginning in 2001, the Trustee will
furnish a report to each Holder of the Certificates of record at any time during
the prior calendar year as to the aggregate of amounts reported pursuant to
subclauses (a)(ii) and (a)(v) above with respect to the Certificates, plus
information with respect to the amount of servicing compensation and such other
customary information as the Master Servicer determines and advises the Trustee
to be necessary and/or to be required by the Internal Revenue Service or by a
federal or state law or rules or regulations to enable such Holders to prepare
their tax returns for such calendar year. Such obligations shall be deemed to
have been satisfied to the extent that substantially comparable information
shall be provided by the Trustee pursuant to the requirements of the Code.

         The Master Servicer shall supply to the Trustee in a timely manner the
information required for the reports described above.

         Section 6.05. REPORTS TO THE TRUSTEE AND THE MASTER SERVICER. (a) Not
later than 15 days after each Distribution Date, at the request of the Master
Servicer, the Trustee shall forward to the Master Servicer a statement setting
forth the status of the Certificate Account as of the close of business on the
last day of the month of the Distribution Date and showing, for the month
covered by such statement, deposits in or withdrawals from the Certificate
Account. On or before the seventh Business Day of each month, the Master
Servicer shall provide to the Trustee, with respect to the Mortgage Loans and
the related REO Properties, an electronic data file containing the information
included in Exhibit J.

         (b) On or before 12:00pm on the Business Day following each
Determination Date, the Master Servicer shall provide to the Trustee (and with
respect to the information contained in subclause (xi) hereof, the Seller) a
Loan Summary and Remittance Report in such electronic format as the Trustee may
reasonably request and in such hardcopy format as the Master Servicer and the
Trustee shall agree which, if there are Sub-Servicers, shall be based upon
reports from Sub- Servicers, if any, received by the Master Servicer on or
before the seventh Business Day of such month with respect to the Mortgage Loans
and related REO Properties and containing the following

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information (in respect of the REO Property, only such information which is
applicable) (provided that the information marked with an "*" below may be
provided by the Master Servicer solely in a hardcopy format).

                  *(i) Aggregate deposits to and withdrawals from the
         Certificate Account since the date of the prior statement, stated
         separately for each category of deposit specified in Section 4.02 and
         each category of withdrawal specified in Section 4.03;

                   (ii) Amount of Available Funds expected for the related
         Distribution Date and attributable to each of the following categories:

                    (A)    regularly scheduled principal;

                    (B)    Principal Prepayments (stated separately for (x)
                           partial prepayments, (y) full prepayments, and (z)
                           Net Liquidation Proceeds, stating Liquidation
                           Proceeds
                           and Liquidation Expenses separately);

                    (C)    Regularly scheduled interest on the Mortgage Loans;

                   *(D)    Monthly Advances made by the Master Servicer;

                    (E)    Compensating Interest Payments; and

                   *(F)    reimbursements in connection with losses on Permitted
                           Investments.

                    (iii) Aggregate Outstanding Principal Balances of the
         Mortgage Loans as of the related Due Date, without giving effect to
         payments due on such date;

                    (iv)  Realized Losses for the prior month;

                    (v) Aggregate Scheduled Principal Balance of the Mortgage
         Loans as of the related Due Date;

                  *(vi) Book value of any collateral acquired by means of
         foreclosure, grant of deed in lieu of foreclosure or otherwise in
         respect of any related Mortgage Loan;

                    (vii) Number and aggregate principal balance of Mortgage
         Loans which are 30, 60, 90 and 120 days delinquent as calculated by the
         Master Servicer, those which are in foreclosure, those with respect to
         which the related Mortgagor is bankrupt, and those which
         are REO Property;

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                    (x) Interest Shortfall with respect to the related
         Distribution Date and portion thereof resulting from Voluntary
         Principal Prepayments in full or the provisions of the Relief Act;

                    (xi) The amount, if any, of any Nonrecoverable Advances by
         the Master Servicer;

                    *(xii) Applicable aggregate Master Servicing Fee for the
         related Due Period; and

                    (xiii) Such other information regarding each related
         Mortgage Loan, including, but not limited to, an updated schedule of
         the Scheduled Principal Balances of such Mortgage Loans as of the
         related Due Date, in such electronic format, as may be reasonably
         requested by the Trustee and, if requested, in such hardcopy format as
         the Master Servicer and the Trustee shall agree.

         Section 6.06. MONTHLY ADVANCES. If the Scheduled Payment (together with
any advances from any Sub-Servicers) on a Mortgage Loan that was due on a
related Due Date and is delinquent other than as a result of application of the
Relief Act exceeds the amount deposited in the Certificate Account with respect
to such Mortgage Loan, the Master Servicer will deposit in the Certificate
Account not later than the Advancing Date immediately preceding the related
Distribution Date an amount equal to such deficiency, net of the related Master
Servicing Fee for such Mortgage Loan except to the extent the Master Servicer
determines any such advance to be nonrecoverable from Liquidation Proceeds,
Insurance Proceeds or future payments on the Mortgage Loan for which such
Monthly Advance was made. Subject to the foregoing, the Master Servicer shall
continue to make such advances through the date that the related Mortgaged
Property has, in the judgment of the Master Servicer, been completely
liquidated. If applicable, on the fifth Business Day preceding each Distribution
Date, the Master Servicer shall present an Officer's Certificate to the Trustee
(i) stating that the Master Servicer elects not to make a Monthly Advance in a
stated amount and (ii) detailing the reason it deems the advance to be
nonrecoverable.

         Section 6.07. COMPENSATING INTEREST PAYMENTS. The Master Servicer shall
deposit in the Certificate Account not later than the Advancing Date immediately
preceding the related Distribution Date an amount equal to the lesser of (i) the
aggregate amounts determined pursuant to subclauses (a) and (b) of the
definition of Interest Shortfall as calculated with respect to Mortgage Loans
serviced by the Master Servicer for the related Distribution Date and (ii) the
applicable Master Servicing Fee for such Distribution Date (such amount, the
"Compensating Interest Payment"). The Master Servicer shall not be entitled to
any reimbursement of any Compensating Interest Payment.

         Section 6.08. REPORTS OF FORECLOSURES AND ABANDONMENT OF MORTGAGED
PROPERTY. Each year the Master Servicer shall report or cause to be reported to
the Internal Revenue Service foreclosures and abandonments of any Mortgaged
Property as required by Section 6050J of the Code and shall provide a copy of
such report to the Trustee.

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                                   ARTICLE VII
                               THE MASTER SERVICER

         Section 7.01. LIABILITIES OF THE MASTER SERVICER. The Master Servicer
shall be liable in accordance herewith only to the extent of the obligations
specifically imposed upon and undertaken by it herein.

         Section 7.02. MERGER OR CONSOLIDATION OF THE MASTER SERVICER. (a) The
Master Servicer will keep in full force and effect its existence, rights and
franchises as a corporation under the laws of the state of its incorporation,
and will obtain and preserve its qualification to do business as a foreign
corporation in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Agreement, the
Certificates or any of the Mortgage Loans and to perform its duties under this
Agreement.

         (b) Any Person into which the Master Servicer may be merged or
consolidated, or any corporation resulting from any merger or consolidation to
which the Master Servicer shall be a party, or any Person succeeding to the
business of the Master Servicer, shall be the successor of the Master Servicer
hereunder, without the execution or filing of any paper or further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding.

         Section 7.03. INDEMNIFICATION OF THE TRUSTEE. (a) The Master Servicer
agrees to the extent described in Section 7.03(b) to indemnify the Indemnified
Persons for, and to hold them harmless against, any loss, liability or expense
(including costs of defense and reasonable legal fees) incurred on their part,
arising out of, or in connection with, this Agreement, including the costs and
expenses (including reasonable legal fees and expenses) of defending themselves
against any such claim other than (i) any loss, liability or expense related to
its failure to perform its duties in compliance with this Agreement (except as
any such loss, liability or expense shall be otherwise reimbursable pursuant to
this Agreement) and (ii) any loss, liability or expense incurred by reason of
such Person's willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder, provided that with respect to any such claim,
the Trustee shall have given the Master Servicer and the Seller written notice
thereof promptly after the Trustee shall have with respect to such claim
knowledge thereof.

         (b) The Master Servicer will indemnify any Indemnified Person for any
loss, liability or expense which primarily relates to the servicing or
administration of the Mortgage Loans. The Seller will indemnify any Indemnified
Person for any other loss, liability or expense of any Indemnified Person not
otherwise referred to in this paragraph.

         Section 7.04. LIMITATION ON LIABILITY OF THE MASTER SERVICER AND
OTHERS. Subject to the obligation of the Master Servicer to indemnify the
Indemnified Persons and the Trustee pursuant to Sections 7.03 and 9.05, neither
the Master Servicer nor any of the directors, officers, employees or agents of
the Master Servicer shall be under any liability to the Indemnified Persons, the
Seller, the

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Trust Fund or the Certificateholders for taking any action or for refraining
from taking any action in good faith pursuant to this Agreement, or for errors
in judgment; PROVIDED, HOWEVER, that this provision shall not protect the Master
Servicer or any such Person against any breach of warranties or representations
made herein or any liability which would otherwise be imposed by reason of such
Person's willful misfeasance, bad faith or gross negligence in the performance
of duties or by reason of reckless disregard of obligations and duties
hereunder.

         (a) The Master Servicer and any director, officer, employee or agent of
the Master Servicer may rely in good faith on any document of any kind PRIMA
FACIE properly executed and submitted by any Person respecting any matters
arising hereunder.

         (b) The Master Servicer and any director, officer, employee or agent of
the Master Servicer shall be indemnified by the Trust out of the Trust Fund and
held harmless thereby against any loss, liability or expense incurred in
connection with any legal proceedings relating to this Agreement or the
Certificates (including reasonable legal fees and disbursements of counsel),
other than (i) any loss, liability or expense related to the Master Servicer's
failure to perform its duties in compliance with this Agreement (except as any
such loss, liability or expense shall be otherwise reimbursable pursuant to this
Agreement) and (ii) any loss, liability or expense incurred by reason of the
Master Servicer's willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder.

         (c) The Master Servicer shall not be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to its duties under
this Agreement and that in its opinion may involve it in any expense or
liability; PROVIDED, HOWEVER, the Master Servicer may in its discretion, with
the consent of the Trustee, undertake any such action which it may deem
necessary or desirable with respect to this Agreement and the rights and duties
of the parties hereto and the interests of the Certificateholders hereunder. In
such event, the legal expenses and costs of such action and any liability
resulting therefrom shall be expenses, costs and liabilities of the Trust Fund,
and the Master Servicer shall be entitled to be reimbursed therefor out of the
Certificate Account as provided by Subsection 4.03(a). Nothing in this
Subsection 7.04(d) shall affect the Master Servicer's obligation to supervise,
or to take such actions as are necessary to ensure the servicing and
administration of the Mortgage Loans pursuant to Subsection 3.01(a).

         (d) In taking or recommending any course of action pursuant to this
Agreement, unless specifically required to do so pursuant to this Agreement, the
Master Servicer shall not be required to investigate or make recommendations
concerning potential liabilities which the Trust might incur as a result of such
course of action by reason of the condition of the Mortgaged Properties but
shall give notice to the Trustee if it has notice of such potential liabilities.

         Section 7.05. MASTER SERVICER NOT TO RESIGN. Except as provided in
Section 7.07, the Master Servicer shall not resign from the obligations and
duties hereby imposed on it except upon a determination that any such duties
hereunder are no longer permissible under applicable law and such
impermissibility cannot be cured. Any such determination permitting the
resignation of the

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Master Servicer shall be evidenced by an Opinion of Independent Counsel to such
effect delivered to the Trustee. No such resignation by the Master Servicer
shall become effective until the Trustee or a successor to the Master Servicer
reasonably satisfactory to the Trustee shall have assumed the responsibilities
and obligations of the Master Servicer in accordance with Section 8.02 hereof.
The Trustee shall notify the Rating Agencies of the resignation of the Master
Servicer.

         Section 7.06. SUCCESSOR MASTER SERVICER. In connection with the
appointment of any successor Master Servicer or the assumption of the duties of
the Master Servicer, the Trustee may make such arrangements for the compensation
of such successor master servicer out of payments on the Mortgage Loans as the
Trustee and such successor master servicer shall agree. If the successor master
servicer does not agree that such market value is a fair price, such successor
master servicer shall obtain two quotations of market value from third parties
actively engaged in the servicing of single-family mortgage loans.

         Section 7.07. SALE AND ASSIGNMENT OF MASTER SERVICING. The Master
Servicer may sell and assign its rights and delegate its duties and obligations
in their entirety as Master Servicer under this Agreement; PROVIDED, HOWEVER,
that: (i) the purchaser or transferee accepting such assignment and delegation
(a) shall be a Person which shall be qualified to service mortgage loans for
Fannie Mae or Freddie Mac; (b) shall have a net worth of not less than
$10,000,000 (unless otherwise approved by each Rating Agency pursuant to clause
(ii) below); (c) shall be reasonably satisfactory to the Trustee (as evidenced
in a writing signed by the Trustee); (d) shall execute and deliver to the
Trustee an agreement, in form and substance reasonably satisfactory to the
Trustee, which contains an assumption by such Person of the due and punctual
performance and observance of each covenant and condition to be performed or
observed by it as master servicer under this Agreement and any custodial
agreement from and after the effective date of such agreement; (ii) each Rating
Agency shall be given prior written notice of the identity of the proposed
successor to the Master Servicer and each Rating Agency's rating of the
Certificates in effect immediately prior to such assignment, sale and delegation
will not be downgraded, qualified or withdrawn as a result of such assignment,
sale and delegation, as evidenced by a letter to such effect delivered to the
Master Servicer and the Trustee; and (iii) the Master Servicer shall deliver to
the Trustee an Officer's Certificate and an Opinion of Independent Counsel, each
stating that all conditions precedent to such action under this Agreement have
been completed and such action is permitted by and complies with the terms of
this Agreement. No such assignment or delegation shall affect any liability of
the Master Servicer arising prior to the effective date thereof.

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                                  ARTICLE VIII
                                    Default

         Section 8.01. EVENTS OF DEFAULT. "Event of Default," wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):

                  (i) The Master Servicer fails to cause to be deposited in the
         Certificate Account any amount so required to be deposited pursuant to
         this Agreement, and such failure continues unremedied for a period of
         two Business Days after the date on which notice was given requiring
         such deposit to be made; or

                  (ii) The Master Servicer fails to observe or perform in any
         material respect any other covenants and agreements set forth in the
         Certificates or this Agreement to be performed by it, which covenants
         and agreements materially affect the rights of Certificateholders, and
         such failure continues unremedied for a period of 60 days after the
         date on which written notice of such failure, properly requiring the
         same to be remedied, shall have been given to the Master Servicer by
         the Trustee or to the Master Servicer and the Trustee by the Holders of
         Certificates evidencing Fractional Undivided Interests aggregating not
         less than 25% of the Trust Fund; or

                  (iii) There is entered against the Master Servicer a decree or
         order by a court or agency or supervisory authority having jurisdiction
         in the premises for the appointment of a conservator, receiver or
         liquidator in any insolvency, readjustment of debt, marshaling of
         assets and liabilities or similar proceedings, or for the winding up or
         liquidation of its affairs, and the continuance of any such decree or
         order is unstayed and in effect for a period of 60 consecutive days, or
         an involuntary case is commenced against the Master Servicer under any
         applicable insolvency or reorganization statute and the petition is not
         dismissed within 60 days after the commencement of the case; or

                  (iv) The Master Servicer consents to the appointment of a
         conservator or receiver or liquidator in any insolvency, readjustment
         of debt, marshaling of assets and liabilities or similar proceedings of
         or relating to the Master Servicer or substantially all of its
         property; or the Master Servicer admits in writing its inability to pay
         its debts generally as they become due, files a petition to take
         advantage of any applicable insolvency or reorganization statute, makes
         an assignment for the benefit of its creditors, or voluntarily suspends
         payment of its obligations; or

                  (v) The Master Servicer assigns or delegates its duties or
         rights under this Agreement in contravention of the provisions
         permitting such assignment or delegation under Sections 7.05 or 7.07.

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In each and every such case, so long as such Event of Default with respect to
the Master Servicer shall not have been remedied, either the Trustee or the
Holders of Certificates evidencing Fractional Undivided Interests aggregating
not less than 51% of the Trust Fund, by notice in writing to the Master Servicer
(and to the Trustee if given by such Certificateholders), with a copy to the
Rating Agencies, may terminate all of the rights and obligations (but not the
liabilities) of the Master Servicer under this Agreement and in and to the
Mortgage Loans and/or the REO Property serviced by the Master Servicer and the
proceeds thereof. Upon the receipt by the Master Servicer of the written notice,
all authority and power of the Master Servicer under this Agreement, whether
with respect to the Certificates, the Mortgage Loans, REO Property or under any
other related agreements, including the Sub-Servicing Agreements (but only to
the extent that such other agreements relate to the Mortgage Loans or REO
Property) shall, subject to Section 8.02, automatically and without further
action pass to and be vested in the Trustee pursuant to this Section 8.01; and,
without limitation, the Trustee is hereby authorized and empowered to execute
and deliver, on behalf of the Master Servicer as attorney-in-fact or otherwise,
any and all documents and other instruments and to do or accomplish all other
acts or things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the Mortgage Loans and related documents, or otherwise. The Master Servicer
agrees to cooperate with the Trustee in effecting the termination of the Master
Servicer's rights and obligations hereunder, including, without limitation, the
transfer to the Trustee of (i) the property and amounts which are then or should
be part of the Trust or which thereafter become part of the Trust; (ii)
originals or copies of all documents of the Master Servicer reasonably requested
by the Trustee to enable it to assume the Master Servicer's duties thereunder;
and (iii) the rights and obligations of the Master Servicer under any
Sub-Servicing Agreements with respect to the Mortgage Loans. In addition to any
other amounts which are then, or, notwithstanding the termination of its
activities under this Agreement, may become payable to the Master Servicer under
this Agreement, the Master Servicer shall be entitled to receive, out of any
amount received on account of a Mortgage Loan or REO Property, that portion of
such payments which it would have received as reimbursement pursuant to Section
3.14 if notice of termination had not been given. The termination of the rights
and obligations of the Master Servicer shall not affect any obligations incurred
by the Master Servicer prior to such termination.

         Section 8.02. TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR. (a) Upon the
receipt by the Master Servicer of a notice of termination pursuant to Section
8.01 or an Opinion of Independent Counsel pursuant to Section 7.05 to the effect
that the Master Servicer is legally unable to act or to delegate its duties to a
Person which is legally able to act, the Trustee shall automatically become the
successor in all respects to the Master Servicer in its capacity under this
Agreement and the transactions set forth or provided for herein and shall
thereafter be subject to all the responsibilities, duties, liabilities and
limitations on liabilities relating thereto placed on the Master Servicer by the
terms and provisions hereof; PROVIDED, HOWEVER, that the Trustee (i) shall be
under no obligation to purchase any Mortgage Loan pursuant to Section 10.01; and
(ii) shall have no obligation whatsoever with respect to any liability (other
than advances deemed recoverable and not previously made) incurred by the Master
Servicer at or prior to the time of receipt by the Master Servicer of such
notice or by the Trustee of such Opinion of Independent Counsel. As compensation
therefor, but

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subject to Section 7.06, the Trustee shall be entitled to all funds relating to
the Mortgage Loans which the Master Servicer would have been entitled to retain
if the Master Servicer had continued to act hereunder, except for those amounts
due the Master Servicer as reimbursement for advances previously made or
expenses previously incurred. Notwithstanding the above, the Trustee may, if it
shall be unwilling so to act, or shall, if it is legally unable so to act,
appoint or petition a court of competent jurisdiction to appoint, any
established housing and home finance institution which is a Fannie Mae- or
Freddie Mac- approved servicer, and with respect to a successor to the Master
Servicer only, having a net worth of not less than $10,000,000, as the successor
to the Master Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Master Servicer hereunder.
Pending appointment of a successor to the Master Servicer hereunder, the Trustee
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the Trustee may make such arrangements for the
compensation of such successor out of payments on the Mortgage Loans as it and
such successor shall agree; PROVIDED, HOWEVER, that the provisions of Section
7.06 shall apply, no such compensation shall be in excess of that permitted the
Trustee under this Subsection 8.02(a), and that such successor shall undertake
and assume the obligations of the Trustee to pay compensation to any third
Person acting as an agent or independent contractor in the performance of master
servicing responsibilities hereunder. The Trustee and such successor shall take
such action, consistent with this Agreement, as shall be necessary to effectuate
any such succession.

         (b) If the Trustee shall succeed to any duties of the Master Servicer
respecting the Mortgage Loans as provided herein, it shall do so in a separate
capacity and not in its capacity as Trustee and, accordingly, the provisions of
Article IX shall be inapplicable to the Trustee in its duties as the successor
to the Master Servicer in the servicing of the Mortgage Loans (although such
provisions shall continue to apply to the Trustee in its capacity as Trustee);
the provisions of Article VII, however, shall apply to it in its capacity as
successor master servicer.

         Section 8.03. NOTIFICATION TO CERTIFICATEHOLDERS. Upon any termination
or appointment of a successor to the Master Servicer, the Trustee shall give
prompt written notice thereof to Certificateholders at their respective
addresses appearing in the Certificate Register and to the Rating Agencies.

         Section 8.04. WAIVER OF DEFAULTS. The Trustee shall transmit by mail to
all Certificateholders, within 60 days after the occurrence of any Event of
Default known to a Responsible Officer of the Trustee, unless such Event of
Default shall have been cured, notice of each such Event of Default hereunder
known to the Trustee. The Holders of Certificates evidencing Fractional
Undivided Interests aggregating not less than 51% of the Trust Fund may, on
behalf of all Certificateholders, waive any default by the Master Servicer in
the performance of its obligations hereunder and the consequences thereof,
except a default in the making of or the causing to be made any required
distribution on the Certificates. Upon any such waiver of a past default, such
default shall be deemed to cease to exist, and any Event of Default arising
therefrom shall be deemed to have been timely remedied for every purpose of this
Agreement. No such waiver shall extend to any

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subsequent or other default or impair any right consequent thereon except to the
extent expressly so waived. The Master Servicer shall give notice of any such
waiver to the Rating Agencies.

         Section 8.05. LIST OF CERTIFICATEHOLDERS. Upon written request of three
or more Certificateholders of record, for purposes of communicating with other
Certificateholders with respect to their rights under this Agreement, the
Trustee will afford such Certificateholders access during business hours to the
most recent list of Certificateholders held by the Trustee.

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                                   ARTICLE IX

                             Concerning the Trustee

         Section 9.01. DUTIES OF TRUSTEE. (a) The Trustee, prior to the
occurrence of an Event of Default and after the curing or waiver of all Events
of Default which may have occurred, undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement as duties of the
Trustee. If an Event of Default has occurred and has not been cured or waived,
the Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and subject to Section 8.02(b) use the same degree of care and skill
in their exercise, as a prudent person would exercise under the circumstances in
the conduct of his own affairs.

         (b) Upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments which are specifically
required to be furnished to the Trustee pursuant to any provision of this
Agreement, the Trustee shall examine them to determine whether they are in the
form required by this Agreement; PROVIDED, HOWEVER, that the Trustee shall not
be responsible for the accuracy or content of any resolution, certificate,
statement, opinion, report, document, order or other instrument furnished by the
Master Servicer hereunder.

         (c) The Trustee shall make monthly distributions and the final
distribution to the Certificateholders as provided in Sections 6.01 and 10.01
herein.

         (d) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct; PROVIDED, HOWEVER, that:

                  (i) Prior to the occurrence of an Event of Default, and after
         the curing or waiver of all such Events of Default which may have
         occurred, the duties and obligations of the Trustee shall be determined
         solely by the express provisions of this Agreement, the Trustee shall
         not be liable except for the performance of such duties and obligations
         as are specifically set forth in this Agreement, no implied covenants
         or obligations shall be read into this Agreement against the Trustee
         and, in the absence of bad faith on the part of the Trustee, the
         Trustee may conclusively rely, as to the truth of the statements and
         the correctness of the opinions expressed therein, upon any
         certificates or opinions furnished to the Trustee and conforming to the
         requirements of this Agreement;

                  (ii) The Trustee shall not be liable in its individual
         capacity for an error of judgment made in good faith by a Responsible
         Officer or Responsible Officers of the Trustee, unless it shall be
         proved that the Trustee was negligent in ascertaining the pertinent
         facts;

                  (iii) The Trustee shall not be liable with respect to any
         action taken, suffered or omitted to be taken by it in good faith in
         accordance with the directions of the Holders of Certificates
         evidencing Fractional Undivided Interests aggregating not less than 25%
         of the

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         Trust Fund, if such action or non-action relates to the time, method
         and place of conducting any proceeding for any remedy available to the
         Trustee, or exercising any trust or other power conferred upon the
         Trustee, under this Agreement; and

                  (iv) The Trustee shall not be required to take notice or be
         deemed to have notice or knowledge of any default or Event of Default
         unless a Responsible Officer of the Trustee's Corporate Trust Office
         shall have actual knowledge thereof. In the absence of such notice, the
         Trustee may conclusively assume there is no such default or Event of
         Default.

         The Trustee shall not be required to expend or risk its own funds or
otherwise incur financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it, and
none of the provisions contained in this Agreement shall in any event require
the Trustee to perform, or be responsible for the manner of performance of, any
of the obligations of the Master Servicer under this Agreement, except during
such time, if any, as the Trustee shall be the successor to, and be vested with
the rights, duties, powers and privileges of, the Master Servicer in accordance
with the terms of this Agreement.

         (e) All funds received by the Trustee and required to be deposited in
the Certificate Account pursuant to this Agreement will be promptly so deposited
by the Trustee. The Trustee shall not be liable for interest or other
compensation on uninvested funds held under this Agreement.

         (f) Except for those actions that the Trustee is required to take
hereunder, the Trustee shall have no obligation or liability to take any action
or to refrain from taking any action hereunder in the absence of written
direction as provided hereunder.

         Section 9.02. CERTAIN MATTERS AFFECTING THE TRUSTEE. Except as
otherwise provided in Section 9.01:

                  (i) The Trustee may rely and shall be protected in acting or
         refraining from acting in reliance on any resolution, Officer's
         Certificate, certificate of a Servicing Officer, certificate of
         auditors or any other certificate, statement, instrument, opinion,
         report, notice, request, consent, order, appraisal, bond or other paper
         or document believed by it to be genuine and to have been signed or
         presented by the proper party or parties;

                  (ii) The Trustee may consult with counsel of its selection and
         any advice of such counsel or any Opinion of Counsel shall be full and
         complete authorization and protection with respect to any action taken
         or suffered or omitted by it hereunder in good faith and in accordance
         with such advice or Opinion of Counsel;

                  (iii) The Trustee shall be under no obligation to exercise any
         of the trusts or powers vested in it by this Agreement, other than its
         obligation to give notices pursuant to this Agreement, or to institute,
         conduct or defend any litigation hereunder or in relation hereto

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         at the request, order or direction of any of the Certificateholders
         pursuant to the provisions of this Agreement, unless such
         Certificateholders shall have offered to the Trustee reasonable
         security or indemnity against the costs, expenses and liabilities which
         may be incurred therein or thereby. Nothing contained herein shall,
         however, relieve the Trustee of the obligation, upon the occurrence of
         an Event of Default of which a Responsible Officer of the Trustee's
         Corporate Trust Office has actual knowledge (which has not been cured
         or waived), subject to Section 8.02(b), to exercise such of the rights
         and powers vested in it by this Agreement, and to use the same degree
         of care and skill in their exercise, as a prudent person would exercise
         under the circumstances in the conduct of his own affairs;

                  (iv) The Trustee shall not be liable in its individual
         capacity for any action taken, suffered or omitted by it in good faith
         and believed by it to be authorized or within the discretion or rights
         or powers conferred upon it by this Agreement;

                  (v) Prior to the occurrence of an Event of Default hereunder
         and after the curing or waiver of all Events of Default which may have
         occurred, the Trustee shall not be bound to make any investigation into
         the facts or matters stated in any resolution, certificate, statement,
         instrument, opinion, report, notice, request, consent, order, approval,
         bond or other paper or document, unless requested in writing to do so
         by Holders of Certificates evidencing Fractional Undivided Interests
         aggregating not less than 25% of the Trust Fund and provided that the
         payment within a reasonable time to the Trustee of the costs, expenses
         or liabilities likely to be incurred by it in the making of such
         investigation is, in the opinion of the Trustee, reasonably assured to
         the Trustee by the security afforded to it by the terms of this
         Agreement. The Trustee may require reasonable indemnity against such
         expense or liability as a condition to taking any such action. The
         reasonable expense of every such examination shall be paid by the
         Certificateholders requesting the investigation;

                  (vi) The Trustee may execute any of the trusts or powers
         hereunder or perform any duties hereunder either directly or through
         Affiliates, agents or attorneys; PROVIDED, HOWEVER, that the Trustee
         may not appoint any agent to perform its custodial functions with
         respect to the Mortgage Files or paying agent functions under this
         Agreement without the express written consent of the Master Servicer,
         which consent will not be unreasonably withheld. The Trustee shall not
         be liable or responsible for the misconduct or negligence of any of the
         Trustee's agents or attorneys or a custodian or paying agent appointed
         hereunder by the Trustee with due care and, when required, with the
         consent of the Master Servicer;

                  (vii) Should the Trustee deem the nature of any action
         required on its part, other than a payment or transfer under Subsection
         4.02(b) or Section 4.03, to be unclear, the Trustee may require prior
         to such action that it be provided by the Master Servicer with
         reasonable further instructions;

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                  (viii) The right of the Trustee to perform any discretionary
         act enumerated in this Agreement shall not be construed as a duty, and
         the Trustee shall not be accountable for other than its negligence or
         willful misconduct in the performance of any such act;

                  (ix) The Trustee shall not be required to give any bond or
         surety with respect to the execution of the trust created hereby or the
         powers granted hereunder; and

                  (x) The Trustee shall have no duty to conduct any affirmative
         investigation as to the occurrence of any condition requiring the
         repurchase of any Mortgage Loan by a Mortgage Loan Seller pursuant to
         this Agreement and/or the Mortgage Loan Purchase Agreement or the
         eligibility of any Mortgage Loan for purposes of this Agreement.

         Section 9.03. TRUSTEE NOT LIABLE FOR CERTIFICATES OR MORTGAGE LOANS.
The recitals contained herein and in the Certificates (other than the signature
and countersignature of the Trustee on the Certificates) shall be taken as the
statements of the Seller, and the Trustee shall have no responsibility for their
correctness. The Trustee makes no representation as to the validity or
sufficiency of the Certificates (other than the signature and countersignature
of the Trustee on the Certificates) or of any Mortgage Loan except as expressly
provided in Sections 2.02 and 2.06 hereof. The Trustee's signature and
countersignature (or countersignature of its agent) on the Certificates shall be
solely in its capacity as Trustee and shall not constitute the Certificates an
obligation of the Trustee in any other capacity. The Trustee shall not be
accountable for the use or application by the Seller of any of the Certificates
or of the proceeds of such Certificates, or for the use or application of any
funds paid to the Seller with respect to the Mortgage Loans. Subject to the
provisions of Section 2.06, the Trustee shall not be responsible for the
legality or validity of this Agreement or any document or instrument relating to
this Agreement, the validity of the execution of this Agreement or of any
supplement hereto or instrument of further assurance, or the validity, priority,
perfection or sufficiency of the security for the Certificates issued hereunder
or intended to be issued hereunder. The Trustee shall at no time have any
responsibility or liability for or with respect to the legality, validity and
enforceability of any Mortgage or any Mortgage Loan, or the perfection and
priority of any Mortgage or the maintenance of any such perfection and priority,
or for or with respect to the sufficiency of the Trust Fund or its ability to
generate the payments to be distributed to Certificateholders, under this
Agreement. The Trustee shall have no responsibility for filing any financing or
continuation statement in any public office at any time or to otherwise perfect
or maintain the perfection of any security interest or lien granted to it
hereunder or to record this Agreement.

         Section 9.04. TRUSTEE MAY OWN CERTIFICATES. The Trustee in its
individual capacity or in any capacity other than as Trustee hereunder may
become the owner or pledgee of any Certificates with the same rights it would
have if it were not Trustee, and may otherwise deal with the parties hereto.

         Section 9.05. FEES AND EXPENSES. (a) The Trustee shall pay to itself on
each Distribution Date from amounts on deposit in the Certificate Account, an
amount equal to the Trustee Fee in accordance with Subsection 4.03(b). Any
amount payable to the Trustee on such Distribution Date

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in excess of such amount on deposit will be paid by the Master Servicer from its
own funds as compensation (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) and the Servicer
will pay or reimburse the Trustee (or, if the Master Servicer is unable to
fulfill its obligations hereunder, the Trust Fund will reimburse pursuant to
Section 4.03(a)(xii) herein) upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee hereunder in
accordance with the terms hereof (including its attorneys' fees and expenses and
of all persons not regularly in its employ). Any payment hereunder made by the
Master Servicer to the Trustee, other than any amount to be paid from the
Certificate Account pursuant to this Section 9.05, shall be paid from the Master
Servicer's own funds, without reimbursement from the Trust Fund therefor. Such
compensation and reimbursement obligation shall not be limited by any provision
of law in regard to the compensation of a trustee of an express trust.

         (b) The Trustee and any director, officer, employee or agent of the
Trustee shall be indemnified by the Master Servicer and held harmless against
any loss, liability or expense (a) incurred in connection with this Agreement or
the Certificates, or the performance of any of the Trustee's duties hereunder,
other than any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of any of the Trustee's
duties hereunder or by reason of reckless disregard of the Trustee's obligations
and duties hereunder or (b) resulting from the exercise of any power of attorney
granted by the Trustee to the Master Servicer in accordance with this Agreement.
Such indemnity shall survive the termination of this Agreement or the
resignation or removal of the Trustee hereunder.

         Section 9.06. ELIGIBILITY REQUIREMENTS FOR TRUSTEE. The Trustee and any
successor Trustee shall during the entire duration of this Agreement be a state
bank or trust company or a national banking association organized and doing
business under the laws of such state or the United States of America,
authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus and undivided profits of at least $40,000,000 or, in the
case of a successor Trustee, $50,000,000, subject to supervision or examination
by federal or state authority and, in the case of a successor Trustee other than
pursuant to Section 9.10, rated in one of the two highest long- term debt
categories of, or otherwise acceptable to, each of the Rating Agencies. The
Trustee shall not be an Affiliate of the Master Servicer, unless the Trustee
acts as successor Master Servicer hereunder. If the Trustee publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section 9.06 the combined capital and surplus of such corporation shall be
deemed to be its total equity capital (combined capital and surplus) as set
forth in its most recent report of condition so published. In case at any time
the Trustee shall cease to be eligible in accordance with the provisions of this
Section 9.06, the Trustee shall resign immediately in the manner and with the
effect specified in Section 9.08.

         Section 9.07. INSURANCE. The Trustee, at its own expense, shall at all
times maintain and keep in full force and effect: (i) fidelity insurance, (ii)
theft of documents insurance and (iii) forgery insurance (which may be
collectively satisfied by a "Financial Institution Bond" and/or a "Bankers'

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Blanket Bond"). All such insurance shall be in amounts, with standard coverage
and subject to deductibles, as are customary for insurance typically maintained
by banks which act as custodians for investor-owned mortgage pools. A
certificate of an officer of the Trustee as to the Trustee's compliance with
this Section 9.07 shall be furnished to the Master Servicer or any
Certificateholder upon reasonable written request.

         Section 9.08. RESIGNATION AND REMOVAL OF THE TRUSTEE. (a) The Trustee
may at any time resign and be discharged from the Trust hereby created by giving
written notice thereof to the Master Servicer, with a copy to the Rating
Agencies. Upon receiving such notice of resignation, the Master Servicer shall
promptly appoint a successor Trustee by written instrument, in triplicate, one
copy of which instrument shall be delivered to each of the resigning Trustee and
the successor Trustee. If no successor Trustee shall have been so appointed and
have accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee.

         (b) If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 9.06 and shall fail to resign after written
request therefor by the Master Servicer or if at any time the Trustee shall
become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Master Servicer shall be entitled to remove the Trustee and appoint a successor
Trustee by written instrument, in triplicate, one copy of which instrument shall
be delivered to each of the Trustee so removed and the successor Trustee.

         (c) The Holders of Certificates evidencing Fractional Undivided
Interests aggregating not less than 51% of the Trust Fund may at any time remove
the Trustee and appoint a successor Trustee by written instrument or
instruments, in quadruplicate, signed by such Holders or their attorneys-in-fact
duly authorized, one complete set of which instruments shall be delivered to
each of the Master Servicer, the Trustee so removed and the successor so
appointed.

         (d) No resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 9.08 shall
become effective except upon appointment of and acceptance of such appointment
by the successor Trustee as provided in Section 9.09.

         Section 9.09. SUCCESSOR TRUSTEE. (a) Any successor Trustee appointed as
provided in Section 9.08 shall execute, acknowledge and deliver to the Master
Servicer and to its predecessor Trustee an instrument accepting such appointment
hereunder. The resignation or removal of the predecessor Trustee shall then
become effective and such successor Trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with like effect as if originally
named as Trustee herein. The predecessor Trustee shall after payment of its
outstanding fees and expenses promptly deliver to the successor Trustee all
assets and records of the Trust held by it hereunder, and the Master Servicer
and the

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predecessor Trustee shall execute and deliver such instruments and do such other
things as may reasonably be required for more fully and certainly vesting and
confirming in the successor Trustee all such rights, powers, duties and
obligations.

         (b) No successor Trustee shall accept appointment as provided in this
Section 9.09 unless at the time of such acceptance such successor Trustee shall
be eligible under the provisions of Section 9.06.

         (c) Upon acceptance of appointment by a successor Trustee as provided
in this Section 9.09, the successor Trustee shall mail notice of the succession
of such Trustee hereunder to all Certificateholders at their addresses as shown
in the Certificate Register and to the Rating Agencies. The Master Servicer
shall pay the cost of any mailing by the successor Trustee.

         Section 9.10. MERGER OR CONSOLIDATION OF TRUSTEE. Any state bank or
trust company or national banking association into which the Trustee may be
merged or converted or with which it may be consolidated or any state bank or
trust company or national banking association resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any state
bank or trust company or national banking association succeeding to all or
substantially all of the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, provided such state bank or trust company or
national banking association shall be eligible under the provisions of Section
9.06. Such succession shall be valid without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.

         Section 9.11. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. (a)
Notwithstanding any other provisions hereof, at any time, for the purpose of
meeting any legal requirements of any jurisdiction in which any part of the
Trust or property constituting the same may at the time be located, the Master
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee and the Master Servicer to act as co-trustee or co-trustees, jointly
with the Trustee, or separate trustee or separate trustees, of all or any part
of the Trust, and to vest in such Person or Persons, in such capacity, such
title to the Trust, or any part thereof, and, subject to the other provisions of
this Section 9.11, such powers, duties, obligations, rights and trusts as the
Master Servicer and the Trustee may consider necessary or desirable.

         (b) If the Master Servicer shall not have joined in such appointment
within 15 days after the receipt by it of a written request so to do, or in case
an Event of Default with respect to the Master Servicer shall have occurred and
be continuing, the Trustee shall have the power to make such appointment without
the Master Servicer.

         (c) No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor Trustee under Section 9.06
hereunder and no notice to Certificateholders of the appointment of
co-trustee(s) or separate trustee(s) shall be required under Section 9.08
hereof.

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         (d) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 9.11, all rights, powers, duties and obligations
conferred or imposed upon the Trustee and required to be conferred on such
co-trustee shall be conferred or imposed upon and exercised or performed by the
Trustee and such separate trustee or co-trustee jointly, except to the extent
that under any law of any jurisdiction in which any particular act or acts are
to be performed (whether as Trustee hereunder or as successor to the Master
Servicer hereunder), the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust or any portion thereof in any such
jurisdiction) shall be exercised and performed by such separate trustee or
co-trustee at the direction of the Trustee.

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

         (f) To the extent not prohibited by law, any separate trustee or
co-trustee may, at any time, request the Trustee, its agent or attorney-in-fact,
with full power and authority, to do any lawful act under or with respect to
this Agreement on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor Trustee.

         (g) No trustee under this Agreement shall be personally liable by
reason of any act or omission of another trustee under this Agreement. The
Master Servicer and the Trustee acting jointly may at any time accept the
resignation of or remove any separate trustee or co-trustee, except that
following the occurrence of any Event of Default which has not been cured, the
Trustee acting alone may accept the resignation of or remove any separate
trustee or co-trustee.

         Section 9.12. MASTER SERVICER SHALL PROVIDE INFORMATION AS REASONABLY
REQUIRED. The Master Servicer shall furnish to the Trustee, during the term of
this Agreement, such periodic, special, or other reports or information (and in
such electronic format or other means acceptable to the Trustee) as may
reasonably be requested by the Trustee in order to fulfill its duties and
obligations under this Agreement.

         Section 9.13. FEDERAL INFORMATION RETURNS AND REPORTS TO
CERTIFICATEHOLDERS. (a) For Federal income tax purposes, the taxable year of the
REMIC shall be a calendar year and the Trustee

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shall maintain or cause the maintenance of the books of the REMIC on the accrual
method of accounting.

         (b) The Trustee shall prepare and file or cause to be filed with the
Internal Revenue Service Federal tax information returns or elections required
to be made by the Trustee hereunder with respect to the REMIC and the
Certificates containing such information and at the times and in the manner as
may be required by the Code or applicable Treasury regulations, and shall
furnish to each Holder of Certificates at any time during the calendar year for
which such returns or reports are made such statements or information at the
times and in the manner as may be required thereby. In connection with the
foregoing, the Trustee shall provide the name and address of the person who can
be contacted to obtain information required to be reported to the holders of
regular interests in the REMIC (the "REMIC Reporting Agent") as required by IRS
Form 8811. The Trustee shall make the elections to treat the REMIC as a REMIC
(which election shall apply to the taxable period ending December 31, 2000 and
each calendar year thereafter) in such manner as the Code or applicable Treasury
regulations may prescribe. The Trustee shall sign all tax information returns
filed pursuant to this Section and any other returns as may be required by the
Code, and in doing so shall rely entirely upon, and shall have no liability for
information provided by, or calculations provided by, the Seller or the Master
Servicer. The Holder of the Class R Certificate is hereby designated as the "Tax
Matters Person" (within the meaning of Treas. Reg. ss.ss. 1.860F-4(d)) for the
REMIC to perform the tasks specifically delegated to such agent herein. The
Trustee is hereby designated and appointed as the agent of each such Tax Matters
Person. Any Holder of a Residual Certificate will by acceptance thereof appoint
the Trustee as agent and attorney-in-fact for the purpose of acting as Tax
Matters Person for the REMIC during such time as the Trustee does not own any
such Residual Certificate. In the event that the Code or applicable Treasury
regulations prohibit the Trustee from signing tax or information returns or
other statements, or the Trustee from acting as Tax Matters Person (as an agent
or otherwise), the Trustee shall take whatever action that in its sole good
faith judgment is necessary for the proper filing of such information returns or
for the provision of a tax matters person, including designation of the Holder
of a Residual Certificate to sign such returns or act as tax matters person.
Each Holder of a Residual Certificate shall be bound by this Section.

         (c) The Trustee shall provide upon request such information (which
shall be provided by the Master Servicer) as required in Section 860D(a)(6)(B)
of the Code to the Internal Revenue Service, to any Person purporting to
transfer a Residual Certificate to a Person other than a transferee permitted by
Section 5.05(b), and to any regulated investment company, real estate investment
trust, common trust fund, partnership, trust, estate, organization described in
Section 1381 of the Code, or nominee holding an interest in a pass-through
entity described in Section 860E(e)(6) of the Code, any record holder of which
is not a transferee permitted by Section 5.05(b) (or which is deemed by statute
to be an entity with a disqualified member).

         (d) The Trustee shall prepare and file or cause to be filed any state
income tax returns required under Applicable State Law with respect to the REMIC
or the Trust Fund.

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<PAGE>

         Section 9.14. LIMITATION ON DUTY OF TRUSTEE IN RESPECT OF FILINGS. The
Trustee shall not be responsible for filing any financing or continuation
statements or recording any documents or instruments in any public office at any
time or times or otherwise perfecting or maintaining the perfection of any
security interest in the Mortgage Loans.

                                       98

<PAGE>

                                    ARTICLE X

                                   Termination

         Section 10.01. TERMINATION REQUIREMENTS. (a) Subject to Section 10.02,
the respective obligations and responsibilities of the Seller, the Master
Servicer and the Trustee created hereby, other than the obligation of the
Trustee or the Master Servicer to make payments to Certificateholders as
hereinafter set forth and to the Trustee, shall terminate:

                  (i) upon the repurchase by or at the direction of the Seller
         or its designee (or the Master Servicer or its designee, as provided in
         clause (d) below) of all Mortgage Loans and all REO Property remaining
         in the Trust at a price equal to (A) 100% of the Outstanding Principal
         Balance of each Mortgage Loan (other than a Mortgage Loan related to
         REO Property) as of the date of repurchase, net of the principal
         portion of any unreimbursed Monthly Advances made by the purchaser,
         together with interest at the applicable Mortgage Interest Rate accrued
         but unpaid through and including the last day of the month prior to the
         month of repurchase, plus (B) the appraised value of any REO Property,
         plus, in the case of a purchase by the Seller, the good faith estimate
         of the Seller (after consultation with the Master Servicer) of
         liquidation expenses to be incurred in connection with its disposal
         thereof (but not more than the Outstanding Principal Balance of the
         related Mortgage Loan, together with interest at the applicable
         Mortgage Interest Rate accrued on that balance but unpaid through and
         including the last day of the month prior to the month of repurchase),
         such appraisal to be calculated by an appraiser mutually agreed upon by
         the Seller or the Master Servicer, as applicable, and the Trustee at
         the expense of the Seller or the Master Servicer, as applicable; or

                  (ii) upon the later of the making of the final payment or
         other liquidation, or any advance with respect thereto, of the last
         Mortgage Loan remaining in the Trust Fund or the disposition of all
         property acquired with respect to any such Mortgage Loan; PROVIDED,
         HOWEVER, that in the event that an advance has been made, but not yet
         recovered, at the time of such termination, the Person having made such
         advance shall be entitled to receive, notwithstanding such termination,
         any payments received subsequent thereto with respect to which such
         advance was made.

         (b) In no event, however, shall the Trust created hereby continue
beyond the expiration of 21 years from the death of the last survivor of the
descendants of Joseph P. Kennedy, the late Ambassador of the United States to
the Court of St. James, living on the date of this Agreement.

         (c) The right of the Seller or its designee or the Master Servicer or
its designee to repurchase all Mortgage Loans pursuant to Subsection 10.01(a)(i)
above shall be exercisable only if (i) the aggregate Scheduled Principal Balance
of the Mortgage Loans at the time of any such repurchase is less than 10% of the
Cut-off Date Balance (the "Optional Termination Date"), or (ii) the Seller or
the Master Servicer, based upon an Opinion of Counsel, has determined that the
REMIC

                                       99

<PAGE>

status of the Trust Fund has been lost or that a substantial risk exists that
the REMIC status of the Trust Fund will be lost for the then-current taxable
year.

         (d) The Seller or its designee may only exercise its option to
repurchase all Mortgage Loans pursuant to Subsection 10.01(a)(i) above on the
first possible Optional Termination Date or the second possible Optional
Termination Date, provided that it has provided notice to the Master Servicer
and the Trustee of its decision to repurchase the Mortgage Loans at least five
Business Days prior to such Optional Termination Date. In the event the Seller
or its designee chooses not to exercise this option, the Master Servicer or its
designee shall have the sole right to repurchase the Mortgage Loans on the
second Optional Termination Date or on any Distribution Date thereafter, or on
the first Optional Termination Date with the written consent of the Seller.

         (e) The Trustee shall give notice of any termination to the applicable
Certificateholders, with a copy to the Rating Agencies, upon which such
Certificateholders shall surrender their Certificates to the Trustee for payment
of the final distribution and cancellation. Such notice shall be given by
letter, mailed not earlier than the 15th day and not later than the 25th day of
the month next preceding the month of such final distribution, and shall specify
(i) the Distribution Date upon which final payment of such Certificates will be
made upon presentation and surrender of such Certificates at the office of the
Trustee therein designated, (ii) the amount of any such final payment and (iii)
that the Record Date otherwise applicable to such Distribution Date is not
applicable, payments being made only upon presentation and surrender of such
Certificates at the office of the Trustee therein specified.

         (f) If the option of the Seller or the Master Servicer to repurchase or
cause the repurchase of all Mortgage Loans under Subsection 10.01(a)(i) above is
exercised, the Seller or the Master Servicer and/or their respective designee
shall deliver to the Trustee for deposit in the Certificate Account, by the
Business Day prior to the applicable Distribution Date, an amount equal to the
repurchase price for the Mortgage Loans being purchased by it and all property
acquired with respect to such Mortgage Loans remaining in the applicable REMIC.
Upon the presentation and surrender of the Certificates, the Trustee shall
distribute an amount equal to (i) the amount otherwise distributable to the
Certificateholders (other than the holder of the Residual Certificate) on such
Distribution Date but for such repurchase, (ii) the Current Principal Amount and
any accrued but unpaid interest at the Pass-Through Rate to the
Certificateholders of each Class, and (iii) the remainder to the Residual
Certificateholder. If the Available Funds are not sufficient to pay all of the
Certificates in full, any such deficiency will be allocated to the outstanding
Class or Classes of Subordinate Certificates having the highest numerical
designation or, if after the Cross-Over Date, to the Senior Certificates pro
rata. Upon deposit of the required repurchase price and following such final
Distribution Date, the Trustee shall release promptly to the Master Servicer
and/or its designee or the Seller and/or its designee, as the case may be, the
Mortgage Files for the remaining applicable Mortgage Loans, and the Accounts
with respect thereto shall terminate, subject to the Trustee's obligation to
hold any amounts payable to Certificateholders in trust without interest pending
final distributions pursuant to Subsection 10.01(i).

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<PAGE>

         (g) In the event that this Agreement is terminated by reason of the
payment or liquidation of all Mortgage Loans or the disposition of all property
acquired with respect to all Mortgage Loans under Subsection 10.01(a)(ii) above,
the Master Servicer shall deliver to the Trustee for deposit in the Certificate
Account all distributable amounts remaining in the Protected Account, and shall
cause any Sub-Servicers to, deliver to the Trustee for deposit in the
Certificate Account all distributable amounts remaining in their Protected
Accounts. Upon the presentation and surrender of the Certificates, the Trustee
shall distribute to the Certificateholders, in accordance with their respective
interests, all distributable amounts remaining in the Certificate Account. Upon
deposit by any Sub- Servicers of such distributable amounts and delivery to the
Trustee of an Officer's Certificate from the Master Servicer certifying that
such deposit has been made, and following such final Distribution Date, the
Trustee shall release promptly to the Master Servicer or its designee the
Mortgage Files for the remaining Mortgage Loans, and the Accounts shall
terminate, subject to the Trustee's obligation to hold any amounts payable to
the Certificateholders in trust without interest pending final distributions
pursuant to Subsection 10.01(ii).

         (h) If not all of the Certificateholders shall surrender their
Certificates for cancellation within six months after the time specified in the
above-mentioned written notice, the Trustee shall give a second written notice
to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
six months after the second notice, not all the Certificates shall have been
surrendered for cancellation, the Trustee may take appropriate steps, or appoint
any agent to take appropriate steps, to contact the remaining Certificateholders
concerning surrender of their Certificates, and the cost thereof shall be paid
out of the funds and other assets which remain subject to this Agreement.

         Section 10.02. ADDITIONAL TERMINATION REQUIREMENTS. (a) If the option
of the Seller or its designee or the Master Servicer or its designee to
repurchase all the Mortgage Loans under Subsection 10.01(a)(i) above is
exercised, the REMIC shall be terminated in accordance with the following
additional requirements, unless the Trustee has been furnished with an Opinion
of Counsel to the effect that the failure of the Trust to comply with the
requirements of this Section 10.02 will not (i) result in the imposition of
taxes on "prohibited transactions" as defined in Section 860F of the Code on the
REMIC or (ii) cause the Trust Fund to fail to qualify as a REMIC at any time
that any Regular Certificates are outstanding:

                  (i) within 90 days prior to the final Distribution Date, at
         the written direction of the Seller or the Master Servicer, as
         applicable, the Tax Matters Persons shall adopt a plan of complete
         liquidation of the REMIC provided to it by the Master Servicer meeting
         the requirements of a "Qualified Liquidation" under Section 860F of the
         Code and any regulations thereunder.

                  (ii) at or after the time of adoption of such a plan of
         complete liquidation of the REMIC and at or prior to the final
         Distribution Date, the Trustee shall sell for cash all of the assets of
         the Trust to or at the direction of the Seller or the Master Servicer;
         and

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<PAGE>

                  (iii) at the time of the making of the final payment on the
         Certificates, the Trustee shall distribute or credit from the
         Certificate Account (or cause to be distributed or credited) (i) to the
         Certificateholders, other than the Holder of the corresponding Residual
         Certificates, the Current Principal Amount of the Certificates plus 30
         days' interest thereon at the applicable Pass-Through Rate, and (ii) to
         the corresponding Residual Certificateholder, all cash on hand from the
         Certificate Account (other than cash retained to meet claims); and the
         corresponding REMIC shall terminate at such time.

         (b) By their acceptance of the Residual Certificates, the Holders
thereof hereby (i) agree to adopt such a plan of complete liquidation of the
relevant REMIC upon the written request of the Seller or the Master Servicer and
to take such action in connection therewith as may be reasonably requested by
the Seller or the Master Servicer and (ii) appoint the Seller or the Master
Servicer as their attorney-in-fact, with full power of substitution, for
purposes of adopting such a plan of complete liquidation. The Trustee shall
adopt such plan of liquidation by filing the appropriate statement on the final
tax return of the REMIC.

                                       102

<PAGE>

                                   ARTICLE XI

                            Miscellaneous Provisions

         Section 11.01. INTENT OF PARTIES. The parties intend that the Trust
Fund shall be treated as a REMIC for federal income tax purposes and that the
provisions of this Agreement should be construed in furtherance of this intent.

         Section 11.02. AMENDMENT. (a) This Agreement may be amended from time
to time by the Seller, the Trustee and the Master Servicer, without notice to or
the consent of any of the Certificateholders, to cure any ambiguity, to correct
or supplement any provisions herein that may be defective or inconsistent with
any other provisions herein, to comply with any changes in the Code or to make
any other provisions with respect to matters or questions arising under this
Agreement which shall not be inconsistent with the provisions of this Agreement;
PROVIDED, HOWEVER, that such action shall not, as evidenced by an Opinion of
Independent Counsel, adversely affect in any material respect the interests of
any Certificateholder.

         (b) This Agreement may also be amended from time to time by the Seller,
the Trustee and the Master Servicer, with the consent of the Holders of
Certificates evidencing Fractional Undivided Interests aggregating not less than
51% of the Trust Fund or of the applicable Class or Classes if such amendment
affects only such Class or Classes for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this Agreement
or of modifying in any manner the rights of the Certificateholders; PROVIDED,
HOWEVER, that no such amendment shall (i) reduce in any manner the amount of, or
delay the timing of, payments received on Mortgage Loans which are required to
be distributed on any Certificate without the consent of the Holder of such
Certificate, (ii) reduce the aforesaid percentage of Certificates the Holders of
which are required to consent to any such amendment, without the consent of the
Holders of all Certificates then outstanding, or (iii) cause the Trust Fund to
fail to qualify as a REMIC for federal income tax purposes, as evidenced by an
Opinion of Independent Counsel which shall be provided to the Trustee other than
at the Trustee's expense. Notwithstanding any other provision of this Agreement,
for purposes of the giving or withholding of consents pursuant to Section
11.02(b), Certificates registered in the name of or held for the benefit of the
Seller, the Master Servicer, a Sub- Servicer or the Trustee or any Affiliate
thereof shall be entitled to vote their Undivided Fractional Interests with
respect to matters affecting such Certificates.

         (c) Promptly after the execution of any such amendment, the Trustee
shall furnish a copy of such amendment or written notification of the substance
of such amendment to each Certificateholder, with a copy to the Rating Agencies.

         (d) In the case of an amendment under Subsection 11.02(b) above, it
shall not be necessary for the Certificateholders to approve the particular form
of such an amendment. Rather, it shall be sufficient if the Certificateholders
approve the substance of the amendment. The manner

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<PAGE>

of obtaining such consents and of evidencing the authorization of the execution
thereof by Certificateholders shall be subject to such reasonable regulations as
the Trustee may prescribe.

         (e) Prior to the execution of any amendment to this Agreement, the
Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating
that the execution of such amendment is authorized or permitted by this
Agreement and that all conditions precedent to the execution and effectiveness
of such amendment have been complied with. The Trustee may, but shall not be
obligated to, enter into any such amendment which affects the Trustee's own
rights, duties or immunities under this Agreement.

         (f) Notwithstanding any provision of this Agreement to the contrary,
this Agreement may not be amended, modified or waived in any manner that would
be adverse to any interest of the Master Servicer, without the Master Servicer's
prior written consent.

         Section 11.03. RECORDATION OF AGREEMENT. To the extent permitted by
applicable law, this Agreement is subject to recordation in all appropriate
public offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the Mortgaged Properties are situated, and
in any other appropriate public recording office or elsewhere. The Master
Servicer shall effect such recordation, at their expense upon the request in
writing of a Certificateholder, but only if such direction is accompanied by an
Opinion of Counsel (provided at the expense of the Certificateholder requesting
recordation) to the effect that such recordation would materially and
beneficially affect the interests of the Certificateholders or is required by
law.

         Section 11.04. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. (a) The
death or incapacity of any Certificateholder shall not terminate this Agreement
or the Trust, nor entitle such Certificateholder's legal representatives or
heirs to claim an accounting or to take any action or proceeding in any court
for a partition or winding up of the Trust, nor otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.

         (b) Except as expressly provided in this Agreement, no
Certificateholders shall have any right to vote or in any manner otherwise
control the operation and management of the Trust, or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Certificates, be construed so as to establish the Certificateholders from
time to time as partners or members of an association; nor shall any
Certificateholders be under any liability to any third Person by reason of any
action taken by the parties to this Agreement pursuant to any provision hereof.

         (c) No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon, under or with respect to this Agreement against the
Seller, the Master Servicer or any successor to any such parties unless (i) such
Certificateholder previously shall have given to the Trustee a written notice of
a continuing default, as herein provided, (ii) the Holders of Certificates
evidencing Fractional Undivided Interests aggregating not less than 51% of the
Trust Fund shall have made written request upon the Trustee to institute such
action, suit or proceeding in its own name as Trustee hereunder and shall have

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<PAGE>

offered to the Trustee such reasonable indemnity as it may require against the
costs and expenses and liabilities to be incurred therein or thereby, and (iii)
the Trustee, for 60 days after its receipt of such notice, request and offer of
indemnity, shall have neglected or refused to institute any such action, suit or
proceeding.

         (d) No one or more Certificateholders shall have any right by virtue of
any provision of this Agreement to affect the rights of any other
Certificateholders or to obtain or seek to obtain priority or preference over
any other such Certificateholder, or to enforce any right under this Agreement,
except in the manner herein provided and for the equal, ratable and common
benefit of all Certificateholders. For the protection and enforcement of the
provisions of this Section 11.04, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.

         Section 11.05. ACTS OF CERTIFICATEHOLDERS. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Agreement to be given or taken by Certificateholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Certificateholders in person or by an agent duly appointed in writing.
Except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is expressly required, to the Seller. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and conclusive in favor of the Trustee and the Seller,
if made in the manner provided in this Section 11.05.

         (b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his or her individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his or her authority. The fact and date of the execution of any such
instrument or writing, or the authority of the individual executing the same,
may also be proved in any other manner which the Trustee deems sufficient.

         (c) The ownership of Certificates (notwithstanding any notation of
ownership or other writing on such Certificates, except an endorsement in
accordance with Section 5.02 made on a Certificate presented in accordance with
Section 5.04) shall be proved by the Certificate Register, and neither the
Trustee, the Seller, the Master Servicer nor any successor to any such parties
shall be affected by any notice to the contrary.

         (d) Any request, demand, authorization, direction, notice, consent,
waiver or other action of the holder of any Certificate shall bind every future
holder of the same Certificate and the holder of every Certificate issued upon
the registration of transfer or exchange thereof, if applicable, or in lieu
thereof with respect to anything done, omitted or suffered to be done by the
Trustee, the Seller,

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<PAGE>

the Master Servicer or any successor to any such party in reliance thereon,
whether or not notation of such action is made upon such Certificates.

         (e) In determining whether the Holders of the requisite percentage of
Certificates evidencing Fractional Undivided Interests have given any request,
demand, authorization, direction, notice, consent or waiver hereunder,
Certificates owned by the Trustee, the Seller, the Master Servicer or any
Sub-Servicer or any Affiliate thereof shall be disregarded, except as otherwise
provided in Section 11.02(b) and except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Certificates which the Trustee knows
to be so owned shall be so disregarded. Certificates which have been pledged in
good faith to the Trustee, the Seller, the Master Servicer or any Sub-Servicer
or any Affiliate thereof may be regarded as outstanding if the pledgor
establishes to the satisfaction of the Trustee the pledgor's right to act with
respect to such Certificates and that the pledgor is not an Affiliate of the
Trustee, the Seller, the Master Servicer or any Sub-Servicer, as the case may
be.

         Section 11.06. GOVERNING LAW. THIS AGREEMENT AND THE CERTIFICATES SHALL
BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REFERENCE TO ITS CONFLICT OF LAWS RULES AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

         Section 11.07. NOTICES. All demands and notices hereunder shall be in
writing and shall be deemed given when delivered at or mailed by registered
mail, return receipt requested, postage prepaid, or by recognized overnight
courier, to (i) in the case of the Seller, Structured Assets Mortgage
Investments Inc, 245 Park Avenue, New York, New York 10167, Attention: Legal
Department, or to such other address as may hereafter be furnished to the other
parties hereto in writing; (ii) in the case of the Master Servicer and the
Mortgage Loan Sellers, 3000 Leadenhall Road, Mailstop SM55, Mt. Laurel, New
Jersey 08054, Attention: Vice President-Secondary Marketing, fax number (856)
439-4900; or such other address as may hereafter be furnished to the other
parties in writing; (iii) in the case of the Trustee, The Bank of New York, 101
Barclay Street, 12E, New York, New York 10286, Attention: Mortgage-Backed
Securities Group, CDMC Mortgage-Backed Pass- Through Certificates, Series
2000-8, or such other address as may hereafter be furnished to the other parties
hereto in writing; (iv) in the case of the Rating Agencies, (a) Moody's
Investors Service, Inc., 99 Church Street, New York, New York 10007; and (b)
Fitch, Inc., One State Street Plaza, New York, New York 10004, Attention:
Mortgage-Backed Surveillance. Any notice delivered to the Seller, the Master
Servicer or the Trustee under this Agreement shall be effective only upon
receipt. Any notice required or permitted to be mailed to a Certificateholder,
unless otherwise provided herein, shall be given by first-class mail, postage
prepaid, at the address of such Certificateholder as shown in the Certificate
Register. Any notice so mailed within the time prescribed in this Agreement
shall be conclusively presumed to have been duly given, whether or not the
Certificateholder receives such notice.

                                       106

<PAGE>

         Section 11.08. SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severed from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the holders thereof.

         Section 11.09. SUCCESSORS AND ASSIGNS. The provisions of this Agreement
shall be binding upon and inure to the benefit of the respective successors and
assigns of the parties hereto.

         Section 11.10. ARTICLE AND SECTION HEADINGS. The article and section
headings herein are for convenience of reference only, and shall not limit or
otherwise affect the meaning hereof.

         Section 11.11. COUNTERPARTS. This Agreement may be executed in two or
more counterparts each of which when so executed and delivered shall be an
original but all of which together shall constitute one and the same instrument.

         Section 11.12. NOTICE TO RATING AGENCIES. The article and section
headings herein are for convenience of reference only, and shall not limited or
otherwise affect the meaning hereof. The Trustee shall use its best efforts to
promptly provide notice to each Rating Agency with respect to each of the
following of which it has actual knowledge:

         1.       Any material change or amendment to this Agreement;

         2.       The occurrence of any Event of Default that has not been
                  cured;

         3.       The resignation or termination of the Master Servicer or the
                  Trustee;

         4.       The repurchase or substitution of Mortgage Loans;

         5.       The final payment to Certificateholders; and

         6.       Any change in the location of the Certificate Account.

         In addition, in accordance with Section 6.04 and Section 3.16, the
Trustee and the Master Servicer, respectively, shall promptly furnish to each
Rating Agency copies of the following:

         1.       Each report to Certificateholders described in Section 6.04;
                  and

         2.       Each annual independent public accountants' servicing report
                  received as described in Section 3.16.

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<PAGE>

         Section 11.13. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND
ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY.

         Section 11.14. NO PETITION. The Seller, Master Servicer and the
Trustee, by entering into this Agreement and each Certificateholder, by
accepting a Certificate, hereby covenant and agree that they will not at any
time institute against the Trust Fund, or join in any institution against the
Trust Fund of, any bankruptcy proceedings under any United States federal or
state bankruptcy or similar law in connection with any obligations with respect
to the Certificates or this Agreement.

                                       108

<PAGE>

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

                                        STRUCTURED ASSET MORTGAGE INVESTMENTS
                                        INC., as Seller

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

                                        THE BANK OF NEW YORK, as Trustee

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

                                        CENDANT MORTGAGE CORPORATION, as  Master
                                        Servicer

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

Accepted and Agreed as to
Sections 2.02, 2.04 and 2.05

CENDANT MORTGAGE CORPORATION, as a
Mortgage Loan Seller

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

<PAGE>

BISHOP'S GATE RESIDENTIAL MORTGAGE TRUST, as a
Mortgage Loan Seller

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

<PAGE>

STATE OF NEW YORK     )
                      )  ss.:
COUNTY OF NEW YORK    )

         On the 30th day of October 2000 before me, a notary public in and for
said State, personally appeared ___________________, known to me to be a Vice
President of Structured Asset Mortgage Investments Inc., the corporation that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.

         IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.

                                   -------------------------------
                                            Notary Public

[Notarial Seal]

<PAGE>

STATE OF NEW YORK    )
                     )  ss.:
COUNTY OF NEW YORK   )

         On the 30th day of October 2000 before me, a notary public in and for
said State, personally appeared __________________, known to me to be an Vice
President of The Bank of New York, the corporation that executed the within
instrument, and also known to me to be the person who executed it on behalf of
said corporation, and acknowledged to me that such corporation executed the
within instrument.

         IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.

                                   -------------------------------
                                            Notary Public

[Notarial Seal]

<PAGE>

STATE OF NEW JERSEY    )
                       )  ss.:
COUNTY OF BURLINGTON   )

         On the 30th day of October 2000 before me, a notary public in and for
said State, personally appeared _________________, known to me to be a
_________________ of Cendant Mortgage Corporation, the corporation that executed
the within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.

         IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.

                                   -------------------------------
                                            Notary Public

[Notarial Seal]

<PAGE>

                                                                     EXHIBIT A-1

                        FORM OF CLASS [A][P] CERTIFICATE

          SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").

          THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DECREASED BY
THE PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO. ACCORDINGLY,
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CURRENT PRINCIPAL AMOUNT
OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE
ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL AMOUNT BY INQUIRY
OF THE TRUSTEE NAMED HEREIN.

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

                                      A-1-1

<PAGE>

Certificate No. __                   [7.50%][0.00%] Pass-Through Rate

Class [A-___][P] Senior

Date of Pooling and Servicing        Aggregate Initial Current Principal Amount
Agreement and Cut-off Date:                   of this Certificate
October 1, 2000                      as of the Cut-off Date: $____________

First Distribution Date:             Initial Current Principal Amount of this
November 27, 2000                    Certificate as of the Cut-off Date:
                                     $_____________

Master Servicer:
Cendant Mortgage Corporation

Assumed Final Distribution Date:     CUSIP______ __ __
November 25, 2030

                  CDMC MORTGAGE-BACKED PASS-THROUGH CERTIFICATE
                                  SERIES 2000-8

     evidencing  a  fractional  undivided  interest  in  the  distributions
     allocable to the Class [A-___][P] Certificates with respect to a Trust
     Fund  consisting   primarily  of  a  pool  of  conventional   one-  to
     four-family  fixed  interest  rate  mortgage  loans sold by STRUCTURED
     ASSET MORTGAGE INVESTMENTS INC.

          This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Structured Asset Mortgage
Investments Inc., the Master Servicer or the Trustee referred to below or any of
their affiliates or any other person. Neither this Certificate nor the
underlying Mortgage Loans are guaranteed or insured by any governmental entity
or by Structured Asset Mortgage Investments Inc., the Master Servicer or the
Trustee or any of their affiliates or any other person. None of Structured Asset
Mortgage Investments Inc., the Master Servicer or any of their affiliates will
have any obligation with respect to any certificate or other obligation secured
by or payable from payments on the Certificates.

          This certifies that [_________] is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a trust (the
"Trust Fund") generally consisting of conventional first lien, fixed rate
mortgages secured by one- to four- family residences, units in planned unit
developments and individual condominium units and cooperative units
(collectively, the "Mortgage Loans") sold by Structured Asset Mortgage
Investments Inc. ("SAMI"). The Mortgage Loans were sold by Cendant Mortgage
Corporation ("Cendant") and Bishop's Gate Residential Mortgage Trust ("Bishop's
Gate"; and together with Cendant, the "Mortgage Loan Sellers") to SAMI. Cendant
Mortgage Corporation will act as master servicer of the Mortgage Loans (in such
capacity, the "Master Servicer," which term includes any successors thereto
under the Agreement referred to below). The Trust Fund was created pursuant to
the Pooling and Servicing Agreement dated as of the Cut-off Date specified

                                      A-1-2

<PAGE>

above (the "Agreement"), among SAMI, as seller (the "Seller"), The Bank of New
York, as trustee (the "Trustee") and the Master Servicer, a summary of certain
of the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, capitalized terms used herein shall have the meaning ascribed to
them in the Agreement. This Certificate is issued under and is subject to the
terms, provisions and conditions of the Agreement, to which Agreement the Holder
of this Certificate by virtue of its acceptance hereof assents and by which such
Holder is bound.

          Interest on this Certificate will accrue during the month prior to the
month in which a Distribution Date (as hereinafter defined) occurs on the
Current Principal Amount hereof at a per annum rate equal to the Pass-Through
Rate set forth above. The Trustee will distribute on the 25th day of each month,
or, if such 25th day is not a Business Day, the immediately following Business
Day (each, a "Distribution Date"), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered at
the close of business on the last Business Day (or if such last day is not a
Business Day, the Business Day immediately preceding such last day) of the
calendar month preceding the month of such Distribution Date, an amount equal to
the product of the Fractional Undivided Interest evidenced by this Certificate
and the amount (of interest and principal, if any) required to be distributed to
the Holders of Certificates of the same Class as this Certificate. The Assumed
Final Distribution Date is the first anniversary of the Distribution Date
immediately following the latest scheduled maturity date of any Mortgage Loan
and is not likely to be the date on which the Current Principal Amount of this
Class of Certificates will be reduced to zero.

          Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement. Notwithstanding
the above, the final distribution on this Certificate will be made after due
notice by the Trustee of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Trustee for that purpose and designated in such notice. The Initial
Current Principal Amount of this Certificate is set forth above. The Current
Principal Amount hereof will be reduced to the extent of distributions allocable
to principal hereon and any Realized Losses allocable hereto.

          This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
fourteen Classes. The Certificates, in the aggregate, evidence the entire
beneficial ownership interest in the Trust Fund formed pursuant to the
Agreement.

          The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund for payment hereunder and that the
Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.

          This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.

                                      A-1-3

<PAGE>

          The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Seller and the rights of the Certificateholders under the Agreement from time to
time by the Seller and the Trustee with the consent of the Holders of
Certificates evidencing Fractional Undivided Interests aggregating not less than
66-2/3% (or in certain cases, Holders of Certificates of affected Classes
evidencing such percentage of the Fractional Undivided Interests thereof). Any
such consent by the Holder of this Certificate shall be conclusive and binding
on such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.

          As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, duly endorsed
by, or accompanied by a written instrument of transfer in form satisfactory to
the Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Fractional Undivided Interest will
be issued to the designated transferee.

          The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Fractional Undivided Interest, as requested by
the Holder surrendering the same.

          No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Seller, the Master Servicer, the Trustee and any agent of any of
them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of Seller, the Master Servicer, the
Trustee or any such agent shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of the (A) final payment or other liquidation (or Advance with
respect thereto) of the last Mortgage Loan remaining in the Trust Fund and (B)
disposition of all property acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage Loan and the remittance of all funds due under the
Agreement, or (ii) the optional repurchase by the party named in the Agreement
of all the Mortgage Loans and other assets of the Trust Fund in accordance with
the terms of the Agreement. Such optional repurchase may be made only on or
after the Distribution Date on which the aggregate unpaid principal balance of
the Mortgage Loans is less than the percentage of the aggregate Stated Principal
Balance specified in the Agreement of the Mortgage Loans at the Cut-off Date.
The exercise of such right will effect the early retirement of the Certificates.
In no event, however, will the Trust Fund created by the Agreement continue
beyond the expiration of 21 years after the death of certain persons identified
in the Agreement.

                                      A-1-4

<PAGE>

          Unless this Certificate has been countersigned by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.

                                      A-1-5

<PAGE>

          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated: ___________________            THE BANK OF NEW YORK
                                      Not in its individual capacity but solely
                                      as Trustee

                                      By:______________________________________
                                                 Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

          This is one of the Class [A-___][P] Certificates referred to in the
within-mentioned Agreement.

                                      THE BANK OF NEW YORK
                                      Authorized signatory of The Bank of New
                                      York, not in its  individual capacity but
                                      solely as Trustee

                                      By:______________________________________
                                                  Authorized Signatory

                                      A-1-6

<PAGE>

                                   ASSIGNMENT
                                   ----------

          FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ___________________________________ (Please print or typewrite
name and address including postal zip code of assignee) a Fractional Undivided
Interest evidenced by the within Mortgage Pass-Through Certificate and hereby
authorizes the transfer of registration of such interest to assignee on the
Certificate Register of the Trust Fund.

          I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address: ____________________________

_______________________________________________________________________________

_______________________________________________________________________________

Dated:                            ______________________________________________
                                      Signature by or on behalf of assignor

                                             ___________________________________
                                                   Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

          The assignee should include the following for purposes of
distribution:

          Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
for the account of _______________________________ account number __________,
or, if mailed by check, to _________________________________________. Applicable
statements should be mailed to ___________________________________.

          This information is provided by ______________________, the assignee
named above, or ____________________________, as its agent.

                                      A-1-7

<PAGE>

                                                                     EXHIBIT A-2

                           FORM OF CLASS X CERTIFICATE

          SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").

          THE NOTIONAL AMOUNT OF THIS CERTIFICATE WILL BE DECREASED TO THE
EXTENT OF PRINCIPAL DISTRIBUTIONS ON THE NON- DISCOUNT MORTGAGE LOANS AND
REALIZED LOSSES ALLOCATED HERETO. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF
THE CERTIFICATES, THE NOTIONAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM
THE DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN
ITS NOTIONAL AMOUNT BY INQUIRY OF THE TRUSTEE NAMED HEREIN.

                                      A-2-1

<PAGE>

Certificate No. ____                        Variable Pass-Through Rate

Class X Senior

Date of Pooling and Servicing               Initial Notional Amount of this
Agreement and Cut-off Date:                 Certificate: $_______________
October 1, 2000

First Distribution Date:
November 27, 2000

Master Servicer:                            CUSIP _______
Cendant Mortgage Corporation

Assumed Final Distribution Date:
November 25, 2030

                     CDMC MORTGAGE PASS-THROUGH CERTIFICATE
                                  SERIES 2000-8

     evidencing  a  fractional  undivided  interest  in  the  distributions
     allocable  to the Class X  Certificates  with  respect to a Trust Fund
     consisting  primarily of a pool of  conventional  one- to  four-family
     fixed interest rate mortgage  loans sold by STRUCTURED  ASSET MORTGAGE
     INVESTMENTS INC.

          This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Structured Asset Mortgage
Investments Inc., the Master Servicer or the Trustee referred to below or any of
their affiliates or any other person. Neither this Certificate nor the
underlying Mortgage Loans are guaranteed or insured by any governmental entity
or by Structured Asset Mortgage Investments Inc., the Master Servicer or the
Trustee or any of their affiliates or any other person. None of Structured Asset
Mortgage Investments Inc., the Master Servicer or any of their affiliates will
have any obligation with respect to any certificate or other obligation secured
by or payable from payments on the Certificates.

          This certifies that [__________] is the registered owner of the
Percentage Interest evidenced hereby in the beneficial ownership interest of
Certificates of the same Class as this Certificate in a trust (the "Trust Fund")
generally consisting of conventional, first lien, fixed rate mortgages secured
by one- to four- family residences, units in planned unit developments and
individual condominium units and cooperative units (collectively, the "Mortgage
Loans") sold by Structured Asset Mortgage Investments Inc. ("SAMI"). The
Mortgage Loans were sold by Cendant Mortgage Corporation ("Cendant") and
Bishop's Gate Residential Mortgage Trust ("Bishop's Gate"; and together with
Cendant, the "Mortgage Loan Sellers") to SAMI. Cendant Mortgage Corporation will
act as master servicer of the Mortgage Loans (in such capacity, the "Master
Servicer," which term includes any successors thereto under the Agreement
referred to below). The Trust Fund was created pursuant to the Pooling and
Servicing Agreement, dated as of the Cut-off Date specified above (the
"Agreement"), among SAMI, as seller (the "Seller"), The Bank of New York, as
trustee (the "Trustee") and the Master Servicer, a summary of certain of the
pertinent provisions of which

                                      A-2-2

<PAGE>

is set forth hereafter. To the extent not defined herein, capitalized terms used
herein shall have the meaning ascribed to them in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is bound.

          Interest on this Certificate will accrue during the month prior to the
month in which a Distribution Date (as hereinafter defined) occurs on the
Notional Amount (equal to the aggregate Stated Principal Balance of the
Non-Discount Mortgage Loans) at a variable Pass-Through Rate equal to the Pool
Strip Rates of the Non-Discount Mortgage Loans. The Trustee will distribute on
the 25th day of each month, or, if such 25th day is not a Business Day, the
immediately following Business Day (each, a "Distribution Date"), commencing on
the First Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day (or
if such last day is not a Business Day, the Business Day immediately preceding
such last day) of the calendar month preceding the month of such Distribution
Date, an amount equal to the product of the Fractional Undivided Interest
evidenced by this Certificate and the amount (of interest, if any) required to
be distributed to the Holders of Certificates of the same Class as this
Certificate. The Assumed Final Distribution Date is the first anniversary of the
Distribution Date immediately following the latest scheduled maturity date of
any Mortgage Loan and is not likely to be the date on which the Notional Amount
of this Class of Certificates will be reduced to zero. The Initial Notional
Amount of this Certificate is set forth above. The Notional Amount hereof will
be reduced to the extent of distributions allocable to principal on the
Non-Discount Mortgage Loans and any Realized Losses allocable hereto.

          Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement. Notwithstanding
the above, the final distribution on this Certificate will be made after due
notice by the Trustee of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Trustee for that purpose and designated in such notice.

          This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
fourteen Classes. The Certificates, in the aggregate, evidence the entire
beneficial ownership interest in the Trust Fund formed pursuant to the
Agreement.

          The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund for payment hereunder and that the
Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.

          This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.

          The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Seller and the rights of the

                                      A-2-3

<PAGE>

Certificateholders under the Agreement from time to time by the Seller and the
Trustee with the consent of the Holders of Certificates evidencing Fractional
Undivided Interests aggregating not less than 66-2/3% (or in certain cases,
Holders of Certificates of affected Classes evidencing such percentage of the
Fractional Undivided Interests thereof). Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in lieu hereof whether or not notation of such consent is made upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.

          As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, duly endorsed
by, or accompanied by a written instrument of transfer in form satisfactory to
the Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate fractional Undivided Interest will
be issued to the designated transferee.

          The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Fractional Undivided Interest, as requested by
the Holder surrendering the same.

          No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Seller, the Master Servicer, the Trustee and any agent of any of
them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of Seller, the Master Servicer, the
Trustee or any such agent shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of the (A) final payment or other liquidation (or Advance with
respect thereto) of the last Mortgage Loan remaining in the Trust Fund and (B)
disposition of all property acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage Loan and the remittance of all funds due under the
Agreement, or (ii) the optional repurchase by the party named in the Agreement
of all the Mortgage Loans and other assets of the Trust Fund in accordance with
the terms of the Agreement. Such optional repurchase may be made only on or
after the Distribution Date on which the aggregate unpaid principal balance of
the Mortgage Loans is less than the percentage of the aggregate Stated Principal
Balance specified in the Agreement of the Mortgage Loans at the Cut-off Date.
The exercise of such right will effect the early retirement of the Certificates.
In no event, however, will the Trust Fund created by the Agreement continue
beyond the expiration of 21 years after the death of certain persons identified
in the Agreement.

                                      A-2-4

<PAGE>

          Unless this Certificate has been countersigned by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.

                                      A-2-5

<PAGE>

          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated: ________________               THE BANK OF NEW YORK
                                      Not in its individual capacity but solely
                                      as Trustee

                                      By:______________________________________
                                               Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

          This is one of the Class X Certificates referred to in the
within-mentioned Agreement.

                                      THE BANK OF NEW YORK
                                      Authorized signatory of The Bank of New
                                      York, not in its  individual capacity but
                                      solely as Trustee

                                      By:______________________________________
                                               Authorized Signatory

                                      A-2-6

<PAGE>

                                   ASSIGNMENT
                                   ----------

          FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ___________________________________ (Please print or typewrite
name and address including postal zip code of assignee) a Percentage Interest
evidenced by the within Mortgage Pass-Through Certificate and hereby authorizes
the transfer of registration of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address: _____________________________

________________________________________________________________________________
________________________________________________________________________________

Dated:                         _________________________________________________
                                    Signature by or on behalf of assignor

                                          ______________________________________
                                               Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

          The assignee should include the following for purposes of
distribution:

          Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
for the account of _______________________________ account number __________,
or, if mailed by check, to _________________________________________. Applicable
statements should be mailed to ___________________________________.

                  This information is provided by ______________________, the
assignee named above, or ____________________________, as its agent.

                                      A-2-7

<PAGE>

                                                                     EXHIBIT A-3

                          FORM OF CLASS B CERTIFICATES

          SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").

          THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DECREASED BY
THE PRINCIPAL PAYMENTS HEREON AND ANY REALIZED LOSSES ALLOCABLE HERETO.
ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CURRENT
PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION
SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT
PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE NAMED HEREIN.

          [UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]

          [THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE
SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT
THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT
THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN
"INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE MEANING THEREOF IN RULE
501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE ACT OR ANY ENTITY IN WHICH
ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING NOT FOR
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE RECEIPT BY
THE TRUSTEE OF A LETTER SUBSTANTIALLY

                                      A-3-8

<PAGE>

IN THE FORM PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH
OTHER EVIDENCE ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR
TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR
IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED
STATES AND ANY OTHER APPLICABLE JURISDICTION.]

          THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED, AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED,
UNLESS THE PROPOSED TRANSFER AND/OR HOLDING OF A CERTIFICATE AND THE SERVICING,
MANAGEMENT AND/OR OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN
ANY PROHIBITED TRANSACTION WHICH IS NOT COVERED UNDER AN INDIVIDUAL OR CLASS
PROHIBITED TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED TO, PROHIBITED
TRANSACTION EXEMPTION ("PTE") 84-14, PTE 91-38, PTE 90-1, PTE 95-60 OR PTE 96-23
AND (II) WILL NOT GIVE RISE TO ANY ADDITIONAL FIDUCIARY OBLIGATIONS ON THE PART
OF THE SELLER, THE MASTER SERVICER OR THE TRUSTEE, WHICH WILL BE DEEMED
REPRESENTED BY AN OWNER OF A BOOK-ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE AND
WILL BE EVIDENCED BY A REPRESENTATION OR AN OPINION OF COUNSEL TO SUCH EFFECT BY
OR ON BEHALF OF AN INSTITUTIONAL ACCREDITED INVESTOR.

                                      A-3-9

<PAGE>

Certificate No. 1                    Variable Pass-Through Rate

Class [B-__]

Date of Pooling and Servicing        Aggregate Initial Current Principal of this
Agreement and Cut-off Date:          Certificate as of the Cut-off Date:
October 1, 2000                      $___________

First Distribution Date:             Initial Current Principal Amount of this
November 27, 2000                    Certificate as of the Cut-off Date:
                                     $__________

Master Servicer:
Cendant Mortgage Corporation

Assumed Final Distribution Date:     CUSIP __________
November 25, 2030

                  CDMC MORTGAGE-BACKED PASS-THROUGH CERTIFICATE
                                  SERIES 2000-8

     evidencing  a  fractional  undivided  interest  in  the  distributions
     allocable to the Class [B-__]Certificates with respect to a Trust Fund
     consisting  primarily of a pool of  conventional  one- to  four-family
     fixed interest rate mortgage  loans sold by STRUCTURED  ASSET MORTGAGE
     INVESTMENTS INC.

          This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Structured Asset Mortgage
Investments Inc., the Master Servicer or the Trustee referred to below or any of
their affiliates or any other person. Neither this Certificate nor the
underlying Mortgage Loans are guaranteed or insured by any governmental entity
or by Structured Asset Mortgage Investments Inc., the Master Servicer or the
Trustee or any of their affiliates or any other person. None of Structured Asset
Mortgage Investments Inc., the Master Servicer or any of their affiliates will
have any obligation with respect to any certificate or other obligation secured
by or payable from payments on the Certificates.

          This certifies that [___________] is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a trust (the
"Trust Fund") generally consisting of conventional first lien, fixed rate
mortgages loans secured by one- to four- family residences, units in planned
unit developments and individual condominium and cooperative units
(collectively, the "Mortgage Loans") sold by Structured Asset Mortgage
Investments Inc. ("SAMI"). The Mortgage Loans were sold by Cendant Mortgage
Corporation ("Cendant") and Bishop's Gate Residential Mortgage Trust ("Bishop's
Gate"; and together with Cendant, the "Mortgage Loan Sellers") to SAMI. Cendant
Mortgage Corporation will act as master servicer of the Mortgage Loans (in such
capacity, the "Master Servicer," which term includes any successors thereto
under the Agreement referred to below). The Trust Fund was created pursuant to
the Pooling and Servicing Agreement, dated as of the Cut-off Date specified
above (the "Agreement"), between SAMI, as seller (the "Seller"), The Bank of New
York, as trustee

                                     A-3-10

<PAGE>

(the "Trustee") and the Master Servicer, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
capitalized terms used herein shall have the meaning ascribed to them in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of its acceptance hereof assents and by which such
Holder is bound.

          Interest on this Certificate will accrue during the month prior to the
month in which a Distribution Date (as hereinafter defined) occurs on the
Current Principal Amount hereof at a per annum rate equal to the Pass-Through
Rate set forth above. The Trustee will distribute on the 25th day of each month,
or, if such 25th day is not a Business Day, the immediately following Business
Day (each, a "Distribution Date"), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered at
the close of business on the last Business Day (or if such last day is not a
Business Day, the Business Day immediately preceding such last day) of the
calendar month preceding the month of such Distribution Date, an amount equal to
the product of the Fractional Undivided Interest evidenced by this Certificate
and the amount (of interest and principal, if any) required to be distributed to
the Holders of Certificates of the same Class as this Certificate. The Assumed
Final Distribution Date is the first anniversary of the Distribution Date
immediately following the latest scheduled maturity date of any Mortgage Loan
and is not likely to be the date on which the Current Principal Amount of this
Class of Certificates will be reduced to zero.

          Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement. Notwithstanding
the above, the final distribution on this Certificate will be made after due
notice by the Trustee of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Trustee for that purpose and designated in such notice. The Initial
Current Principal Amount of this Certificate is set forth above. The Current
Principal Amount hereof will be reduced to the extent of distributions allocable
to principal hereon and any Realized Losses allocable hereto.

          This Certificate may not be acquired directly or indirectly by, or on
behalf of, an employee benefit plan or other retirement arrangement which is
subject to Title I of the Employee Retirement Income Security Act of 1974, as
amended, and/or Section 4975 of the Internal Revenue Code of 1986, as amended,
unless the proposed transfer and/or holding of a Certificate and the servicing,
management and/or operation of the trust and its assets: (i) will not result in
any prohibited transaction which is not covered under an individual or class
prohibited transaction exemption, including, but not limited to, Prohibited
Transaction Exemption ("PTE") 84-14, PTE 91-38, PTE 90-1, PTE 95-60 or PTE 96-23
and (ii) will not give rise to any additional fiduciary obligations on the part
of the Seller, the Master Servicer or the Trustee, which will be deemed
represented by an owner of a Book-Entry Certificate or a Global Certificate and
will be evidenced by a representation or an Opinion of Counsel to such effect by
or on behalf of an Institutional Accredited Investor.

          This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
fourteen Classes. The Certificates, in the aggregate,

                                     A-3-11

<PAGE>

evidence the entire beneficial ownership interest in the Trust Fund formed
pursuant to the Agreement.

          The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund for payment hereunder and that the
Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.

          This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.

          The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Seller and the rights of the Certificateholders under the Agreement from time to
time by the Seller and the Trustee with the consent of the Holders of
Certificates evidencing Fractional Undivided Interests aggregating not less than
66-2/3% (or in certain cases, Holders of Certificates of affected Classes
evidencing such percentage of the Fractional Undivided Interests thereof). Any
such consent by the Holder of this Certificate shall be conclusive and binding
on such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.

          As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, duly endorsed
by, or accompanied by a written instrument of transfer in form satisfactory to
the Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Fractional Undivided Interest will
be issued to the designated transferee.

          The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Fractional Undivided Interest, as requested by
the Holder surrendering the same.

          No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Seller, the Master Servicer, the Trustee and any agent of any of
them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Seller, the Master Servicer, the
Trustee or any such agent shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the

                                     A-3-12

<PAGE>

Agreement) shall terminate upon the earlier of (i) the later of the (A) final
payment or other liquidation (or Advance with respect thereto) of the last
Mortgage Loan remaining in the Trust Fund and (B) disposition of all property
acquired upon foreclosure or deed in lieu of foreclosure of any Mortgage Loan
and the remittance of all funds due under the Agreement, or (ii) the optional
repurchase by the party named in the Agreement of all the Mortgage Loans and
other assets of the Trust Fund in accordance with the terms of the Agreement.
Such optional repurchase may be made only on or after the Distribution Date on
which the aggregate unpaid principal balance of the Mortgage Loans is less than
the percentage of the aggregate Outstanding Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the expiration of 21
years after the death of certain persons identified in the Agreement.

          Unless this Certificate has been countersigned by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.

                                     A-3-13

<PAGE>

          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated: __________________             THE BANK OF NEW YORK
                                      Not in its individual capacity but solely
                                      as Trustee

                                      By:_______________________________________
                                                   Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

          This is one of the Class [B-__] Certificates referred to in the
within-mentioned Agreement.

                                      THE BANK OF NEW YORK
                                      Authorized signatory of The Bank of New
                                      York, not in its  individual capacity but
                                      solely as Trustee

                                      By:______________________________________
                                                 Authorized Signatory

                                     A-3-14

<PAGE>

                                   ASSIGNMENT
                                   ----------

          FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________ (Please print or
typewrite name and address including postal zip code of assignee) a Fractional
Undivided Interest evidenced by the within Mortgage Pass-Through Certificate and
hereby authorizes the transfer of registration of such interest to assignee on
the Certificate Register of the Trust Fund.

                  I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address: _____________________________

________________________________________________________________________________
________________________________________________________________________________

Dated:                     _____________________________________________________
                                 Signature by or on behalf of assignor

                                          ______________________________________
                                               Signature Guaranteed

                                             DISTRIBUTION INSTRUCTIONS

          The assignee should include the following for purposes of
distribution:

          Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
for the account of _______________________________ account number __________,
or, if mailed by check, to _________________________________________. Applicable
statements should be mailed to ______________________________________.

          This information is provided by ______________________, the assignee
named above, or ____________________________, as its agent.

                                     A-3-15

<PAGE>

                                                                     EXHIBIT A-4

                           FORM OF CLASS R CERTIFICATE

          THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON-UNITED
STATES PERSON, AN ELECTING LARGE PARTNERSHIP UNDER SECTION 775(A) OF THE CODE OR
A DISQUALIFIED ORGANIZATION (AS DEFINED BELOW).

          SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").

          THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED, AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED,
UNLESS THE PROPOSED TRANSFER AND/OR HOLDING OF A CERTIFICATE AND THE SERVICING,
MANAGEMENT AND/OR OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN
ANY PROHIBITED TRANSACTION WHICH IS NOT COVERED UNDER AN INDIVIDUAL OR CLASS
PROHIBITED TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED TO, PROHIBITED
TRANSACTION EXEMPTION ("PTE") 84-14, PTE 91-38, PTE 90-1, PTE 95-60 OR PTE 96-23
AND (II) WILL NOT GIVE RISE TO ANY ADDITIONAL FIDUCIARY OBLIGATIONS ON THE PART
OF THE SELLER, THE MASTER SERVICER OR THE TRUSTEE, WHICH WILL BE DEEMED
REPRESENTED BY AN OWNER OF A BOOK-ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE AND
WILL BE EVIDENCED BY A REPRESENTATION OR AN OPINION OF COUNSEL TO SUCH EFFECT BY
OR ON BEHALF OF AN INSTITUTIONAL ACCREDITED INVESTOR.

          ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE
MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE MASTER
SERVICER AND THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES,
ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY POSSESSION OF THE UNITED STATES,
OR ANY AGENCY OR INSTRUMENTALITY, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING (OTHER THAN AN INSTRUMENTALITY WHICH IS A CORPORATION IF ALL OF ITS
ACTIVITIES ARE SUBJECT TO TAX AND, EXCEPT FOR THE FEDERAL HOME LOAN MORTGAGE
CORPORATION OR ANY SUCCESSOR THERETO, A MAJORITY OF ITS BOARD OF DIRECTORS IS
NOT SELECTED BY SUCH GOVERNMENTAL UNIT), ANY FOREIGN GOVERNMENT, ANY
INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN SECTION
521 OF THE CODE) WHICH IS EXEMPT

                                      A-4-1

<PAGE>

FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE (INCLUDING THE TAX IMPOSED BY
SECTION 511 OF THE CODE), (C) ANY RURAL ELECTRIC AND TELEPHONE COOPERATIVES
DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE OR (D) ANY ORGANIZATION DESCRIBED
IN SECTION 1381(A)(2)(C) OF THE CODE, (ANY SUCH PERSON DESCRIBED IN THE
FOREGOING CLAUSES (A), (B), (C) OR (D) BEING HEREIN REFERRED TO AS A
"DISQUALIFIED ORGANIZATION") OR (D) AN AGENT OF A DISQUALIFIED ORGANIZATION, (2)
NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND
(3) SUCH TRANSFEREE SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO THE
FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION
IN THE CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS
CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED
ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR
EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE
OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
PARAGRAPH.

                                      A-4-2

<PAGE>

Certificate No.__                     7.50% Pass-Through Rate

Class R Senior

Date of Pooling and Servicing         Aggregate Initial Current Principal Amount
Agreement and Cut-off Date:           of this Certificate as of the Cut-off
October 1, 2000                       Date: $______

First Distribution Date:              Initial Current Principal Amount of this
November 27, 2000                     Certificate as of the Cut-off Date: $_____

Master Servicer:
Cendant Mortgage Corporation

Assumed Final Distribution Date:      CUSIP __________
November 25, 2030

                  CDMC MORTGAGE-BACKED PASS-THROUGH CERTIFICATE
                                  SERIES 2000-8

     evidencing a percentage interest in the distributions allocable to the
     Class R Certificates with respect to a Trust Fund consisting primarily
     of a pool of  conventional  one- to  four-family  fixed  interest rate
     mortgage loans sold by STRUCTURED ASSET MORTGAGE INVESTMENTS INC.

          This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Structured Asset Mortgage
Investments Inc., the Master Servicer or the Trustee referred to below or any of
their affiliates or any other person. Neither this Certificate nor the
underlying Mortgage Loans are guaranteed or insured by any governmental entity
or by Structured Asset Mortgage Investments Inc., the Master Servicer or the
Trustee or any of their affiliates or any other person. None of Structured Asset
Mortgage Investments Inc., the Master Servicer or any of their affiliates will
have any obligation with respect to any certificate or other obligation secured
by or payable from payments on the Certificates.

          This certifies that [______________________] is the registered owner
of the Percentage Interest evidenced hereby in the beneficial ownership interest
of Certificates of the same Class as this Certificate in a trust (the "Trust
Fund") generally consisting of conventional first lien, fixed rate mortgages
loans secured by one- to four- family residences, units in planned unit
developments and individual condominium and cooperative units (collectively, the
"Mortgage Loans") sold by Structured Asset Mortgage Investments Inc. ("SAMI").
The Mortgage Loans were sold by Cendant Mortgage Corporation ("Cendant") and
Bishop's Gate Residential Mortgage Trust ("Bishop's Gate"; and together with
Cendant, the "Mortgage Loan Sellers") to SAMI. Cendant Mortgage Corporation will
act as master servicer of the Mortgage Loans (in such capacity, the "Master
Servicer," which term includes any successors thereto under the Agreement
referred to

                                      A-4-3

<PAGE>

below). The Trust Fund was created pursuant to the Pooling and Servicing
Agreement, dated as of the Cut-off Date specified above (the "Agreement"),
between SAMI, as seller (the "Seller"), The Bank of New York, as trustee (the
"Trustee") and the Master Servicer, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
capitalized terms used herein shall have the meaning ascribed to them in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of its acceptance hereof assents and by which such
Holder is bound.

          Interest on this Certificate will accrue during the month prior to the
month in which a Distribution Date (as hereinafter defined) occurs on the
Current Principal Amount hereof at a per annum rate equal to the Pass-Through
Rate set forth above. The Trustee will distribute on the 25th day of each month,
or, if such 25th day is not a Business Day, the immediately following Business
Day (each, a "Distribution Date"), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered at
the close of business on the last Business Day (or if such last day is not a
Business Day, the Business Day immediately preceding such last day) of the
calendar month preceding the month of such Distribution Date, an amount equal to
the product of the Percentage Interest evidenced by this Certificate and the
amount (of interest and principal, if any) required to be distributed to the
Holders of Certificates of the same Class as this Certificate. The Assumed Final
Distribution Date is the first anniversary of the Distribution Date immediately
following the latest scheduled maturity date of any Mortgage Loan and is not
likely to be the date on which the Current Principal Amount of this Class of
Certificates will be reduced to zero.

          Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee for that
purpose and designated in such notice. The Initial Current Principal Amount of
this Certificate is set forth above. The Current Principal Amount hereof will be
reduced to the extent of distributions allocable to principal hereon and any
Realized Losses allocable hereto.

          Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions set forth in the Agreement to the effect that (i) each
person holding or acquiring any Ownership Interest in this Certificate must be a
United States Person and a Permitted Transferee, (ii) the transfer of any
Ownership Interest in this Certificate will be conditioned upon the delivery to
the Trustee of, among other things, an affidavit to the effect that it is a
United States Person and Permitted Transferee, (iii) any attempted or purported
transfer of any Ownership Interest in this Certificate in violation of such
restrictions will be absolutely null and void and will vest no rights in the
purported transferee, and (iv) if any person other than a United States Person
and a Permitted Transferee acquires any Ownership Interest in this Certificate
in violation of such restrictions, then the Seller will have the right, in its
sole discretion and without notice to the Holder of this Certificate, to sell
this Certificate to a purchaser selected by the Seller, which purchaser may be
the Seller, or any affiliate of the Seller, on such terms and conditions as the
Seller may choose.

                                      A-4-4

<PAGE>

          This Certificate may not be acquired directly or indirectly by, or on
behalf of, an employee benefit plan or other retirement arrangement which is
subject to Title I of the Employee Retirement Income Security Act of 1974, as
amended, and/or Section 4975 of the Internal Revenue Code of 1986, as amended,
unless the proposed transfer and/or holding of a Certificate and the servicing,
management and/or operation of the trust and its assets: (i) will not result in
any prohibited transaction which is not covered under an individual or class
prohibited transaction exemption, including, but not limited to, Prohibited
Transaction Exemption ("PTE") 84-14, PTE 91-38, PTE 90-1, PTE 95-60 or PTE 96-23
and (ii) will not give rise to any additional fiduciary obligations on the part
of the Seller, the Master Servicer or the Trustee, which will be deemed
represented by an owner of a Book-Entry Certificate or a Global Certificate and
will be evidenced by a representation or an Opinion of Counsel to such effect by
or on behalf of an Institutional Accredited Investor.

          This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
fourteen Classes. The Certificates, in the aggregate, evidence the entire
beneficial ownership interest in the Trust Fund formed pursuant to the
Agreement.

          The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund for payment hereunder and that the
Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.

          This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.

          The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Seller and the rights of the Certificateholders under the Agreement from time to
time by the Seller and the Trustee with the consent of the Holders of
Certificates evidencing Percentage Interests aggregating not less than 66- 2/3%
(or in certain cases, Holders of Certificates of affected Classes evidencing
such percentage of the Percentage Interests thereof). Any such consent by the
Holder of this Certificate shall be conclusive and binding on such Holder and
upon all future Holders of this Certificate and of any Certificate issued upon
the transfer hereof or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.

          As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, duly endorsed
by, or accompanied by a written instrument of transfer in form satisfactory to
the Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Percentage Interest will be issued
to the designated transferee.

                                      A-4-5

<PAGE>

          The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.

          No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Seller, the Master Servicer, the Trustee and any agent of any of
them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Seller, the Master Servicer, the
Trustee or any such agent shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of the (A) final payment or other liquidation (or Advance with
respect thereto) of the last Mortgage Loan remaining in the Trust Fund and (B)
disposition of all property acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage Loan and the remittance of all funds due under the
Agreement, or (ii) the optional repurchase by the party named in the Agreement
of all the Mortgage Loans and other assets of the Trust Fund in accordance with
the terms of the Agreement. Such optional repurchase may be made only on or
after the Distribution Date on which the aggregate unpaid principal balance of
the Mortgage Loans is less than the percentage of the aggregate Outstanding
Principal Balance specified in the Agreement of the Mortgage Loans at the
Cut-off Date. The exercise of such right will effect the early retirement of the
Certificates. In no event, however, will the Trust Fund created by the Agreement
continue beyond the expiration of 21 years after the death of certain persons
identified in the Agreement.

          Unless this Certificate has been countersigned by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.

                                      A-4-6

<PAGE>

          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated: ____________                   THE BANK OF NEW YORK
                                      Not in its individual capacity but solely
                                      as Trustee

                                      By:_______________________________________
                                                  Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

          This is one of the Class R Certificates referred to in the
within-mentioned Agreement.

                                      THE BANK OF NEW YORK
                                      Authorized signatory of The Bank of New
                                      York, not in its  individual capacity but
                                      solely as Trustee

                                      By:______________________________________
                                              Authorized Signatory

                                      A-4-7

<PAGE>

                                                    ASSIGNMENT

          FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________(Please print or
typewrite name and address including postal zip code of assignee) a Fractional
Undivided Interest evidenced by the within Mortgage Pass-Through Certificate and
hereby authorizes the transfer of registration of such interest to assignee on
the Certificate Register of the Trust Fund.

                  I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address: _____________________________
________________________________________________________________________________
________________________________________________________________________________

Dated:                     ____________________________________________________
                                    Signature by or on behalf of assignor

                                      _________________________________________
                                           Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

          The assignee should include the following for purposes of
distribution:

          Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
for the account of _______________________________ account number __________,
or, if mailed by check, to _________________________________________. Applicable
statements should be mailed to ______________________________________.

          This information is provided by ______________________, the assignee
named above, or ____________________________, as its agent.

                                      A-4-8

<PAGE>

<PAGE>

                                   EXHIBIT B-1

                MORTGAGE LOAN SCHEDULE FOR CENDANT MORTGAGE LOANS

<PAGE>

                                   EXHIBIT B-2

             MORTGAGE LOAN SCHEDULE FOR BISHOP'S GATE MORTGAGE LOANS

<PAGE>

                                    EXHIBIT C

           REPRESENTATIONS AND WARRANTIES OF THE MORTGAGE LOAN SELLERS
                          CONCERNING THE MORTGAGE LOANS

<PAGE>

                                    EXHIBIT D

                        REQUEST FOR RELEASE OF DOCUMENTS
                                                                         [DATE]
To:       The Bank of New York,
          as Trustee
          101 Barclay Street
          New York, New York 10286

RE:       Pooling and Servicing Agreement dated as of October 1, 2000, among
          Structured Asset Mortgage Investments Inc., Cendant Mortgage
          Corporation, as Master Servicer and The Bank of New York, as Trustee,
          regarding CDMC Trust 2000-8, CDMC Mortgage-Backed Pass-Through
          Certificates, Series 2000-8
          ----------------------------------------------------------------------

          In connection with the administration of the Mortgage Loans held by
you, as Trustee, pursuant to the above-captioned Pooling and Servicing
Agreement, we request the release, and hereby acknowledge receipt, of the
Mortgage File for the Mortgage Loan described below, for the reason indicated.

MORTGAGE LOAN NUMBER:

MORTGAGOR NAME, ADDRESS & ZIP CODE:

REASON FOR REQUESTING DOCUMENTS (check one):

______   1.   Mortgage Paid in Full and proceeds have been deposited into the
         Custodial Account

______   2.   Foreclosure

______   3.   Substitution

______   4.   Other Liquidation

______   5.   Nonliquidation

______   6.   Other Reason:___________________________

               By:____________________________________
                          (authorized signer)

               Issuer:________________________________
               Address:_______________________________
               Date:__________________________________

                                       D-1

<PAGE>

TRUSTEE

The Bank of New York

Please acknowledge the execution of the above request by your signature and date
below:

______________________________      _______________
Signature                           Date

Documents returned to Trustee:

______________________________      _______________
Trustee                             Date

Date: ______________

         __________________________________________
         [NAME OF MASTER SERVICER]

         By:  _____________________________________
              Name:
              Title:

                                       D-2

<PAGE>

                                    EXHIBIT E
        FORM OF AFFIDAVIT PURSUANT TO SECTION 860E(E)(4) OF THE INTERNAL
            REVENUE CODE OF 1986, AS AMENDED, AND FOR OTHER PURPOSES

STATE OF        )
                ) ss:
COUNTY OF       )

     [NAME OF OFFICER], being first duly sworn, deposes and says:

     1. That he/she is [Title of Officer] of [Name of Investor] (the
"Investor"), a [savings institution] [corporation] duly organized and existing
under the laws of [the State of__________] [the United States], on behalf of
which he makes this affidavit.

     2. That (i) the Investor is not a "disqualified organization" as defined in
Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended (the
"Code"), and will not be a disqualified organization as of [Closing Date] [date
of purchase]; (ii) it is not acquiring the CDMC Trust 2000-8, Mortgage-Backed
Pass-Through Certificates, Series 2000-8, Class R Certificates (the "Residual
Certificates") for the account of a disqualified organization; (iii) it consents
to any amendment of the Pooling and Servicing Agreement that shall be deemed
necessary by Structured Asset Mortgage Investments Inc. (upon advice of counsel)
to constitute a reasonable arrangement to ensure that the Residual Certificates
will not be owned directly or indirectly by a disqualified organization; and
(iv) it will not transfer such Residual Certificates unless (a) it has received
from the transferee an affidavit in substantially the same form as this
affidavit containing these same four representations and (b) as of the time of
the transfer, it does not have actual knowledge that such affidavit is false.

     3. That the Investor is one of the following: (i) a citizen or resident of
the United States, (ii) a corporation, partnership or other entity taxable as
such created or organized in or under the laws of the United States or any
political subdivision thereof or (iii) an estate that is subject to U.S. federal
income tax regardless of the source of its income, or (iv) a trust other than a
"foreign trust," as defined in Section 7701(a)(31) of the Code.

     4. That the Investor's taxpayer identification number is ___________.

     5. That no purpose of the acquisition of the Residual Certificates is to
avoid or impede the assessment or collection of tax.

     6. That the Investor understands that, as the holder of the Residual
Certificates, the Investor may incur tax liabilities in excess of any cash flows
generated by such Residual Certificates.

     7. That the Investor intends to pay taxes associated with holding the
Residual Certificates as they become due.

                                       E-1

<PAGE>

     IN WITNESS WHEREOF, the Investor has caused this instrument to be executed
on its behalf, pursuant to authority of its Board of Directors, by its [Title of
Officer] this ____ day of _____________, 19__.

                                      [NAME OF INVESTOR]

                                      By:__________________________
                                      [Name of Officer]
                                      [Title of Officer]

     [Address of Investor for receipt of distributions]

     Address of Investor for receipt of tax information:

     Personally appeared before me the above-named [Name of Officer], known or
proved to me to be the same person who executed the foregoing instrument and to
be the [Title of Officer] of the Investor, and acknowledged to me that he
executed the same as his/her free act and deed and the free act and deed of the
Investor.

     Subscribed and sworn before me this _____ day of ___________ , 19__.

NOTARY PUBLIC

COUNTY OF

STATE OF

My commission expires the _____ day of ____________ , 19__.

                                       E-2

<PAGE>

                                   EXHIBIT F-1

                            FORM OF INVESTMENT LETTER

                                                                          [Date]

[SELLER]

The Bank of New York, as Trustee
101 Barclay Street
New York, New York 10286

Structured Asset Mortgage Investments Inc.
245 Park Avenue
New York, New York  10167

    Re:  CDMC Trust 2000-8, CDMC Mortgage-Backed Pass-Through Certificates,
         Series 2000-8 (the "Certificates"), including the Class B-4, Class B-5,
         Class B-6, Certificates (the "Privately Offered Certificates")
         ---------------------------------------------------------------

Ladies and Gentlemen:

     In connection with our purchase of Privately Offered Certificates, we
confirm that:

          (i)  we understand that the Privately Offered Certificates are not
               being registered under the Securities Act of 1933, as amended
               (the "Act") or any applicable state securities or "Blue Sky"
               laws, and are being sold to us in a transaction that is exempt
               from the registration requirements of such laws;

          (ii) any information we desired concerning the Certificates, including
               the Privately Offered Certificates, the trust in which the
               Certificates represent the entire beneficial ownership interest
               (the "Trust") or any other matter we deemed relevant to our
               decision to purchase Privately Offered Certificates has been made
               available to us;

          (iii) we are able to bear the economic risk of investment in Privately
               Offered Certificates; we are an institutional "accredited
               investor" as defined in Section 501(a) of Regulation D
               promulgated under the Act and a sophisticated institutional
               investor;

                                      F-1-1

<PAGE>

          (iv) we are acquiring Privately Offered Certificates for our own
               account, not as nominee for any other person, and not with a
               present view to any distribution or other disposition of the
               Privately Offered Certificates;

          (v)  we agree the Privately Offered Certificates must be held
               indefinitely by us (and may not be sold, pledged, hypothecated or
               in any way disposed of) unless subsequently registered under the
               Act and any applicable state securities or "Blue Sky" laws or an
               exemption from the registration requirements of the Act and any
               applicable state securities or "Blue Sky" laws is available;

          (vi) we agree that in the event that at some future time we wish to
               dispose of or exchange any of the Privately Offered Certificates
               (such disposition or exchange not being currently foreseen or
               contemplated), we will not transfer or exchange any of the
               Privately Offered Certificates unless:

                    (A) (1) the sale is to an Eligible Purchaser (as defined
               below), (2) if required by the Pooling and Servicing Agreement
               (as defined below) a letter to substantially the same effect as
               either this letter or, if the Eligible Purchaser is a Qualified
               Institutional Buyer as defined under Rule 144A of the Act, the
               Rule 144A and Related Matters Certificate in the form attached to
               the Pooling and Servicing Agreement (as defined below) (or such
               other documentation as may be acceptable to the Trustee) is
               executed promptly by the purchaser and delivered to the
               addressees hereof and (3) all offers or solicitations in
               connection with the sale, whether directly or through any agent
               acting on our behalf, are limited only to Eligible Purchasers and
               are not made by means of any form of general solicitation or
               general advertising whatsoever; and

                    (B) if the Privately Offered Certificate is not registered
               under the Act (as to which we acknowledge you have no
               obligation), the Privately Offered Certificate is sold in a
               transaction that does not require registration under the Act and
               any applicable state securities or "blue sky" laws and, if The
               Bank of New York (the "Trustee") so requests, a satisfactory
               Opinion of Counsel is furnished to such effect, which Opinion of
               Counsel shall be an expense of the transferor or the transferee;

          (vii) we agree to be bound by all of the terms (including those
               relating to restrictions on transfer) of the Pooling and
               Servicing, pursuant to which the Trust was formed; we have
               reviewed carefully and understand the terms of the Pooling and
               Servicing Agreement;

          (viii) we either: (i) are not acquiring the Privately Offered
               Certificate directly or indirectly by, or on behalf of, an
               employee benefit plan or other retirement arrangement which is
               subject to Title I of the Employee Retirement Income Security Act
               of 1974, as amended, and/or section 4975 of the Internal Revenue
               Code of 1986, as amended, or (ii) are providing as such other

                                      F-1-2

<PAGE>

               evidence acceptable to the Trustee to the effect that the
               proposed transfer and/or holding of a Privately Offered
               Certificate and the servicing, management and/or operation of the
               Trust and its assets: (I) will not result in any prohibited
               transaction which is not covered under an individual or class
               prohibited transaction exemption, including, but not limited to,
               Prohibited Transaction Exemption ("PTE") 84-14, PTE 91-38, PTE
               90-1, PTE 95-60 or PTE 96-23 and (II) will not give rise to any
               additional fiduciary duties on the part of either Master Servicer
               or the Trustee.

          (ix) We understand that each of the Privately Offered Certificates
               bears, and will continue to bear, a legend to substantiate the
               following effect: "THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE
               REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
               "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER
               HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS
               CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
               TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
               APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE
               SECURITIES ACT ("RULE 144A") TO A PERSON THAT THE HOLDER
               REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
               MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR
               A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS
               INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER
               TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO
               AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
               SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN
               "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE MEANING THEREOF IN
               RULE 501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT OR
               ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH
               PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE
               SECURITIES ACT, SUBJECT TO (A) THE RECEIPT BY THE TRUSTEE OF A
               LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND
               (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE
               TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS
               IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS
               OR IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS
               OF THE UNITED STATES AND ANY OTHER APPLICABLE JURISDICTION. THIS
               CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
               BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
               ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE
               RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, AND/OR
               SECTION 4975 OF THE INTERNAL REVENUE

                                      F-1-3

<PAGE>

               CODE OF 1986, AS AMENDED, UNLESS THE PROPOSED TRANSFER AND/OR
               HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND/OR
               OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY
               PROHIBITED TRANSACTION WHICH IS NOT COVERED UNDER AN INDIVIDUAL
               OR CLASS PROHIBITED TRANSACTION EXEMPTION, INCLUDING, BUT NOT
               LIMITED TO, PROHIBITED TRANSACTION EXEMPTION ("PTE") 84-14, PTE
               91-38, PTE 90-1, PTE 95-60 OR PTE 96-23 AND (II) WILL NOT GIVE
               RISE TO ANY ADDITIONAL FIDUCIARY DUTIES ON THE PART OF EITHER
               MASTER SERVICER OR THE TRUSTEE," WHICH WILL BE DEEMED REPRESENTED
               BY AN OWNER OF A BOOK-ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE
               AND WILL BE EVIDENCED BY A REPRESENTATION TO SUCH EFFECT BY OR ON
               BEHALF OF A HOLDER OF A PRIVATE CERTIFICATE."

     "ELIGIBLE PURCHASER" means a corporation, partnership or other entity which
we have reasonable grounds to believe and do believe (i) can make
representations with respect to itself to substantially the same effect as the
representations set forth herein, and (ii) is either a Qualified Institutional
Buyer as defined under Rule 144A of the Act or an institutional "Accredited
Investor" as defined under Rule 501 of the Act.

     Terms not otherwise defined herein shall have the meanings assigned to them
in the Pooling and Servicing Agreement dated as of October 1, 2000 among
Structured Asset Mortgage Investments Inc., Cendant Mortgage Corporation, as
Master Servicer and The Bank of New York, as Trustee (the "Pooling and Servicing
Agreement").

     If the Purchaser proposes that its Certificates be registered in the name
of a nominee on its behalf, the Purchaser has identified such nominee below, and
has caused such nominee to complete the Nominee Acknowledgment at the end of
this letter.

Name of Nominee (if any):___________________

                                      F-1-4

<PAGE>

     IN WITNESS WHEREOF, this document has been executed by the undersigned who
is duly authorized to do so on behalf of the undersigned Eligible Purchaser on
the ____ day of ________, 19__.

                                            Very truly yours,

                                            [PURCHASER]

                                            By:________________________________
                                                   (Authorized Officer)

                                            [By:_______________________________
                                                    Attorney-in-fact]

                                      F-1-5

<PAGE>

                             Nominee Acknowledgment

     The undersigned hereby acknowledges and agrees that as to the Certificates
being registered in its name, the sole beneficial owner thereof is and shall be
the Purchaser identified above, for whom the undersigned is acting as nominee.

                                      [NAME OF NOMINEE]

                                      By:__________________________________
                                            (Authorized Officer)

                                     [By:__________________________________
                                            Attorney-in-fact]

                                      F-1-6

<PAGE>

                                   EXHIBIT F-2

                FORM OF RULE 144A AND RELATED MATTERS CERTIFICATE

[SELLER]

The Bank of New York
101 Barclay Street
New York, New York 10286

Structured Asset Mortgage Investments Inc.
245 Park Avenue
New York, New York  10167

          Re:  CDMC Trust 2000-8, CDMC Mortgage-Backed Pass-Through
               Certificates, Series 2000-8, Class B-4, Class B-5, and Class B-6
               Certificates (the "Privately Offered Certificates")
               ---------------------------------------------------

Ladies and Gentlemen:

     In connection with our purchase of Privately Offered Certificates, the
undersigned certifies to each of the parties to whom this letter is addressed
that it is a qualified institutional buyer (as defined in Rule 144A under the
Securities Act of 1933, as amended (the "Act")) as follows:

1.   It owned and/or invested on a discretionary basis eligible securities
     (excluding affiliate's securities, bank deposit notes and CD's, loan
     participations, repurchase agreements, securities owned but subject to a
     repurchase agreement and swaps), as described below:

     Date:  _____________, 19__ (must be on or after the close of its most
     recent fiscal year)

     Amount:  $_________________; and

2.   The dollar amount set forth above is:

     a.   greater than $100 million and the undersigned is one of the following
          entities:

     (1)  o    an insurance company as defined in Section 2(13) of the Act; or1

     (2)  o    an investment company registered under the Investment Company Act
               or any business development company as defined in Section
               2(a)(48) of the Investment Company Act of 1940; or

--------

     1    A purchase by an insurance company for one or more of its separate
          accounts, as defined by Section 2(a)(37) of the Investment Company Act
          of 1940, which are neither registered nor required to be registered
          thereunder, shall be deemed to be a purchase for the account of such
          insurance company.

                                      F-2-1

<PAGE>

     (3)  o    a Small Business Investment Company licensed by the U.S. Small
               Business Administration under Section 301(c) or (d) of the Small
               Business Investment Act of 1958; or

     (4)  o    a plan (i) established and maintained by a state, its political
               subdivisions, or any agency or instrumentality of a state or its
               political subdivisions, the laws of which permit the purchase of
               securities of this type, for the benefit of its employees and
               (ii) the governing investment guidelines of which permit the
               purchase of securities of this type; or

     (5)  o    a business development company as defined in Section 202(a)(22)
               of the Investment Advisers Act of 1940; or

     (6)  o    a corporation (other than a U.S. bank, savings and loan
               association or equivalent foreign institution), partnership,
               Massachusetts or similar business trust, or an organization
               described in Section 501(c)(3) of the Internal Revenue Code; or

     (7)  o    a U.S. bank, savings and loan association or equivalent foreign
               institution, which has an audited net worth of at least $25
               million as demonstrated in its latest annual financial
               statements; or

     (8)  o    an investment adviser registered under the Investment Advisers
               Act; or

       b. o    greater than $10 million, and the undersigned is a broker-dealer
          registered with the SEC; or

       c. o    less than $10 million, and the undersigned is a broker-dealer
          registered with the SEC and will only purchase Rule 144A securities in
          transactions in which it acts as a riskless principal (as defined in
          Rule 144A); or

       d. o    less than $100 million, and the undersigned is an investment
          company registered under the Investment Company Act of 1940, which,
          together with one or more registered investment companies having the
          same or an affiliated investment adviser, owns at least $100 million
          of eligible securities; or

       e. o less than $100 million, and the undersigned is an entity, all the
          equity owners of which are qualified institutional buyers.

     The undersigned further certifies that it is purchasing a Privately Offered
Certificate for its own account or for the account of others that independently
qualify as "Qualified Institutional Buyers" as defined in Rule 144A. It is aware
that the sale of the Privately Offered Certificates is being made in reliance on
its continued compliance with Rule 144A. It is aware that the transferor may
rely on the exemption from the provisions of Section 5 of the Act provided by
Rule 144A. The undersigned understands that the Privately Offered Certificates
may be resold, pledged or transferred only to (i) a person reasonably believed
to be a Qualified Institutional Buyer that purchases for its own account or for
the account of a Qualified Institutional Buyer to whom notice is given that the
resale, pledge or transfer is being made in reliance in Rule 144A, or (ii) an
institutional "accredited

                                      F-2-2

<PAGE>

investor," as such term is defined under Rule 501 of the Act in a transaction
that otherwise does not constitute a public offering.

     The undersigned agrees that if at some future time it wishes to dispose of
or exchange any of the Privately Offered Certificates, it will not transfer or
exchange any of the Privately Offered Certificates to a Qualified Institutional
Buyer without first obtaining a Rule 144A and Related Matters Certificate in the
form hereof from the transferee and delivering such certificate to the
addressees hereof. Prior to making any transfer of Privately Offered
Certificates, if the proposed Transferee is an institutional "accredited
investor," the transferor shall obtain from the transferee and deliver to the
addressees hereof an Investment Letter in the form attached to the Pooling and
Servicing Agreement dated as of October 1, 2000 among Structured Asset Mortgage
Investments Inc., Cendant Mortgage Corporation, as Master Servicer and The Bank
of New York, as Trustee, pursuant to which the Certificates were issued.

     The undersigned certifies that it either: (i) is not acquiring the
Privately Offered Certificate directly or indirectly by, or on behalf of, an
employee benefit plan or other retirement arrangement which is subject to Title
I of the Employee Retirement Income Security Act of 1974, as amended, and/or
section 4975 of the Internal Revenue Code of 1986, as amended, or (ii) is
providing such other evidence acceptable to the Trustee to the effect that the
proposed transfer and/or holding of a Privately Offered Certificate and the
servicing, management and/or operation of the Trust and its assets: (I) will not
result in any prohibited transaction which is not covered under an individual or
class prohibited transaction exemption, including, but not limited to,
Prohibited Transaction Exemption ("PTE") 84-14, PTE 91-38, PTE 90-1, PTE 95-60
or PTE 96-23 and (II) will not give rise to any additional fiduciary duties on
the part of either Master Servicer or the Trustee.

     If the Purchaser proposes that its Certificates be registered in the name
of a nominee on its behalf, the Purchaser has identified such nominee below, and
has caused such nominee to complete the Nominee Acknowledgment at the end of
this letter.

                                      F-2-3

<PAGE>

Name of Nominee (if any):___________________

     IN WITNESS WHEREOF, this document has been executed by the undersigned who
is duly authorized to do so on behalf of the undersigned Eligible Purchaser on
the ____ day of ________, 20__.

                                       Very truly yours,

                                       [PURCHASER]

                                       By:__________________________________
                                                (Authorized Officer)

                                      [By:__________________________________
                                                 Attorney-in-fact]

                                      F-2-4

<PAGE>

                             Nominee Acknowledgment

     The undersigned hereby acknowledges and agrees that as to the Certificates
being registered in its name, the sole beneficial owner thereof is and shall be
the Purchaser identified above, for whom the undersigned is acting as nominee.

                                      [NAME OF NOMINEE]

                                      By: _________________________
                                             (Authorized Officer)

                                      [By:__________________________

                                             Attorney-in-fact]

                                      F-2-5

<PAGE>

                                    EXHIBIT G

                          FORM OF INITIAL CERTIFICATION

Date:_______________________

Cendant Mortgage Corporation, as Master Servicer
3000 Leadenhall Road
Mail Stop SM 55
Mt. Laurel, New Jersey  08054

Structured Asset Mortgage Investments Inc.
245 Park Avenue
New York, New York  10167

        Re:  Pooling and Servicing Agreement dated as of October 1, 2000, among
             Structured Asset Mortgage Investments Inc., as seller, Cendant
             Mortgage Corporation, as master servicer and The Bank of New
             York, as trustee, regarding CDMC Trust 2000-8, CDMC Mortgage-
             Backed Pass-Through Certificates, Series 2000-8
             ------------------------------------------------------------------

Ladies and Gentlemen:

     In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement, the undersigned, as Trustee, hereby certifies that it has
received a Mortgage File (which contains an original Mortgage Note or Lost Note
Affidavit) to the extent required in Section 2.01 of the Pooling and Servicing
Agreement with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule.

     Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Pooling and Servicing
Agreement.

                                             THE BANK OF NEW YORK,
                                             as Trustee

                                             By:________________________________
                                                    Name:
                                                    Title:

                                                        G-1

<PAGE>

                                    EXHIBIT H

                           FORM OF FINAL CERTIFICATION

Date:________________________

Cendant Mortgage Corporation, as Master Servicer
3000 Leadenhall Road
Mail Stop SM55
Mt. Laurel, New Jersey  08054

Structured Asset Mortgage Investments Inc.
245 Park Avenue
New York, New York  10167

Re:  Pooling and Servicing Agreement dated as of October 1, 2000, among
     Structured Asset Mortgage Investments Inc., as seller, Cendant Mortgage
     Corporation, as master servicer and The Bank of New York, as trustee,
     regarding CDMC Trust 2000-8, CDMC Mortgage-Backed Pass-Through
     Certificates, Series 2000-8
     -----------------------------------------------------------------------

Ladies and Gentlemen:

In accordance with Section 2.02 of the above-captioned Pooling and Servicing
Agreement, the undersigned, hereby certifies that, except as noted on the
Schedule of Exceptions attached hereto, for each Mortgage Loan listed on the
Mortgage Loan Schedule (other than any Mortgage Loan paid in full or listed on
the attachment hereto), it has received a complete Mortgage File which includes
the documents required to be included in the Mortgage File as set forth in the
Pooling and Servicing Agreement.

The undersigned has made no independent examination of any documents contained
in each Mortgage File beyond the review specifically required in the
above-referenced Pooling and Servicing Agreement. The undersigned makes no
representation as to: (i) the validity, legality, sufficiency, enforceability or
genuineness of any documents contained in any Mortgage File for any of the
Mortgage Loans listed on the Mortgage Loan Schedule to the Pooling and Servicing
Agreement, (ii) the collectability, insurability, effectiveness or suitability
of any such Mortgage Loan or (iii) whether any Mortgage File should include any
flood insurance policy, any rider, addenda, surety or guaranty agreement, power
of attorney, buy down agreement, assumption agreement, modification agreement,
written assurance or substitution agreement.

                                       H-1

<PAGE>

Capitalized words and phrases used herein shall have the respective meanings
assigned to them in the above-captioned Pooling and Servicing Agreement.

                                           THE BANK OF NEW YORK,
                                           as Trustee

                                           By:__________________________________
                                                    Name:
                                                    Title:

                                       H-2

<PAGE>

                                    EXHIBIT I

            LIST OF MORTGAGE LOANS FOR WHICH MORTGAGE NOTES ARE LOST

     LOAN ID                     DOC                       EXCEPTION
     -------                     ---                       ---------

     REPORT TOTALS: 1 LOAN WITH 1 UNCLEARED EXCEPTION.

                                       I-1

<PAGE>

                                    EXHIBIT J
                        ELECTRONIC DATA FILE INFORMATION
                FORMAT AGREED UPON BY MASTER SERVICER AND TRUSTEE
                              PROVIDED UPON REQUEST

                                       J-1

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